Detroit suspends water shut-offs for 15 days
posted at 8:41 pm on July 21, 2014 by Allahpundit
More than half of Detroit’s residential accounts are either 60 days overdue or owe $150 or more. A bankrupt city needs the money. Solution: Pay up or do without water. Some people can’t, of course. They’re broke and simply can’t come up with what they owe.
Some. Not all.
The Detroit Water and Sewerage Department is suspending water shut-offs for 15 days starting Monday…
He said half of the customers whose water was cut off never made arrangements to get it turned back on, leading officials to believe they were using the service illegally. So during the 15-day pause, the department is informing “shutoff crews to more aggressively turn off illegal use.”…
Johnson said 89,000 customers owe about $91 million. Detroit had 176,879 active residential water accounts as of June 30. Thousands of those had water restored within 48 hours after paying their overdue bills or getting into a payment program. The department had cut off service to more than 2,000 residential accounts in the first two weeks of July…
Detroit’s City Council recently approved a rate increase of 8.7 percent. The increase not only covers the bills of city rate payers, but also the costs associated with individuals who are not paying or are gaming the system.
Not unlike an insurance industry “death spiral,” as more consumers drop out of the payment pool, the smaller number who are left are forced to absorb a greater share of the cost for operating the system, which means even higher rates, which in turn drives even more people out of the pool, etc. But look again at that third paragraph; when the water department went knocking on doors, it turned out thousands of people had the money to pay their debts. Why’d they choose not to, then? Because, says the Detroit Free Press, of a “culture of nonpayment” created by the city government during its fast-track-to-civic-destruction days:
“No other major city in America has let accounts go delinquent for so long,” Nowling said…
[T]here’s no question that the department’s longstanding history of tolerance for unpaid bills has helped to create a culture that enables nonpayment by those who can afford to. Sound policy would discern who can’t pay, and who won’t, before cutting off service.
But because of the culture of nonpayment that the department helped to create — and with $90 million in bad debt, it’s impossible to argue that the department hasn’t contributed to this problem — such a policy shift should come slowly, and should err on the side of caution.
In other words, water has effectively been free in Detroit for anyone willing to game the system. That era is ending now because, as tends to happen when more money is spent on entitlements than collected, the math eventually gives out. The water department’s catching flak from critics because, allegedly, they didn’t do enough to distinguish the willing deadbeats from the truly needy in cutting off service this month — they’re being sued for not providing nonpayors their constitutional right to due process before cutting them off — but watch the clip below of the protest from Friday. Sounds like they’re less interested in the timeframe they’re being given to pay than the fact that they’re not being bailed out like Wall Street was in 2008. How about a teeny tiny tax on banks to help pay for Detroit’s water? I’m sure this is a one-time thing and the precedent won’t be exploited.
Breaking on Hot Air