Many of you may have heard rumors that hundreds of thousands of dollars of tax payer money has literally gone down the drain. Unfortunately, this is true. You may have also heard that the town will be going after water and sewer customers in order to recover much of these losses, this is also true. This is the first post, in what will surely be many, to provide you with the facts as the story unfolds. For now, we will provide you with a summary of events to explain what happened and what the town’s plans are to recoup some of the money.
The loss in revenues stems from billing errors which stretch back as far as 2004. The amounts are quite astonishing; water $308,812.09, sewer $$225,181.53. What’s more, at the June 16th Council Meeting the Mayor made clear that this is a work in progress and the numbers could rise. To see if you are affected, the current list can be found on the Riverdale Borough website.
The good news for the town is, the statute of limitations on utility billing is 6 years, meaning the town can legally revise billing records going back up to 6 years. Of course, since the errors go back as far as 10 years, this is also the bad news. Though we do not yet know exactly how much can or cannot be recovered, early estimates have the unrecoverable amount at over $200,000. We will be sure to report all of the figures as they come in. If you, or your residential development, are on the list and are wondering how and when the town is going to request payment, the plan has not been finalized. There has been discussion about stretching the payments out over a number of years with a discount for those who are willing and able to pay a lump sum. We urge you to attend the next council meeting at 7:30PM on July 21st at our Town Hall. If you cannot make it don’t worry, Eye On Riverdale will be there to report any new information.
If you are wondering how billing errors at such a scale could continue for so long, you are not alone. When the issue was first brought up at the May 19th Council Meeting, Mayor Budesheim placed the blame entirely on a billing clerk who has since retired. The errors were discovered by the Borough of Butler shortly after taking over the billing services for our water and sewers systems. So if Butler was able to spot these errors on the first billing cycle, why did Riverdale miss this for 10 years? This question was asked by residents at the May 19th Council Meeting and the 2 subsequent meetings since, yet to date, no credible reasons have been provided.
One such response was that Riverdale has been averaging known non-revenued water (water that we know was supplied through our system but was not billed to anyone) at levels between 15-21%. This may be within the national average but it does not mean that this is acceptable. As a matter of fact, there has been a push nationwide for municipalities to audit their systems to reduce this average. The numbers are, by no means, a license to be complacent. When asked directly if an audit was ever conducted, the Mayor stated that an audit is conducted every year. After further investigation, it turns out that the Mayor was referring to the town’s annual financial audit and in fact, an audit of our water system has not been conducted in the last 10 years.
This is quite surprising since we have been facing large discrepancies in our sewer usage for years; specifically between what the system’s meters are reporting and what the town is billing our residents and businesses. We have spent thousands of dollars searching for breaches in our sewer lines yet we never tried to determine how much of our known non-revenued water was contributing to this. Let me explain. In Riverdale we use meters to track water usage but not sewer usage. Instead we use a formula to estimate sewer usage. This allows for adjustments for summer water use that does not enter the sewers; sprinklers, pools, car washing. A properly conducted water audit would have revealed the billing errors and tightened the gap in the sewer discrepancies.
So what is involved in an water audit? In about 10 minutes on Google, Eye On Riverdale located a publication by the Environmental Finance Center Network (EFC) that explains the process; The Water Audit Handbook for Small Drinking Water Systems. Granted this particular publication was first made available in 2013 but the agencies cited have been around for a very long time; American Water Works Association, Environmental Protection Agency and the Texas Water Development Board. In fact, the American Water Works Association was established in 1881 and with membership (annual cost $295), you can download free water system audit software developed by the AWWA. Again, not a secret organization, their NJ office is located in Ridgewood and, as a matter of fact, they have presented at the NJ State League of Municipalities Annual Conference; a conference regularly attended by our mayor and some of our council members.
The point of this is not to assign blame but to install accountability, something that has clearly been lacking over the past 10 years. The billing issues may be water under the bridge (pun fully intended) but the mismanagement of our water and sewer systems is not. Please attend the next Town Council meeting on Monday, July 21st and request that our Town Administrator reads the handbook, joins the AWWA and gets educated on the auditing process.
In the meantime, ask yourself where else our town may be pouring money down the drain (sorry, can’t help myself), and send your suggestions to firstname.lastname@example.org. Investigation is what we do.