The Sewerage & Water Board is expected to resume shutoffs at some point this summer for customers who are 60 days or more past due on their bills. For more than a year, disconnections for nonpayment have been postponed by the COVID-19 pandemic.
The utility says it’s owed nearly $54 million from these delinquent accounts, the number of which has actually decreased since before the pandemic.
Members of the S&WB Finance and Administration Committee received an update on past-due accounts Wednesday. They then approved a measure to request that utility staff develop a plan to reinstitute normal collections, and the full board of directors is expected to support that proposal when it meets next week.
Ghassan Korban, S&WB executive director, told committee members he technically doesn’t need the board’s permission to resume customer shutoffs.
“Given the nature of the issue, and the political nature of it, we feel very strongly that board support is crucial,” Korban said. “While we may have a lot of support from you, in the community there may be some opposition to reinstating that policy.”
According to numbers, the Sewerage & Water Board provided Thursday, there are 24,973 delinquent active accounts with bills totaling $53.8 million that were two months overdue as of April 30. Residential customers accounted for 92% of that amount, or 23,094 accounts that owe $41.4 million.
There were 1,287 delinquent business accounts totaling $9.3 million, and 590 multi-family property accounts with $3 million in late unpaid bills.
Grey Lewis, S&WB chief financial officer, told the finance committee members there is federal assistance in the works to help low-income customers pay their bills. Congress has provided more than $1.1 billion through this year’s Consolidation Appropriations Act and the American Rescue Plan. Initial figures show New Orleans’ initial allotment from these sources will come to $3 million, Lewis said.
The city and state will coordinate with the nonprofit organization Total Community Action to administer the utility assistance. Households that qualify for aid must have income under 150% of the federal poverty line, which places the ceiling at $37,650. They must also spend at least 30% of that income on housing.
Lewis said TCA will assist in identifying S&WB customers that qualify for assistance.
Korban said he anticipates providing a plan to resume customer shutoffs to S&WB directors next month, adding that he would request a one-month “grace period” for implementation.
Finance committee chairman Lynes “Poco” Sloss noted that other utilities have already resumed collections efforts on delinquent accounts, including customer shutoffs.
“I certainly want to be cognizant of our citizens and so forth, but I think we need to be aggressive with this,” Sloss said. “Entergy’s already gone down that path, and it makes total sense for us to shadow them.”
Like Entergy Corp., the Sewerage & Water Board halted customer disconnections in March 2020. The Entergy Louisiana subsidiary, which services Jefferson Parish, resumed shutoffs in February. Entergy New Orleans has notified customers it will resume delinquent account disconnections this month.
During Wednesday’s committee meeting, Korban acknowledged the Sewerage & Water Board’s past difficulties with collecting delinquent accounts and carrying out disconnections. His staff will work to remedy those issues and develop a customer outreach strategy to make them aware that shutoffs will resume.
Customers far behind on their bills will be offered payment plans to avoid disconnection, Korban said, noting a similar program was in place before the pandemic.
“We also want to be very sensitive to our customers, and we don’t want to create another situation or unintended consequence from pushing this forward the way we used to do it,” he said.
Figures shared with the finance committee indicate the Sewerage & Water Board was owed $33.1 million from 60 days-plus past due accounts as of January 2020. The total has increased 62% as of April 2021.