Detroit launches new water affordability plan based on income and usage

Starting in August, some Detroiters could pay $18 a month for their water bills under a new affordability plan. 

City officials on Tuesday unveiled the Detroit Water and Sewerage Department’s  Lifeline Plan —  a fixed monthly rate for income-eligible households below a certain threshold of water usage. 

A moratorium on shut-offs is expected to lift Jan. 1, 2023, except for Detroiters enrolled in payment assistance programs. 

The city’s Board of Water Commissioners approved the plan earlier Tuesday despite pushback from several longtime community advocates who have fought for income-based affordability solutions and an end to service shut-offs.

The advocates wanted more time to consider the proposal. 

DWSD Director Gary Brown said during a Tuesday news conference that there are more than 100,000 households in the city of Detroit — 40% of the 250,000 residential customers — who are eligible for food assistance and because of that will fall under the first tier of the plan, capping monthly payments at $18 a month for water, sewer, and drainage services. 

The second tier, defined as “low-income,” or an average household making $28,652, is capped at $43 a month. Families falling under the third level, referred to as “modest income” or those making an average of $37,127, will max at $56 a month as long as they’re not receiving food assistance benefits.

“The total bill will be 1.8% of the average monthly household income for each tier,” Brown said. 

The average monthly bill for a family of three in Detroit is $81.62, which amounts to just under $980 annually. City water bills are calculated based on water usage, sewage disposal, and flat service charges for water, sewerage and drainage.

The new plan would also erase arrears for those who qualify.

It is funded by regional, state and federal dollars but Brown acknowledged that a permanent funding source is not yet in place. His department has enough dollars for a year or two, he said. 

“There needs to be permanent funding. It cannot come from rates. We can’t pass on that kind of cost to ratepayers that are struggling to pay bills. It has to come from either the state or federal government and we’re cautiously optimistic,” Brown said. 

People can apply for the new plan July 1 and the changes will be reflected in bills Aug. 1. 

Those who are already in the Water Residential Assistance Program, or WRAP, will be automatically enrolled and an additional 19,000 or so households, who “aged out” of the program after two years, will be notified by the Wayne Metropolitan Community Action Agency.

Starting Friday, Detroiters who qualify can apply by calling Wayne Metro at 313-386-9727 or by going to  www.waynemetro.org.

Customers have to use within 6 centum cubic feet of water per month, which translates to about 4,500 gallons, in order to stay within the fixed rate. Go above that and pay more. In other words, if a family received food assistance benefits and is enrolled in the new plan and they use 6,000 gallons of water,  their bill will be $38.06 instead of $18. 

All customers — whether residential, commercial, industrial, governmental or nonprofit — will pay based on usage under the new plan, Brown said.

The average three-person Detroit household used between 2,300 to 3,000 gallons of water a month, according to the water department’s billing data. 

Brown said increases may be due to plumbing and leaking issues. He said he’s looking for state approval for a $10 million tranche of funds, for the next five years, to help low-income residential customers repair leaks and keep water usage low. 

The proposal faced fierce critique from manywater advocates, several of whom requested a 30- to 45-day review and public comment period before implementation of the plan. Some decried the process as nontransparent. 

“The rollout of the plan was less than acceptable,” Cecily McClellan, a founding member of We the People of Detroit, said during Tuesday’s Board of Water Commissioners meeting. 

She said advocates were invited to meetings but did not have full details of the plan. 

“I would educate the community that there is a difference between assistance and affordability,” said Monica Lewis-Patrick, president and CEO of We The People of Detroit. She said the plan appears to be a patchwork solution. 

Sylvia Orduño, an organizer with the Michigan Welfare Rights Organization and People’s Water Board Coalition, said the water department’s proposal was not the first affordability plan — several groups had proposed one back in 2005. At the time, there were concerns around its legality. The plan was approved by Detroit City Council but not implemented, according to a 2019 report from the  Haas Institute for a Fair and Inclusive Society at UC Berkeley. 

Meanwhile, Beulah Walker, chief coordinator of Hydrate Detroit, says her group is in “full support” of DWSD’s new plan, but had a couple concerns around the hurdles Detroiters face when applying for assistance programs and  the procurement of  long-term funding to support the new plan.

“Hydrate Detroit has witnessed death and destruction during these water shut-offs and I’m just happy that we are finally coming to a means to an end,” she said. 

Theresa Landrum, a southwest Detroit resident, said Tuesday was the first time she has heard about the new plan. She said there is “gap” in receiving information. 

“Why is it always that the residents get information after the plan is in place?” Landrum said to the city’s Board of Water Commissioners during public comment. 

Brown said he has had conversations with 35 different advocates. 

“We will work with them. I have to do a better job of making sure that they have information. … I’ve been working with them for more than 10 years now on these issues,” he said. 

In 2014, Detroit’s shut-off practices drew international attention, spurring the United Nations to declare that cutting off water for those with a “genuine inability to pay” is a human rights violation. 

More than 60,000 city households have delinquent water bills — an estimated 27% of Detroit’s 220,000 residential customers, according to DWSD earlier this month. The average debt per customer is $700. 

One in 10 Detroit households spends more than a quarter of their income — outside of other essential expenses like food and utilities — on water services, a report from the University of Michigan, Michigan State University and consulting firm Safe Water Engineering found last year. 

Dr. Abdul El-Sayed, Detroit’s former public health director who was tapped to identify funding to prevent water shut-offs back in late 2020, said dozens of advocates have been key to fashioning solutions and that there’s more work to do.

“No Detroiter will have their water shut off because they cannot afford to pay their bill, that has always been the North Star,” he said.

DWSD said it is hosting a 60-day “community engagement” effort to gather feedback on the plan for any amendments and going door to -door to let residents know about payment options. 

BridgeDetroit reporter Malachi Barrett contributed to this report.