The Village of Plandome Board of Trustees expressed disappointment with the outcome of its lawsuit against the Manhasset-Lakeville Water District over the calculation of the village’s water rates in an e-mail sent to residents last Tuesday, and announced plans to appeal the court’s decision and consider a return to the village providing its own water.
“As we informed the court, our engineers are looking into the possibility of opening the Village’s wells, with the feasibility, timing, and cost of doing so still to be determined,” the board of trustees wrote. “In the meantime, the Village will be filing a Notice of Appeal while the Trustees evaluate all options, including re-opening the wells.”
Justice Bruce Cozzens ruled in Nassau County Supreme Court on Aug. 1 that the water district’s rates were determined fairly and reasonably, and that the district did not breach its terms with the village when raising the village’s rates.
Cozzens also ruled that Plandome was not a “captive customer” of the district, as the village has alleged, because it has its own water wells that it could use to provide water.
“Contrary to these findings, whether the Village is currently a captive customer, and whether the Village can activate its wells during the term of the contract, were hotly contested issues,” the board wrote in the e-mail. “In fact, the unequal bargaining power caused by the Village’s captive status is the direct cause of the Village being forced to file suit.”
The Village of Plandome, which is located outside the water district, filed a lawsuit November alleging that it has been charged higher rates than district clients who received additional services and that the water district’s methodology for calculating rates was flawed.
The village purchased water under a 20-year contract with the water district from 1992-2011. During the last five years of that contract, the two parties agreed to a fixed rate of $3.85 per 1,000 gallons, while a contract extension was negotiated.
After the initial contract ended, the village continued to purchase water from the district and negotiate for lower rates.
Manhasset-Lakeville Water District Commissioner Brian Morris wrote a letter to the village in February 2012 stating that the district would provide water under a new formula and that the village’s acceptance of the water indicated it accepted the new rates. A second letter was issued in July.
In 2012, the water district raised its water rate from $3.85 per 1,000 gallons to $4.20 per 1,000 gallons. The village initially refused to pay the increase, but made good on money owed under the new rates in September.
Plandome’s water rates were raised again last month to $4.85 per 1,000 gallons, retroactive to January. Its current water contract expires at the end of the year.
