In two months, New Yorkers will once again see their water and sewer rates rise by double digits. By July 1, the New York City Water Board will have soaked New Yorkers with water-rate increases of nearly 63 percent over four years.
Many reasons for the rising costs of water are outside the city’s control. One thing the city could control, however, is a flawed rental-payment formula that transfers some of the revenues from your water rates to the city’s general fund.
The formula for the rental payment, originally established to pay off old bonds that once funded the water system, currently generates revenues far in excess of the cost of those bonds.
In fact, in the upcoming fiscal year, only 25 percent of the projected rental payment will be used to pay off old bonds, with the remaining 75 percent — or about $164 million — becoming a direct subsidy from your water rates to the general fund. This is nothing more than a back-door tax, felt acutely by homeowners and small businesses.
We all understand the city faces tough fiscal decisions, but taxing New Yorkers under the guise of increased water and sewer rates is simply wrong. What is truly a shame is that the average New Yorker doesn’t even know they are being misled.
New Yorkers deserve a clean, fresh, dependable water supply, and they could be getting it a little more cheaply if the money now siphoned off to the city budget were used to pay for water- and sewer-system expenses instead.
Those excess funds should be returned to help defray the cost of operations and fund additional “pay-go” capital. By returning the excess funds, the Water Board could both decrease rate increases now and reduce future debt-service payments, while continuing to make needed investments in infrastructure.
With the Water Board hearings beginning to take place this week, all New Yorkers who are tired of watching their water bills multiply should let the board know directly that enough is enough.
Ask: Why does the money we pay toward the water system not go where it should, and what is the plan for future years?
Demand: An end to the city’s practice of siphoning off money and, instead, direct the excess money to pay for actual water- and sewer-system expenses.
Urge: State legislation that ensures an independent water board dedicated to the best interest of New Yorkers.
John C. Liu is the city comptroller.