Philadelphia Water Rate Experiment Aims to Help Struggling Residents Pay Their Bills

"PHILADELPHIA — On July 1, the Philadelphia Water Department stepped into unexplored territory for a U.S. water utility. The department became the first to set the monthly water, sewer, and stormwater bill for its poorest residents according to their income.

Called the Tiered Assistance Program, or TAP, the groundbreaking aid program was ordered by City Council as a way of matching the cost of household water service with residents’ ability to pay. The need is significant. As many as 60,000 households — one in eight residential customer accounts — meet the eligibility threshold of earning less than 150 percent of the federal poverty line, according to a Water Department estimate.

Philadelphia’s experience with TAP is of keen interest nationally to scholars, public officials, and especially utility leaders, who are walking a narrow line between repairing aged water systems, raising enough revenue to sustain operations, and ensuring that that water bills remain affordable for the poor.

The balancing act has grown more difficult as water rates have climbed faster than inflation. Wage income — the amount earned from work — for the bottom 20 percent went the other direction. It dropped by roughly one percent, measured in today’s dollars, between 1979 and 2016..."

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