How many of your friends and neighbors are living below the poverty line? There may be more than you think.
The United Nations estimates that 40 million Americans are living in poverty, and 18.5 million are living in “extreme poverty,” defined as an income of $12,000 or less for a family of four. The report also found the largest “health gap” in any industrialized country and ranked America 36thin access to potable water and sanitation. Estimates range from three-in-four to three-in-five Americans who, while not necessarily in poverty, are living from paycheck to paycheck. More than 40 percent face a high likelihood of material hardship.
Many of these struggling in the day-to-day are not prepared to endure a financial shock, or an unexpected financial emergency, yet approximately 60 percent of American households endured one in a calendar year, according to the Pew Trust. Among those that did experience such a shock, the most expensive median cost was $2,000 and 55 percent of households struggled to make ends meet afterwards.
Among those unexpected emergencies are medical expenses, car repairs, loss of income or home repairs. The HomeServe State of the Home Winter 2019 found that more than half of Americans have had a home repair in the past twelve months, while one in five has nothing set aside for a “rainy day fund.” That increases to more than 50 percent among those who have a household income of $50,000 or less – in short, a vulnerable population already struggling.
CostOwl estimates the cost of replacing a water service line at between $1,500 and $5,000, depending on the extent of the work, layout of the home and region. Replacing a sewer service line would cost an average of $3,000 to $12,000. Many homeowners don’t know they are responsible for the maintenance of a service line until an issue arises – sometimes literally.
The Prosperity Now Scorecard estimates that 40 percent of American households don’t have the savings to weather a financial shock and 20 percent don’t have access to mainstream credit. This means such a household would be unable to meet that expense, a crippling blow that may force them from their home, if they don’t have access to potable water and sanitation.
As a municipal official, what can you do? Many municipalities have funds to help residents with water or sewer bills that have exceeded their ability to pay them, but doing repairs on the private side is a can of worms many municipalities are rightly cautious about. However, you can help your vulnerable residents avoid a financial shock while educating them about their service line responsibilities.
The National League of Cities Service Line Warranty Program, administered by Utility Service Partners, Inc., a HomeServe company, offers affordable home repair service plans for water lines, sewer lines and interior plumbing, and educates residents about their responsibilities. The program allows residents to make claims 24/7/365 to an award-winning contact center to receive service from a fully-vetted local contractor. To learn how you can help your residents avoid financial shock, contact us.