City Council Memorandum
TO: HONORABLE MAYOR AND CITY COUNCIL DATE: MAY 17, 2022
FROM: PUBLIC UTILITI ES DEPARTMENT WARDS: ALL
SUBJECT: RESTART UTILITY BILL REPAYMEN T PROGRAM FOR CUSTOMERS WHO
WERE UNABLE TO PAY THEIR RIVERSIDE PUBLIC UTILITIES BILLS DUE TO ONGOING COVID-19 PANDEMIC AND R ESUME THE UTILITY SHUT-OFF
PROCESS
ISSUES:
Approve the Restart Utility Bill Repayment Program for cust omers who were unable to pay their Riverside Public Utilities bills due to the ongoing COVID-19 pandemic and resume the utility shut- off process for non-payment of water, electric sewer and refuse service.
RECOMMENDATIONS:
That the City Council:
1. Approve the Public Utilities Restart Utility Bill Repayment Program for customers who were unable to pay their Riverside Public Utilities bills due to the ongoing COVID-19 pandemic; and
2. Direct the City Manager to re verse the March 17, 2020 suspension of discontinuing water electric, sewer and refuse utility service for non-payment.
BOARD RECOMMENDATION:
The Board of Public Utilities met on July 12, 2021, with Chair Sanchez-Monville, Vice-Chair Crohn, and Board Members Heru, Montgomery, Oc eguera, and Wohlegemuth present and Board Members Cherney and Melendez absent, to discuss revisions to the Restart Utility Bill Repayment Program and unanimously approved to recommend t hat the City Council: 1) implement the revised Restart Utility Bill Repa yment Program for all custom ers that have been adversely impacted by the COVID-19 pandemic to be effective within 60 days of the City Council reversing the direction given on March 17, 2020 to sus pend discontinuance of service for nonpayment of water, electric, sewer and refuse utility services including repayment c ontracts for commercial customers and to provide an option for non-equal repayment schedules; and 2) authorize the City Manager, or designee, to implement the Restart Utility Bill Repayment Program for all customers that have been adversely impacted by the COVID-19 pandemic to be effective within 60 days of Utility Shut Offs & Restart Program ● Page 2
the City Council reversing its Marc h 17, 2020 direction to suspend discontinuance of service for nonpayment of water, electric, sewer and refuse utility services.
BACKGROUND:
On March 17, 2020, to assist Riverside resident s and businesses that were suffering financial hardship, the City Council direct ed the City Manager to suspend di scontinuance of service for nonpayment of water, electric, sewer and refuse utility services. Water and Electric Rules 7 both provide that the City may discontinue service for fa ilure to pay; however, the City is not required to terminate service. The City cannot, however, waive any payments. The Electric and Water Rules do not allow for the waiver of charges that otherwise comply with the rules. As of the date this report was written, this order is still in effect.
On May 5, 2020, the City Council approved the expenditure of $5 million from RPU’s public benefit funding for the Emergency Recovery Assistance Program (ERAP). This program provided residential electric customers who had lost their jobs or experienced a loss of income with a one- time, $250 bill credit on the customer’s RPU bill. This program launched on May 20, 2020 and has helped approximately 5,285 customers.
Also on May 5, 2020, the City Council approved t he concept of a utility bill repayment program titled “Restart” with direction to return for final approval of a st andardized agreement which customers could opt into to repay their utility bills. This was the City ’s first step to support utility customers. The action ensured t hat all customers continue to have access to necessary utility services, regardless of the financ ial hardships faced due to the loss of household income. RPU cannot waive the utility charges for these customers and the bills are accumulating. The Restart Program supports all customers, both residential and commercial, with a standardized process to repay their outstanding utility bills.
On August 24, 2020, the Board of Public Utilities unanimously voted to recommend increasing the ERAP customer credit from $250 to $400 and approve the Re start Program and associated agreements to provide bill repa yment deferral for customers w ho were unable to pay their Riverside Public Utilities bills due to the ongoing COVID-19 pandemic.
On October 6, 2020, the City Council approved an in crease in the ERAP cust omer credit from $250 to $400, the Restart Program, and associated agreements.
