At a meeting of the NYC Water Board held on April 11, 2008, the NYC Department of Environmental Protection (DEP) proposed a water and sewer rate hike of 14 ½% effective July 1, 2008. The rate hike is substantially higher than the 11 ½% increase DEP had projected at a Water Board meeting just one month earlier. Commissioner Emily Lloyd also indicated that the increase for the following year may be equally high.
The proposed rate increase comes just months after DEP threatened a mid-year, January rate hike of 18% unless the City Council approved legislation to permit the City to sell stand-alone water and sewer liens. At that time, DEP argued that its revenues were lower than expected and that it could not improve its 88% collection rate without the authority to shut off water delivery and to sell water liens independent of real estate tax liens.
The City Council approved independent water lien sales and approximately 12,000 of the 17,000 delinquent accounts have either paid their bills or entered into installment payment agreements under a payment incentive program that will expire on April 21, 2008. At the same time, DEP has begun to shut off water service to single family homes which have not responded to the payment incentive program.
DEP blames the larger than projected rate increases on three factors. Collections on outstanding balances have been lower than projected. DEP has experienced large increases in operating costs including higher costs for oil and electric, chemicals used in water treatment and labor cost settlements negotiated by the City. Finally, DEP has committed capital funds at a far higher rate than in prior years. Also to blame is the City’s refusal to give up “excess” rent payments from the Water board to the City.
The Water Board will now hold a series of meetings in all five boroughs prior to a final vote scheduled for May 16, 2008. RSA members are strongly encouraged to testify. Please click here to view the meeting dates and times. Call Kevin Kunkle at the Water Board at 718-595-3601 or email kkunkle@dep.nyc.gov for more information or to register to testify.
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