A proposed change to DC Water fees would hit renters hardest

Since 2009, DC Water customers have paid a fee to help pay for the $2.7 billion, federally-mandated Clean Rivers Project which stops sewage from overflowing into our region’s waterways. As that fee has gone up, some customers with large parking lots, such as churches and cemeteries, say they have struggled to pay their water bills.

Now the agency wants to shift how that fee is calculated in order to reduce their burden. But the proposed change would disproportionately hit renters in multi-family buildings instead, and weaken incentives to adopt more climate-friendly infrastructure.

This fee, called the Clean Rivers Impervious Area Charge or CRIAC, has been phased in from $1.24 per 1,000 square feet of impervious space in 2009 to $25.18 per 1,000 square feet in 2018. It’s projected to hit $45.99 per 1,000 square feet by 2027. Single-family home ratepayers, who are wealthier in aggregate than renters who mostly live in multifamily buildings, will pay less under the new structure.

The residential CRIAC charge is currently based on a six-tier category of each ratepayer’s amount of impervious area, or land rainwater cannot be absorbed into. If a property owner replaced impervious areas with pervious pavers or rain gardens, green roofs, and other green infrastructure that water can soak into, they wouldn’t be charged as much.

DC Water’s current proposal would shift the current CRIAC fee so that a portion of it will be based on how much water a customer uses instead. This will reduce some users’ water bills—like churches and cemeteries—because they have a lot of impervious space but don’t use much water. Under the proposal, by 2022, 37% of the CRIAC would be based on how much water a ratepayer uses, and it’ll go up to 18% next year.

Why does DC Water charge by “impervious area?”

It may seem odd to have a significant portion of a utility bill be based on land area rather than water usage, but it’s for a good reason.

When it comes to sewer runoff, pervious surfaces let the ground absorb rainwater and slowly trickle into springs and aquifers as groundwater. Impervious surfaces such as roofs and driveways stop rainwater from being absorbed into the ground. The water flows down the drain, into the sewer, and into our waterways or to the new expensive stormwater tunnels DC Water is building.

Impervious areas cause runoff which increases the needed capacity—and cost—of the Clean Rivers Project. Areas that soak up rainwater don’t add to the need.

A proposed fee structure that takes from the poor and gives to the rich

DC Water claims that basing a portion of the CRIAC fee calculation on the amount of water used rather than impervious area would better reflect the percentage of sanitary wastewater flow in the Clean River Tunnels. In a presentation on the proposed change, one of DC Water’s rationale is that it “helps to address concerns about equity.”

But is that really true? With total rates rising by 5.7% (as was previously approved), a typical single-family household will see its water rates reduced from $62.21 to $59.07 per month. A multifamily building, which uses 15 times the amount of water on the same amount of space, would have a monthly bill increase from $413.88 to $431.77.

That’s a 5.7% decrease for single-family ratepayers and a 4.3% increase for each household in the multifamily building, assuming their water usage is 15 times that of the single-family household because there are 15 households living in the building. But that’s just for Fiscal Year 2020. By Fiscal Year 2022, single-family households will pay less of the CRIAC and multifamily households will pay even more.

Based on the 2017 American Community Survey five-year estimates, over three quarters of single-family homes are owner-occupied, much higher than the 41.7% of DC households which own. When looking at housing cost burden, the percentage of renters in DC who pay more than 30% of their income in housing costs (including utilities) is 45.1%, nearly double the 23.6% of owner households who are similarly cost burdened.

Not every person living in a single-family building is wealthy, and not every person living in a multi-family structure is housing cost burdened. But in aggregate, the proposed CRIAC structure change increases costs on those most likely to be paying the most, and reduces costs for those who are less likely to need it.

The fee change goes against DC’s resilience goals too

It can be expensive to convert typical infrastructure, but a high fee based on impervious areas creates an incentive to invest in green infrastructure. Objective 2.1.4 of Resilient DC is to “design climate-ready neighborhoods and development.” As extreme storms become more hazardous and the climate changes, a key adaptation is strengthening the region’s capacity to overcome severe weather events.

Launching a “campaign to significantly reduce the urban heat island” is objective 2.3.1 of Resilient DC, the city’s plan to adapt to natural and man-made challenges. This objective supports accelerating and evaluating District investments in trees, plants, green and cool roofs, and permeable paving materials. Private property owners can also reduce their CRIAC charge by converting impervious areas to pervious areas and employing stormwater management best practices.

Although a new rain garden may seem like a minor upgrade, every bit of pervious infrastructure helps stop flooding and wastewater runoff. Reducing the cost of owning impervious areas by 37% removes some of the cost of the status quo and disincentivizes climate adaptation.

Some of the proposal is good!

The District is responding to the concerns raised by nonprofits like churches and cemeteries by funding the CRIAC Nonprofit Relief Program, which credits 90% of the CRIAC for qualified nonprofits. The proposed budget also increases the discount for managing stormwater with “best practices” infrastructure like rain gardens or green roofs from 4% to 20%.

In addition, the budget would add to the existing Customer Assistance Program for households earning below 60% of the State Median Income. This assistance waives District fees and the Water System Replacement Fee, discounts the first 748 gallons per month, and provides a 50% discount on the CRIAC.

The budget proposal also creates more limited discount programs for households between 60% and 80% median family income, funded by DC Water, and an even more limited discount program households between 80% and 100% median family income, paid for by the District.

What’s happening next?

Over the past few weeks DC Water has held public meetings in each ward to explain the proposed changes, and held a public hearing last night on June 12 as well. The public record closes on June 17. To comment, email Linda R. Manley, Secretary to the Boad at Lmanley@dcwater.com.

After the rulemaking period closes, the DC Retail Water & Sewer Rates Committee will make a decision about the rate structure at its June 25 meeting. The Board will approve rates for next fiscal year at its July 11 meeting.