Thursday, December 01, 2011

Don't drink the water

In the September round of layoffs, the city of Trenton was to release three technicians from the water department for reasons of “economy and efficiency.”  These are individuals who are licensed Water System Distribution Technicians…professionals who through the application of their experience and knowledge help maintain and safeguard the delivery of potable water to thousands of paying customers in Trenton and the surrounding suburbs.  (Need I remind the reader of the water distribution fiasco of October 2010 apparently caused by inexperienced individuals failing to follow proper procedure in opening and closing valves in the water system?)

First and foremost…laying off any employee of the Trenton Water Works does not save money!  Let me repeat that.  Laying off water works employees does not save money.

How is this so?  Well as you should know by now, the Trenton Water Works operates on its own budget separate and distinct from the city of Trenton budget.  The water utility revenue comes from the rate payers who buy and consume the water it produces. They may or may not be city of Trenton taxpayers. It doesn’t matter.  The money that flows into the waterworks comes from the distribution and sale of the water it produces. Period. 

Cutting the number of employees in the water utility does not save the city money or lower the property tax rate for Trentonians.

In fact, the argument can be made that reducing personnel costs at the water works actually hurts the city and can contribute to tax increases for city property owners.


Because the city of Trenton owns and operates the water utility it is allowed by law to take a portion of the operating surplus (profit, if you will) and move it over to the city’s general budget.  That portion is equal to a percentage of the utility’s operating expense.  The more money the utility spends on operating costs…like paying licensed Water System Distribution Technicians, the more money can be moved over to the city’s budget. 

Got it?  Good.

Now back to those technicians…why, you might ask yourself, would we lay anyone off from the water works, especially licensed professionals if it isn’t saving us money and thus lowering taxes? 
Good and fair question.  The answer lies in the fact that even though it operates on its own budget, the Trenton Water Works currently resides organizationally within the city Department of Public Works.  Civil service laws require that if a layoff impacts a department it must impact every division within that department. You can’t lay off people from solid waste but leave the water works employees alone.

If you recall, late last winter the city announced a plan to essentially shut down operations each Friday for 13 or 14 weeks as a cost saving measure. This would have been an across the board shutdown…including licensed water utility staff. This plan was eventually shelved at least in part because the city could not show how it could conduct these layoffs and still staff the water utility with the properly credentialed individuals.

In a letter dated February 15, 2011, John Plonski, the Assistant Commissioner for Water Resource Management at NJDEP, sent a letter to Mayor Mack raising the concern of proper staffing of the treatment facility during these weekly furloughs. The letter reminds the mayor that the water system is required to have licensed staff on duty at all times.

Makes sense, right? There needs to be proper, professional operators of the water system that so many depend on for potable water.

When the September layoffs are approved and notices sent out, Mr. Plonski sent a second letter, this time to then Business Administrator Eric Berry. This letter, dated August 5, 2011 (scroll down past thesecond page of the first letter) is more forceful and direct. Mr. Plonski states the case quite plainly:

“The NJDEP has identified the lack of qualified personnel as a key problem adversely affecting TWW’s ability to effectively operate its water system.”

A thinking person might reconsider the wisdom of laying off technicians in a utility already short handed.  Alas, our mayor does not think.  Or does he.

You see, the two licensed individuals targeted for layoff just happen to have testified before the grand jury last year about the misdeeds of Stanley Davis, the mayor’s half brother. This is a case of retaliation pure and simple. 

The mayor is not laying them off for matters of “economy and efficiency”. They are being singled out because they did the right thing and told what they knew about Mr. Davis.

Not convinced? 

How about this: last winter and again this summer, city council tried to pass an ordinance rearranging the organizational structure to create a standalone water and sewer authority department that could be isolated from the layoff plans. The first attempt was shelved because the less than astute members of council couldn’t grasp why it was needed. Then the city withdrew the “Friday furlough” plan and the issue didn’t come again until the September layoffs loomed.  That time, council passed the ordinance 4 – 3 but the mayor refused to sign it or discuss it and council couldn’t raise the fifth vote needed to override Mr. Mack.

It’s pretty common knowledge that when layoffs are planned, the most recent hires (the ones with least seniority) go first.  How is it that the long term employees…the licensed technicians were slated for layoff when two laborers and three water meter readers hired shortly after Mayor Mack took office were not?

Certainly the two laborers, Rodney Washington and Terrance Bailey should have been on the layoff list. Both are known Mack supporters with legal and other problems in their pasts. They are also the ones named in a harassment complaint brought by Kevin Moriarty for their verbal abuse while he tried to collect signatures for the recall petition.

The meter readers, too, by common sense would be the first to go in a layoff.  One, Charles Hall, is the nephew of Mack crony Harold Hall and although being paid by the water utility, is now assigned to oversee landscaping and design work in city parks.  Work that young Mr. Hall is absolutely not qualified to do.   Another is one time caterer and former owner of the now-closed Maxine’s restaurant, Henry Page. Page, another Mack “friend” reportedly cannot or will not complete his daily meter reading assignments, leaving them for others to do.

