Utility Questions


Water and Sewer Information

About your water and sewer bill...






I have a problem with my water or sewer bill, who should I call?

New Jersey American Water Company makes every attempt to provide accurate monthly billings for their services. If you have questions related to your water or sewer charges, please contact New Jersey American Water’s 24-hour Customer Service Center @ 1-800-652-6987.


I called New Jersey American Water Company about my sewer bill, and they told me to call the City. Why?


We have worked very hard with the management of New Jersey American Water Company on this issue, and they have instructed their Customer Service Center representatives to answer questions from Ocean City customers and not to refer them back to the City itself. If a customer service representative mistakenly tells you to call the City about your concern, please ask them if you could speak with a supervisor. Unfortunately, this system is always not sure fire and there are occasional glitches that occur with misinformed service representatives at the water company.



How is my water rate determined?


The cost of delivering high-quality, reliable water depends on a number of factors, including the following:

  • required capital investments and the expense of operating and maintaining the City water supply system.
  • electricity used to pump the water from its source in the ground to homes and businesses within the City.
  • standards of quality and quantity, pressures and service set by federal and state officials as well as New Jersey American Water Company’s standards to protect the heath and welfare of our customers.
  • staffing costs, including salaries and benefits, for its technicians, water quality specialists, meter readers, administrative personnel and others who help run the water utility.


Note: The rates charged by the New Jersey American Water Company are reviewed and approved by the New Jersey Board of Public Utilities (NJBPU). Traditionally, public hearings are held in Ocean City after petitions have been filed with the NJBPU for any rate increases/decreases. At that time the public & City representatives are afforded an opportunity to speak on the proposed changes in rates. Additional information can be found on the NJ Board of Public Utilities website @ http://www.state.nj.us/bpu/



What are the main components of my water bill?


  • Fixed Service Charge: The purpose of the monthly service charge is to recover the full cost of providing meter reading and billing services, as well as the capital costs for providing the meter and related service lines. The rate is based on the size of the meter that was installed at the billing address. For residential customers who have a 5/8” meter, the service charge is $10.60 per month.


  • Volumetric Charge: is based on your water consumption or $5.9405 per 1,000 gallons since the last meter reading. These costs are related to operating and maintaining the source of supply, treatment and transmission facilities, as well as other general operating expenses.



What are the main components of my water bill? (Continued)


  • Purchased Water Adjustment Clause (PWAC): The current PWAC rate $0.4368 per thousand gallons. New Jersey American Water Company purchases water from a number of water service providers to supplement its own surface water and groundwater supplies. While we take steps to minimize the amount of water we purchase, these supplies are critical to providing a reliable source of water supply for our customers. The PWAC enables New Jersey American Water to recover the costs related to purchasing water from other water suppliers and to supplement their own ground and surface water supplies. The PWAC is reset on an annual basis (generally in August) and is adjusted to reflect current costs. Because the NJ American Water Company is regulated water utility, they are required to file with the NJ Board of Public Utilities (NJBPU) each time they wish to increase the PWAC to recover costs associated with the water supply. Subsequently, the NJBPU performs a thorough review of the petition and after various required hearings either denies, changes the amount proposed or approves the fee increase.



Why does New Jersey American Water charge for sewer service in Ocean City?


New Jersey American Water Company owns and maintains the collection system, or pipelines, that are used to collect sewage from homes and businesses in the City. The sewage is transferred to the Cape May County Municipal Utilities Authority (CMCMUA) sewage treatment plant located at 45th Street & West Avenue. The CMCMUA owns and maintains the treatment plant, pumps and pipes necessary to treat and dispose of the collected sewage. Approximately 69% percent of your sewer payment covers the costs New Jersey American Water Company pays to the CMCMUA to treat and dispose of the sewage generated within Ocean City. Each municipality using the CMCMUA plant is required to pay for the volume they send to be processed. The remaining 31% percent covers New Jersey American Water’s expenses to collect sewage; maintenance of  the collection system; pay local, state and federal taxes and to invest in the aging infrastructure of the collection system.



What are the current sewer rates for wastewater in Ocean City?


