Does public ownership of utilities matter for local government water policies?

Abstract

What differentiates local governments that implement water policies on equity and the environment? Analyzing a 2015 national survey of 1,897 U.S. municipalities, we find municipalities that own their water utilities are more likely to report policies to protect low-income residents from disconnection and implement water resource management. Respondents from 8% of municipalities report protecting residents from disconnection. State economic regulation of municipally owned utilities and Democrat-majority municipal governments are positively associated with local policies to protect low-income households from shutoffs but bear no association with resource management. Both municipal ownership of utilities and state economic regulation may play a role in meeting certain local water policy goals.

Which states and cities protect residents from water shutoffs in the COVID-19 pandemic?

“…However, prior to the COVID-19 pandemic, mechanisms for ensuring water access, such as temporary bans on disconnections for low-income residents in the United States, were few ( Hauter and Grant, 2018 ). A national study using survey data from 2015 found only eight percent of responding municipalities protected low-income households from disconnection ( Homsy and Warner, 2020 ). The lack of universal service obligations and disconnection protections in the United States stands in stark contrast to Europe, where countries implement a variety of mechanisms to ensure access to water.…”

“…Partisan political control could affect the decision of a state to impose a moratorium, as prior research has found that Republican-controlled governments are less likely to protect low-income consumers from water disconnection ( Homsy and Warner, 2020 ). We create a variable, unified Republican control, for states where both the state legislature and the Governor's office are Republican.…”

Water Pricing and Affordability in the US: Public vs Private Ownership

“…This may be because publicly owned utilities have a broader interest beyond profit; they are generally interested in fair pricing and affordability to their residents (Mann & Warner 2019;McDonald 2018). Municipally owned utilities are also more likely to protect low-income residents from water shutoff (Homsy & Warner, 2020;Warner et al 2020). Regarding problems with water affordability, private ownership and poverty rate are the primary drivers.…”

“…For example, a recent study of Philadelphia's Tiered Assistance Program found that affordability programs based on household income in the US do not have a negative effect on water conservation efforts (Mack, et al 2020). A national study of US municipalities found that municipally owned systems were more likely to both impose conservation practices and protect consumers from water shut off (Homsy & Warner 2020). Some cities across the US have brought privatized systems back under public control.…”

“…Water affordability programs are needed to address the water access challenges of the lowest income households in the US. States, municipalities and utilities all have a role to play (Homsy & Warner, 2020;Pierce, Chow & DeShazo 2020;Pierce et al, 2021;Swain et al 2020).…”