A reverse course

City officials have reversed course on a very important issue in the Trenton Water Works controversy.

They now argue that state law, which permits utilities that serve outside municipalities to transfer up to 5 percent of their total operating budget into the municipal budget, limits the ability of the Trenton Water Works to remain the cash cow for the city that it has been in recent years.

Such statements directly contradict the city and the state’s most recent position on the issue.

Officials from both entities have previously stated that Trenton may transfer as much of the water utility’s multimillion-dollar surplus into the city’s general fund as city officials wish, as illustrated by the below 2007 Times of Trenton article:

(an excerpt)

Suburban towns sue Trenton over water rate increase

by Ryan Tracy/The Times

Tuesday October 21, 2008, 5:10 PM

In the past, city officials have argued that because Trenton is not subject to state approval of water rates, the city may take an unlimited amount of money from the Trenton Water budget.

In 2006, the city adopted an equalized rate for all the customers in the system, exempting Trenton Water from a rate approval process overseen by the state Board of Public Utilities.

In 2007, Trenton transferred $6.2 million collected from Trenton Water customers to the city budget. That transfer came in addition to $3.6 million transferred from 2004 to 2006, according to the civil complaint.

A spokesperson from the state Department of Community Affairs has backed Trenton’s logic and said the transfers are legal, but the suburbs remain unconvinced.

City officials have also said the revenue infusions are a deserved benefit, given that Trenton maintains and administers the entire water system.

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