Affordability

The American Water Works Association (AWWA) recognizes that providing reliable and high-quality water, wastewater, reclaimed water, and stormwater services at fair and reasonable rates and charges to all customers is fundamental to a utility's mission. To be financially sustainable, utilities optimize expenditures through operating efficiencies, implement water conservation and resource management best practices, and prudently manage capital, operating, and financing costs. However, even with sound planning and budgeting practices, some utilities are faced with affordability challenges among some of their low-income residential customers which in turn affect their customer-based revenues. Such affordability challenges can occur in any community, regardless of size, location, demographic makeup, and income distribution. 

AWWA strongly recommends the adoption of policies and procedures by utilities, regulators, and governmental entities to address the affordability challenges experienced by some of their residential customers. Utilities should work closely with their local, state, provincial, and national governments to ensure that applicable laws and policies do not impede utility efforts to address affordability challenges and evaluate new policies that allow low-income households to have access to utility services, while maintaining the fiscal sustainability of utilities. 

Low-income customer assistance can take many different forms that should be designed and implemented to meet the unique challenges of individual communities and may be considered as an appropriate component of system revenue requirements. Effective communication and education programs targeting low-income households are also important to build awareness about available assistance programs and strategies to use water more efficiently.

Implementing long-term solutions to meet affordability challenges entails applying both existing tools and modification of current government policies. Along with non-water service providers, effective locally appropriate solutions can deliver assistance to low-income households through collaboration with existing community service programs, customer assistance programs operated by other utilities (such as energy service), and community housing assistance programs. 

Practices specified in this policy statement are consistent with all other pertinent AWWA policy statements. 

Adopted by the Executive Committee October 24, 2018