Water districts in Nassau County that run large surpluses should charge their customers less and borrow more, county Comptroller Howard Weitzman said last week.
Weitzman said that 19 commissioner-run districts have a combined $59.9 million in the bank.
“Commissioner-run districts have argued that they are saving money by accumulating large fund balances to pay for future major repairs or capital projects,” he said in a press release. “In effect, they are taking money from current residents to finance future benefits instead of using long-term borrowing to spread the cost over future years. Not only is this unfair, but it can also avoid town oversight over district borrowing.”
Weitzman recommended that future capital improvements, such as wells, water tanks, and land acquisition and repairs that extend the useful lives of assets, should be financed through debt.
He also recommended that districts should not accumulate more than 5% of their operating budget or previous year’s expenditures as a cushion. Some water districts have much more than that — Cathedral Gardens has 763% of its operating budget in fund balance; Garden City Park, 198%; and Franklin Square, 124%. Eight of the 19 districts have enough surplus to operate for one to two years without charging their users fees or collecting property taxes.