Water Watch NYC

Everything you need to know about water in NYC.


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Victory for Taxpayers of New York

Just short of a week ago, Supreme Justice Carol Edmead voided the Water Board and City Hall’s authority to impose a water rate hike for this year as well as terminated the program to reimburse small homeowners on their water bill credit.

Citing unfair and preferential distribution of funds, the city of New York and the Water Board were stopped in their tracks by the people of New York.

Thanks should be given to Joseph Strasburg of the Rent Stabilization Association who fought against City Hall and the Water Board for this win for the people of New York.

Further applause should be given to Justice Edmead who is protecting the taxpayers of New York and our fragile water system from the greedy hands of politicians.


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Ten Ways to Save the DEP – #2: Introduce Stormwater Fees

Almost any effective CSO mitigation plan that the city can possibly come up with will involve the creation of large multi-billion dollar retaining tanks and force our water/sewer rates to skyrocket. So here comes our out of the box thinking: How can we mitigate the negative effects of CSO without spending billions of dollars restructuring our sewer system?

The Citizens Action Committee (CAC), made up of industry experts, recommended that the city use water and sewer rates to incentivize owners to retain water on site. Currently, New York property owners do not pay to dump stormwater but by levying such charges the city can effectively incentivize owners to retain water on site and eliminate CSO occurrences, as the CAC recommended. More importantly, the administrative costs to the city would be minuscule compared to the billions that would be spent building huge tanks. As a bonus, on site retention can also have other environmental benefits (for example, green roofs mitigate the effects of urban heat island).

In recognition of the above, the mayor’s PLANYC Sustainable Stormwater Management Plan 2008, Initiative 10 states:

The City’s current water rate structure is comprised of a charge for consumption of water and an additional 159 percent for all sewer, stormwater, and wastewater services. Because this rate structure fails to reflect the true costs of stormwater generation and can lead to distortions, the City is currently undertaking a yearlong study to consider improvements. The City is analyzing its current expenditures, reviewing the rate and credit programs of other municipal water systems, and estimating the impacts of alternative stormwater rate structures on ratepayers and revenues. This effort will be coordinated with other ongoing efforts to map impervious areas in the City and to overhaul the program for water bills.

The “yearlong study to consider improvements” that the plan refers to is Booz Allen Hamilton’s (BAH) rate study, the results of which were released last week. (You may remember BAH from many of the other studies they performed for the DEP in the past. They are, after all, the DEP’s favorite go-to accounting firm when using the Water Board to bypass the contract bidding process.) The first thing worth mentioning is that this “yearlong study” took more than a year. Shocker.

But that’s not as important as the results. So let’s look at the results. The DEP paid BAH over a million dollars to “[analyze] its current expenditures, [review] the rate and credit programs of other municipal water systems, and [estimate] the impacts of alternative stormwater rate structures on ratepayers and revenues.” I would have thought that BAH would calculate the administrative costs involved and the feasibility of enacting a stormwater fee. Then they would project the savings as a result of on site stormwater retention and avoidance of the creation of stormwater retention facilities. I expected graphs indicating the relationship between the different possible stormwater rates and expected consumer response. (If we charge 5% of the water rate we need $2 million to implement the program but it’ll take us 20 years to recover that two million. If we charge 30% of the water rate  we need $2 million to implement the program and we’ll recover the costs in less than a year. Something like that.) In short, how large (or small) a fee would you have to implement to start seeing a savings.

What BAH did instead was what every college student does when the deadline is up and they haven’t done any of their work. They reiterated the question. Don’t get me wrong–they did it well. They included five pages of meaningless charts (fancy, but meaningless) showing which cities use which rate structures. But they didn’t address the crux of the problem. There is nothing in the report about the effectiveness of such a program, what it would cost the DEP to implement it and how much can be saved by stormwater avoidance.

