No Rate or Revenue Caps on Private Corporate Entities
Austerity Driven Financial Crisis In Public Sector An Excuse To Privatize
Another Threat to Clean Water & Power Grab by Governor Christie
It has become increasingly obvious that, for many years, NJ has failed to invest in our antiquated water infrastructure and that those failures to invest have created multi-billion dollar financial deficits that will force significant rate increases across the State to generate funds to maintain and upgrade infrastructure to meet clean water standards.
Infrastructure deficits and likely significant water and sewer rate increases served as justification for passage of recent legislation to promote privatization of NJ’s water and sewer systems.
In the wake of passage of that law promoting privatization of public water and sewer systems, the Christie Administration now is quietly pushing a legislative initiative that would starve local sewer authorities of adequate revenues to provide clean water, creating financial crisis and making them ripe for privatization.
Yesterday, the Senate Budget and Appropriations Committee heard a bill (S72 [1R]) that would impose the Christie Administration’s 2% revenue cap on regional sewer authorities, and subject their budgets to oversight by the Governor’s Office: (Statement)
This bill would impose oversight by the Director of the Division of Local Government Services and the Governor over the budgets of regional sewerage authorities that are created pursuant to the “sewerage authorities law,” P.L.1946, c.138 (C.40:14A-1 et seq.).
Under the bill as amended, the percentage of growth in the fee- funded appropriations in the annual budget of a regional sewerage authority could not exceed two percent per year; and the amount billed to customers of the authority, or the amount billed to a local unit for its proportional share of the authority’s expenses, as the case may be, could not exceed that amount billed in the previous budget year to each customer or local unit, as the case may be, by more than two percent.
As a red flag, we note that the prime sponsor of the bill is Senator Oroho, NJ’s ALEC representative.
The bill was strongly opposed by the Association of Environmental Authorities and operators of several regional sewerage authorities.
They explained how increases in wastewater flows or regulatory compliance costs could require a more than 2% increase in revenues or rates and charges.
There is no such cap on revenues or rates collected by private water corporations or oversight by the DCA or the Governor.
The objective seems obvious – it’s a page out of the “starve the beast” and “drown government in the bathtub” right wing austerity agenda:
1) starve public authorities for revenues just at the critical point in time that additional revenues are required to support needed investments;
2) This would create a financial crisis in public authorities; and
3) This would make them ripe targets for privatization.
This is not a bill that Democrats should be supporting, as it jeopardizes clean water, the jobs of public sector employees, and hurts ratepayers.
Let’s hope this bill does not get rammed through a lame duck legislature during the holidays.