The average Jackson water customer will soon have to pay close to an additional $10 each month for services.
U.S. District Judge Henry Wingate approved on Monday a 12% rate hike recommended by JXN Water, the third-party utility manager overseeing the city’s water services. The request was made months ago by JXN Water manager Ted Henifin, who has sounded the alarm that revenue is not keeping pace with operating costs.
The water system, per officials, is operating at a monthly loss of around $1.2 million with fewer than 65% of customers paying for services and thousands of residents not logged in the system. Wingate noted that, while the rate increase is necessary at this time, he is not comfortable with paying customers being punished while others either do not pay or are not billed, among other failures in acquiring the funds needed to operate the system.
“Jackson’s ‘water mess’ is a profound inequity born of the City’s decades of seemingly deliberate disregard of water shortages, intermittent pressurization, and funding emergencies passed from one administration to the next; a failure to maintain an accurate billing registry; and even a horrendous shockingly-bad Siemens investment, which saw the City hand out what could only be described as ‘Christmas money,'” Wingate wrote. “We, the Court and the citizenry of Jackson, nonetheless, are in a tragic Catch-22: without the revenue from paying customers today, JXN Water cannot obtain the resources to fix the billing system and identify the ‘free riders’ tomorrow.”
Due to the financial instability, along with delays in receiving $54 million in federal funds allocated by Congress last November, the city of Jackson will be tasked with covering $1.5 million in water bond debt on March 1 that JXN Water cannot pay. Jackson Mayor John Horhn, while opposed to the 12% rate increase, has committed to covering the debt service payments tied to the city’s water system.
This commitment comes with strings attached in the form of pushing JXN Water and federal officials to be more accountable, improve collection efforts, and ensure complete transparency.
“Jackson families are already carrying a heavy load, and that is why I opposed this 12 percent rate increase,” Horhn said. “At the same time, we cannot and will not allow our city to default on its water debt. My responsibility is to protect residents from unnecessary hardship while keeping our system solvent and honest about what we owe.”
Horhn’s requests, many of which were echoed by the Jackson City Council, were granted by Wingate in Monday’s court filing. The federal judge called on JXN Water to identify and bill unmetered and unbilled properties, restore an in-person customer service presence for ratepayers, and provide a clear “sample bill” for the rate increase. JXN Water is also instructed to assess a “fairer-tiered” rate structure and pursue a “vigorous, fair collections strategy” for past-due accounts.
“This Court will initiate its own independent, forensic analysis of JXN Water’s historical expenditures,” Wingate continued. “While the City of Jackson must keep the water flowing today, the public is entitled to a full accounting of how every dollar, federal and local, has been spent. Accountability is not being waived; it is being deferred only long enough to ensure the system does not collapse under the weight of its own debt.”
The water bill increase will not take effect until late March, and JXN Water officials will begin the process of notifying ratepayers about the price change in the near future. In the meantime, Horhn is hoping the third-party utility provider will deliver on plans to be more efficient in bill collection instead of forcing existing customers to bear the burden of higher costs.
“Jackson residents deserve a water system that is funded fairly, not on the backs of the people who can least afford it,” Horhn said. “We will meet our legal obligations, but we will also keep pushing for solutions that use existing tools like better collections, honest billing, and already-approved federal funds before asking every household to pay more each month.”
