Monday, May 10, 2010

Homeowners Waterboarded

In last Friday's NY Post Comptroller John Liu blasted the proposed water rate hikes-and demystified how the extra money garnered is put to questionable use: "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."

So, all of the BS over falling consumption rates as a rationale for the increase is being used to cover up the fact that the rate hike money is essentially being laundered: "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."

Liu calls for a pay as you go system that will utilize water revenue for, hold on to your hats-the water system itself: "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."

All of this dramatizes, not only the ineptitude of the DEP (which can't even figure out how to accurately gauge your water bill, or collect it once it has); but the insidious nature of the Bloomberg governance methodology-fines, fees and hidden taxes to fund the bloated public sector he has shamelessly fed for eight years. It is why we can't stomach the mayor's faux outrage at Albany's irresponsibility.

Liu bells the Bloomberg feline: "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." Of course, they would know if the editorialists who have made Pedro Espada Public Enemy #1 would have the same zealous approach to exposing the mayor's role in creating the current NYC fiscal mess.

And for its part, the hapless DEP needs to be exposed as well. It has determinedly blocked the use of commercial food waste disposers, claiming that their use would overburden the city's sewer system. But an enlightened agency would have been in the forefront of a reform effort that would redirect water rate dollars to the upgrading of the waste disposal infrastructure. With this mission accomplished, the city's food establisments, and the public cafeterias at the hospitals and schools, could be using disposers to dramatically reduce waste and clean the neighborhood environments of the detritus that attracts rats and roaches.

Instead, we get the stealth water tax sleight of hand. We'll give Liu the final word on the need to end this misdirection: "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.