HB 4555 Outline: Water Affordability Act (Michigan)
Overview
- Purpose: Establish an income-based water rate program (the “income rate program”) and set the framework for state oversight of retail water, sewerage, and stormwater services to promote affordable water bills for low- to moderate-income households.
- Status and timing: Introduced March 12, 2025; read first time June 5, 2025; referred to Committee on Government Operations. Electronically reproduced June 5, 2025. Companion: SB 2748.
- Scope: Applies to all water systems in Michigan once the program is implemented; creates duties for the Department of Health and Human Services (DHHS) and water/sewer/stormwater providers; includes enforcement provisions and remedies for violations.
Key Provisions
1) Definitions and terminology (Part 1)
- Water system: Includes public/private systems serving residential, commercial, or industrial customers; also small-scale systems (e.g., mobile home parks) serving fewer than 15 individuals.
- Customer and household: Defines who is eligible for program participation (primary residence, household composition).
- Income rate: A water bill calculated so that the bill does not exceed a specified percentage of a qualified customer’s household income (the exact percentage is to be determined by program rules).
- Federal poverty level (FPL) and household income: Uses federal poverty guidelines; household income excludes assets.
- Protected/critical care customers: Special protections for households with a critical care member, seniors, dependents under 18, or pregnant individuals.
2) Program administration and protections (Part 1)
- Program administrator: Could be the DHHS, a provider, or a third-party organization that administers the low-income water affordability program.
- Protected residence and customers: Recognizes households with vulnerable members (critical care, seniors, etc.) for additional protections.
- Landlords, local governments: Definitions indicate involvement could extend to landlords and local governmental bodies in program implementation.
3) Income rate program (Part 2)
- Creation and implementation: The income rate program is created within the department to ensure water bills reflect household income.
- Timeline: Not later than 1 year after the act’s effective date, the department must implement the income rate program; upon implementation, the program applies to all water systems statewide.
- Application process (pre-implementation): Before implementation, the department must develop an application form. Applicants must provide:
- Full name, address, phone number
- Water system name
- Proof of income via specified programs (e.g., SNAP, Medicaid, Michigan Energy Assistance Program, WIC, SSI, weatherization, etc.)
- Review and enrollment: Within 30 days of receiving a completed application, the department must review to determine if the applicant is a qualified customer; if qualified, the department must notify in writing of enrollment. The text indicates a denial path exists, though the specifics are truncated in the provided version.
4) Compliance, remedies, and penalties
- The act grants powers, duties, and potential penalties to water system providers and relevant state entities for violations of the act.
- Prohibits certain acts and practices by providers of retail water, sewerage, and stormwater management services; specifies remedies for violations.
Who is Affected
- Individual households at primary residences served by water systems, particularly those with low to moderate income.
- Protected customers (critical care, seniors, dependents under 18, pregnant individuals) and protected residences.
- Water/sewer/stormwater providers (municipal, private, and small-scale systems), landlords, and local units of government involved in service delivery.
- DHHS as program administrator or overseeing agency, with possible involvement of third-party administrators.
Notes
- The bill aims to integrate efficiency and equity into utility pricing, linking affordability to income and access to public assistance programs.
- Related bill: SB 2748 (companion).
