BAYONNE – City residents will see their water bill increase more than three times what they expected when they get their bill in January, a city official said.
Bayonne Municipal Utility Authority Executive Director Tim Boyle said on Tuesday, Dec. 8 that the expected annual four-percent increase in water bills on Jan. 1 will actually be a 13.25 percent hike.
The annual four-percent increase was part of the Bayonne Water Joint Venture contract worked out between the BMUA and Kohlberg, Kravis, Roberts & Co. during the administration of Mayor Mark Smith in late 2012.
Also part of the contract was an anticipated $2 million increase for 2015 and another $1 million for 2016, according to Boyle. The city will not reach those increased revenue predictions for those two years, and the city is still contractually bound to pay them; thus the increase, Boyle said.
“For some reason they expected the revenue for 2015 to be $26.3 million, and $27.3 million for 2016,” he said. “There was no reason to anticipate a million-dollar increase from one year to another.”
Recent revenue figures were $23.3 million for 2013 and $24.4 million for 2014, according to Boyle.
Stephen Gallo, BMUA executive director under Smith, said he couldn’t comment on why the city did not meet its revenue projections and about why there would be an increase higher than four percent.
Boyle said the one-year 13.25 percent water rate increase will go toward meeting the $3 million projection in increased revenues over the next two years. He said the 2016 increase will get the city’s annual water bill hike back to four percent for the following year.
Boyle said residents’ water bills could have been raised by nine percent in 2016, but then they also would have had to be raised another eight percent in 2017. So a quicker route to back the four-percent increase level was chosen.
“What we did this year is to correct for both years,” he said.
Boyle said the increase would amount to an extra $3.87 a month for a minimum water user and about $12 a month for an average user.