Subcommittee hears push for $60 million statewide water-assistance program

At a meeting of the House Appropriations Subcommittee on Human Services, witnesses urged lawmakers to create a permanent statewide water-assistance program and requested $60 million in the fiscal 2026 health and human services budget to help low-income households pay water bills and to stabilize utilities.

Public Sector Consultants researcher Maddie Palone, who presented statewide data, said there is no federal counterpart for water-assistance programs and described statewide need based on a new rate-and-income analysis. "There is no permanent program at the federal level that supports water assistance, unlike energy, telecom," Palone told the committee. Her team collected rate data from 500 of roughly 1,200 utilities, covering about 85% of Michigan's population, and estimated that roughly 371,000 households would qualify for a program that limits household water costs to about 3% of income. Palone said those households have an average annual gap of about $435 (roughly $36 per month) between current bills and a 3%-of-income affordability benchmark.

Sarah Rubino, representing the Michigan section of the American Water Works Association, said local water systems rely on customer rates and bear the financial effects when low-income households fall behind. "Local water systems are supported by the service fees and rates that they charge to customers," Rubino said, adding that water-assistance programs help prevent shutoffs, stabilize revenue and protect public health. Rubino told the panel the Michigan section helped craft and supports a senate bill package to establish a statewide water affordability program and that the association is requesting $60 million in FY 2026 to support assistance programs until a permanent mechanism is adopted.

Jasmine Carson, executive director of Empowerment and Integration at Wayne Metropolitan Community Action Agency (Wayne Metro), described local program administration and results the agency has achieved. Wayne Metro has administered $59.5 million in assistance since 2022 and reached more than 36,000 households, Carson said, and delivered over $4 million this year to multiple Michigan communities. "These programs are not handouts. They are essential public investments," Carson told the committee, and she urged continued and increased appropriations.

Deborah Pospeach, speaking with Detroit Water and Sewerage Department stakeholders, summarized changes made to the water-affordability legislation from the prior session. She said that under the revised bill: funds would remain within four MDHHS service-center regions; a monthly meter fee to fund the program was set at $1.25 per meter with a possible annual increase of $0.25 if needed; and a community could opt out and retain its per-meter charge to run a local program. "The funds in each region stay in that region," Pospeach said.

Committee members pressed witnesses on program design and consequences if state funds are not appropriated. Representative DeSana asked whether the committee has a breakdown of renters versus homeowners among the 371,000 households; Palone said the research team did not have that split on hand but offered to follow up. Vice Chair Edwards and others asked whether the $84 average monthly bill Palone cited includes sewer and fees; Palone said the $84 figure was an average that encompassed water, sewer and associated fees and that bills vary widely across communities.

Several legislators raised concerns about how assistance interacts with landlord responsibilities. Representative Beeson said funds should not be used to substitute for a landlord’s obligation to maintain plumbing, arguing "there should be no money going out to any person that's renting a home for this function." Witnesses and other members noted program designs can target assistance to customer-responsible charges and that many local ordinances hold landlords accountable for plumbing.

No appropriation votes were held at the meeting. The subcommittee did approve the minutes of May 20 by voice, with Representative Beeson moving approval and no objections recorded.

The committee asked staff and witnesses to provide additional detail on program administration, eligibility verification, and how funds would be allocated among regions and local providers. Witnesses said MDHHS has previously administered one-time water-assistance allocations and provided an informational sheet to the committee; the committee chair said members would receive further materials and legislative language for review.

Why it matters: Witnesses and research firms told the panel that Michigan faces widespread water-affordability need across urban and rural communities, tied to long-term underinvestment in aging infrastructure and to household incomes. Proponents say a statewide program with a sustainable funding mechanism would prevent service interruptions, protect public health and allow utilities to set rates that reflect the true cost of service without shifting unpaid debts to other customers.