Parsippany residents and businesses could see their sewer rates go down starting in the beginning of 2013.
Parsippany Mayor James Barberio made the announcement of proposed rate decreases and a sewer rebate during Tuesday's Township Council agenda meeting at Town Hall.
Meanwhile, the Montville Township Committee planned to repeal a decision to lower sewer rates beginning in January at Tuesday's meeting. Montville officials said they are no longer able to offer the lower rates proposed to residents this summer because new technology at the Parsippany Wastewater Treatment Plant has showed that Montville will be responsible for a higher percentage of cost than previously anticipated.
"All along, we've discussed that once the sewer treatment plant was complete, we would come up with a plan to lower the rate and also to give money back to the residents," Barberio said about Parsippany residents. "This was something we said we were going to do from day one."
The mayor said his administration is proposing a 10 percent decrease in the sewer rate and a $1.5 million rebate for the first quarter of the new year.
"In the future were going to see if we can reduce it more," he said. "Hopefully we can do it next year too and get the rates down to where they should be."
He noted that the new sewer treatment plant has reduced energy costs for the township by about 60 percent.
Business Administrator Jasmine Lim outlined some details surrounding the rebate.
"The [one-time] giveback is allocated by category—residential, garden apartment, commercial—in the same percentage that the revenues are brought into the sewer plant," she said.
Lim explained that, for example, a residential unit would receive a rebate of $49.73, $48.53 would be given back for an apartment unit and $1.14 per 1,000 gallons would go to commercial entitities.
Additionally, quarterly sewer fees paid by residents and businesses would go down.
"What we're proposing is that the fixed rate for [single-family homes] will be decreased by almost $10 a quarter, or about $40 a year [in savings]. For garden apartments, the decrease is, again, close to $10. Both would go down to $51 per quarter," Lim explained. "For commercials, the decrease would be 90 cents per thousand gallons, so the final rate would be $5.14 per thousand gallons."
She added that the figures announced are "really conservative."
"We ran some scenarios for 10, 15 and 20 percent, and we decided that at least at this first stab at it, it's really safer to stick with the 10 percent," Lim said. "If in 2014 it looks like we're building that surplus back, we can reduce the rate further and issue another rebate, if that's what the council chooses to do."
The sewer rate decreases will have to be presented as a proposed ordinance to gain council approval, according to the business administrator, but she said she was unsure whether the rebate must be approved via a resolution or by ordinance. She said that in any case the approval process will be put into motion beginning next week.
Lim said that a surplus of about $4.5 million would remain in town coffers for the sewer plant.
"And that is okay with the bonding companies?" asked Councilman Michael dePierro.
Lim said yes.
Mayor Barberio said maintaining a sewer surplus was necessary in case the new treatment plant malfunctioned—which almost happened during Superstorm Sandy.
"Our sewer treatment plant was almost compromised by the storm," he said. "That would have been a travesty for the township of Parsippany-Troy Hills.
"We were in a dire emergency at that time. We were at one point...12 hours away from the infrastructure in Parsippany possibly failing. There were a lot of calls from residents calling to get their power back on, but the priority had to be taken care of. The sewer treatment plant and the water department became priorities because they lost power."
Barberio credited the Office of Emergency Management and the sewer and water departments with averting disaster.
"If our infrastructure [had been] compromised, it would have been a huge state of emergency for Parsippany," the mayor said. "If it had failed, we would have lost revenue like you cannot imagine."