Water Rate Jumps 4.42%, Latest Addition to the List of Rising Costs

The hits keep coming for residents of New York City co-ops and condos. Their property taxes just jumped by an average of 8%, and their gas and electricity bills are rising by 8.4% and 9.1%, respectively. Many boards are wrestling with ways to pay for retrofits that will cut their buildings’ carbon emissions enough to avoid stiff fines under looming Local Law 97. Meanwhile, insurance costs remain high thanks to the so-called “hard” market, and inflation is pushing up the cost of mandatory facade repairs, interest rates, staff pay and more. Even the cost of a subway ride is going up.

Now co-op and condo residents can add water to their list of rising costs.

After holding public hearings on rates proposed by the Department of Environment Protection (DEP), the New York Water Board has released the Water and Wastewater Rate Schedule for 2023-24, which includes a 4.42% hike in the cost of water. That means that New Yorkers now pay $4.49 for every 100 cubic feet (748 gallons) of water they use (up from $4.30), and their combined water and sewer bill per 100 cubic feet will rise from $11.12 to $11.63.

The DEP estimates that the typical co-op and condo apartment with metered billing will see an increase from $773 to $808 per year per unit — an increase of $2.85 per month, based on an average consumption of 52,000 gallons of water per year.

The rate increase will boost DEP’s projected revenues to above $4.2 billion — enough to pay for the salaries and benefits of more than 6,000 city employees, as well as such major initiatives as the the $1.6 billion Combined Sewer Overflow Retention Tanks for the Gowanus Canal, the $1 billion repair of the Delaware Aqueduct, the buildout of a comprehensive drainage system for Southeast Queens and the excavation of the final shafts for the Brooklyn-Queens leg of City Water Tunnel No. 3.

The DEP points out that this year’s increase to the water rates is below the rate of inflation and is about 20% below the average rates of the nation’s 30 largest cities.

“Everyone is experiencing inflation,” says Ana Champeny, vice president for research at the nonpartisan Citizens Budget Commission, which monitors city and state finances. “And so is the DEP, which has to cover labor costs and much more. Those wastewater treatment plants are very energy-intensive, and you can’t turn off your wastewater treatment plants.”

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The city’s water system, fed by 19 reservoirs upstate, provides 1.2 billion gallons of water per day to the city’s 8 million residents and an additional 1 million people living outside the five boroughs. The DEP also manages stormwater runoff, treats 1.3 billion gallons of wastewater a day and maintains 7,400 miles of pipes.

To put this year’s water-rate increase in perspective, the largest percentage increase in the 21st century was 14.5% in 2009. There were no hikes in 2017, 2018 or 2021, and this year’s hike is slightly smaller than last fiscal year’s 4.9%.

The way New York City sets water rates has its share of anomalies. For instance, the sewer rate is a flat 159% of the water rate, regardless of how much wastewater a property generates. That means that a store with a large paved parking lot and extensive rainwater runoff will be billed according to its water usage, not by the volume of runoff it sends into the city’s sewers.

“That’s a burden on the wastewater system that isn’t addressed by the current water rate system,” Champeny says.

To address this and other inequities, the DEP will soon release the results of a three-year study on how to make water rates more affordable and more fair.