Residents in the Merrick, Lynbrook and Sea Cliff water districts found a letter from New York American Water in their mailboxes during the final week of October, and it was not a water bill. It was a rate increase notice, signed off on by the New York Public Service Commission.
NYAW said in the letter that it needed additional revenue to cover production costs and property taxes that it pays. According to the letter, Lynbrook residents will see the biggest increase — a 6.47 percent hike — while those in the Merrick district will be hit by a 5.57 percent increase, and the Sea Cliff district will see a 4.78 percent spike. The increases took effect on Nov. 1.
In dollars, residents in the Merrick district using 8,000 gallons a month would see their bills increase by a couple of dollars, but households using 15,000 gallons a month would see their bills increase by almost $5. (See sidebar)
“New York American Water is employing every effort to manage the cost of water by reducing expenses, finding efficiencies and working with our customers in finding ways to reduce their bills through water conservation,” said Lee Mueller, NYAW’s manager of external affairs, in a statement. “Water providers throughout the region continue to face increasing costs and regulatory challenges in providing water that meets or surpasses all federal, state and local standards. It is our obligation to meet these challenges head-on and do so effectively, efficiently and responsibly on behalf of the 125,000 households we serve.”
“When our customers conserve,” Mueller continued, “not only do they reduce their water bill, but New York American Water is able to defer infrastructure investment projects that are needed to meet peak water demand, which can reach as high as 50 million gallons of water a day in the summer. Conservation is important for helping our customers control their water bill, and it supports the long-term sustainability of Long Island’s sole-source aquifer, which is under significant stress.”
Merrick activist Claudia Borecky, of Long Island Clean Air Water & Soil, said she believes that since the company’s conservation rates may have discouraged people from using more water, NYAW “didn’t have enough revenue to pay property taxes or give to their shareholders.” The RAC/PTR surcharge, she said, “give us a surcharge to cover [the loss of] revenue.”
Mueller said the RAC/PTR surcharge reconciles Rate Year 2 (April 1, 2018 through March 31, 2019), which occurred prior to the start of the conservation program this past summer.
“The RAC is designed to prevent customers from overpaying while also protecting the utility from underearning what is needed to continue to invest in its systems,” Mueller said. “When our customers conserve, not only do they reduce their water bill, but New York American Water is able to defer infrastructure investment projects that are needed to meet peak water demand, which can reach as high as 50 million gallons of water a day in the summer.”
State Sen. John Brooks, a Democrat from Seaford, recently sent a letter to the PSC requesting NYAW’s tax payments from the past three years to confirm that its rates are “driven by property taxes,” he said, and information about the company’s profit margin and what it’s based on. Additionally, he plans to file legislation in January “for a benefit analysis” that would assess if the Suffolk County Water Authority could take over Nassau’s three NYAW districts.
“I’ve kind of run out of patience with them,” Brooks said. “I believe their rates are way out of line . . . and their service isn’t anything close to outstanding.”
Alyssa Seidman contributed to this story.