by Kathy Savolt
At the request of the Board of Trustees (BOT), representatives of the Westchester Joint Water Works (WJWW/the Waterworks) spent about an hour explaining the Waterworks to the BOT and the community at the March 10th BOT meeting.
Paul Kutzy, Manager, and David Birdsall, Business Director, were present and Birdsall led the presentation and discussion (see presentation HERE). They started with the fact that WJWW was founded as a public benefit corporation in 1927 by the Village of Mamaroneck, Town of Mamaroneck and Town/Village of Harrison. WJWW is likely one of the first shared municipal services in New York State.
Overview
The three founding municipalities are now known as the “member municipalities” and the chief elected officials of each serve as the three-person Board of Directors (the Board) of the Waterworks. Mayor Sharon Torres currently serves as the representative of the Village.
The professional employees of the Waterworks run the day to day operations and manage a $19 million operating budget and a Five-Year Capital Plan that is currently $248.8 million. They provide safe drinking water to the residents of the member municipalities as well as to residents of two small portions of Rye and New Rochelle that border the member municipalities and wholesale customers including the Village of Larchmont, and Veolia Water - a for-profit company serving Port Chester, Rye and Rye Brook. A portion of North Castle will soon be added as a wholesale customer.
WJWW buys the water it provides to us from New York City and the two main sources are Rye Lake (the eastern end of the Kensico Reservoir and seen from Rte. 684) and what is known as Shaft 22 of the Delaware aqueduct located in Yonkers.
To deliver this water, WJWW currently owns and maintains:
· 270 miles of water mains
· 15,000 water connections
· 1 ultraviolet treatment facility
· 7 water storage tanks ranging from 800,000 to 2 million gallons
· 3 water treatment/pumping stations
· 2 booster pumping stations
· A network of pressure regulators
All of this is out of sight of most customers who only see the end result when they turn on the tap and water flows out.
Financial Structure
As complicated as the delivery system may appear at first glance, the financial structure may seem incomprehensible. It was designed so that the member municipalities paid only their share of the cost of providing water. Joint costs are shared by the member municipalities based on consumption (the Village of Mamaroneck’s current share is 27.7%). Costs specific to a municipality are charged to that municipality.
Operating Budget
Operating costs are determined by WJWW staff and the budget is approved by the WJWW Board. The current year’s budget of $19 million breaks down as follows:
· Water Distribution System - $10 million, (52.6%)
· Plant Operations - $3.5 million (18.4%)
· Overhead: Administration, Engineering, Technology, Customer Service, General
$5.5 million (29%)
Because WJWW is a public benefit corporation, there is no profit which keeps the costs down.
Capital Budget
The current Five-Year Capital Budget totals $248,760,000 including $196,000,000 to build a Filtration Plant to meet Federal and State regulatory requirements. The remaining $52,760,000 is more typical of the Waterworks’ capital spending.
When the WJWW was formed by the New York State Legislature in 1927, they were not given the authority to issue debt. That obligation is held by the member municipalities. Each municipality issues bonds to cover their share of joint projects and any project specific to their customers. Debt service is factored into each municipality’s rate, is collected by WJWW and then transferred to the municipalities.
Capital expenses (including debt service) are shared the same way as operating expenses. Joint project costs are split according to water consumption and projects for a specific municipality are charged to that municipality.
Revenue
Each member municipality is responsible for setting the rates charged to their residents based on the cost information provided by WJWW and the individual needs of their municipality.
In addition, the wholesale customers (customers who just purchase water) pay a negotiated rate set by WJWW. This negotiated rate includes the cost of water, operating costs of the joint system as well as debt service for joint capital projects since their water is delivered to them via the WJWW system.
The Breakdown of Your Bill
A look at your water bill shows that water usage is billed showing gallons but divided into tiers depending on the size of your meter and the amount of water used. The tiers are determined by units. To convert: one unit is 100 cubic feet or water, roughly 748 gallons. The more water you use, the more expensive it gets. The first tier also includes a flat service charge plus usage up to 22 units. The second tier covers 23 – 72 units and the final tier is any usage over 72 units.
