JXN Water likely to ramp up shut offs for non payment later this month

JACKSON, Miss. (WLBT) - JXN Water will likely be ramping up efforts to shut off customers for nonpayment by the end of the month.

Interim Third-Party Manager Ted Henifin provided details about efforts to increase the utility’s revenue at a status conference on Friday in U.S. District Court.

Henifin told U.S. District Judge Henry Wingate that software was being tested that could help JXN Water better detect and shut off delinquent accounts.

“If all goes well, we’ll go live on the 24th of this month, which means we’ll be able to do much more severances for nonpayment starting on March 24,” he said. “We’ve got 60,000 accounts. About 15,000 are in arrears. We can’t manage that without the work order system fully functional.”

Meanwhile, Henifin told the judge about his plan to increase rates, which is needed to help the utility cover costs and remain solvent as federal funds dry up.

Henifin, who was appointed manager of Jackson’s water system in 2022, announced the need for a rate increase as part of his 2025 Financial Management Plan released last month.

He said even with the increase, JXN Water would “still not meet positive cash flow until 2029″ and not meet bond covenant requirements until 2026.

“If everyone was paying their bill, the existing rates can only generate about $115 million. We need $115 million just for operations. We won’t have the money for other things,” he said.

JXN Water expects to spend $148 million in 2025. That amount includes a $115 million operating budget, $20 million for debt service, $4 million for debt service reserves, and $9 million for capital reinvestments.

JXN Water 2025 Budget Requirements:

• Operating - $115 million
• Debt Service - $20 million
• Debt Service Contingency - $4 million
• Capital Reinvestment - $9 million

“Comparable utilities of our size typically have closer to a $200 million budget, and we may find we have to grow ours in the future,” he said. “So, we need to get to $148 million, and the existing rates just won’t get us there.”

Expenses have been paid for with a combination of federal funds and collections from billing. In 2022, the city received some $800 million in federal allocations, including $450 million for water infrastructure projects, $125 million in Section 208 money that will be used for sewer improvements, and $150 million in flexible funding that the third-party administrator has relied on to help fund operations.

Just $15 million of the flexible funding remained as of December 31. Henfin told Wingate the remaining funds should be exhausted by April.

Under Henifin’s proposal, the amount billed for water consumption would go up by about 25 percent across the board, with a typical residential bill increasing by about $13 a month, or about a penny a gallon.

Currently, customers pay $6 per hundred cubic feet (CCFs or 748 gallons) of water for the first 50 CCFs used, $14.96 for the next 100 CCFs, $17.45 for the next 200 CCFs, and $19.95 for any CCFs used above that.

Wingate called the conference, in part, to allow Henifin to explain the rate increase. He also wanted to set the record straight after hearing comments at a recent mayoral forum at Jackson State University.

When asked about inaccurate billing, Mayor Chokwe Antar Lumumba responded, saying, “You would be surprised to learn that the water billing has gotten worse under JXN Water’s leadership with inaccuracies.”

Henifin called the mayor’s claims “blatantly false, patently false.”

“A lot of people get high bills and immediately question the accuracy. They’ve either got a leak in the system or have a new water meter that’s [measuring] real usage,” he said. “There’s a lot of handholding when folks have a perceived inaccuracy. If there has been [any inaccuracies], it has been an incredibly small number.”

The judge never called the mayor out by name but said the person “made some other statements that have been inaccurate too. He even [tried to give] water filters to citizens while we tell them the water is safe,” he said.

In 2023, Lumumba was summoned to appear before Wingate to answer claims about the comments the judge was referring to, which were made at a press conference announcing a partnership with United Healthcare to distribute water filters to vulnerable residents.

At the time, the mayor told reporters that the filters were needed to protect pregnant women and young children as the city worked to implement new corrosion control measures at its water treatment plants.

“There’s a lot of confusion about water quality. I was in Costco yesterday and everyone had giant carts of bottled water. I wanted to go up to them and tell them, ‘If you live in Jackson, you can drink the water,’” Henifin said. “There’s no reason for anyone to drink bottled water. But we continue to fight that battle.”

Henifin outlined other milestones since taking over the water system, citing multiple improvements to the O.B. Curtis Water Treatment Plant, the facility that shut down in the summer of 2022, months before the federal takeover.

“The membrane plant has had four of six membrane trains replaced, which will provide us with five to 10 years of reliable membrane capacity,” he said. “On the conventional side, we had one filter down for many years. We have a contractor working to fix that filter. They’re close to being finished. Then, they’ll go through the other filters and get them up to speed.”

Curtis is essentially two treatment plants, which treat water through a conventional system and membrane system.

“The amount of energy going on there, when we’re finished, the Curtis plant will have many reliable years of service in front of it.”

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