Time for questions about wastewater plan

Nassau County Executive Edward Mangano unveils a debt Nassau County Executive Edward Mangano unveils a debt reduction and sewer stabilization plan in Mineola, New York. (May 3, 2012) Photo Credit: Howard Schnapp

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Joye Brown Newsday columnist Joye Brown

Joye Brown has been a columnist for Newsday since 2006. She joined the newspaper in 1983 and has ...

Here it comes, the Big One: Nassau County's complex proposal for a private firm to operate, maintain and improve the county's wastewater management system, in what would be largest public-private partnership in the United States.

Still, like past proposals for a private bus operator and police precinct consolidation, there are no documents for public review.

All this makes now the time to start asking questions:

Q: What's to be discussed at the public information sessions, which begin Wednesday?

A: County Executive Edward Mangano says he'll pitch a private operator as a way to better manage wastewater services to help the county retire debt. What's not on the agenda is the fundamental public policy question of whether Nassau should be seeking a private operator at all. In an interview, Mangano said he's rejected the option of keeping the government as operator, although some Nassau residents are likely to disagree.

Q: Why does Mangano want a private operator?

A: Nassau's Sewer and Storm Water Finance Authority, which now handles county wastewater, is running out of money. Mangano said he will not increase the property taxes necessary to keep it going. Because of the fiscal crisis, the county can't afford to maintain or improve the system through capital borrowing either, Mangano said.

Q: What's this going to cost residents?

A: Mangano's pitching this as a way to keep costs the same or slightly higher, with better service. The bottom line is that residents would pay more either way: Either higher taxes to keep the current system going, or, down the line, in higher costs to cover the wastewater treatment bill an operator would send the county every year.

Q: So, where's the savings?

A: Under the deal, the operator would pay the cost -- a higher one, since United Water is not a municipality -- of any borrowing to improve the system, Mangano said. In theory, then, some county expenses would decline -- but so would wastewater-related tax revenues, which the county would collect from residents and forward to the operator.

Mangano said he did not plan on eliminating employees who do wastewater-related work. But they'd be likely to have to move to other county-funded jobs or work for the operator, whose compensation and pension plans are likely to be less generous.

Q: There's talk of a financier? How's that going to work?

A: Think of an Oreo cookie. The county is the top layer; the operator, United Water, is the bottom layer and the financier -- who would pay Nassau almost $1 billion upfront to fund the deal -- is the rich double-stuffed filling.

Under Mangano's plan, the county would sign a 30- to 50-year contract with the investor, committing Nassau to up to half a century of dealing with its wastewater operator through an intermediary.

Q: How's that arrangement supposed to work?

A: The county would have a contract with the financier, which would include a memorandum of understanding with United Water to address Nassau's wishes, which include billing no more than cost of living increases after two years of frozen costs. It's unclear how the memorandum would work if the financier selected -- or the county preferred -- another operator in the future.

Q: What happens now?

A: According to Mangano, Nassau and United Water are now working together to pick a financier. And to address questions -- and there should be many, many more coming -- during public information sessions. Ultimately, the proposal would require approval from county lawmakers and the Nassau Interim Finance Authority, the state control board, members of which already have expressed skepticism.

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