The city of Madison is launching a pilot program to knock $20 or $30 off what lower-income households pay per month for water, sewer and other city-provided services — helping to offset, at least for a time, increasing water rates and a pair of new charges added to residents' bills over the past decade.
Enrollment opens Wednesday for the Madison Customer Assistance Program, or MadCAP, which will provide the $20 monthly credit for households making between 30% and 50% of the area's median income, or AMI, and $30 for households making 30% or less of AMI.
Fifty percent of AMI for a four-person household is $57,650; 30% is $34,600. Homeowners, but not renters, also must show they've participated in a city water-conservation program, such as the toilet-rebate program, to be eligible.Â
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About 8,000 of Madison's approximately 118,000 households are believed to be eligible for the two-year pilot, Madison Water Utility general manager Krishna Kumar said. Households approved for the credits could begin seeing them on their April bills, he said.
“Working families are struggling to afford housing in Madison," Mayor Satya Rhodes-Conway said in a news release. "One way we can help is to reduce the cost of household bills. This program will encourage efficiency and help ease the burden on individuals and families who are struggling financially."
The mayor's office and the Water Utility provided details of the program in advance of its formal announcement today, on the condition that any story on the program does not appear until today.
The city's monthly utility bill averages about $100 for residents, Kumar said, and is made up of water, sewer, stormwater, landfill, forestry and "resource recovery" charges. Water and sewer charges each make up about 36% of the bill, Kumar said.
The forestry charge, currently $6.38 a month for residential properties, was created in 2014. The resource recovery charge of $4.08 per dwelling unit was implemented in August and is designed to offset the cost of city recycling programs.
As part of a long-term effort to replace aging pipes, and in line with guidance from the state Public Service Commission, the Water Utility has asked for and received approval for rate hikes that average out to about 8% annually since 2018, Kumar said. Madison's water rates had until recent years been among the cheapest in the state, but currently rank in about the 75th percentile of water utilities statewide, he said.
Kumar said investing in the city's water system now is key if the city wants to avoid even higher costs to replace the system in the future.
The pilot program, the first of its kind in Wisconsin, was approved by the PSC in December. It is expected to cost the city about $375,000 a year, Kumar said. It will be up to the commission to evaluate the program and then decide whether to continue it once the two years are up, he said.
