Does Water Works Hate Poor People?

Posted by admin on Jan 20, 2014 in YouBuyHouses Blog | 2 comments

Effective January 2014, the Greater Cincinnati Water Works (GCWW) has dramatically increased the costs they charge for clients on Monthly Billing. They increased the cost for getting a monthly bill by $69 a quarter – or $275 a year – it’s like they added a 5th quarter of water/sewer service to cover their costs for sending 8 extra bills.

I bet most of you did not even know monthly billing was an option. That’s because the only people who use it are low income people. It’s typically low income residents (tenants and owners) who had struggled before to keep up. Yes – the people facing GCWW’s excessive fees are the people in our community who want to be responsible and pay (as opposed to those who skip out and move) and are least able to absorb the economic roller-coaster of quarterly cycle of no bill, no bill, and a large bill every three months.

These are low income families who struggled previously to keep up with the standard quarterly water billing in the past and moved to monthly billing as part of a catch-up plan. Typically they went on monthly billing when already behind and it was part of a payment plan between the Tenant, the Landlord and GCWW. All three would agree on a payment plan where the tenant paid monthly and also paid a share of their arrearage to get caught up over 3 to 6 months.

Tenants who fail to pay water as required by their lease can be subject to disconnection and eviction. The ability to get on a plan and set up affordable payments helped keep people in their homes. It helped low income tenants and homeowners avoid disconnection, eviction and all the problems that both those will cause.

The monthly payment plan option was first offered around 2011 and, in my experience, it really helped families keep up with the ever growing costs of water. Many low income families have little elasticity in their budget so when every 3 months they get a $225 to $330 water bill, it is a struggle. Last year, I did more than a dozen water payment plans – a number that has grown year over year with the growing costs of water/sewer service combined with the overall weak economy. I used to do one or two a year – now it’s become every month we are asked to prepare these plans for people who might otherwise face eviction or having to move because they are not keeping up with their water bills.

You can imagine that when GCWW started offering monthly billing, many residents and property owners found that it was a great option. It’s much easier for a family on a fixed to plan for $100 a month than to get a $300 bill every three months.

GCWW, however, despite the fact that they are having a 22% water increase and 6% sewer increase this year, decided they did not like the extra costs it took to send monthly bills to low income families. Keep in mind, GCWW is guaranteed payment because if the tenant skips out the owner has to pay to keep the house occupied — so GCWW always get paid in the end.

In January, GCWW raised the minimum costs involved in having a Monthly bill. And I don’t mean they raise it a little. They raised is $69 a quarter or $275 a year. That’s the equivalent of adding the costs of a full quarter’s water and sewer service – for the privilege of getting billed monthly the same as EVERY OTHER UTILITY OR BUSINESS BILLS THEIR CLIENTS.

Naturally, my tenants on monthly billing are calling to say they want to go back on quarterly billing. These are families who struggled to keep up before. These are people for whom the monthly bill let them catch up and stay current. These are the good ones. The bad ones run up huge bills and skip out – nearly every landlord can tell you stories of getting stiffed for between $600 and $1100 at some time. GCWW doesn’t care because the owner had to pay to keep the water on.

GCWW rates have gone up over 300% since 1999. Tenants call all the time now saying “why is my water bill so high”. I have had tenants move from houses into apartments because they cannot afford the water costs they must pay to live in a single family home.

Now GCWW has taken another step to make it harder for low income tenants to keep up. They raise the rates year after year, and now have made a program that helped low income residents unaffordable by charging so much.

I encourage all of you who care about affordable housing to let our city and county leaders know that you think GCWW should roll-back this new rate. I encourage the Affordable Housing Advocates and the Faith Community Alliance members to speak up. Mayor Cranley, the City Council, and the County Commissioners are all copied on this message – feel free to let them know if you think it’s unfortunate GCWW has increased the costs of this service that served our communities low income residents.

The people who benefited from this are not going to speak up – that’s why the housing advocates exist. I encourage you to speak up.

While sending a monthly bill has extra costs, it’s hard to believe it’s $35 per statement. Somehow every other business in American can send monthly bills to their clients – except GCWW.

Maybe if enough of us speak up, we can get this policy changed.

Thank you,

Jim Shapiro

Vice President

Chair, Government Affairs and Community Action Committee

Real Estate Investors Association of Greater Cincinnati