Lumumba rejects water rate increase proposal, questions JXN Water's spending, collection efforts

Yahoo

17-03-2025

Shaking his head when asked, Jackson Mayor Chokwe Antar Lumumba flatly said he was against increasing water rates for Jackson residents ― a move that Ted Henifin, the third-party water manager overseeing JXN Water, recently said is necessary as federal funds for the city's water system are expected to run out by summer.
Lumumba, speaking during a Monday press conference at Jackson City Hall, lobbed additional critiques at JXN Water and Henifin. The mayor again questioned the accuracy of JXN Water's bill collection rates and criticized Henifin for his handling of the water utility's advertising costs and what Lumumba sees as a lack of a competitive bidding process.
JXN Water did not immediately return calls seeking comment for this story
In late February, Henifin, who was appointed to oversee the water system's repairs at the end of 2022, released JXN Water's "Financial Management Plan." The report noted that monthly expenses are exceeding revenues, creating an operating deficit. The revenue shortfall is currently being covered by the $600 million in federal funds Jackson received from the U.S. Congress in December 2022. However, those funds are quickly running out.
Given the critical cash-flow challenges, the report states that additional revenue increases are necessary to maintain the system's sustainability. One way to increase revenue is by raising water rates, which would raise the average monthly residential bill by about $9, or roughly 12%. JXN Water plans to seek a rate increase this spring, according to the report.
"I am not in favor of that (increasing water rates), not only because we just recently raised the access costs for residents less than a year ago and I think that there are few things that we have to be aware and cognizant of. One, what are our rates of collection? Because we've had some of the poorer rates of collection through the course of time that they've (JXN Water) been there," Lumumba said, but he didn't provide a number for JXN Water's exact collection rate.
The mayor's questioning of JXN Water's bill collection rates has been an ongoing saga between Lumumba and Henifin for nearly a year now. Lumumba has repeatedly said JXN Water's collection rate is lower than when the city managed the water system. In April 2024, the two clashed over the collection rate for garbage bills, which appear on residents' water bills.
Each time, Henifin has denied Lumumba's claims.
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According to the most recent quarterly report, released at the end of January, JXN Water's collection rates are "nearly 70 percent." It also notes that more than 14,000 accounts are receiving services but not paying their bills. Those accounts will be targeted for increased collection efforts in 2025.
"Revenues continue to increase through the significant efforts of the JXN Water billing staff," the report states. "Severance (the process to disconnect customers for non-payment) started in March 2024. The percentage of billed revenue collected moved from approximately 56 percent in January 2024 to nearly 70 percent at the end of the year."
Lumumba's comments are part of an ongoing, tense relationship with Henifin, with whom Lumumba has said he has little rapport. The two have clashed multiple times since JXN Water took over in 2023 over issues such as bill collections, water safety and the leadership of Jackson's water system once Henifin's receivership ends.
Water rates increased in Jackson within the last year after Henifin unveiled JXN Water's new billing system in November 2023. At the time, Henifin said a majority of water customers would see an increase of about $9 per month in their water bills, while also introducing the "water availability charge." The Jackson City Council abstained from voting on the water-rate increase in December 2023.
However, the council's vote was largely symbolic. According to the 2022 court order that put Henifin in charge of the water system, he must consult with Lumumba before raising rates. Lumumba must then present a resolution to the council for consideration. Ultimately, Henifin and JXN Water need only the approval of U.S. District Judge Henry Wingate to implement rate increases.
During Monday's press conference, Lumumba also criticized JXN Water's procurement process, which he said has driven up operating costs.
"We have to make sure we are holding them accountable and one of those things that is very evident is that there is no competitive procurement process," Lumumba said. "What Mr. Henifin would say to you is that we were in an emergency two, almost three years ago at this point, and he needed to avoid the procurement requirements in order to respond and act quickly. But we're not perpetually in an emergency … And the reason you have procurement practices is to get the lowest and best bid."
Lumumba also went after JXN Water's spending nearly $1 million on advertising. With a firm face, the mayor repeated, "I know they spend a lot of money for advertising" three consecutive times while looking around the room during the press conference.
A total of $878,997.82 has been spent on "communications" as of March 17, according to JXN Water's website. The price tags and companies who have received payment include:
HDR Engineering, Inc.: $552,284.83
TV Station WLBT: $144,510.66
Gray Media Group, Inc.: $46,027.70
1 Vision: $111,170.60.
Art Mekanics: $15,000
Studio54Multimedia: $9,000
Alliance Business Service Inc.: $1,004.03
Asked what he would do if he were in Henifin's shoes — running out of money — and the water system was still in the city's hands, Lumumba said it was an unfair comparison.
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"We didn't have the benefit of $600 million that we went to Congress and got," Lumumba said. "So, the city was operating without money for many, many, many, many years … it's not a fair comparison. I think anyone would readily admit if we had the benefit of $600 million, then things should improve. The question really becomes, have you had a $600 million improvement to take place."
Lumumba said that raising rates isn't inherently a bad idea, but proper collection and competitive procurement should be prioritized first.
"I'm not saying that the notion of raising (water) rates isn't a reasonable one," Lumumba said. "What I am saying is that you first need to make sure you are collecting appropriately. Secondly, you need to make sure that you're doing competitive procurement … So it's a balance, it's a balance of not only making the tough decisions of when rates need to be increased and doing that in a systematic and structured way. But it's also making sure that we are being good stewards of the money we have."
This article originally appeared on Mississippi Clarion Ledger: Jackson MS mayor rejects water rate increase, cites poor bill collection