The New York Times is reporting that Mayor Bloomberg and City Council Speaker Christine Quinn have reached an agreement that could halt the proposed 18% water rate increase.

The exact details of the agreement are not totally clear, but what is clear is that the agreement will put a bill before City Council that would allow the DEP to sell stand-alone water bill liens on properties that don’t pay their water bills. What isn’t clear is whether or not City Council would demand anything in return from the DEP.

More details on what is known about the agreement can be found at this New York Times article and at this article from NY1.

The DEP has been requesting the right to sell stand-alone liens for some time now and City Council has been denying them that right due to their inefficient operation and lack of oversight in the past. Hopefully, this bill requires the DEP to enact some sort of process that satisfies City Council’s requests.

The Water Board will continue to go through with their plans to raise rates, at least until the new bill before City Council passes.

The problem we face now comes with the realization that the proposed rate increase may not have even been necessary in the first place. At City Council hearings and Water Board meetings, when anyone from the DEP or Water Board was asked to justify the proposal for a rate increase of 18%, the response was always something along the line of, “Well, we’re not sure…. Maybe we need 11%, maybe 28%…. It’s not totally clear at this point, so we’re settling on 18%.”

We have always been under the impression that city agencies are meant to operate as efficiently as possible. They calculate how much money they need and then work out a way to obtain that particular amount. In this case it is becoming more and more clear that the DEP never calculated the 18% rate increase to make up for lost revenue. They may never have needed a rate increase at all. Eighteen percent was just a number that they pulled out of the air that they thought would be enough to pressure City Council into granting them stand-alone water bill liens sales.

This calls into question all rate increases requested by city agencies. For example, does the MTA really need to raise the subway rate, or is talk of a rate increase just a threat so that the MTA can get what it wants from us, the taxpayers?