CU eyes new family-assistance program
by RICK NORTON, Associate Editor
Oct 22, 2012 | 1600 views | 0 0 comments | 5 5 recommendations | email to a friend | print
Faced with a gradual donor disinterest in its longtime Project HELP customer-support program, Cleveland Utilities is pondering a second initiative aimed at assisting area residents who are struggling to pay their utility bills.

Currently it’s just a concept, one that — if implemented — could be patterned after similar initiatives already in use by other utility companies.

According to Ken Webb, CU senior vice president and CFO, in some cases public utilities that provide this type of programming often weave its identity around the name of Project Roundup. One is the Jackson Energy Authority in West Tennessee that calls its campaign the Round Up Program.

Regardless of the name, Webb said such programming allows for a customer’s bill to be “rounded up” to the next dollar amount. The difference is then placed into a fund used to help families in need or other approved community service projects.

For example, if a customer’s bill is $25.55, Cleveland Utilities would “round up” the amount to $26. The added 45 cents would then be donated to an emergency fund. Another example would be for a bill that is $25.01. The full 99-cent difference would be donated.

The program would be strictly voluntary and CU customers would be given the opportunity to “opt out” of the initiative at any time, Webb explained.

The utility’s CFO, backed by CU President and CEO Tom Wheeler, told members of the Cleveland Board of Public Utilities in a recent session that the local utility is seeing more and more need by families who are unable to pay their monthly utility bills. He gave some sobering numbers.

From Jan. 1 through Sept. 17, some 6,289 Cleveland Utilities accounts came up for “disconnect,” meaning they were behind in their payments and were in danger of having their utility service disconnected. Of this alarming number, 3,003 were actually physically disconnected during the period, Webb said. The others avoided disconnection because of CU’s practice of working closely with customers to arrange partial or delayed payments that would allow the lights to stay on.

Webb reminded board members the U.S. and global economies remain sluggish and that many communities continue to reel from the effect. Although the Cleveland and Bradley County community has not been impacted as severely, and the local recovery continues to pick up steam, the fact remains that many area families are struggling. The reasons are varied — lost jobs, unexpected bills, medical catastrophes and others, the CU accountant explained.

Although Project HELP is still up and running, its participation level has dramatically dropped. Whereas more than 1,000 CU customers once donated to the assistance program each month, the number has plummeted to 504. Total monthly donations to Project HELP are now down to about $800. This small amount won’t pay many monthly bills, Webb reasoned.

However, a new initiative like Project Roundup (in some cases, it is spelled “Project roundUP” or other ways) has the potential for raising about $100,000 per year with only 50 percent participation, Webb cited. In most cases, because customers’ bills are “rounded up” only 12 times each year, their total commitment to the program would probably be about $6 per year or close to that amount. Again, it depends on the amount of “round up.” Rounding up $33.15 to $34 is going to accrue a larger donation than, say, a roundup of $33.63 to $34.

Wheeler pointed to a similar program operated by the Volunteer Energy Cooperative that enjoys a customer participation rate of 75 to 77 percent.

Webb stressed that some utility programs of this nature make the donations available to any number, or types, of community social programs. However, CU believes the best use for these types of customer donations is the payment of overdue utility bills, Webb cited.

“... We feel the better need is those [families] who are having trouble paying their utility bills,” the CFO stressed.

“So compassion is a driver ... but business is also a driver,” board chairman Aubrey Ector commented. Webb confirmed the chairman’s assessment by pointing out such a “round up” program would benefit area families in need as well as the utility company.

One caveat, Webb explained, is that Cleveland Utilities does not want to administer the program. Like Project HELP, the utility company would collect the monthly donations through its own operations and funnel the funds to another entity for dissemination to qualifying families. Project HELP donations, and family interviews, are coordinated through the “Neighbors in Need” division of The Caring Place.

The proposed new program is expected to be discussed in detail later this week when the CU board reconvenes. Matt Ryerson, United Way president and CEO, was to be invited to the session.

The board is scheduled to meet Thursday at 3 p.m. in the CU training center.