The Independent Budget Office (IBO) today released The Impact of Water Filtration in the Catskill/Delaware Watershed on Water and Sewer Charges in New York City, a study that estimates the cost to residential water customers of constructing what would be the largest water filtration plant in the United States.
New York City's drinking water supply is one of the few remaining large unfiltered water supplies in the United States. In December 2001, the United States Environmental Protection Agency (EPA) will review New York City's progress in meeting federal water quality standards without filtration in the Catskill/Delaware watershed-the source of over 90 percent of the city's water. If the EPA determines that supply from the watershed can no longer meet federal standards, the city may be required to construct a filtration plant. Current cost estimates for such a plant range from $2.74 billion to $6 billion, with estimated operating costs of at least $100 million a year.
"Even without a costly filtration plant, New York City residents' water bills are going to rise considerably over the next few decades," said Ronnie Lowenstein, IBO Director. "Filtration of the Catskill/Delaware watershed would further increase the city's already-high cost of housing and place a particular burden on low-income renters and homeowners." Among the report's major findings are:
- Even without filtration, the average annual water and sewer bill for a single-family home will increase an inflation-adjusted 62 percent from $454 currently to $707 by 2018.
- Costs would be 12 percent higher if the filtration plant is built at DEP's current cost estimate of $2.74 billion-at least $789 per year for a single-family home.
- If the filtration plant costs $4 billion, water and sewer bills would be 13 percent higher than without filtration, or $800 for the average single-family home. A plant costing $6 billion would increase the average single-family home's bill to $864-22 percent higher than without filtration.
The EPA's recent mid-course review of the city's progress in protecting the watershed highlighted several areas in which the city needs to step up efforts in order to avoid filtration, including: upgrading of upstate sewage treatment facilities that discharge into the watershed; and acquiring additional land or conservation easements around the Kensico reservoir. If these steps are not successful, the EPA could order the city to begin filtering the Catskill/Delaware water supply.
The final cost of the plant is subject to considerable uncertainty. The plant's size is unprecedented; the filtration technology is relatively new; and potential delays resulting from litigation and/or construction delays could add to the costs.
The IBO is an independent city agency whose mission is to provide non-partisan budgetary, economic and policy analysis for the residents of New York City, and to increase New Yorkers' understanding of and participation in the budget process. IBO reports can be downloaded from www.ibo.nyc.ny.us.
