Third-party administrator Ted Henifin speaks at the Two Mississippi Museums in Jackson on January 27, 2023.
- JXN Water’s Interim Third-Party Manager appeared before the Capital City Revitalization Committee last week to defend the need to raise rates to maintain and operate the troubled municipal water system.
Officials with JXN Water sought to explain to lawmakers last week why it needs to increase rates by 25 percent over the next five years. The discussion was met with mixed reactions and questions about the utility’s billing process.
JXN Water Interim Third-Party Manager Ted Henifin told the Capital City Revitalization Committee the utility needs to raise rates to continue operating.
“Our current rates, even at 100 percent, would only generate enough money to pay our operating cost on an annual basis,” he said, noting the first round of rate increases would raise monthly bills between $9 and $11.
Two Jackson administrations have opposed the hike, and the requested water rate increase is now being litigated in federal court, where it is currently on hold. U.S. District Judge Henry Wingate has not indicated when he would make a ruling on the issue.
Jackson had until December 14 to investigate a nearly $90 million legal settlement with Siemens Industries USA, which it hired to install a state-of-the-art billing system, but failed to do so. The investigation found that within a year and a half, nearly every dollar was spent. After attorney fees, the city received $59.8 million. Records show that $18.5 million went to paying down water and sewer debt. Another $14.7 million was earmarked for a water/sewer contingency fund, which brought the city into compliance with its bond obligations. More than $12.6 million was channeled into the general fund to refund Jackson for previous loans it made to the utility. Then $3.5 million was set aside for emergency sewer repairs, leaving $7.6 million. However, more than $5.6 million is set aside to purchase new water meters from Sustainability Partners.
After Henifin’s testimony, State Rep. Clay Mansell (R) said he would support a rate increase, saying rate increases are needed to maintain the system.
When Governor Tate Reeves was asked about the rate hike during a press conference on Thursday, he said, “money going out, got to equal money coming in.”
Henifin was blunt when asked what JXN Water was doing about the estimated 4,000 locations stealing water by not having an account, some of which are vacant homes.
“We’re finding this in every neighborhood, from Country Club to Eastover to all over the city. Places that no one would ever imagine. People are taking water, stealing water,” he said. ‘They don’t have an account.”
That statement drew pushback from several members of the joint committee, including State Rep. Fabien Nelson (D), who said he only recently started receiving monthly water bills.
“When you talk about stealing water and people not receiving bills, I was one of those people that was not receiving a bill,” said Nelson, who appeared by Zoom while in Israel.
“Are you receiving a bill now?” Henifin responded. “Are you paying? Are you paying that bill?… I don’t believe you are.”
“I’m receiving a bill now,” Nelson said. “And when I got that bill it was a $1,300 bill.”
Henifin told Nelson he has not arranged for payment to date, with Nelson said he was working on doing so.
Henifin told the committee he knows they have heard from constituents regarding individual billing issues.
“We’re addressing them all. In many cases, they don’t like our answers, and they’re fishing for a different response,” said Henifin, noting that some Jackson water customers have a history of not paying water bills. “When he took over by federal decree three years ago, less than half of users were making regular payments. That rate is now around 90 percent.”
You can watch the full hearing below.
