Review of the Water LowIncome Programs Meeting of

Review of the Water Low-Income Programs Meeting of the Low Income Oversight Board Stephen St Marie Policy & Planning Division 1 May 16, 2013

Low-Income Programs for Each Class-A Water Utility • The Programs for the 10 Class-A Water Utilities have been built up and developed in each company’s GRCs, so each program is unique. • The programs are all based on Income and Household size, but beyond that, they have many variations: – A specific Dollar amount off, a sur-credit, or a percentage of the fixed charge. – A reduced quantity rate or percentage off the bill • Typical value, from $6 to $25 2

The Penetration Rate Of the Low Income Programs • Typical enrollment was about 25% • Now, there is an effort to raise the penetration rate – the participation of eligible customers – including by sharing of data with the energy utilities. – Penetration could increase from 25% to over 80%. • This study: What would be the cost to the supporting households if all eligible households participate? 3

Note that the Income Eligibility Upper Limit Is based on Household size. 4

A preliminary Review of Three California Water Utility Companies • Great Oaks Water Company – A relatively small utility in an affluent area within San Jose • San Jose Water Company – Relatively large utility – serves most of San Jose • Park Water Company – Serves a less affluent area in Los Angeles County 5

Example: Great Oaks Water Company 6

Great Oaks Water Company Low-Income Program • 50% off of bi-monthly service charge of $16. 78 • Actual Dollar Value to an eligible customer: $8. 39 per bimonthly bill. • Typical bi-monthly residential bill: $90 7

Great Oaks Estimated Median Income: $90, 625 National Median Income: $50, 054 8

About 29, 500 households – Census Data Estimated Median Income: $90, 625 Eligibility Limit, say $35, 000 About 15% Of Households Eligible To Receive $8. 39 9 Supporting Households Would Pay $1. 49 Each Cost is 14. 4% of One Hour Of Median Household Income

A California Water Utility Example: San Jose Water Company 10

San Jose Water Company Low-Income Program • 15% off of total bill • Actual Dollar Value varies with consumption • Typical bi-monthly residential bill: $46 • For this analysis, we take 15% of $46, for a value of $6. 90 11

Estimated Median Household Income For San Jose Water Svc Area: $80, 243 US Median Income: $50, 054 12

About 327, 000 households – Census Data Estimated Median Income: $80, 243 Eligibility Limit, say $35, 000 About 21% Of Households Eligible To Receive $6. 90 on Avg 13 Supporting Households Would Pay $1. 88 Each Cost is 20. 5% of One Hour Of Median Household Income

A California Water Utility Example: Park Water Company 14

Park Water Service Estimated Median Income $50, 000 US Median Income: $50, 054 15

About 56, 000 households – Census Data Estimated Median Income: $50, 000 Eligibility Limit, say $35, 000 About 30% Of Households Eligible To Receive $5. 50 16 Supporting Households Would Pay $2. 37 Each Cost is 41. 5% of One Hour Of Median Household Income

Review and Next Steps • An evaluation of three companies shows substantial variation in the cost borne by the supporting households. • New and Better Data from 2010 Census are becoming available. • Calculate for All of the Class-A Companies • Estimate Incomes by Household Size • Analyze Commercial and Industrial Sales 17

Thank you! For Additional Information: www. cpuc. ca. gov Stephen. St. Marie@cpuc. ca. gov 415 -703 -5173 18