Date of Defense

Spring 4-11-2005

Department

Economics

First Advisor

George Erickcek, W.E. Upjohn Institute

Second Advisor

Donald Alexander, Economics

Third Advisor

Peter Kobrak, Public Affairs Administration

Keywords

public utilities, price regulation, ability to pay

Abstract

Water and wastewater services are essential to modern life and a minimum standard of living. Access to safe water and sanitation may be basic human rights, but despite the positive externality created by universal access, these services cannot be free. In light of a planned rate increase, the Kalamazoo Department of Public Services asked the Upjohn Institute to examine the issue of water and wastewater affordability, identify existing problems, and recommend approaches that might be adopted to ensure all can afford these basic services. The follow is an overview of the author's findings: (1) there is no evidence of a system-wide affordability problem, (2) some customers still struggle to pay, (3) traditional assistance programs do not benefit tenants who are indirect customers, (4) customers struggling with affordability are often facing only a temporary crisis, and (5) low-income customers likely have aging fixtures and plumbing. Thesis suggests that there be a flexible menu of assistance options that can be tailored per need and demand-side management to increase affordability.

Comments

Prepared for the City of Kalamazoo Department of Public Services

Access Setting

Honors Thesis-Campus Only

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