By BRIAN DONOHUE
Members of the Red Bank Borough Council defended a plan to raise water and sewer rates Thursday, calling it a painful “hard truth” but a better option than selling off the water utility to a private for-profit company.
A chart from the Engenuity Infrastructure water rate study.(Click to enlarge.)
The council voted unanimously to introduce an ordinance that would increase rates by 9.5 percent beginning in August. Four more yearly increases would result in a total increase of about 46 percent by 2029.
The increases are based on a report by engineers that found the system threatening to go into the red amid rising costs and a lack of rate increases since 2015. The report also includes a ten-year capital plan for the system.
“This is the work of being reformers,’’ said Deputy Mayor Kate Triggiano. “This is the work of reforming. When something wasn’t taken care of for a decade, you have to make the hard decisions.”
Triggiano and other council members pushed back against the notion of selling the borough’s water utility to a private for-profit operator, citing frequent rate increases and profiteering by the companies.
New Jersey American Water, which already provides Red Bank water for several months of the year, now serves 183 towns in New Jersey. Selling Red Bank’s utility is an idea that has come up occasionally over the years in a state with the highest rate of private water system ownership in the US.
Only a lone public speaker, former councilwoman Cindy Burnham suggested the borough should ask New Jersey American Water to assess the utility and see what they can offer.
“Red Bank is not in the infrastructure water business and New Jersey American is, so if we get a catastrophic problem then Red Bank people have to pay for it, whereas if it was New Jersey American-owned it would be spread over all these different towns,” Burnham said. “Maybe we’re at the point where we need to get out of the water infrastructure business for our little town.”
Perhaps hearing echoes of past debates on the issue, several members of the council said they were against it – even before Burnham got up to speak.
Calling the need for higher rates a “hard truth,” Councilperson David Cassidy said he thought privatization might make sense when it was debated years ago, but has since changed his mind.
“A lot has changed in the last fifteen years and drinking water has been treated as a commodity, it’s not treated as a necessity,” he said. “Our interests are not for sale. Our interests are for the residents of Red Bank. And that’s going to unfortunately include the correction that wasn’t made a long time ago.”
Councilperson Nancy Facey-Blackwood said she had studied the issue and weighed the pros and cons of privatization and had also rejected the idea.
“It’s an asset to the community, it’s not a for-profit company such as New Jersey American Water and I would not be in favor of selling it,” she said. “I’d rather work through what we have and have a plan to go forward.”
Councilperson Ben Forest said he was not against “sitting down with American Water and listening to what they had to say.”
But he recounted watching other towns sell off their water utilities for an infusion of cash and the promise of “low ball rates” only to be hit with higher rates than Red Bank customers now pay.
“They were able to have some nice little tax windfall for a couple of years, and then, boom. As soon as that five year period was over, their water rates went very high.”
The rate hike ordinance will be up for a public hearing and final vote at the next council meeting on July 11.
In other business, the council:
- Approved a resolution revamping the rules and regulations for the police department.
- Gave final unanimous approval to a plan to devote all proceeds from a tax on retail cannabis sales to the borough’s parks and recreation trust fund. The borough received its first infusion of weed tax revenue from the thus far sole retailer, which totaled just $3,600. The business opened late in the first quarter of the year and the total covers just a few weeks of sales.
Do you value the news coverage provided by redbankgreen? Please become a financial supporter if you haven’t already. Click here to set your own level of monthly or annual contribution.