  • Sewer Service Charge (including PSTAC): NJ American Water Company provides sewer (wastewater) services in Ocean City, the Adelphia section of Howell Township & Lakewood Township only. All other communities in the State are either with another water company or with a municipal water authority. Like the PWAC, the Purchased Sewerage Treatment Adjustment Clause (PSTAC) is a pass-through charge for sewage treatment costs. The PSTAC reflects the costs that NJAWC pays to the CMCMUA for treating wastewater in areas such as Ocean City where they operate and maintain the sewer pipelines and collection system. Each year, the PSTAC is rest and may increase or decrease depending on many different factors, including the amount of wastewater sent to the sewage treatment plant and the authorities’ costs associated with treating the sewage. The current charge is $35.4021 per 1000 gallons of water usage billed at the property during the prior year’s summer quarter (July, August & September), but not less than $264.81 per year. This sewer service charge is divided by 12 and is billed equally over the period of January through December each year. The sewer service charge includes the PSTAC charge. The PSTAC rate is $24.2983 per 1000 gallons, which is included in the above Sewer Service Charge. The total PSTAC charge represents approximately 69% percent of the overall Sewer Service Charge. The service charge includes the capital investment in the wastewater collection system pipelines and service lines and the majority of the costs for the operation and maintenance of those systems within the City.


  • Volume Charge: In addition to the above monthly Sewer Service Charge there is a charge of $1.8698 per 1000 gallons ($1.39861 per 100 cubic feet) of water consumed for the current month. This is based on the amount of water used since your last meter reading and represents all of the costs not included in the sewer service charge.




What is the purpose of the PSTAC?


The PSTAC reflects the costs that New Jersey American Water Company pays to the CMCMUA for treating the wastewater. Each year the PSTAC is reset and may increase or decrease depending on many different factors, including the amount of wastewater sent to the sewage treatment plant and the CMCMUA costs associated with treating and disposing of the sewage. The current rate is $24.2983 per thousand gallons. The total PSTAC fee is included within the Sewer Service Charge on your bill. The PSTAC currently represents approximately 69% percent of the Sewer Service Charge.



Why is this year’s sewer service charge based on last year’s summer quarter usage?


The CMCMUA designed and built the 45th Street treatment plant to handle the tremendous peak flows Ocean City generates during the summer months. The CMCMUA develops its annual user charge based on the previous year’s sewage flows to the treatment plant during the summer quarter (July, August & September). New Jersey American Water Company utilizes the same methodology as the CMCMUA, where they bill their customers in the current year based on the prior year’s summer consumption. This approach attempts to match the charges from the CMCMUA with the revenues received from its Ocean City customers. Our Sewer Service Charge is structured on the same basis, and ensures that everyone will share proportionately in the CMCMUA’s costs of owning, maintaining and operating their sewer treatment facilities.



Why am I being billed for sewer services when I am not there?


Sewer service charges are billed to all customers regardless of the volume of water used that month. You may only be a seasonal resident and do not use the water service or experience any water volume during certain months of the year, but you are still being billed for the sewer service charges monthly. The annual Sewer Service Charge is based on the water usage billed during the prior summer quarter (July, August & September) and covers the fixed costs associated to provide the sewer service. New Jersey American Water Company realizes that this annual charge could be burdensome to some customers, if full payment were required on a once a year basis. Thus the City and the water company agreed on a billing plan that would spread the payments out equally over a 12-month period, so that customers are billed 1/12th of this charge each month throughout the calendar year. The Sewer Service Charge represents New Jersey American Water Company’s fixed costs to operate and maintain the collection system and the actual cost to collect the sewage, as well as the fee billed by the CMCMUA to treat, and dispose of the sewage. Over the years there has been much controversy concerning these charges and how they are billed out. What must be understood is that in the end the water company will be entitled to recover their cost and that the charges will remain the same no matter if they are billed in one lump sum or spread out in 12 equal payments. For the average property owner it appears to be more desirous to have the payments spread out equally and to afford them the opportunity to budget the cost over the entire year. In a way it is a type of budget plan, similar to what is currently being offered by other public utilities for the services that they provide. The only difference is that the entire City is on the same plan and that it was negotiated on your behalf by City representatives at the time the new processing plant was built.




The Sewer Service Charge Calculations for 2014


  1. Add up your total monthly water usage recorded during the prior summer quarter (July, August & September).  If that total is less than 7.48 thousand gallons the minimum service charge of $264.81 or $22.07 per month will be billed to your account.


  1. Multiply the total water used by the rate per thousand gallons.


  1. Divide that figure by 12 for your monthly service charge.



Sample Ocean City Sewer Charge Calculations


July            10                    (thousand gallons)

August          4                    (thousand gallons)

September   4                    (thousand gallons)

                                                                  18                    (thousand gallons)


                                                18 x $35.4021 (rate per 1,000 gallons) = $637.24


                                                $637.24 / 12 months = $53.10 per month







(Revised: UAC01242014)