Water: The Waste You Don’t Know About
Property owners are asking where they can save more money. We have helped them to reduce violation occurrence, to deal with problem tenants, to cure and prevent arrears, but how often does anyone think of their water? If there’s no visible leak, then it’s not broken, right? Wrong.
In NYC, the Water Board, a division of the Department of Environmental Protection (DEP) is in charge of water. It has a monopoly and in recent years has been hiking up fares in the tradition of Standard Oil. Unlike other utilities (gas, electricity, etc.) where New York State (NYS) has unbundled services so residents can choose their providers, water doesn’t offer that opportunity. That means residents are price takers. In recent years, residents have been taking quite a beating.
The important element for managing water charges is to make sure they are correct. The DEP makes mistakes and leaves errors on their books for decades. Also, when the DEP is correct, they still rarely do much to collect on overdue bills. Even if the DEP is correct, there is still a chance you’re paying too much. This, like so many other property management issues, all boils down two areas: personal attention and modern management techniques.
Lines need to be checked regularly. A faucet that leaks one drip per second wastes almost 20 gallons of water a month. That comes back to bite owners after just a short while. Imagine that the leaking water is hot. Now you’ve got water and the cost of heating it too.
Bills need to be monitored. The New York City Department of Environmental Protection routinely over bills you for your water and sewer usage. One reason is that the process of monitoring and billing is subject to human and technological errors. Other reasons for overbilling are:
- Estimated Bills – By definition, estimates are not accurate. Estimated bills occur when the DEP estimates water consumption based on past actual reads. Auditors can correct inaccurate estimates.
- Broken Meters – A faulty meter can generate inaccurate readings, resulting in abnormally high water bills. Auditors can verify readings and check the accuracy of meters.
- Frontage Billing – You may be billed for lines or fixtures you do not own. Auditors can obtain refunds for errors in frontage billing.
- Overlapping Billing – Dates on your billing cycle may overlap so that you are paying double for some water use. Auditors can catch and correct this.
If there’s even a question about accuracy, companies like AWS can give their expert advice on the best ways to investigate and cure the problem.
Even with the recent price hikes (7% CAGR over the past 10 years); NYC’s water induced hardships are still not nearly as bad as some other cities. In September 2008, the annual survey conducted by the NUS Consulting Group found that the average price of water in the United States soared by 7.3 percent for the period ending July 1, 2008. The survey, which includes 51 water systems located throughout the country, revealed the highest price paid was in Boston, MA at $5.76 per one thousand gallons (“KGal”).
“With so much attention being paid to oil and gasoline markets, Americans may neglect to notice the increases in their water charges,” remarked Richard Soultanian, co-president of NUS Consulting Group. “While U.S. prices are considered modest by international comparison, this most precious commodity is truly our sleeping giant in terms of cost impacting each and every consumer.”
They hope to install a $200 million automated meter-reading (AMR) system, but that will not be in place until 2010. AMR is more accurate than manual meter reading. An added bonus to AMR is that it is less expensive than manual meter reading.
There may not be much we can do to fight City Hall but we can certainly do our best to keep them honest and make sure we are the masters of our own destiny by monitoring water in the properties we manage.
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