Legislator Cornell Requests PSC Investigate UWNY’s Proposal to Develop New Water Supply for Rockland County

LEGISLATIVE PRESS RELEASE

Rockland County Legislator Harriet Cornell has requested the NYS Public Service Commission (PSC) initiate a Prudence Investigation to determine if the actions by United Water New York in selecting and continuing its proposal for a desalination plant,
while dismissing a combination of less costly alternative water supply options, were prudent, practical and carefully researched by the company’s management.

Responding to a May 22 statement in which the PSC invited interested parties “to make a prima facie case of imprudence regarding UWNY’s actions,” Cornell sent a letter on June 23rd to PSC Secretary Kathleen Burgess stating that UWNY has been unwilling to acknowledge new information and change course. She listed nine highly imprudent decisions made by UWNY.

She pointed out that UWNY rejected the possibility of enhanced water conservation, green infrastructure, leak management, increased storage options and better water system management, yet provided no assessment of how a combination of these alternative options could provide additional supply.  Cornell also stated that UWNY failed to provide information on the environmental impact of drawing water from the Hudson River, the cost of energy to run the plant, and the eventual cost to rate payers.  She called for a forensic audit to clarify the unexplained, extravagant project development costs which UWNY is proposing to pass along to ratepayers in the form of a surcharge.

The PSC recently determined that the County has ample water supply through 2020 and the County Executive and the Legislature have created the Task Force on Water Resources Management, that will be charged with the responsibility to develop a comprehensive water policy for the County that will ensure a safe, cost effective, long-term water supply for the County that incorporates sustainability, demand-side principles and conservation.  Cornell asked the PSC to “please halt UWNY’s
continuation of the Haverstraw Water Supply Project and stop the continued push for permits and spending of taxpayer funds.”

Hon. Kathleen H. Burgess
Secretary, Public Service Commission
Three Empire State Plaza
Albany, NY 12223-1350

Dear Secretary Burgess: Re:  Case No. 13-W-0303:  Call for
Prudence Investigation To Examine United Water NY’s Development of New
Water Supply Source

Thank you for the opportunity to request a Prudence Investigation of
the Need for the Haverstraw Water Supply Project (Case No. 13
–W-0303.)

New Information:
Few would deny that the situation regarding “need” for a new water
supply for Rockland has changed substantially since 2006. We now have
important new information including the USGS study; the adoption of
Rockland Tomorrow: Rockland County Comprehensive Plan after an 18-month
planning process with wide community involvement and input; changing
demographics with a greatly increased and growing elderly population;
huge public interest in avoiding the expense and environmental hazards
of a desalination plant on the Hudson; the PSC staff report indicating
that need for a new supply may never exist—but if it does, it won’t
be before 2020; and most recently, new steps by the County of Rockland
to take charge of its own water future. I have attached a copy of the
legislation creating a Task Force on Water Resources Management which
was passed unanimously by the Rockland County Legislature and signed
into law by the County Executive on June 19.  Planning by a working
group has been taking place, and the Task Force will be up and running
within weeks.

Old Information:
What has not changed is the definition of “prudence.” According to
Webster’s Unabridged Dictionary, Second Edition, prudence means:
“Practical wisdom as distinguished from speculative wisdom.”  The
definition goes on to say that prudence is “the skill or sagacity in
the management of practical, especially business, affairs;
circumspection and discretion in selecting, adjusting, or utilizing
means to a desired end; provident or cautious use of resources. . .
there is an implication of self-interest when prudence is forgotten.”

