Senate Approves Sales Tax Exemption for Water, Sewer Protection Programs

The state Senate has passed a bill co-sponsored by Sen. Tony Avella, D-Bayside, that provides for a sales tax exemption for water and sewer service line protection programs.

Earlier this year, the city’s Department of Environmental Protection announced that it would offer coverage to water and sewer customers in the event of a service line break.

Previously, homeowners had been forced to repair breaks in their connection to the city’s water main, which could cost thousands of dollars.

Currently, homeowners can pay $3.99 per month for water line protection and $7.99 for sewer coverage. The program is managed by American Water Resources through the DEP.

Avella said insurance does not include sales tax in New York State, but that the DEP’s protection program serves the same purpose as an insurance plan.

Last week, the Senate passed a bill co-sponsored by Avella in the Senate that would exempt the water and sewer line protection program from sales tax.

“With this new insurance policy, homeowners will be able to defray the cost of repairs for a broken service line with a nominal monthly fee,” Avella said. “However, homeowners should not be subject to unnecessary taxes on their water and sewer line protection programs and this legislation will ensure exemption from the burden of excessive fees.”

The legislation has also been introduced in the state Assembly by Michael Simanowitz, D-College Point.