Utility Debt is a Crisis for All Pennsylvanians
For those who are out of work, scraping together enough cash to pay the rent or the mortgage is often very difficult. People rely on a small unemployment check, zero out their savings accounts or cash out retirement funds all while falling deeper in debt just so their families can have a roof over their head.
Community activists and anti-poverty organizations rightfully paid a great deal of attention to the issue of evictions and foreclosures during the early days of the pandemic. Gov. Tom Wolf temporarily prohibited evictions and foreclosures while he and the state legislature created a $150 million rent-relief package.
These were all wise choices based on a real and understandable concern for our neighbors who, through no fault of their own, lost their jobs because of the pandemic. These efforts remain ongoing since no one wants a neighbor to lose their home, especially during these hard times.
But there was another crisis that failed to get as much attention, even though it can be as equally disruptive to those struggling to make ends meet: unpaid utility bills. A few weeks back, I chaired a Policy Committee meeting in Harrisburg regarding mounting utility debt among Pennsylvanians; what we learned was heartbreaking and terrifying.
In June, 800,000 Pennsylvanians were facing utility shutoffs from their electric, natural gas or water companies. By September, that number jumped nearly 25% to 970,000 residential customers. Think about what this means: nearly 1 million Pennsylvania households are at risk of losing their electricity, heat or indoor plumbing.
While everyone should be concerned about the ongoing eviction and foreclosure crisis, nearly 1 million Pennsylvanians are at risk of making their apartment or home uninhabitable, which will only exacerbate the number of people facing homelessness. We are facing a potential humanitarian crisis right here in Pennsylvania that will adversely impact every neighborhood in every town in our entire state.
As if the threat of hundreds of thousands of Pennsylvanians facing utility shutoffs wasn’t bad enough, this growing crisis carries the risk of impacting your pocketbook too.
There is more than $721 million in debt owed by Pennsylvanian customers to electric, gas and water utility providers according to a recent report issued to the Pennsylvania Public Utility Commission. That $721 million will have to be paid by someone and it will most likely be you. Public utilities (including PPL and UGI) can seek approval to increase utility rates to help cover the cost of uncollected debts.
Pennsylvania received about $3 billion from the federal government meant to help fund PPE, provide support for our medical providers and first responders, and reduce the economic impact of the COVID-19 pandemic on families and businesses. As of Nov. 1, we still had about $1.13 billion remaining.
At that same time, we also had an urgent need to pass a stopgap state budget. It was my hope that we would pass a responsible state budget that would use the remaining $1.13 billion on programs to help people. I even proposed using a portion of those dollars to help reduce the burden of utility debt on residential customers knowing that it would ease the housing crisis and lessen the need for a jump in utility costs for all consumers.
Alas, that money was used to balance our budget, leaving millions of Pennsylvanians out in the cold at a time when they need the help the most. Ultimately, I voted against the latest budget because of this.
All hope is not lost, however. Utility companies including PPL and UGI can continue their outreach to customers who are behind on their payments and work with them to get them back on track. Ultimately, this is the first line of defense against out of control utility debt.
And we can enact Pennsylvania-specific laws that can reduce the burden of spiking utility debt on residential customers. We can cap late fees. We can allow for greater flexibility on payment plans. And most importantly, we can expand the very popular and very successful Low-Income Home Energy Assistance Program, known as LIHEAP.
By doing these things, we can reduce the overall debt owed by people before the bill comes due. Failure to act now, however, will increase the risk of homelessness for those most at-risk and make it more likely that all Pennsylvanians will see higher utility bills. State Rep. Peter Schweyer serves the 22nd Legislative District in Allentown.