Jackson council opposes JXN Water rate increase, tables pay raise proposal

• According to a court order, JXN Water’s Interim Third-Party Manager has “full power and authority” to raise the water rate.

Jackson City Council members learned this week that their protest of a $9 a month water rate increase sought by JXN Water was merely symbolic. Whether Jacksonians pay more for water is up to the “full power and authority” of the Interim Third-Party Manager as ordered by U.S. District Judge Henry Wingate.

Despite the city council unanimously opposing the rate hike, the 2022 court order placed the city’s water system in federal receivership, giving Interim Third-Party Manager Ted Henifin the ability to raise rates without council support.  

The city will now send a letter to the federal judge stating the citizens of Jackson cannot afford another water rate hike.

During debate, one council member said the increase was “too much,” adding that it was “more than our citizens should be asked to bear.”

“We absolutely did not want a rate increase for our citizens, but we really felt like it wouldn’t make any difference because it would have to go before the judge and the judge would have to make the final decision,” Council President Virgi Lindsay said. “But this time, I felt like it’s important that I be part of sending a message to this judge that this is excessive, and it’s too much, and it’s more than our citizens should be asked to bear.”

Henifin has said a 12 percent rate increase is needed to continue operation and maintenance on the system. At a news conference last week, he said the increase is needed to stabilize the utility’s finances, as federal technical assistance, known as flex funds, will run out this summer.

The court order allows the Interim Third-Party Manager to raise rates using the latest financial management plan in consultation with the mayor and the mayor’s office to determine whether an increase is necessary. It continues that if the city denies the increase, the ITPM can still move forward if it has been more than one year since the last rate increase. The ITPM must notify the mayor, city council, and Director of Public Works of the intended increase within 30 days.

Finally, the increase must be advertised following state law and on the ITPM website. As of Thursday, no such notice had been posted on the utility’s website.

Jackson can fight the increase by writing to the ITPM, the EPA, and the state Health Department. The federal receivership agreement states that the ITPM and the city must “engage in formal discussions” aimed at an agreement within 30 days. If that fails, they can ask the court for assistance.

In other action before the Jackson City Council, the council tabled proposed pay raises for themselves after outcry from the public. The proposal would have raised the mayor’s salary by more than $50,000 annually, from $120,000 to more than $170,000, while the council could have seen a 40 percent bump in pay.

Ward Five Councilman Vernon Hartley also questioned if it was wise to increase the council’s pay while department heads’ raises were on hold.

“During the last Finance Committee meeting, [there] were some shortfalls in the budget, and we asked directors to hold off on their increases, and I would ask the same here, at least until we have our budget meeting this week,” he said.

The issue could be revisited in the future.