Jackson Jambalaya

 Jackson Mayor John Horhn issued the following statement. 

The City of Jackson is looking for every way possible to increase revenue in the water/sewer system without raising rates. The City is offering to help JXN Water accomplish the following:

1.      locate the 6,000+ water users who do not have accounts, do not receive bills, and do not pay into the system;

2.      obtain payment from the 20,000 customers who receive bills monthly but do not pay them;

3.      collect the $75 million in uncollected fees over the last two years;

4.      lower debt payments;

5.      lobby the State for new revenue streams.

The above recommendations represent $30+ million in new annual revenue before accounting for collection revenues and legislative action.

The City is also demanding that JXN Water turn over sanitation fees that it has kept from paying customers and that it utilize competitive procurement practices to ensure that it is operating as efficiently as possible and at the lowest cost possible.

The numbers say that doing the above will provide sufficient funds to operate the system with no immediate rate increase, even if smaller, later rate increases prove to eventually be needed.

JXN Water has not disputed the revenue potential and savings suggested by the City. JXN Water has not disputed the numbers or the math the City used in making its report and recommendations to the federal court that oversees the system. Instead, it has attacked the City for not supporting a 25% rate increase to the 60% or so of current customers who are paying their bills. It blames past City administrations for not maximizing system revenue, even though JXN Water has been in control of the system for over three years.

The City will continue to look for creative ways to maximize system revenues, minimize system expenses, and grow the paying customer base. The City’s efforts will be more successful if JXN Water will work with it and not against it.

It is also worth noting that JXN Water says it needs this 25% rate increase despite being the beneficiary of unprecedented federal financial resources, including approximately $175 million in grant money to pay for operations and maintenance. In only three years, all of that money has been spent, plus the revenue generated by ratepayers paying their bills, plus approximately $14 million in City sanitation fees it has kept, plus another $6 million in City debt payments.

In other words, since JXN Water took over the system in 2022, it had approximately $175 million in federal grant money, plus about $250 million in collected bills, plus about $20 million in City funds, all of which was designated to be used to operate the system. JXN Water spent that approximately $450 million in less than three years. In the first of those years, JXN Water managed water only. In the last two years, they have also managed sewer.