On August 3, 2021, the City Council was scheduled to review and approve revisions to the Restart Utility Bill Repayment Program for all custom ers that have been adverse ly impacted by the COVID-19 pandemic to be effective within 60 days of the City Council reversing the direction given on March 17, 2020 to suspend discontinuance of service for nonpayment of water, electric, sewer and refuse utility services; and authorize the Cit y Manager, or his designee, to implement the revised Restart Utility Bill Repa yment Program for all custom ers that have been adversely impacted by the COVID-19 pandemic to be effective within 60 days of the City Council reversing its March 17, 2020 direction to suspend disconti nuance of service for nonpayment of water, electric, sewer and refuse utility services. At the meeting, it was discussed that in July 2021, the Legislature passed nearly $2 billion in fundi ng to address statewide energy, water, and wastewater utility arrearages. Staff reported an estimated tota l delinquency of $26,322,826.
Following this discussion, it was moved by Councilmember Cervantes and seconded by Councilmember Edwards to table the item until a future date and bring it back when additional information is received from the State. The motion carried unanimously, with all Councilmembers present.
Utility Shut Offs & Restart Program ● Page 3
DISCUSSION:
The City Council’s delay to resume utility discontinuances for non-payment has allowed the Public Utilities Department to submit for and receive State funding for utility arrearages which has directly benefited eligible customer accounts.
California Arrearage Payment Programs
Electric
On July 16, 2021, Governor Newsom signed AB 135, which cr eated the California Arrearage Payment Program (CAPP), administered by the California Department of Community Services & Development for funding electric utility customer arrearages. RP U applied for CAPP assistance on behalf of electric customer s who incurred a past due balance of 60 days or more on their energy bill during the COVID-19 pandemic relief period covering March 4, 2020 through June 15, 2021. On December 16, 2021, the following CAPP benefits were applied for RPU customers:
Account Type Number Of Accounts CAPP Benefit
Residential 11,148 $8,707,442
Low Income Residential 775 495,449
Commercial 676 1,873,165
Total 12,599 $11,076,056
Drinking Water
On July 22, 2021, Governor Newsom signed AB 148, which created the California Water and Wastewater Arrearage M anagement Program (CWWAPP) to administer funding for water/wastewater utility custom er arrearages. The State Wate r Resources Control Board is administrating these program s. RPU applied for CWWAPP assistance on behalf of water customers who incurred a past due balance of 60 days or more on their energy bill during the COVID-19 pandemic relief period covering March 4, 2020, through June 15, 2021. On December 22, 2021, the following CWWAPP benefits were applied for RPU customers:
Account Type Number Of Accounts CWWAPP Benefit
Residential 4,264 $1,757,642
Commercial 126 123,160
Administrative Costs 3% 63,440
Total 4,390 $1,944,242
Wastewater
The State Water Resources Control Board st arted the CWWAPP progr am for wastewater arrearages on February 9, 2022. On February 22, 2022, RPU ap plied for CWWAPP assistance on behalf of wastewater customers who incurred a past due balance of 60 days or more on their energy bill during the COVID-19 pandemic relief period covering March 4, 2020 through June 15, 2021.
Utility Shut Offs & Restart Program ● Page 4
Account Type Number Of Accounts CWWAPP Requested
Residential 8,132 $2,443,484
Commercial 99 108,053
Administrative Costs 3% 76,546
Total 8,231 $2,628,083
Low-Income Water Assistance *New*
The California Low-Income Household Water Assi stance Program (LIHWAP) is administered by the California Department of Co mmunity Services & Developm ent. This program provides financial assistance to low-income customers where qualified. Low-income households can apply to their Local Service Provider to receive a one-time credit (up to $2,000) on their water or wastewater bill. The Local Service Provider fo r RPU customer is Community Action Partnership of Riverside County. RPU is participating in the program to ensure access for our customers.
Account Delinquency Rates
Since the COVID-19 Local Emergency Declaration, the City has experienced significant increases in utility customer accounts receivable. This in cludes increases in delinquent account balances and the number of utility accounts that have become delinquent.
The charts below include account information through March 31, 2022. Accounts receivable for all services including electric, water, sewer and refuse have increased by 59%, or $18 million, from March 2020 to Marc h 31, 2022. During the same period, delinquent accounts receivable have increased 488%, or $24 million. The City re ceived and applied $13 million to customer accounts from state funding offering financial assistance for eligible past-due electric and drinking water customer debts incurred from March 4, 2020 to June 15, 2021.
Notes: 1. Delinquent Account Balance includes active & inactive accounts.
