Study Uncovers Projected Funding Deficit In Water Allowances For Low-Income Housing Residents

July 30, 2012
University of Texas research shows sub-metering may be the answer

NWP Services Corp. (NWP), in collaboration with the McCombs School of Business at The University of Texas at Austin, released the results of an MBA-student study exploring a wide range of water management, cost and conservation issues, including key takeaways for municipalities and governments who hope to keep ahead of the rising cost of water subsidies for low-income housing and voucher recipients. 

The study was conducted by Texas MBA graduate student Rob Schimmel and sponsored by the Energy Management & Innovation Center at McCombs. NWP, a provider of utility management, resident and property operation services, was the industry partner and sponsor for the research.

The goal of the study was to substantiate the true economic cost of water and how these costs compare to funds appropriated to low-income housing tenants. It is hoped that the research results will further public discussion on water's relationship to energy and available methods to promote responsible water usage and allocation. 

The study focused on water use and costs in Travis County, Texas, projecting how these will change as Texas faces future water shortages. A 2010 review of water supply reports by 24/7 Wall Street, a news organization, identified 10 red-flag cities at risk for severe water shortages in the near future. That list includes three cities in Texas—Fort Worth, Houston and San Antonio—along with seven other metropolitan areas that are home to the 10 million plus residents living in and around Atlanta, Las Vegas, Los Angeles, Orlando, Fla., Phoenix, San Francisco and Tucson, Ariz. 

As a result of his research, Schimmel created a model that can be extrapolated for other regions facing future shortages. "Water data available today is sparse, error-prone and inconsistent. Given the fact that no clear federal role exists for the measurement of water quantity, our best option is to inform our macro views with disparate data collected by local water agencies. As a consequence, most of the public debate centers on finding the right incentives to promote conservation," said Schimmel. "Water sub-metering in the multi-housing sector has proven to be a key driver of the kind of behavioral change needed for conservation, but sub-metering is practically nonexistent in the low-income housing sector."

After identifying the true cost of water delivery and wastewater disposal in Austin, Texas, Schimmel's study goes on to explain the cost components of water usage, the economic impact of projected population growth and subsequent water demand in Travis County. Further, the study explores how Section 8 utility allocations of water costs compare with study model findings.

"This study suggests there will be a significant funding deficit in Section 8 water allowances based on projected usage and costs," said Sheridan Titman, director of the Energy Management & Innovation Center at the McCombs School of Business. "That means we can either get serious now about finding more efficient ways to conserve water or we will be looking for ways to foot the bill later in the form of higher taxes or a reduced level of service to our low-income populations."

As the industry partner for the survey, NWP has a vested interest in spurring public discussion on the use of submetering for water conservation. To move that discussion towards additional proof of return on investment, NWP is actively looking for low-income housing partners to serve as case studies for effective conservation in exchange for preferential pricing on sub-metering installation.

Source: NWP Services Corp.

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