The New York State Public Service Commission began seeking plans and comments from municipalities and water districts on June 22 on how a public takeover of New York American Water might happen.
The announcement came amid a planned sale of NYAW’s assets to Liberty Utilities. The proposed sale was announced last November, and has been opposed by public water advocates ever since, including a number of Sea Cliff residents who have complained for years about the area’s water rates.
Lee Mueller, NYAW’s external affairs manager, said the sale to Liberty would be more efficient than a public takeover of NYAW’s service areas, which include the Sea Cliff Water District — comprising Sea Cliff, Glen Head, Glenwood Landing, and parts of Roslyn Harbor and Old Brookville — as well as the Lynbrook and Merrick districts.
“A full or a piecemeal sale of our systems to public entities would take several years, cost taxpayers millions of dollars and lead to gaps in service,” Mueller said. “The fastest way to achieve more affordable water service for New York American Water customers is to remove the significant taxes that are inequitably imposed on our customers’ water bills — not saddling customers with additional taxes to pay for a public takeover.”
Several members of public water advocacy group North Shore Concerned Citizens said they are excited by the chance to offer comment on a public takeover to the PSC.
Joe Lopes, of Sea Cliff, has acted as NSCC’s PSC expert since 2016. He built a career as a utility industry consultant and has dealt with the PSC many times. He said parties such as NSCC, the Village of Sea Cliff and the Glen Head-Glenwood Civic Association that are registered with the PSC can submit testimony and rebuttal, much like a court case.
Lopes said the PSC would use data from utilities to determine whether public acquisition of NYAW’s districts would be in ratepayers’ best interest.
The sale to Liberty requires PSC approval, he said, and agency officials do not appear eager to approve the sale because, he said, it would substitute one private company for another at a cost of $608 million.
The sale price, he said, is “high,” and if it were approved, that would “put pressure on the utility to take on very high rates because they’re going to have to cover their investment from our ratepayers for their shareholders.”
Lopes said the two main options for public water in Sea Cliff are the creation of a state-approved public water authority or a merger with a neighboring water district such as the one in Jericho.
In April, the Village of Sea Cliff hired Walden Environmental Engineering to conduct a feasibility study to determine if the switch from private to public water would be economically feasible, as well as which of the two public water options would be more desirable. Lopes said the study has been delayed because of the pandemic, but he said it should be completed soon.
Bruce Kennedy, NSCC president and Sea Cliff Village administrator, said he was pleased to see the PSC paying attention to local ratepayers. He said NSCC has been involved in the process, submitting weekly documents and requests to the PSC.
Sea Cliff residents pay more for water than anywhere on Long Island. Kennedy said high prices and poor customer service are two of the biggest reasons that NSCC is working to bring public water to the area.
“It’s very rewarding to see that our work with North Shore Concerned Citizens over the past two years is finally starting to prove fruitful,” Kennedy said.
NSCC Director Agatha Nadel said the PSC has a history of ruling for private companies, but she is happy to see the PSC examining whether a public takeover would be in the public’s best interest.
Nadel said she has sent lists to the PSC explaining why she favors a public takeover, asking the agency to look at what water would cost after a public takeover compared to its cost now under a private company. With each sale of water assets that goes through at an inflated price, she said, it becomes more costly for the public to buy out a private company. She also said elected officials have a great deal of power in helping the public takeover happen.
“Every elected official and the water districts that could bring affordable public water to us must find a way to help us get this done,” Nadel said. “We should not have to beg for affordable water. How can anyone look themselves in the mirror and think this imprisonment of private water is OK?”