American Water customers file complaint over tank costs

New York American Water has nearly doubled the projected cost of a new water tank in Glen Head, customers charged in a recent state complaint, saying they fear the new $6.2 million price tag will be passed on to them. 

In a filing with the State Department of Public Service this week, more than 50 customers from Glen Head, Brookville and Glenwood Landing said that after they objected to the original estimate of $5 million in 2017, the company provided lower costs estimates of $3.1 million and $3.6 million. 

Now, customers are calling for a state investigation of the even higher $6.2 million cost, which was disclosed to residents in a recent mailer noting work on the project had recently begun. 

Public Service Commission spokesman James Denn didn't immediately respond to a request for comment.

"Requests for explanation about this uptick on costs was that the $3.6 million quote to the community and $3.1 million quoted to the town did not include all added expenses that entail the replacement of the tank," states the filing signed by residents. 

It further notes other American Water districts replaced tanks for $1.6 million to $3 million. 

A New York American Water spokeswoman said those lower estimates are for less constrained regions of Pennsylvania, not Long Island, where costs to replace tanks by other water companies have ranged from $5.1 million to nearly $7.3 million. 

"New York American Water always strives to make the most prudent and cost-effective investment possible," spokeswoman Lee Mueller said. "While the cost to construct is higher than initial estimates, the cost is based on competitive bids from the industry."

The company will pay for the tank project through an ongoing four-year rate hike, Mueller said, adding that the 1930s-era tank doesn't meet current engineering standards and must be replaced. The new tank, expected to be in service by 2020, will have the same 500,000 gallon capacity. 

Earlier this month, JD Power & Associates released new rankings for water companies that found NYAW had dropped from the 10th-ranked Northeastern water company in customer satisfaction (with a 707 score out of 1,000) to 15th ranked in the 2019 survey, with a score of 664.

East Rockaway customer David Beldner said he wasn't surprised by the drop. "You can’t charge the same people double the amount for the same water in two different areas," he said, referring to wide disparities in costs for different Long Island service areas. The company has blamed high and varying property taxes for the bill impacts. 

Mueller said the JD Power and other surveys help inform customer service improvements. 

“By gaining a better understanding of what our customers want through surveys and focus groups, as well as evaluating our systems and processes, we continue to improve our overall customer experience.”

She said the company has made “significant improvements in our communication process in 2019 to improve our customer experience. We are connecting regularly with our customers to explain conservation rates, and to help our customers understand their consumption and empower them to reduce their water bill through conservation.”

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

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