2. Updated through March 31, 2022 for electric, water, sewer, and refuse. 0%
10%
20%
30%
40%
50%
60%
70%
$-
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
$70,000,000
Mar 2020
Jun 2020
Sep 2020
Dec 2020
Mar 2021
Jun 2021
Sep 2021
Dec 2021
Mar 2022
Total Accounts Receivable (A/R) Comparison
Delinquent Account Balance Total Amount Billed Delinquent as %Billed Utility Shut Offs & Restart Program ● Page 5
The chart below demonstrates the number of active customers based on the oldest unpaid utility bill:
Note: Updated through March 31, 2022 for electric, water, sewer, and refuse.
The average total unpaid utility account balance for each customer grouped by the oldest unpaid bill on the active account is calculated in the below table:
Note: Updated through March 31, 2022 for electric, water, sewer and refuse.
6,894
3,228
1,558
2,512
4,356 4,369
632
208
83 137
200 264
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
30 to 59 days 60 to 89 days 90 to 119 days 120 to 179
days
180 to 359
days
360+ days
Delinquent Balance
Customer Count
Delinquent Active Accounts Receivable Customers
Residential Delinquent Accounts Commercial Delinquent Accounts Delinquent Balance $147 $281 $465 $704
$1,290
$2,179
$892
$2,131
$1,471
$1,731
$4,824
$5,461
$-
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
30 to 59 days 60 to 89 days 90 to 119 days 120 to 179 days 180 to 359 days 360+ days
AVERAGE ACCOUNT DELINQUENT BALANCE BASED ON
THE OLDEST UNPAID BILL
Residential Avg Delinquent Balance Commercial Avg Delinquent Balance Utility Shut Offs & Restart Program ● Page 6
Current Customer Benefit Programs
In addition to the recent Federal program for Emergency Rental and Utility Assistance, RPU provides low-income customer utility assistance and an emergency bill credit for customers who have experienced financial impacts due to COVID:
1. SHARE Sharing Households Assi st Riverside Energy Program This program is an income-qualified pr ogram and provides emergency/deposit and monthly bill credit assistance. On March 8, 2021 and March 22, 2021, respectively, the Board of Public Utilities and City Council approved t he SHARE emergency/deposit assistance increase from $150 to $250. On May 17, 2022, the City Council is expected to receive a request to approve an increase of the SHARE Electric Monthly Credit from $15.50 per month to $16.00 and Water Monthly Credit fr om $3.00 to $3.25 to align with electric and water rate increases for Fiscal Year 2022/23; and approve to update the Sharing Households Assist Riverside’s Energy pr ogram guidelines from 200% of the federal poverty level guidelines to 250%.
2. ERAP Emergency Recovery Assistance Program
This program was established in response to the COVID-19 pandemic and provides a $400 bill credit assistance for residential cust omers whose incomes have been negatively impacted due to the pandemic. This program has been approved to expire three months after the local emergency has been terminated. From May 20, 2020, to the date of this report, 5,285 customer utility accounts have benefitted with a total value of $2.1 million.
3. Emergency Rental Assistance Program
This program was established through funding provided by the United States Treasury to pay the past due rent and utility balances to low-income residents whose incomes were negatively affected due to the pandemic. Program funds were exhausted on April 16, 2021, and are administered through United Lift. To dat e, 778 customer utility accounts have benefitted with a total value of $786,102 in payments completed.
Restart Program
As the City has now exceeded two years under the Local Emergency Declaration, staff is recommending program changes from the City Council approved program on October 6, 2020, to reflect the long-term customer impacts of the Local Emergency Declaration.
OCTOBER 6, 2020 PROGRAM PROPOSED PROGRAM
A. DELAYED START TO REPAYMENT
RPU shall provide customers with a 6-month
delay before their first payment towards their
outstanding balance is due. Customers may
sign up for this program from the time that City
Council approves the agreement through two
months after RPU resumes utility
disconnections.
RPU customers be provided with a 60-day
delay from the end of the March 2020 Local
Emergency Declaration to sign up for the
program.
B. STANDARDIZE THE REPAYMENT AGREEMENTS
Customers will enter in to agreements with
RPU to repay unpaid balances on their
accounts. This repayment agreement will be
a standardized formal agreement for
commercial customers and a standardized
letter a
greement for residential customers.
All residential payment arrangements to be
conducted via the current administrative
process using a variety of letters and
agreements already in practice with Utilities
Customer Service teams.
Utility Shut Offs & Restart Program ● Page 7
Having a standardized repayment agreement
process will streamline the process both for
RPU and City staff as well as for the
customers.
