"Our purpose was to understand the extent of affordability issues across the state and to provide Michigan policymakers with a resource they can use in developing sustainable solutions to what appears to be a growing water and sewer service affordability crisis in our state,” said study lead author Jennifer Read, director of the University of Michigan Water Center, a program of the Graham Sustainability Institute.
"And because the gap between income and the cost of basic services continues to widen, we can anticipate harms to more Michigan residents will occur into the future if left unaddressed,” Read said.
On Thursday, Read and colleagues from Michigan State University Extension and Safe Water Engineering will release a detailed analysis that contains more than 20 findings and six recommendations.
The assessment, funded by the C.S. Mott Foundation, complements decades of work on water service affordability by community groups in Michigan. It examines the issue across the state and considers the financial and infrastructure challenges that both households and utilities face in accessing or providing safe and affordable water.
Over the last four decades, water and sewer bills across the United States, including in Michigan, have increased at a higher rate than any other basic need except health care. This has resulted in a dramatic increase in the proportion of household income dedicated to water and wastewater services for Michigan residents.
The most important impact is on the economically vulnerable Michigan households who find themselves behind in their bills, sometimes resulting in utilities shutting off their water service. This limits their ability to maintain basic hygiene and thus endangers both the residents and their communities. The challenges can snowball, leading to increased stress, more and exacerbated physical health problems, housing crises, and family and community disruption, according to the study.
"These issues are not just experienced in vulnerable households in Flint, Detroit or Benton Harbor, they are also experienced in economically challenged parts of rural Michigan and the Upper Peninsula, including households on private wells, septic systems and those in mobile homes. It is important to recognize the similarities in these economic challenges and how they impact communities across the state," said study co-author Ritchie Harrison, extension specialist at MSU Extension’s Community, Food and Environment Institute.
The challenges do not stop at the household level. "To provide safe water, our water utilities need consistent investment and renewal, and unfortunately many water utilities have fallen behind due to a number of factors," said Elin Betanzo of Safe Water Engineering, a co-author of the assessment.
"This report demonstrates the need for household support and utility investment from all levels of government," Betanzo said. "Raising water rates, without supporting those least able to pay, will not ensure safe water for the residents who need it most."
Among the assessment’s findings about water affordability:
- In the Midwest, water bills for households in the lowest 20th percentile of income have risen 433% on average since 1986, while household income for these residents has only risen 241%.
- Between 6.59% and 10.75% of households on community water supplies across Michigan have high-burden water bills. It would take between $78.3 million and $145.99 million annually to support these households.
- Rural Michigan residents on private wells and septic systems face economic challenges similar to their urban and suburban neighbors. Roughly 20% percent of wells and 27% of septic systems are in need of repair or replacement.
- The 21st Century Infrastructure Commission (2016) estimated an annual cost of $20 million to support those unable to afford septic replacement costs alone.
- At the water-utility level, the cost of providing water and sewer services has been rising for decades nationally, while federal spending on water infrastructure has decreased, creating a widening investment gap in water infrastructure. In Michigan, the study found a gap in the 20-year estimated water infrastructure funding needs of $19.8 billion.
- Water utilities are stretched thin, having also been subject to increasing state and federal requirements to address known and emerging risks, such as combined sewer overflows, lead service lines, and PFAS contamination. In addition, climate change has added pressure to strained wastewater systems and can affect source-water quality.
The assessment is based on data compiled from federal sources, as well as directly from utilities themselves. This enabled the team to analyze the potential magnitude of water affordability challenges in Michigan. However, the team did face data access challenges.
"Answering any questions about the infrastructure and financial status of water utilities is incredibly difficult given the lack of comparable and accessible financial and infrastructure data at the utility level across the state," said study technical lead Noah Attal of the U-M Water Center. "Basic information such as how many households are unable to pay is not regularly reported anywhere. This also makes policy solutions difficult to formulate."
Local and statewide data were supplemented by interviews with employees of large and small water utilities, state regulatory agencies, and community groups to gain insight about the challenges they face in confronting water affordability in their communities.
While the researchers recognize that there is not a single solution for water affordability, they identify the following elements, all of which must be addressed in a solutions package:
- Address household capacity to pay for water and sewer services under a variety of hardship scenarios (water service arrearages, long-term poverty, short-term economic hardship, private well and septic systems, economically vulnerable communities).
- Prohibit water shutoffs for economically vulnerable households.
- Address gaps in utility capacity statewide and prioritize assistance for the utilities and communities with the least financial stability.
- Address the lack of comparable utility-level financial data statewide.
- Require water utilities to implement meaningful and significant community engagement in water and sewer system planning and decision-making.
- Embrace a state role with adequate authority and resources for oversight that ensures public health protection, water quality regulation, and appropriate water rates; and provides technical, managerial, and financial support for water utilities.
The researchers stress that Michigan cannot allow the variety of challenges to delay or avoid a policy response to the current and emerging crises in water services across the state. The assessment’s findings and recommendations are designed to support the policy community in co-developing a solution package to ensure safe, accessible and affordable water for all.