March 25, 2014

In Anticipation of News from the New York City Water Board


UPDATE (April 7th, 2014): While there is no additional news since the cancellation of the Water Board meeting on April 4th, we wanted to share these two links. In the first, Queens Councilman Lancman is holding a press conference on March 27th calling for a reduction in the rental payment from the New York City Water Board. The second is the March 14th City Council Environmental Protection Committee hearing on the budget  At 1 hour and 23 minutes, there is a 7 minute exchange between Councilman Lancman and DEP Deputy Commissioner Steven Lawitts about the rental payment.


​The Daily News ran this article a few days ago as the time approaches for the Water Board to consider a water and sewer rate increase for July 1, 2014. While the article focuses on the costs impact on homeowners, all New Yorkers—apartment building owners and tenants—feel the pain of rising water rates. Property owners feel it when they get the bill for water; tenants see the impact in their rent bills when the Rent Guidelines Board considers the cost of water in setting annual lease renewal amounts.

The article talks about the rental payment that the water system pays to the City of New York. That number has risen dramatically in recent years and the result is that the water system now annually pays approximately $200 million to the City of New York.

Revising the rental payment offers the quickest way for a rate increase to be avoided this year and would give the new administration time to devise a rate setting system that was more equitable to all New Yorkers.

Currently, the New York City Water Board, composed of 7 mayoral appointees, is legally required to set the water rates to cover the cost of operating the system, pay debt service, and make a rental payment to the City of New York. (The cost of operating the system is the staffing and maintenance of the entire water system. The debt service covers the loan payments on the billions of dollars borrowed to cover the capital costs of the water system;  the capital funds cover the construction projects of the water system, many of them in response to state and federal mandates. The rental payment is set at 15% of the annual debt service paid by the Water Board;  in 2012, the Bloomberg administration started a pilot program to return a portion of the payment to the water system, but in 2013, $200 million was still paid to the City general operating budget).

Stay informed! We will continue updating our blog and twitter with information as it becomes available.