ABSTRACT
Water and wastewater utilities attempt to provide service that is not only dependable, but also affordable. Unfortunately, as demonstrated by the survey results discussed in Chapter 20, the cost of providing safe and reliable water and wastewater service continues to rise faster than generally accepted inflation gauges, such as the consumer price index. In the coming years, utilities can expect to face continued upward pressure from aging infrastructure, population growth, and an ever-expanding body of regulatory requirements. These factors alone will make it difficult to maintain the financial capability to operate an effective utility, while maintaining the affordability of water and wastewater services to customers. Although the two often are inappropriately conflated, financial capability and affordability are distinct concepts of utility finance; this chapter defines each of them, discusses how they are integral to providing sustainable service, lays out methods of assessing financial capability and affordability, and offers illustrations of utilities’ measures to address affordability.
