August 16, 2007

Pending before the State Assembly and State Senate is legislation (A03381-A / S04176A) intended to resolve a dispute between the Mohawk Valley Water Authority (MVWA) and the State Canal Corp. over the use of Hinckley Reservoir. This legislation, the "West Canada creek riparian rights restoration act" ("Act"), has gone through several changes, the latest of which appears calculated to "buy" Herkimer County's support by specifying a quantity of water for certain Herkimer County municipalities. Before accepting this proposition, you need to understand what you are getting, and what you are giving up.

Although the legislation is called a "riparian rights restoration act," it is nothing of the sort. Riparian rights are a matter of common law in the eastern United States. Riparian rights are rights associated with the ownership of land adjacent to a stream. They include a right to access the water for such things as swimming, boating, or fishing, and the right to reasonable USE of the water passing by the land ON the riparian tract of land. Every riparian owner has the right to the FULL flow of the stream, undiminished in quantity by the use of other riparian owners. Riparian rights DO NOT include any right to take the water away from the land for use elsewhere -- that would reduce the flow in the stream. Even if one were to buy all the riparian rights to a stream, there is still no right to take the water elsewhere because you can only buy what the other party has the right to sell. Taking the water away from the riparian tract of land requires permission from the state, and is subject to state regulation. This is because the state has an obligation to preserve an equitable distribution of potable water among its subdivisions, to ensure that water supplies which are more available for use by one community are not absorbed by another.

In carrying out its obligation to preserve an equitable distribution of potable water, the state designates which communities are appropriately served by which water supplies. The state can compel one water system to supply another, with amounts and costs to be agreed upon, and if the systems cannot agree, the state can specify the amounts and costs following a hearing. Because developing a water supply system involves considerable cost and infrastructure, the state can and does prohibit suppliers from competing with each other and will prevent one supplier from going in and cherry picking the easiest to reach customers from another, which would cause the other supplier financial harm.

The communities of Greater Utica and those of the West Canada Creek drainage basin below Hinckley reservoir have a COMMON interest in Hinckley reservoir because the state in 1937 declared Hinckley, and the other sources belonging to the former Consolidated Water Company, to be the "natural and proper sources of water supply" for these communities. That is not to say that other communities cannot be added to this list, but Greater Utica and the West Canada drainage basin communities below Hinckley have already been allocated this resource, and others must justify their need to the state before they can tap in.

Although the legislation purports to restore the "RIGHTS" of the water authority to "THE FULL AND UNFETTERED USE OF THE SEVENTY-FIVE CUBIC FEET OF WATER PER SECOND" reserved from a state taking, it really is giving the water authority something it never had before -- the freedom to do what it wants with the water -- because in New York, rights in water are limited, and taking water away from a riparian tract of land for municipal water supply purposes has always been subject to state regulation.

The legislation would reserve 15 CFS (or 20% of the water authority's total) for certain Herkimer County communities. However, all the communities that are part of the West Canada Creek drainage basin below Hinckley reservoir already have a right to the Water Authority's share of Hinckley water by virtue of the state's declaration in 1937. So qualifying the right with 15 CFS adds little. But what will be lost if this legislation goes through?

The legislation states that the authority "MAY SELL" its water to "ANY END USER AT A PRICE OR PRICES TO BE DETERMINED BY SUCH AUTHORITY." This vests the Authority with the exclusive discretion to determine who will get its water and at what price. However, those communities in the West Canada Drainage basin below Hinckley reservoir, who have already been designated as the natural recipients of this water, currently have the right to have the state compel the water authority to supply them with water when they need it, and have the right to have the state specify amounts and costs. They will lose these rights with this legislation. These matters will become solely the Water Authority's discretion.

The water authority claims that it needs to expand to Western Oneida County for new customers to stabilize its rates -- but it is no different from any other water supplier in our region that is suffering from population loss. The proposed legislation's authorizing the Water Authority to sell water to whomever it wants raises the specter of the Authority entering into competition with other water suppliers, because it would be free of the state's prohibition on competition. The water authority has already indicated an intention to serve the City of Sherrill if the Verona project goes through. But Sherrill is already a customer of the City of Oneida system, and a switch by Sherrill will hurt Oneida. The water authority's current permit prohibits competition -- but if this legislation goes through, it will be free of this restriction. Who is to say that parts of the Ilion system won't be next?

And if the ability to compete isn't bad enough, the Water Authority could use its customer base in Greater Utica to subsidize the competition -- and not because of any increased efficiency. That seems to have been the case with Verona.

Verona needs more water because of the growth of the casino. Verona studied three potential water supply sources: Onondaga County Water Authority, the City of Rome, and the MVWA. Verona's engineers concluded after determining the cost of the infrastructure to bring the water in, that the City of Rome would be the most cost effective source of supply. The MVWA was the least cost effective of the three. But Verona chose MVWA even though, infrastructure wise, it was the least cost effective solution. Although there were some statements in its engineering report that Verona could not come to an agreement with Rome, if you look at the agreement between MVWA and Verona, you would know that that claim was only an excuse. MVWA is going to let Verona write off the cost of its pipeline against its water bills over 30 years -- essentially making its customer base in Greater Utica pay for most of the deal -- a deal that would create infrastructure that Verona's own engineers concluded would not be a cost effective way of getting water to Verona. So there is little justification to expand to Verona.

The pipeline would pass through central Oneida County, but that is sparsely populated and there is currently little need for public water there -- again, little justification for extending service there. With no showing of public need, there would be little reason to for the State to grant a permit.

But if this legislation goes through, the pipeline will get built, because MVWA will be free of state control. And even though there is little current need for this pipeline, any land nearby will suddenly become more valuable, enriching individual owners and developers -- but that will be at the public's expense.

The Water Authority paints itself as being concerned with getting water to those who need it. The contaminated wells in Camelot Village in Westmoreland became the poster child for letting its 16 mile Verona pipeline go through. Well, it was recently reported that Camelot Village is finally getting its water -- from the City of Rome -- which had pipes less than a quarter mile away.

It should be clear by now that this legislation is not about supplying people with water. It's about power and control. And this legislation will give unprecedented power and control to an unelected authority. MVWA will have powers that other water suppliers do not have. It will even have more power than the Department of Environmental Conservation because when DEC makes an allocation of water supplies between communities, it has to follow certain rules. MVWA, however, will get to sell water to whomever it chooses.

I have not even touched on the destruction of Gray Reservoir, the 1917 Agreement's requirement that the water authority at least in part restore the creek flow that it is diminishing, and the legislation's doing away with the 1917 agreement. But I do not want to take up more of your time. I leave you with this question:

Do you think it's a good idea to give more power to an entity that has already broken its agreement with you?

Frank Montecalvo