Mayor proposes $10 million initiative to help those behind on utility bills as a result of COVID-19

Mayor proposes $10 million initiative to help those behind on utility bills as a result of COVID-19
November 16, 2020

[Original Post]

Mayor Greg Fischer has proposed an ordinance to provide the Office of Resilience and Community Services (RCS) with an additional $10 million in the current fiscal year to help thousands of Louisville customers struggling to pay their utility bills because of a COVID-19 related financial hardship.

Citing the negative impact that COVID-19 has had on employment, here and across the country, the Mayor noted that the Louisville MSA has lost more than 36,000 jobs since last year, including nearly 8,000 in the Leisure and Hospitality industry alone.

“As a result, thousands of our neighbors are in a financial crisis, many for the first time. They want to pay their bills but simply cannot keep up, and every month, they become increasingly behind in paying for these vital services,” Mayor Fischer said. “Our goal here is to help them steady the ship.”

The effort represents a new partnership with Louisville Water Co., MSD, LG&E, and the utilities’ foundations, working together to help people get back on track in paying their utility bills.

The plan is for the funds to be available in mid-January. Customers with outstanding balances on their utility bills could receive a one-time credit at an amount that’s still to be determined. Customers will need to attest that they’ve had a financial hardship during the pandemic.

Since mid-March, none of the local utilities have cut off service for non-payment. Kentucky Gov. Andy Beshear issued a moratorium on utility service cut-offs in March that was lifted in October. But even under the moratorium, customers are responsible for the utility services they use, and many are falling further and further in arrears.

For example, in mid-March, 1,900 customers were behind on their Louisville Water/MSD bill. As of Oct. 29, there are 18,000 residential customers in Jefferson County who are behind on their Louisville Water/MSD bill, with an average outstanding balance of $430 owed.

“We know the critical importance of our product during this pandemic,” said Spencer Bruce, President and CEO of Louisville Water. “This potential funding will help thousands of customers, and we are grateful for this community partnership.”

“Providing essential services of collecting and treating wastewater, flood protection, and managing stormwater is not an easy task in the best of times,” said Louisville MSD Executive Director Tony Parrott. “Our regulatory requirements continue even as we face severe revenue shortages resulting from an economic downturn in our community, country and world. We are grateful for the actions of Mayor Fischer and our Metro Council in providing utility payment assistance for our customers facing economic hardship.”

LG&E currently has nearly 38,000 residential customers in arrears, with an average bill of more than $400.

“This has been a challenging year and we appreciate the additional funding being allocated to those having difficulty paying their utility bills,” said LG&E President and CEO, Paul Thompson. “We have been working with our customers to establish longer term payment arrangements to get them to stronger economic times. This additional assistance certainly supports our efforts.” 

Louisville Water/MSD already provide customer assistance through the Louisville Water Foundation, and LG&E also helps customers in need through its foundation. The utilities have also provided additional COVID-19 relief help. LG&E, for example, has contributed more than $250,000 to COVID relief efforts, including $100,000 each to the One Louisville Fund and Team Kentucky.

The city’s $10 million, which must be approved by Metro Council, would come from general fund dollars freed up by CARES (Coronavirus Aid, Relief, & Economic Security) Act) funding in other areas. The funds would be distributed by RCS under agreements with the utilities and foundations. Other details are still being worked out among the parties.

Councilman Markus Winkler, one of several Council sponsors, said, “As the Covid-19 pandemic continues to impact our business community, tens of thousands of Louisvillians remain unemployed and are struggling to make ends meet. To make matters worse, our federal government seems unwilling or unable to create a comprehensive plan to address the pandemic and provide meaningful aid to families. This failure of leadership pushes the burden on local communities and as such we must do our part to ensure families can maintain access to basic services such as water and heat as we head into the winter.”

For now, the city urges residents to be in contact with the utilities about their bills to understand all their options for becoming current on their bills.

“We know this credit will help some families completely catch up, but some will still be in arrears, so they need to be in communication with the utility companies, all of which have ways to help beyond this credit,” Mayor Fischer said. “I appreciate that all three companies are working hard to help their customers through this difficult time.”

The utility relief initiative will complement work that Louisville Metro Government (LMG) and its partners have already done to help residents struggling because of COVID-19. For example, RCS has distributed more than $2.8 million raised through the One Louisville: COVID-19 Response Fund to landlords and/or utility companies on behalf of 3,324 households.

This summer, LMG allocated $21.2 million in federal CARES money toward eviction prevention assistance, establishing a program to assist individuals through RCS, as well as a program that allows landlords of subsidized units to apply for assistance on behalf of their tenants, the Landlord Tenant Rental Assistance Program, through the Office of Housing.

The Office of Housing also has partnered with the court system and Legal Aid Society on the Eviction Diversion Pilot Program, which acts as a backstop for eviction as cases enter the court system. As of Oct. 16, those three programs have allocated $5.4 million, assisting 3,246 households and 6,199 total residents in Jefferson County.

Louisville Metro also recently reallocated $3 million from the Landlord Tenant Rental Assistance Program for external agency agreements with the Coalition for the Homeless and ACM to administer eviction prevention programs.