A week before the September 16 layoffs, Civil service stepped in and told the Mack administration to “bump” the technicians down to water meter readers and, presumably, layoff the two of the most recently hired readers.

That didn’t happen.  Instead, the Mack administration tried to move the technicians into laborer positions.  The techs balked; the administration moved to dismiss them entirely; a lawsuit was filed. A temporary restraining order halting the dismissal of the employees was also filed but ultimately, Judge Pereksta reversed it.  “While I agree that the DEP is recommending that (the utility) be more fully staffed, it’s too thin (an argument) to say that there is going to be this major effect on the safety of the citizenry of Trenton if your clients are moved to other positions,” Pereksta ruled. 

Assistant Commissioner Plonski states in his August 5 letter:  “Recent service disruptions due to operational deficiencies, which have not yet been resolved, indicate that TWW should not decrease the number of experienced and educated individuals who hold the licenses necessary to effectively operate the water treatment plant and distribution system. Targeting those licensed personnel serving TWW for layoff at a time when significant operational issues still exist is inappropriate and threatens the ability of TWW to provide a safe, dependable water supply to the City of Trenton and its surrounding communities.”

Judge Pereksta feels that is “too thin to say that there is going to be a major effect on the safety”. 

George Dougherty, attorney for the technicians has this to say: “The evidence is overwhelming that the reduction of the technician staff from an already low six to three is truly a dangerous thing to do.” .

So, we guess Judge Peksta is ok with putting the water supply at risk for the sake of Mayor Mack's spite against the people who he doesn't like. And we guess that Mayor Mack must not like customers of the city owned water utility.

Pass the bottled water.


Anonymous said...

Hasn't Page already stolen enough money from Trenton, through unpaid loans and such for his awful "restaurant?"

Anonymous said...

In January of 2006, the City of Trenton (Palmer Administration) raised water rates and at the same time equalized the water rates charged to City water customers to those charged to Township water customers. Prior to the equalization, City customer rates were about 20 percent less than Township customer rates. Except for veterans and certain low-income senior citizens, the City also eliminated the 10 percent discount City customers could receive if they paid their bill within 30 days of issuance. Prior to the equalization of rates, the amount of money that could legally be transferred from the water utility surplus to the City general fund was limited to 5 percent of the annual costs of the operation of the utility in the prior year provided that there was sufficient water utility surplus to do so. The 5% limit was and is stipulated in N.J.S.40A:4-35.1. For example, if the annual operating cost of the water utility was $30 million in the previous year (e.g. 2004), the City could transfer $1.5 million of water utility surplus to the City’s general fund in the current year (e.g. 2005).

With equal rates for City customers and Township customers, rates were and are no longer subject to the review and approval of the New Jersey Board of Public Utilities. The Palmer Administration’s view was that with equal rates the NJBPU not only had no jurisdiction over rates but also had no jurisdiction over the any other aspect of the water utility. That view justified to the administration and to City Council the transfer of as much water utility surplus as the administration wanted to transfer. Beginning in 2006, more than the 5% of prior years operating costs (expenditures) was transferred from the water utility surplus fund to the City’s general fund. In one year, $6 million was transferred. The minimum that has been transferred since 2006 was $3 million. The Mack administration has transferred $3 million in fiscal year 2011 and will probably transfer at least that amount in fiscal year 2012.

Since 2006 the City has transferred more than the 5 percent that it may be legally limited to transfer. Consequently, the reduction in operating costs through the dismissal of employees does not affect the amount of money the City receives or transfers from the water utility. However, the Townships have taken the matter to court with the claim that the City is bound by the 5 percent “rule” and that the City should restore to the water utility the funds taken in excess of the 5 percent. If the court rules in favor of the Townships, the City will have to return to the water utility about $10 million. That amount does not include other funds that the Townships claim that the City has misappropriated from the water utility for salaries for City employees that do not work for or provide service to the water utility as well as for water utility funds used for City equipment and materials and for non-existent services provided to the water utility by other City departments and divisions.

Anonymous said...

In 2008, the City raised water rates again. But it was not because there was insufficient water utility revenue to fund the anticipated water utility expenses. It has been stated that it was for the purpose of raising Trenton water rates to the same level as New Jersey American Water rates so that Township water customers were given the false sense that the sale of the assets would not have an impact on what they had to pay for water service. Since that time, New Jersey American has raised rates and recently filed a request to the New Jersey Board of Public Utilities for a 25% rate increase. The 2008 rate increase caused water bills for City customers to reach a level of twice what they were before the 2006 increase. If a City customer paid $90 per quarter prior to 2006, that customer now pays about $180 per quarter.

Old Mill Hill said...

We don't disagree.

The Palmer administration did believe that by equalizing rates between city and suburban customers they could avoid BPU oversight AND raid the surplus for as much money as they wanted. Whether or not the courts agree with that remains to be seen.

In the meantime we have a very valuable asset being mismanaged and plundered to the detriment of all.

This needs to stop. It is our belief that the water utility could be run effeciently, rates maintained at a reasonable level and there would still be a decent stream of income to pour back over into the city coffers.