Climbing desal costs could mean further United Water rate increases, according to attorney

BY MICHAEL RICONDA 

NEW CITY – Rate-payers might be in for a costly surprise if United Water New York is allowed to increase rates in anticipation of their proposed desalination project, according to an attorney retained by the Town of Ramapo and a collection of other municipal bodies who spoke to the Rockland County Legislature’s Environmental Committee on Wednesday.

Daniel Duthie, who represents Ramapo in its proceedings against UWNY, explained cost estimates for first phase of the desalination project have more than doubled from $69 million to $153 million since its inception. At the latest estimate, UWNY has spent $56.8 million on pre-construction costs thus far, but no changes to the rate increases have been requested yet.

According to Duthie, however, Rockland’s water suply has been stabilized by existing fixes. Duthie explained Rockland is projected to see a water surplus from 2014 to 2017, leading to questions of whether the project is even necessary.

“We think that the record strongly indicates that there is no need for a new long-term water supply,” Duthie said.

UWNY is pursuing two separate rate hikes. The first is a 28.9 percent increase to the general rate, which would generate $20.4 million more in annual income to recoup costs from infrastructural improvements and maintenance. The second, which increases rates by 8.08 percent and generates $5.7 million annually, specifically targets desal pre-construction costs.

The rate hikes were announced weeks apart in the Summer of 2013, generating an instant backlash from consumers and public officials. Critics questioned how a surcharge could be levied on a project which is still in its planning phases and might not even see state approval.

Much of UWNY’s opposition has already organized for legal action. In 2013, the county joined a collection of towns, villages, sewer districts and school districts to form the Municipal Consortium. Duthie also represents the Consortium in the PSC’s general rate case.

The legislature seems equally skeptical. Leg. Alden Wolfe stated during the meeting that though he was normally opposed to hiring outside counsel, the county itself might be ready to retain Duthie to advocate against the rate hikes.

“I’ve come to appreciate the focus of Dan’s prcctice and the highly technical nature of it,” Wolfe said. “I think there’s a lot at stake.”

Stephen Powers with the County Executive’s Office confirmed Duthie’s retention is under consideration and a decision should be reached shortly.

The State’s Public Service Commission is expected to rule on the general rate case on June 30 and the surcharge case on July 28. No deadline has been set for a PSC decision on the project’s need.

  desal, Rockland, Suez, United Water, water rate hikes