All commercial payment arrangements to
include the Board of P ublic Utilities and City
Council approved standard agreement.
C. NO COST OR PENALTY
The program will be offered at no additional cost to the customer and will ensure a customer’s credit is not negatively impacted by late bill payment. Restart agreements will be at no additional cost and no interest.
D. STANDARD REPAYMENT TIMELINE
Customers will be provided 12-months to
repay their outstanding bi ll balance. Twelve
equal monthly payments will be established
for the customers. Customers may repay their
outstanding balances early. For the agreement
to remain valid and for the customer to avoid
disconnection, custom ers must pay their
monthly utility bills plus the agreed upon
monthly payment.
Customers will be provided up to 18 months
from the City Council directive to City Manager
to reverse the March 17, 2020, suspension of
discontinuing water, electric, sewer and refuse
utility service for non-payment to repay their
outstanding bill balance. Regular, equal
monthly payments will be established however
a customer may request an alternative
“ramp up” schedule. Customers may repay
their outstanding balances early. For the
repayment agreement to remain valid and for
the customer to avoi d utility disconnection,
customers must make on time payments for
the current monthly utility bills plus the agreed
upon amount for the past due balance.
Additional staff recommendations for the Restart Program:
E. DOWN PAYMENT
It is recommended that customers requesting enrollment in the Restart Utility Bill Repayment Program Restart delinquent repayment plan provide a down payment of 10% of the outstanding utility account balance to enroll in the program.
Note: Low-income qualified cust omers are eligible to enro ll in the SHARE program and upon approval for SHARE may be eligible for a $250 emergency deposit credit.
F. RESTART ELIGIBILITY DATES
The program is for delinquent utility bill am ounts as defined in the March 2020 Local Emergency Declaration. Any additional account delinquency amounts outside of this defined period of the Local Emergency are not eligible for the Restart program.
STRATEGIC PLAN ALIGNMENT:
The implementation of the Restart Repayment program continues to Strategic Priority 3 - Economic Opportunity and Goal 3.4 - Collaborate with key partners to implement policies and programs that promote local business growth and ensure equitable opportunities for all.
The program aligns with each of the Cross-Cutting Threads as listed below:
1. Community Trust –The Restart Repayment program has been discussed at several Board of Public Utilities and City Council meetings. The policy discussions have evolved Utility Shut Offs & Restart Program ● Page 8
as the COVID-19 pandemic continued and the program objective has remained to provide an equitable re-payment plan that best meets the needs of all customers.
2. Equity –The Restart Program includes equal opportunity for flexible repayment options for all customers as well as available assistan ce programs for low-income customers or for those that were negatively impacted by the pandemic.
3. Fiscal Responsibility –The Restart Program is a ba lanced, responsible approach to provide customers with options to retain utility services without concern for disconnection while they re-pay the delinquent Electric, Water, Sewer and Refuse charges that have been provided.
4. Innovation –The Restart program is an innovative program designed to meet the fiscal challenges experienced by our community during the pandemic.
5. Sustainability & Resiliency –The Restart program allows for customer flexibility without compromising the current and future needs of the City’s electric, water, sewer and refuse funds.
FISCAL IMPACT:
Due to the ongoing situation with the pandemic, the total fiscal impact of the issues discussed in this report is unknown at this time. The City’ s major enterprise funds are experiencing similar impacts resulting from the pandemic, with much higher delinquent account balances and lower commercial/industrial revenues. To date, these impacts have not affected the overall health of the funds, but the potential write-off of delinquent accounts will reduce fund resources and could impact credit ratings for certain utilities where applicable.
There is no fiscal impact related to the revisions to the Restart Utility Bill Repayment Program.
Funding for RPU’s public benefit programs is available in the Electric Public Benefits Fund Low- Income Assistance Residential COVID-19 Program Account No. 6020100-456100. Of the original $5 million budget, approximately $2.8 million remains available as of March 21, 2022.
Prepared by: Todd M. Corbin, Utilities General Manager Certified as to
availability of funds: Edward Enriquez, Chief Financial Officer/City Treasurer Approved by: Kris Martinez, Assistant City Manager Approved as to form: Phaedra A. Norton, City Attorney
Concurs with;
___________________________ _________ __________________
RONALDO FIERRO GABY PLASCENCIA
Councilmember, Ward 3 Councilwoman, Ward 5
Attachments:
1. Commercial Agreement
2. Presentation