Here are the current rates for each tier for Village of Mamaroneck customers:
Your water bill also includes a Sewer Rent charge that is also determined by each municipality.
The Waterworks collects the water and sewer rent charges from its customers and uses the revenue to pay expenses. If there is any surplus at the end of the fiscal year, money is returned to the member municipalities. WJWW tracks payments by municipality and returns surpluses accordingly.
In New York State, municipalities use fund accounting, and each municipality has both a Water Fund and a Sewer Fund separate from their General Fund (that is used to manage their own operations). Returned water fees are deposited into each municipality’s Water Fund and the Sewer Rent Fees go into the Sewer Fund.
Some municipalities use these funds to cover general operating expenses that would ordinarily be covered by property taxes. This is a legitimate practice when appropriate. For example, this complicated financial structure requires the municipalities’ Treasurers to manage the funds and a portion of their compensation could rightfully be charged to the Water Fund based on the time spent on this task.
In March 2023, then Village Manager Jerry Barberio proposed a 90% increase in the Sewer Rent charges in order to offset portions of the salaries of several Village employees starting in FY 2023/24. The actual projected increase in Sewer Rent Charges in the adopted budget was 105% - over $800,000. This is one example of why your water bills are not solely for your water usage.
On May 31, 2023, the end of FY 2022-23, the Water Fund had a balance of $1.66 million and the Sewer Fund had a balance of $771,700, an increase of $432,000 over the previous year. The FY 2023-24 financial statement is not yet available.
Rye Lake Filtration Project
After years of trying to avoid building a very expensive filtration plant that is mandated by the 1972 Clean Water Act, WJWW was finally required to settle cases with both the Federal Environmental Protection Agency and New York State and begin the process of building the plant. Efforts to partner with other water providers, including Westchester County did not pan out.
The filtration plant cleared its final hurdle recently when the County Board of Legislators approved a land swap that gave WJWW an appropriate parcel on which to build off Purchase Street. WJWW staff expect a Request for Proposals for Construction Management services to be issued this Spring.
This massive undertaking - $196 million – will be factored into water rates and WJWW told the community to expect an increase of 15-20% this August.
Q&A – Explaining the Jargon
After the presentation, Trustee Ellen Silver asked some questions. The Mamaroneck Observer also reached out to Birdsall for further clarification.
Silver first questioned the current safety of the drinking water and Paul Kutzy, the WJWW Manager, assured everyone that the water is safe, always has been safe and the filtration plant is a regulatory requirement that will make the water even safer.
Silver questioned the lead line replacement initiative that is part of the filtration plant settlement. Birdsall explained that WJWW was still in the inventory phase of the initiative and the customers need to contact WJWW so a complete picture of how many lead pipes exist and where they are. Typically, lead pipes were used in older homes. Learn more about this program HERE.
Silver also questioned expenses that had been charged to the Village and based on Birdsall’s responses at the meeting and subsequent conversation with The Observer, it appears that Birdsall’s use of industry jargon is different from the average person’s understanding of certain words.
Service Line Repair – WJWW is not responsible and cannot fund repairs for customer service lines that run from their homes to the water main under the street. WJWW uses this terminology, which Birdsall asserts is industry standard, to describe repairs to the curb box that serves as the connector between the service line and the water main. The curb box is “in the street” and the responsibility of WJWW.
Hydrant Rental – as clarified at the meeting, this is a misnomer and is actually repairs.
“Yard” Cleanup – this is not equivalent to a homeowner’s yard. This is the maintenance yard located adjacent to the Equipment Shed on the WJWW property on Mamaroneck Avenue. This yard is the repository of debris from street repairs and other materials that are accumulated and then periodically hauled away. The expense is split just like the other expenses. Full understanding of the Village of Mamaroneck’s share would require more information such as the nature of what was removed, the total cost and the total breakdown of those costs. Disposal of contaminated or hazardous waste may be more expensive than other materials.
Editor's note: As Mayor of the Village of Mamaroneck the author served on the WJWW Board from 2007-2009.
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