Recommendation for Commission Consideration

The evidence reviewed in this report supports a specific next step. The New York Public Service Commission should evaluate and, if supported by the record, develop a workable optional household-occupancy adjustment to the starting water allocation for Veolia Water New York customers in the applicable separately metered residential class. The immediate purpose should be to determine whether the current common threshold places material basic indoor water needs into higher conservation tiers because more residents share one meter, and whether an occupancy-adjusted starting allowance would improve rate equity while preserving strong conservation incentives.⁵³

The objective should not be merely to study household size in the abstract. The regulatory process should be directed toward an implementable outcome: if the evidence demonstrates that the present starting allowance creates a material occupancy-related rate-design problem and that a reasonable adjustment can be administered, the Commission should establish the adjustment through the appropriate tariff and program rules. If the evidence does not support implementation, the record should explain why.

The adjustment should preserve the basic structure of conservation pricing. Every participating household would continue to pay for every unit of water used. The adjustment would change only the amount of water available at the starting rate before higher conservation prices apply; once the adjusted amount is exceeded, the existing higher-tier framework would continue to provide a conservation signal. Households of every size would remain responsible for efficient water use.

Participation should be voluntary. A household that does not request an adjustment should remain under the standard tariff and should not be required to provide occupancy information for this program. A household that does participate should meet neutral eligibility and reasonable verification requirements that apply on the same terms without regard to neighborhood, income, family structure, religion, ethnicity, or community identity. Privacy, renewal, and program-integrity rules should be proportionate to the information and benefit involved.

The Commission should also ensure fair revenue recovery and consider the effects of any final design on participating and nonparticipating customers. The inquiry should consider both the effects of a proposed adjustment and whether the present structure allocates customer-related costs and conservation price signals reasonably. It should not assume that an adjustment necessarily transfers the cost of larger households to smaller households, or that the existing allocation is neutral. Current cost-of-service, billing, usage, and revenue evidence should determine how the utility's authorized revenue is being recovered and how any revised design would distribute that responsibility.

This report intentionally does not prescribe a gallons-per-person allowance, minimum household size, fixed verification document list, or renewal period. Those details require utility-specific evidence and the judgment of the Commission, Department of Public Service Staff, the utility, consumer representatives, municipalities, conservation advocates, and other parties. The report's guidance is instead substantive: the final design should give qualifying households a reasonable opportunity to meet verified basic indoor water needs before the stronger conservation price signal applies, while retaining conservation, fair revenue recovery, privacy, and practical administration.⁵⁴

This recommendation concerns Veolia's applicable separately metered residential class in the New York Rate District. Any broader application would require a separate utility-specific record and should not be assumed from the Veolia evidence alone.

Accordingly, the report recommends Commission consideration directed toward a practical optional occupancy adjustment for Veolia's applicable separately metered residential class, with implementation if the regulatory record supports it. Such an approach would preserve the conservation principles that remain central to New York water policy while addressing a rate-equity question supported by residential-demand evidence and reinforced, but not resolved, by New York's own regulatory history.