Changing water and sewer finance: Distributional impacts and effects on the viability of affordable housing

Usage-based charges finance an increasing share of water and sewer costs in the U.S. The shift has beeen especially sharp in New York, where residential users traditionally did not pay usage-based charges. In this article, we examine the impact that a transition to universal metered billing would have on multifamily housing. We find that universal metering would result in large increases in water and sewer bills for many multifamily buildings in fow-income neighborhoods. Comparing the predicted increases with the net operating income of landlords in low income neighborhoods indicates that universal metering might pose a threat to the viability of much affordable housing.