The only thing BAH actually put forth in their conclusions (slide 30 of this presentation) is the following: “New billing system must be in place in order to fully implement a City-wide stormwater rate structure and credit program.” It’s subtle. Did you catch it? It sounds to me like BAH’s pitch to sell the DEP a new rate program, one that would no doubt take another few years and another few million dollars.

In summary, we hope that the good people at the DEP and the Water Board go ahead with stormwater rates and are not put off by the BAH report. To quote the mayor’s office in Appendix K to the Sustainable Stormwater Management Plan, Environmental Entrepreneurs, a national community of over 850 prominent business leaders who believe in protecting the environment while building economic prosperity, had the following to say about stormwater rates:

We strongly urge the City to include in the Plan a firm commitment to restructure the water rates to implement a separate stormwater fee, varying based on the imperviousness of a site, as soon as possible. We understand that a rate restructuring study is now underway and urge that the consultants conducting that study be asked not whether a separate stormwater fee is practicable – because we know it is, based on the experience of many jurisdictions around the country – but rather how to implement such a fee structure in New York City as soon as possible.

Again, special thanks to the good folks at SWIM for fighting for this one. We’ve even heard DEP Deputy Commissioner of Environmental Planning and Analysis Angela Licata advocating for stormwater fees at a few Water Board hearings.


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A Prediction

Now that New York City’s mayoral election is officially over (though, unofficially, it was over before it started), it is safe to discuss what we at WaterWatchNYC expect of the DEP and the Water Board in the near future.

We have already heard about how water consumption continues to drop drastically in NYC. If I remember correctly, at the last Water Board hearing it was announced the consumption is down another 6-7% so far this year. We’ve also heard a little bit about Booz Allen Hamilton’s preliminary findings in their water/sewer rate study and we know that they were the ones that suggested last year’s disastrous Theft of Service and Denial of Access penalties.

With this in mind, here is what we predict is going to go down at the next Water Board hearing: Because New Yorkers are using less water, the DEP has less money to work with.  Therefore, we can expect to see another double digit rate increase. However, because Booz Allen has made it their job to come up with ways of increasing the DEP’s revenue at the expense of us New Yorkers it is likely that the rate increase will be limited to a figure around 12%. While this sounds like good news, and while the DEP and Water Board will certainly present this as good news, the reality is that the only reason the rate increase will be able to stay that low is because we expect the DEP to implement (at the recommendation of Booz Allen, of course) new fees in addition to the rate increase. Look out for new connection fees and fixed service fees as well as serious increases in all existing fees.


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Water/Sewer Rates Going Up Today

As it does on every July 1, the DEP’s water and sewer rate goes up today. The new rate is $6.76 per hundred cubic feet (hcf) of water, or $2.61 per hcf as a water charge and $4.15 per hcf as a sewer charge (159% of the water charge). One hcf is approximately equal to 748 gallons.

One of the most popular links on this blog during the last 12 months was a graph of the DEP’s Water/Sewer rate from 1980 to 2009. An updated version of the graph, from 1980 to 2010, can be found here.


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DEP Lays Out Specifics on Amnesty Program

We’ve been tracking the DEP’s new Denial of Access and Theft of Services regulations for a long time. The last thing the DEP told the public about these new regulations was that there’d be a 120-day amnesty period beginning July 1 during which time customers found to be stealing water and/or denying access will not pay the full amount demanded by the new regulations.

The DEP recently released the specific numbers that they intend to use during the amnesty program, and I must say, they are quite reasonable. The new regulations authorize the DEP to charge customers found to be stealing water and/or denying access for water consumption at the 90th percentile. The attributed consumption and charges are detailed in this post. (Be aware though, that since Fiscal Year 2010’s water rate increase was only 12.9% and not the originally announced 14%, the actual costs for this attributed consumption is slightly lower than is listed.)

