Suffolk County Water Authority proposes Nassau water takeover

I just think [the SCWA] stepped up to the plate and now have put us in an additional chapter to this fight.”

Agatha Nadel, Director, North Shore Concerned Citizens

The Suffolk County Water Authority has submitted a six-page filing with the state Public Service Commission indicating that SCWA officials believe it could play a role in assisting with or operating a new public water authority for New York American Water customers in Nassau County through an agreement between the SCWA and the authority.

The water authority suggested by the SCWA would include all of Nassau’s NYAW territories and would enter into an agreement with the SCWA for it to manage or operate them. The SCWA has consolidated more than 40 public and private water supply systems throughout Suffolk since it began operations in 1951, and the proposed Nassau consolidation would be done in a similar fashion.

Another option, however, would be to acquire any individual Nassau systems not claimed by other authorities. This could be especially important on the North Shore. Last year, a bill proposed by State Sen. Jim Gaughran, a Democrat from Northport, which would establish a municipal North Shore Water Authority to replace NYAW’s Sea Cliff Water District, passed the Senate. Since it did not pass the Assembly by the end of 2020, it is set to be taken up again by the Senate this year.

Assemblymen Charles Lavine, a Democrat from Glen Cove, and Michael Montesano, a Republican from Glen Head, have both said they are confident the bill would pass there as well. Gov. Andrew Cuomo would then have to sign it for it take effect.

The Sea Cliff Water District includes Sea Cliff, Glen Head and parts of Glenwood Landing, Glen Cove, Roslyn Harbor and Old Brookville.

On public water option on the North Shore would be for the Sea Cliff Water District to merge with the neighboring municipal Jericho Water District. Gaughran said this could still happen if a Nassau County Water Authority were created.

Gaughran chaired the SCWA from 2010 until he joined the Senate in 2018. In his experience, he said, individual authorities benefited when they were consolidated by the SCWA, as infrastructure improvements were easier to accomplish with a larger entity.

He said the SCWA managing or operating NYAW’s Nassau districts could ultimately turn into something even bigger. “I think it’s a very positive step,” Gaughran said. “I also think it probably could also lead to something that Long Island has to seriously consider moving forward and that is, do we need one large Long Island municipal water system? Because we all share the same aquifer.”

Legislation amending the SCWA’s statutes to permit them to provide water service outside of Suffolk would have to pass for the change to take effect, Gaughran said.

According to the SCWA’s filing, the authority could operate the Nassau system for a management fee that was equal to the prevailing rates that the SCWA charges its Suffolk customers, plus an overhead percentage. This would amount to bills of $450 to $500 per year for every customer. If the SCWA were to acquire payments in lieu of taxes, however, the average water bill could be knocked down roughly 20 percent in the first year of operation.

NYAW President Lynda DiMenna said ratepayers would benefit most from the removal of special franchise taxes on customers imposed by state officials as opposed to a shift to public water.

“As we continue to point out, state elected officials have the power to reduce customers’ bills by up to 56 percent by removing the unjust and unfair special franchise tax that the state imposes on our [Sea Cliff] customers’ bills,” DiMenna said. “The savings from eliminating the special franchise tax are real, tangible and immediate, rather than any speculative savings from a very costly and long eminent domain process. The Suffolk County Water Authority proposal will also take years and cost hundreds of millions of dollars. Eliminating the special franchise tax could provide relief immediately.”

Walden Environmental Engineering recently concluded studies examining feasibility of a switch to public water on both the North and South shores, which found municipal water would be cheaper for ratepayers in the long run. According to the studies, Sea Cliff ratepayers would save $430 to $492 a year if water were provided by a public entity. Town of Hempstead ratepayers would see savings between $70 and $383 a year.

The studies also concluded that it would cost the Town of Hempstead roughly $465 million to acquire NYAW’s infrastructure, and it would cost $19.2 million to do the same in Sea Cliff. NYAW is now finalizing a sale of its Long Island infrastructure to Liberty Utilities for $608 million, which still needs to be approved by the PSC.

Cuomo also announced on Feb. 3 that the state Department of Public Service would look into the feasibility of bringing municipal water to NYAW’s Long Island territories. The study is to be completed by April 1.

Agatha Nadel, director of public water advocacy group North Shore Concerned Citizens, said the SCWA’s proposal provides yet another avenue that could be used to bring public water to the North Shore.

“This is just significant, and make no mistake, I think this is another game changer,” she said. “The greatest thing is that it provides another path to getting affordable public water.”

Nadel said she was impressed by the SCWA’s initiative in submitting a proposal only a week after the PSC and special counsel for Cuomo’s study finished virtual public hearings about the study. With another large party submitting a proposal, studies showing that municipal water is feasible and bipartisan support on the state level, she said there are no excuses not to have public water.

“I just think [the SCWA] stepped up to the plate and now have put us in an additional chapter to this fight,” Nadel said. “I think it’s great. I just think it’s a win-win for us.”