State holds forums on proposed NY American Water public takeover

New York State next week will hold three public forums on the prospect of a public takeover of New York American Water, even as the company seeks to sell itself to a private company.

The virtual forums will help inform a larger state review of a public takeover of the embattled water company, which has endured years of withering criticism and probes of high rates, water quality and rate-case irregularities. The state’s review, by the Department of Public Service and its special counsel for ratepayer protection, Rory Lancman, is expected to be completed by April 1.

Merrick-based New York American Water argues a public takeover would only increase debt costs for customers.

Gov. Andrew M. Cuomo said New York American Water customers have been "unfairly faced with the continued threat of ever-increasing rates for water" for too long. Approximately 125,000 customers in Nassau face the prospect of catchup rates set to take effect May 1.

Lynda DiMenna, president of New York American Water, has argued the best way to lower water costs for customers, from East Rockaway to Sea Cliff, is to nix a special state tax that weighs heavily on customer bills and to allow the $607 million sale to Liberty Utilities of Canada to go through.

"We do not believe this is a financially prudent option for our customers in the midst of a global pandemic and unemployment crisis," DiMenna said.

But at least three separate feasibility studies have already concluded a public takeover of part or all of the system is feasible, including reviews by the Town of Hempstead, the Massapequa Water District, and the Village of Sea Cliff. Hempstead Town, however, has said such a takeover would devastate town finances and saddle it with too much debt. Hempstead Supervisor Don Clavin and others have called for a state-funded study and takeover.

Lancman, in response, had said, "If Hempstead is suggesting that New York State directly take over and run a local water district, well that's the definition of infeasible: expecting the state to do the job that Hempstead’s own hired expert concluded should be done by Hempstead itself."

Activists and residents have been clamoring for a public takeover of the investor-owned water system for years.

"Rather than allow a corporate monopoly to continue to have a license to print money on the backs of Nassau ratepayers, it’s time for a Nassau County water authority," said David Denenberg, co-director of watchdog group Clean Air, Water and Soil, which brought to light some of the early rate-case irregularities.

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.