Judge Orders Jersey City To Compensate Sewerage Authority For Decades Of Outsourcing

Following a controversy that dates back over one hundred years, Jersey City’s water and sewer system operator will soon have to pay millions for outsourcing its wastewater treatment operations.

“The Jersey City Municipal Utilities Authority [MUA] will find out this year how much it will have to fork over to the Rockaway Valley Regional Sewerage Authority [RVRSA] to operate and maintain wastewater treatment facilities near the city’s Boonton reservoir,”NJ.com reported. “Attorneys for RVRSA believe the payments could total at least $3.5 million annually and end up saving its clients hundreds of millions into the future.”

The MUA has an annual budget of about $127 million. Jersey City has recently approved $527 million in water bonds so that MUA can make infrastructure improvements.

These payments were ordered in October through a civil judgment, but the relationship between the two authorities dates back over a century.

“Back in 1916, Jersey City and Dover agreed to let the city build and operate a sewage treatment plant to protect its Boonton reservoir,” per NJ.com. “Over the next few decades, Jersey City entered into agreements with other towns in the area to connect its sewage collection systems to the facility.”

In the ’60s, Jersey City sued in order to leave those agreements, resulting in the creation of the RVRSA and a new agreement that Jersey City would pay for a portion of operating the new plant. There was a lawsuit in the ’80s when the plant still hadn’t been constructed. Then another one in 2010 when MUA and RVRSA disagreed about how much the former should pay. This latest order may finally settle the fiscal relationship between the two, but a separate trial this year will ultimately decide the final amount that MUA owes to RVRSA.

“The RVRSA is gratified that, after many years of dispute with Jersey City, there is now an unequivocal judicial decision that requires the city to make the financial payments it committed to make in 1971 and repeated in 1984 for the thousands of users of the RVRSA wastewater treatment system,” an attorney for RVRSA said in a statement obtained by NJ.com.

To read more about how utilities pay for water and wastewater treatment visit Water Online’s Funding Solutions Center.