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PSC appoints a monitor for NY American Water; activists say it's not the long-term answer

The monitor, PA Consulting Group, will be expected to evaluate the spike in customers' billing complaints, issue quarterly updates and immediately report any violations.

New York American Water in Merrick on July

New York American Water in Merrick on July 3. Photo Credit: Danielle Silverman

ALBANY — A state panel on Thursday appointed a monitor to review New York American Water Co.’s billing and other processes in the aftermath of rate-hike irregularities and soaring charges for its Nassau County customers.

But it won’t appease some residents’ push for public takeover of services now provided by the private company.

The Public Service Commission said the PA Consulting Group has been hired to review American Water’s rate-case filings, metering, property-tax assessments and operations. The monitor will be expected to evaluate the spike in customers’ billing complaints, issue quarterly updates and immediately report any violations. PA Consulting is hired through Sept. 30, 2021, the PSC said.

Assemb. Michael Montesano called the appointment a “good first step” but it won’t resolve the long-term question of how to handle water delivery to Nassau customers.

“It sounds like an extensive review and I’m happy to see it,” Montesano (R-Glen Head) said. “But this is not going to stop the community from looking for a public takeover.”

Echoing that sentiment, Agatha Nadel of North Shore Concerned Citizens, formed specifically to oust American Water, said: “We’re very thankful for the PSC action, don’t get me wrong. But the PSC has to take their blinders off — this is not going to solve the problem.”

American Water supplies about 4,500 in what’s called the Sea Cliff district, covering Glen Head, Glenwood Landing and the villages of Sea Cliff and Brookville. Some residents there have been pushing to oust the company after seeing their bills more than double last year.

The company, which has a total of 120,000 customers on Long Island, has blamed its prices in part on its property taxes and tax assessments, and it has sued Nassau County alleging it has been overtaxed. But a state probe also said the company deceived regulators during 2016 rate hearings about its property-tax assessments in the Sea Cliff district. The state attorney general’s office has launched a probe of the company for possible consumer fraud.

Earlier this year, the company reached a settlement with the PSC; conditions included temporary suspension of a “conservation” rate that had kicked in earlier this year and increased customers’ bills, and the eventual appointment of a monitor to review the company. It also provided $11 million in lowered bills, according to the PSC.

“The monitor will ensure the company remains firmly on the path to providing the best possible customer service and prevent backsliding,” PSC Chairman John B. Rhodes said in a statement. He added that “any corrective actions that are needed will be taken.”

The monitor’s fees will be paid by American Water shareholders, not customers.

In a statement, company vice president John Dillon said: “New York American Water thanks the Public Service Commission for swiftly approving the independent monitor, PA Consulting. We look forward to working with the staff of the Department of Public Service and PA Consulting to best serve our valued customers.”

“I think the PSC realizes it got hoodwinked by American Water in the first go-around,” Montesano said. “The PSC now is delivering on what it promised a while back, which is to look into it.”

For Nadel, the solution is American Water “needs to go.”

“There’s no reason we shouldn’t get public water like everybody else,” she said.

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