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Denenberg Asks AG to Investigate Privatization of Sewage Plants

In a press conference held on Dec. 15 at Cedar Creek Park Playground, just north of the sewage facility in Wantagh, County Legislator Dave Denenberg, of the 19th District, announced his request for State Attorney General Eric Schneiderman to investigate the legality of County Executive Edward Mangano’s plan to privatize the county’s sewage treatment plants.

Legislator Denenberg submitted his request for investigation in a letter, dated December 14, 2011, to A.G. Schneiderman and State Comptroller Thomas DiNapoli. He said his request is on behalf of several residents regarding the sale or lease of the county’s sewage treatment plants and infrastructure, with concerns that the deal is a “‘one shot budget gimmick’ that will result in higher sewage charges to taxpayers and less public oversight of this vital county function and environmental issue.”

Denenberg also calls into question a contract between Nassau County and Morgan Stanley regarding the privatization deal. “The contract, for which Morgan Stanley will be paid $100,000 per quarter, is for the evaluation and assessment of the county’s sewage treatment plants and disposal infrastructure for the purpose of preparing bid documents to sell the plants to a private company,” said Denenberg. “The county’s financial control board, NIFA, has already criticized the plan because instead of retiring debt, the proceeds of the sale will be used as one-shot revenue.”

In the letter to Schneiderman and DiNapoli, Denenberg said, “Based upon the narrative description, Morgan Stanley was awarded a contract after a February 16, 2010 bid process. The bid proposal was for the contractor to provide services in relation to evaluating and formulating a request for proposal for the privatization, through sale or lease, of Nassau County’s sewage treatment infrastructure and assets. The contract was first brought to the Legislature for a Rules Committee review and vote on December 12, 2011, although Morgan Stanley had been retained in March or April 2010. The agreement itself is made effective as of October 1, 2011.

“I request an investigation into this process whether state municipal laws and/or regulations with respect to proper bidding processes and proper contracting processes were violated. Moreover, as this Morgan Stanley contact clearly provides that over $500,000 of taxpayer money will be spent to formulate a proposal and seek bids on a proposal to privatize the county’s sewage treatment and other assets, I request a further investigation and opinion from your respective offices. The subject of the further investigation and opinion is whether a county can unilaterally consummate a privatization of infrastructure and assets that were purchased and constructed utilizing, in material part, state and federal funds. Upon information, the three plants in question were each built through substantial federal and state investment. It would appear that Nassau County’s sale of these plants would require federal and state approval as well as possible reimbursement to taxpayers for their initial investment.”

The county’s three sewage treatment facilities are: Bay Park, Cedar Creek, and the City of Glen Cove. According to the county’s website, its facilities account for 85 percent of the county’s waste treatment. Other independent facilities within the county, including Long Beach, Jones Beach, Cedarhurst, Lawrence, Great Neck, Port Washington, Belgrave, Greater Atlantic Beach, and Oyster Bay handle the remaining 15 percent of sewage treatment. Six municipal sewer districts, including Garden City, Freeport, Mineola, Hempstead, Roslyn, and Rockville Centre, collect and pump sewage to the county facilities to be treated.

Denenberg said, “Just putting everything into time perspective will really tell us a disturbing story; the public has been kept in the dark.”

Ralph Spagnolo, in attendance, has worked in the county’s sewage facility explained how the sale of the plants would be in jeopardy if a private company’s employees chose to strike. Spagnolo said that as it stands, under county control, if the employees chose to walk off the site, they would be arrested. Under privatization, Spagnolo said, if they chose to strike and the plants were unmanned, sewage would back up and flood into the bays and canals. Spagnolo said the plants must remain manned; there are no shut-off valves.

“Bay Park and Cedar Creek plants must be pumped; they’re not like the city plants, there’s no miracle valve that you open up and let the water go into the East River or into the bay or any place else; it’s going to go into the plant, into the canals and into your homes,” said Spagnolo.

Denenberg has had a history of involvement with environmental remediation projects at the plants, citing that in 2008 and 2009 he passed capital budgets for odor abatement and ammonia removal, in addition to other upgrades and repairs.

One local resident of the Bay Park Sewage facility, Scott Bochner, was in attendance at the press conference. He explained how he regularly sees a brown plume of sludge streaming from the sewage facility into Reynolds Channel.

Bochner told how it took his own private video of blocks of raw sewage floating in the water near his home, which he posted on YouTube, to get the proper authorities to investigate and begin remediation.

Denenberg confirms that the discharge is not a new incident, that the county and other environmental agencies have been aware of the issues due to a “number of delayed projects over two [county] administrations.”

Denenberg suggests that of the $700 million of taxpayer money allocated, the county should be spending the money on adding a “third stage treatment” and including upgrades and increased maintenance.

“Meanwhile, since 2007 the county allocated $700 million in sewage treatment plant infrastructure improvements. This deal stinks for taxpayers, stinks for the environment, stinks for county workers and reeks of backroom deals with politically connected insiders. Nominal sewer taxes will be replaced with exorbitant sewage and water rates,” concluded Legislator Denenberg.

In a statement released by Brian Nevin, Senior Policy Advisor to County Executive Edward Mangano, said, “The only person who should be investigated by the Attorney General is Dave Denenberg for his neglect and failure to properly oversee Nassau’s sewage treatment plants over the past decade as they polluted the environment and fell into a state of disrepair. The administration will only move forward with a public-private partnership for Nassau’s sewage treatment plants if it protects the environment and county taxpayers.”