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  September 2, 2016

Baltimore Water Price Hike Will Disproportionately Impact Low-Income People and Senior Citizens

Jorge Aguilar of Food & Water Watch says that the city should instead opt for income-based water service billing in order to fund new infrastructure
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Jorge Aguilar has been working on securing funding for water infrastructure and fighting water privatization for the past 8 years. He also worked on successful legislative campaign in Maryland to ban the use of arsenic in chicken production and a moratorium on fracking.


DHARNA NOOR, TRNN: Welcome to The Real News Network. I'm Dharna Noor.

This week here in Baltimore the city passed a new three-year plan to increase the city's water rate by about 33 percent, an average price hike of 9.9 percent per year. According to the city's Department of Public Works, the funds from the price hike are needed in order to implement better physical infrastructure for water and to instate a more efficient billing system. The city noted that the decrease of federal funding for water has made this price increase necessary.

Here to discuss this is Jorge Aguilar. Jorge Aguilar is the southern regional director for Food & Water Watch. He's been working on securing funding for water infrastructure and fighting water privatization for the past eight years.

Thanks for joining us today.


NOOR: So I want to start by asking you about your initial reactions to this proposed plan. A 9.9 percent hike per year is pretty steep, especially in a city where 23.8 percent of residents live below the poverty line. But the city says this measure is necessary to improve infrastructure, which has been neglected for decades. The infrastructure is so bad that there have been reports of sewage leaks in thousands of Baltimore basements. What's your response?

AGUILAR: Well, I think it's outrageous that Baltimore officials continue to set inequitable water policies by passing these type of rate hikes that fall hardest on low-income residents and seniors and continuing to do shutoffs for people that just can't pay. So, yes, while it's true that we do have to upgrade and fix a lot of the crumbling infrastructure, it should not come on the backs of low-income and senior citizens.

NOOR: This week, the Department of Public Works did approve an increase in assistance for low-income households' water and eliminated minimum-use charges for households that don't use any or very much water. But Food & Water Watch published a report this week that states, as you said, that low-income households would be disproportionately affected. How is this possible?

AGUILAR: Well, that is basically coming up--it's coming because of the new way that the city is coming up with their rate structure. Basically, they're adding new fixed fees, [eliminating] the minimum-usage fee, and changing the volumetric water charges. So what does this means is sort of counterintuitive, but households that use about half as much water as typical will see a total increase of 55 percent by July 2018, but households that use twice as much as typical will see their rates drop by 9 percent first before actually increasing slightly. So what this means, though, is that senior and low-income households that live in the denser urban areas that often use less water get hit the hardest. These are folks that don't have big yards, right, don't have big houses, don't use a lot of water. So, effectively what the city is saying is, again, that low-income and seniors are the ones that are going to be bearing the brunt of this rate increase.

NOOR: Right. And when this report came out or when this new proposed policy came out, a few of us around the office were saying, just a couple of weeks ago, just a couple of weeks before this price hike was announced, Baltimore forgave the $1.5 million water bill that was owed by the former owners of the steel mill at Sparrows Point also here in Baltimore. So how is the Board of Estimates able to forgive a water debt like that when the Department of Public Works is asserting that it needs everyday people to spend so much more? Is this money coming from the same place? Isn't the infrastructure for the steel mill the same infrastructure for households across the city?

AGUILAR: Yeah, so this is, again, part of two years' and multiple years' worth of policy by Baltimore officials that is really seemingly targeting residents of low income and senior citizens. So the $1.5 million that you mention is really a part of the city's plan, really, starting last year, when the city began an aggressive plan to get people to pay their bills.

And so what we found in our analysis is that about 300, 400 different businesses owned about a third of the default bills that hadn't been paid, and tens of thousands of residents, too, had some bills that hadn't been paid, but the city chose to go after residents instead of getting these businesses to pay up. So this latest news article that came out about the steel mill just shows that the city has made very clear choices about who it wants to go after and who they really let off the hook. There's no reason, really, that the largest steel mill in the world should be getting a free pass while low-income and seniors are paying, again, for the brunt of these rate increases.

I mean, you've got to look at this. Right now, over the past three years, rates have gone up by 42 percent. This is in a city that has 25 percent of Baltimore residents living in poverty, and a third of them right now aren't able to pay their water service bills. So what this has led to is 20,000 people estimated having their water shut off. With these new rate hikes, we can expect a lot more. So this is just shocking and abominable, that anyone would be forced to live without water because they cannot actually pay their bills. And the city is not really being proactive about getting an affordability plan, some sort of structure that makes sure that people are able to pay. And that's really, really outrageous.

NOOR: But we do, here in the city, need new infrastructure for water, and the Food & Water Watch report I mentioned earlier put forth a proposal for a more equitable solution for the need for this new infrastructure in Baltimore. Could you talk about the call for income-based water service billing?

AGUILAR: Sure. Our position on this rate hike was that the board of estimates that took this vote and really were led by the mayor in passing this rate hike, that they should hold off on passing any new rate increase until there was an affordable plan in place, an income-based one in place.

What we have said is that it should generally follow what the United Nations has set out in terms of policy when it comes to water and wastewater, which is basically that affordable water bills would not consume more than 3 percent of household income. And in our Food & Water Watch analysis from last year, we found that folks hovering around the poverty line in Baltimore were paying 3 percent and up to 8 percent of their income for water rates.

So we are continuing to work to make sure that the City Council actually takes on an equitable rate structure that, again, doesn't leave low-income and senior citizens behind. But there's been a decision right now by the mayor to go the opposite way and just increase these rates without having that new, more fair plan in place.

NOOR: And is there any evidence that such a system would work in practice? Have any other cities implemented anything like an income-based water billing system?

AGUILAR: So right now this is definitely something that is being addressed by a lot of cities who have infrastructure that is very old, much like Baltimore. And some of these systems were set up 100 years ago and really do need an influx of capital-improvement projects.

But the one that we're really looking at is in Philadelphia, who just recently passed an income-based affordability plan. And that was recently, so we're still waiting to see how that goes.

What we'd like to see is Baltimore really take a lead on this because of exactly the numbers I [pointed] out. It's just unacceptable, right, arbitrary, inhumane to deny anyone water. It's just a basic human right.

NOOR: Jorge Aguilar is the southern regional director for Food & Water Watch.

Thank you so much for joining us today.

AGUILAR: Absolutely. Thank you for having me.

NOOR: And thank you for joining us on The Real News Network.


DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


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