Nassau mayors unite against water tax hike

The mayors of Valley Stream, Lynbrook and Cedarhurst have joined to fight Long Island American Water's proposed 20-percent rate hike, which would be imposed all at once rather than spread over several years.

American Water is asking the New York State Public Service Commission to approve the $9.6-million rate increase. A typical residential customer using 72,000 gallons per year would pay an extra 20 cents per day, company officials said, the equivalent of $73 per year.

"A 19.59-percent increase is outrageous in this time," Lynbrook Mayor William J. Hendrick said. "I don't see how they can ask for such an increase when times are tough."

American Water, based in Lynbrook, is the largest water supplier in Nassau County, providing service to more than 200,000 people in 31 communities in southern Hempstead Town.

The three villages have formed the "Municipal Consortium in Support of Reasonable Water Rates" to gather information about the proposed increase. They want other villages affected by the rate increase to join, the mayors said.

"We are trying to get everybody on board," Cedarhurst Mayor Andrew J. Parise said. "We can't do it alone."

If the rate increase is approved, Lynbrook would pay American Water $300,000 a year for hydrant rentals compared with the current $250,000, Hendrick said. Valley Stream would pay $22,000 in hydrant rentals in addition to the current $78,000 charge. Cedarhurst would pay $27,000 on top of the $88,000 it already pays, officials said.

"We were eligible in 2010 to file for an increase and we elected not to," American Water president William Varley said. "We spent $54 million in capital improvements since 2007 and we need to recover it to maintain the integrity of the system."

Representatives from the three villages met with Varley on Sept. 23 and asked him for a "fair and equitable" rate increase spread over several years instead of one.

"They put a ton of investment into getting us clean water, so I am not going to throw them under the bus," Valley Stream Mayor Ed Fare said. "But 20 percent is excessive."

About 35 percent of the requested rate hike would be used to pay American Water's anticipated property tax increases -- costs that are passed on to consumers, Varley said. Almost 27 percent of customer bills represents the company's property tax payments, he said.

Historically, the company has phased in rate increases over three-year periods, Varley said. If the current rate increase request is approved, it would become effective at once on April 1.

Rate review proceedings can take as much as a year, but before making a decision, the public service commission will schedule a public hearing later this year, spokeswoman Anne Dalton said.