May 24,2017
the staff of the Ridgewood blog
Ridgewood NJ, since 2010 ,the class action, brought by the three municipalities on behalf of ratepayers, alleges that Ridgewood Water owes $14 million in past overcharges and claims the Village of Ridgewood improperly applied water company revenues to other areas in its municipal budget.
The three municipalities Glen Rock, Midland Park and Wyckoff have alleged that the utility company, operated by the village of Ridgewood, overcharged customers from 2010 to 2016 and improperly used company funds to supplement Ridgewood’s municipal budget.
The towns want $17.4 million returned to ratepayers, including $13.8 million in alleged overcharges and $3.6 million in transfers from the utility’s fund balance from 2010 to 2016.
By way of background, the Ridgewood Water Utility supplies water to Ridgewood residents and to the residents of the neighboring communities of Wyckoff, Midland Park and Glen Rock. Importantly, the Water Utility is not regulated by the New Jersey Board of Public Utilities (BPU) or any other neutral and impartial governmental agency. This case concerns a scheme devised by the Village of Ridgewood to unlawfully off-load a portion of the Village operating budget to the extraterritorial ratepayers of the Water Utility. The scheme was simple: through the accounting devise of “indirect costs,” the Village used its Water Utility to transfer substantial Village operating costs that are wholly unrelated to the operations of the Water Utility to the ratepayers of the Water Utility. In effect, the residents of Wyckoff, Glen Rock and Midland Park have been subsidizing the Village of Ridgewood Operating Budget so that, during periods of economic difficulty, Ridgewood does not have to make the tough choices that all other communities make by reducing expenditures or raising taxes on their own residents.
In the past seven years, the Water Utility has raised its rates by some 37 percent. The Plaintiffs in this litigation assert that these massive rate increases are unlawful and excessive. Plaintiffs demand, among other things, a full refund of the seven years of unlawful rate increases.
