WAWARSING -- The same tunnel that delivers water to millions of faucets in New York City is blamed for leaving homes in this upstate town in soggy misery.

Residents say the leaky aqueduct running below their neighborhood creates flooding in their basements during even routine rain storms. They are plagued with heaving floors, moldy walls and sinkholes in their lawns.

"There's just nowhere for the water to go on the property. It's like a big wet sponge," said Mike Rosselli, who raised his family in this semirural neighborhood 80 miles north of Manhattan.

"We're used to saying, 'Oh, nice spring rain!' Now it's 'Oh crap.' . . . It's a terrible way to live." After years of complaints and lobbying by residents, New York City is preparing to spend more than $7 million to buy homes from willing sellers in Wawarsing, in Ulster County. But even as 67 homeowners have applied for the buyout, some residents fear the offers won't be large enough to cover the cost of their homes and their out-of-pocket losses.

"I'm glad to see them finally stepping up and doing something, but for me it's a little late," said 65-year-old Andrea Smith as she walked around her trailer to point out a sinkhole on her lawn. She and her husband applied for a buyout as a way of telling government officials they have a problem, but she says they won't sell.

Complaints of flooded basements and squishy lawns have come from residents of this town since at least the 1990s.

Residents blame the Delaware Aqueduct, which runs more than 650 feet underground here as it delivers water from the nearby Rondout Reservoir.

The tunnel is an 85-mile-long engineering marvel that runs under the Hudson River, serving 8 million people in the city and a million more elsewhere. In service since World War II, it handles about half the water for the city, more than 500 million gallons a day collected from four upstate reservoirs.

And it's old.

The tunnel has almost 500 feet of cracks along a stretch through Wawarsing and another 5,000 feet of cracks close to where it crosses under the river at Roseton, the city's Department of Environmental Protection says. The aqueduct loses 10 million to 30 million gallons a day. The city plans to spend $1.2 billion to fix the tunnel by 2021.

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