Prudence “Forgotten” by United Water:
Prudence has indeed been “forgotten” by the management of United
Water New York. as demonstrated by the many highly imprudent decisions
made—and the unwillingness to select, adjust or utilize means that
acknowledge new information.
The 2006 decision did not mandate a single project, but United Water
New York (UWNY) quickly seized on a project to build a desalination
plant and use the water from Haverstraw Bay in the Hudson River.  The
search for the Proposed Project as described in the DEIS shows that
UWNY, while presenting two alternatives—the long-planned Ambrey Pond
and Wastewater Reuse– dismissed a list of other possibilities as not
providing safe yield, including enhanced water conservation and green
infrastructure; enhanced leak management; increased storage at Lake
DeForest; Quarry Reservoir Alternatives; and better water system
management with Lake DeForest permit modification. There was no
assessment of how a combination of alternative options could provide
additional supply.

·       The fact that UWNY did not provide an assessment of how a
combination of alternative options could provide additional water supply
was imprudent.
-more-
·       It was imprudent for UWNY to fail to use consistent measures and
commonly accepted industry standards in its DEIS to determine
comparative costs for alternate projects that could achieve the same
goals.

·       The fact that UWNY did not provide information on whether the
costs and impacts on the environment from alternatives would be less
than the Proposed Project was imprudent.

·       It was imprudent of UWNY to insufficiently analyze or evaluate
the potential savings in terms of costs and water usage of a
comprehensive conservation program when there has been major success in
the Northeast (NYC DEP and Massachusetts Water Resources Authority) that
resulted in negating the need for capital-intensive infrastructure to
increase water supplies.

·       It was imprudent for UWNY to submit a DEIS with such analytic
deficiencies that the cost sections were described by ECONorthwest, a
respected economics, finance and planning organization, as “almost
useless” for those seeking to independently verify cost results with
the most significant omission being the lack of documentation on how the
construction, operations and maintenance costs would impact ratepayers.

·       It was imprudent of UWNY to design an energy-intensive
solution—a desalination plant which requires electricity to pump
water from the Hudson to solve the problem of occasional peak demand
which has other non-capital solutions, which have not been equitably
studied.

·       The insufficient analysis by UWNY in its DEIS was imprudent
because it has fostered the impression that the company is blocking an
environmentally sustainable future for Rockland while adding great
financial burden on rate-payers.

·       It has been imprudent for UWNY to continue expending money on
this project, which has not yet been approved under the laws and
regulations of the State of New York.

·       It has been imprudent for UWNY to continue expending money on
this project in the face of decreasing demand for water—demand which
will further decrease as rates go up and a surcharge is added to
rate-payers’ burden—and which could result in a stranded
investment.

A Prudence Investigation is warranted for the many reasons I have
cited, and I respectfully call for the Public Service Commission to take
this action on behalf of the public it serves.

Forensic Audit:
It is also essential that the PSC order a forensic audit to clarify the
extravagant and unexplained major costs being claimed by United Water as
a repayment/surcharge for the work it has done on a project that has not
been approved and which is not needed. Invoices submitted to the PSC
show names of professionals, hourly rates and hours allegedly worked.
There is no explanation of what work was done. The top four engineering
firms received approximately $24 million out of $39 million in direct
vendor costs.  Two law firms received $5.3 million, but the bills are so
heavily redacted, that it is impossible to know the services that were
provided for multi-millions of dollars.  Every page of the $39 million
in costs has been stamped “Confidential.”  This is totally
unacceptable public policy—and it makes a mockery of the hundreds of
thousands of volunteer hours which have been and continue to be expended
by Rockland citizens in order to research and present to the PSC and
other state agencies accurate information. On behalf of all ratepayers,
residential and commercial, I hereby request a forensic audit.

Please Call a Halt:
Furthermore, I urge the Public Service Commission to halt UWNY’s
continuation of the Haverstraw Water Supply Project and stop the
continued push for permits and spending of ratepayer funds.

Thank you once again for offering this opportunity to express my
indignation and my thoughts on these matters.

Very truly yours,

Harriet Cornell
Chairwoman, Environmental Committee
Rockland County Legislature
845-638-5100 (o)
845-634-3304 (h)

cc:  Administrative Law Judge Kevin Casutto
All parties
Basil Seggos