New York American Water in Merrick. 

New York American Water in Merrick.  Credit: Danielle Silverman

The Public Service Commission is working on a plan to postpone near-term utility rate hikes in an effort to ease the financial impact of the coronavirus, forestalling a New York American Water hike set for April 1, sources said Tuesday.

Negotiations are ongoing, and the outcome remains uncertain but a resolution could come as soon as Tuesday, the sources said.

The state is said to be focused on New York American Water and a pending National Grid rate-hike proceeding, and a postponement could happen either way through an executive order by Gov. Andrew M. Cuomo or a one-commission order by the state commission, a source said.

New York American Water announced last month that rate hikes set for April 1 across its service territory would increase bills from $3.89 to more than $10 a month. The rate hike would include a new fourth-tier of prices for the largest residential water users. The increase is part of a four-year rate hike approved by the Public Service Commission in 2016.

The state move would push back New York American Water's planned rate hike to Sept. 1, one source said, defraying a new rate tier that would have hit highest users during the high-use summer period.

Sen. John Brooks (D-Seaford), who had been working with regulators and the company to push through the rate freeze for weeks, welcomed the move.

"These are trying times for everybody as we go through this pandemic and it's critical everybody does their part to help," he said. "Forestalling this rate increase until September gives folks on Long Island some breathing room, and I compliment the PSC for the role they played and the cooperation we received from New York American Water." 

Added Sen. Todd Kaminsky (D-Long Beach): “We’re in the middle of a global health crisis and New York is now the epicenter. The last thing Long Islanders should have to deal with is higher utility bills.”

Utilities across the state, at the commision's urging, have already agreed to forestall service shut-offs because of the necessity of electricity, gas and water during the global pandemic. PSEG Long Island, National Grid, the Suffolk County Water Authority and New York American Water have all announced they would stop shut-offs effective earlier this month.

Lee Muller, a spokeswoman for New York American Water referred questions about any rate-hike postponement to the Public Service Commission.

“New York American Water recognizes the impact of the current public health emergency and we are pursuing tools to provide relief for our customers that may experience financial hardship, such as suspending shut-offs and offering payment plans,” Muller said.

A commission spokesman did not immediately respond Tuesday to a request for comment.

New York American Water, which has taken heat from ratepayers and public officials over soaring bills that led to a series of investigations, is in the process of being sold to Canada-based Liberty Utilities for $608 million. The sale is scheduled to be complete this summer.

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