N.J. American Water head: Rate request comes with increased access to affordability programs, supplier diversity initiative

Cheryl Norton, the president of New Jersey American Water, acknowledges that it’s a difficult time to be asking for a rate increase. That’s why, when she testified Thursday afternoon before the Assembly Special Committee on Infrastructure and Natural Resources, she talked about how the company’s START program comes with affordability plans that will help the utility’s neediest customers.

START, Solutions Today and Reinvesting Tomorrow, is a proposal the Camden-based company says will accelerate capital investment in water and wastewater infrastructure, while creating thousands of jobs.

It also includes an expansion of the company’s H2O, or Help to Others, Program, which is administered by New Jersey Shares. Customers who qualify may receive a grant of up to $500 to help pay their water bill.

File photo
Cheryl Norton of New Jersey American Water.

Norton said the company wants to make changes, including increasing eligibility for customers impacted by COVID-19, temporarily waiving the restriction of receiving a grant only every three years and waiving the requirement of no broken payment arrangements within the past year.

“As we thought through it, we realized this is a big package of things that have to tie together,” Norton said. “You can’t do the investment without taking care of the affordability issue. And we feel like we’ve done quite a lot to address that affordability issue.”

Norton noted the utility not only has stopped turning water service off for nonpayment, but it has turned water back on for those who hadn’t paid — and stopped charging late fees for those struggling to pay.

“Now, we’re figuring out what the payment plans look like,” she said. “Can we extend the amount of time on payment plans or expand the H20 program to help customers pay their bills?

“The measures we’re implementing are aimed at increasing participation in the program by making it easier to apply and qualify.”

The key to the START proposal, Norton said, is what the company is calling WWIIP — or the Water and Wastewater Infrastructure Investment Program.

Norton said projects under WWIIP must be on non-revenue-producing assets and must fall into certain categories, such as existing DSIC-eligible projects; replacement of plant items; water main cleaning and lining; distribution, production and other infrastructure for the purpose of safety; water quality; resiliency; and environmental compliance. (See full story here.)

The cost to the customer would be approximately $1.50 per month for the first year, which is as far out as can be estimated. That cost needs to be approved.

“Ideally, what we would like is a speedy regulatory approval of this WWIIP program, so we can start making these investments very quickly,” Norton said. “We’ve already got projects queued up because there are so many projects that need to be done.

“And we are in the process of getting approval for the additional capital to be able to move more projects forward later this year and into next year, going forward. But if we don’t have a recovery mechanism, it’s going to be really hard to get that capital approved.”

New Jersey American Water estimates WWIIP could generate between $100 million and $150 million in capital investments and create 1,500-2,000 jobs.

Many of those jobs could go to small businesses. Norton said the utility is pledging to make a greater investment in minority-owned and operated companies by expanding its supplier diversity programs.

“We strive to work with suppliers that look like the customers and communities we serve, and we are fully aware of the diverse backgrounds of our customer base,” she said. “That’s why we are committed to strengthening the economy and improving our communities.

“Supplier diversity plays a critical role in how we do that. We realize that small, minority-owned, women-owned and other diverse businesses play a vital role in the economic well-being of our communities. Diverse suppliers are the fastest growing business segment in the country, offering innovation, customer-focused solutions.”

The company already is getting to work on the initiative, Norton said.

Earlier this week, New Jersey American Water officials did a speed dating-type virtual supplier diversity meeting with business owners from New Jersey and Pennsylvania.

“We met with the small businesses and minority-owned businesses and the women-owned businesses and said, ‘What do you bring to the table and how can we help you be more successful?’”

Norton said the utility also is looking to develop an apprenticeship program to help find the next generation of workers — a program she said would help the customers it serves as well as the utility itself.

Norton said New Jersey American Water is working with the Department of Labor & Workforce Development and the New Jersey Council of County Vocational-Technical Schools to develop the initiative.

“In the next five years, we could lose 30% to 50% of our workforce to retirement — that’s what we’re anticipating,” she said. “That’s a lot of people going out of the business all at one time. Making sure that we have people that have the skill sets that they need to step in and fill those roles is vital.

“People, especially young people, do not know about the well-paying jobs that are attainable in the water industry.”

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