Water Rates Set to Rise 3.35 Percent — Unless Boards and Owners Speak Up
May 9, 2014 — An annual rite of spring in New York City has been the often-contentious debate over the setting of the rate homeowners, including co-op and condo buildings, will pay for the city's water and sewer system in the coming fiscal year. Rising costs have led the Water Board to increase the water and sewer rate every year since 1995, sometimes in excess of 10 percent. Over the past decade, the rate has increased by 135 percent — with the current rate of $9.27 per 100 cubic feet of water working out to 1.2 cents per gallon used.
Mayor Bill de Blasio's Administration recently made its first water-rate proposal, calling for an increase of 3.35 percent. This rise to $9.58 per 100 cubic feet averages out to an annual cost of $666 per co-op or condo unit, up from $644. Beginning next week, the Water Board will hold a series of public hearings on this year's rate proposal. What points should co-op and condominium board members attending these hearings bring up?
In addition to lowering system costs, the need to raise rates could also be reduced by collecting missed revenue due to delinquency or under-billing. In recent years, the City's Department of Environmental Protection (DEP) — the mayoral agency responsible for the maintenance and operation of the system — has taken measures to increase billing accuracy through expanding automatic meter readings and limiting the number of properties that receive flat-rate billing. DEP has also addressed nonpayment by gaining the authority to sell liens on certain delinquent properties — although single-family homes are exempt from this process.
Larger savings also could be realized through changes to the financing structure of the system, more specifically by having some of the system's fixed costs paid directly by the city rather than by water and sewer revenues.
DEP and the Water Board have also considered changes to the flat-rate structure. A 2009 rate study commissioned by the City suggested the possibility of adding fixed charges to cover some of the system's fixed costs; separate stormwater charges; and conservation rates, where a customer's rate would increase after a certain amount of water usage.
While DEP and the Water Board have conducted a small pilot program to charge stormwater fees on certain properties, they have not recommended altering the current flat rate structure.
One public hearing is being held in each borough from May 14 to May 20. You can see the schedule below. For more information go to the Water Board Public Notices page.
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