EPA Releases Financial Impact Tool to Help Water Utilities

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U.S. Environmental Protection Agency (EPA) released a new tool to help water utilities assess the financial impact of COVID-19 on operations. Throughout the COVID-19 national health emergency—and as communities across the country reopen—water utilities have reliably provided safe drinking water and critical wastewater services. This new tool will help provide important information about the financial and operational health of water utilities, which play an integral role in protecting human health and the environment for our nation.

“It’s important for water utilities to understand – as early as possible – how to carry out their responsibilities and plan reinvestment for their communities as local economies start to recover from COVID-19,” said EPA Administrator Andrew Wheeler. “This tool will support the financial resilience of water utilities today and into the future by providing in-depth insight into how operations during COVID-19 have affected their financial standing.”

“Water utilities and the water workforce have kept vital clean water services operating throughout this challenging time,” said EPA Assistant Administrator for Water David Ross. “With this new tool, EPA is again showing its support for the water sector and its incredible workforce—this time by encouraging robust financial planning that is critical to sustaining the water workforce and the infrastructure that is needed to help protect public health and the environment every day.”

Many water utilities expect to experience revenue losses due to reduced commercial consumption, households that are unable to pay their bills, and deferred or cancelled rate increases. Water utilities also anticipate incurring increased costs related to overtime wages, personal protective equipment (PPE) purchases, and increased demand on customer assistance programs. Developed by EPA’s Water Infrastructure and Resiliency Finance Center, the Water Utility COVID-19 Financial Impact Tool leads water utilities through a series of questions that can determine how their revenues, expenses, and cashflow have been affected. This tool will help water utilities understand their own financial health as they plan for ongoing operation and maintenance and capital infrastructure needs, including implementing plans to repair, replace and modernize aging infrastructure.

Throughout the COVID-19 national health emergency, EPA has worked to support the water sector. For example, the agency urged states and territories to ensure that drinking water and wastewater employees are considered essential workers by authorities. EPA also posted information and resources that water stakeholders-including states, municipalities, utilities and their workforce-can use to support operations. For example, on the website, the agency summarizes resources that can support utilities, including by helping maintain adequate staffing and laboratory capacity.

In addition, EPA has closed eight WIFIA loans and refinanced one from March 2020 through June 2020. These recent loan closings will save ratepayers over $1 billion compared to typical bond financing while supporting the financial health of vital water systems. This financial support came at a critical time as the federal government, EPA and the water sector worked together to help mitigate the public health and financial impacts of COVID-19.

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