During the amnesty period, customers are only going to be charged at the 50th percentile, which is the following for commercial properties:

Meter Size –       Annual Attributed Consumption Rate (Gallons per Year)

5/8″ and less                                                                                50,000
3/4″ or more and less than 1.5″                                                   80,000
1.5″ or more and less than 3″                                                    280,000
3″ or more and less than 4″                                                       550,000
4″ or more and less than 6″                                                    1,300,000
6″ or more and less than 8″                                                    2,300,000
8″ or more and less than 10″                                                  4,600,000
10″ or greater                                                                       38,000,000

and the following for residential units:

First Dwelling Unit                                                                         70,000
Each Additional Unit                                                                      60,000

In dollars, this comes to:

Meter Size –                                                          Annual Attributed Cost

5/8″ and less                                                                            $       452
3/4″ or more and less than 1.5″                                                        723
1.5″ or more and less than 3″                                                        2,530
3″ or more and less than 4″                                                           4,971
4″ or more and less than 6″                                                         11,748
6″ or more and less than 8″                                                         20,786
8″ or more and less than 10″                                                       41,572
10″ or greater                                                                            343,417

and:

First Dwelling Unit                                                                            $633
Each Additional Unit                                                                           542

I expressed my frustration when I thought it was too high; it would be unfair of me not to express satisfaction at these extremely reasonable figures.


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Big Surprises at the Rate Approval Hearing

The Water Board held its annual meeting this morning (May 15, 2009) to approve the changes to the Water/Sewer Rate Schedule for Fiscal Year 2010. As you know, WaterWatchNYC protested three major elements of the new rate structure pertaining to the DEP’s proposed “Denial of Access” and “Theft of Services” regulations. Thanks to you, the concerned, active New Yorkers who read this blog, there were many surprising changes to rate schedule announced this morning.

Firstly, as we requested, the Denial of Access notices now have to be sent out via certified mail as opposed to regular mail.

Also, there will be an appeals process put in place for New Yorkers to defend themselves from the DEP’s Theft of Services claim. We have not been informed of the details of this process but it’s certainly a step in the right direction.

Finally, there will be a 120-day grace period for those found to be stealing water, during which time these people will only pay half of the previously announced maximum water/sewer rate. This 120-day grace period is from the beginning of July to the end of October, not the first 120 days after each customer is found to be stealing water.

We want to commend everyone that spoke out against the unfair regulations and helped create these new caveats, especially Councilman Jim Gennaro and the other council members who joined his charge, the property owners and managers that spoke out at the City Council hearing and Water Board hearings and anyone else who voiced their concern and made a difference.

One final thing about this morning’s meeting to take note of is that the proposed 14% rate hike is actually only going to be a 12.9% rate hike. That means that starting in July, out water/sewer rate is $6.76 per hcf and not $6.82 per hcf. Sure, it may have been a tactic to publicly announce 14% when they only needed 12.9% just so they could gain public favor when they announced the lower rate. But either way, what matters is that the rate isn’t as high as initially expected and Commissioner Lawitts and Chairman Moss deserve recognition for that.

Could this be the beginning of a kinder, gentler DEP/Water Board? I guesss we’ll just have to wait and see.


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Does Conservation Equal Higher Water Bills?

I would just like to quickly clarify something about the relationship between conservation, water rates and water bills.

Conservation necessitates higher water rates. There is no way around it: If we consume less of a product (in this case, water) then the product’s variable costs go down. But its fixed costs remain the same which equals a higher cost per unit.

But there is another thing to take into account. If we are conserving water, if we are truly using less of it, then even at a higher cost per unit, our total cost should go down.

Now let’s evaluate the opinion of Coucilman Vacca in the previous post, an opinion shared by many who spoke at last week’s City Council hearing. How can New Yorkers who are conserving water be seeing their water bills go up even as they are dying of dehydration?

The answer is that approximately one-third of the percentage points of the rate hike (4-5%) is going to fund things that are only remotely related to the cost of water, like the unfair rental agreement!

So to conclude: The DEP must stop blaming their rate hikes on conservation. Sure, conservation contributes but if you’re conserving water and your bill is too high, conservation is not to blame. Economics has proven that. The fault lies with the DEP and their enormous budget that continues to spiral out of control.