Friday, May 20, 2022

Food Fight: Mayor Fires Back at WLBT

Jackson Mayor Chokwe Antar Lumumba took strong exception to WLBT's reporting of how the Siemen's settlement was spent. The latest food fight between the two started when WLBT reported Monday: 

Among findings, he said Jackson experienced less than a $15 million gain from the Siemens settlement proceeds, with those funds being used to keep the water/sewer enterprise fund and sanitation accounts afloat.

Hodges also told council members the city in recent years had spent millions of dollars more in water and sewer funds than it brought in, with officials basing the spending on amounts billed, rather than amounts collected.

“You’ve got revenue reported during the year that is not going to be collected,” Hodges said. “That needs to be allowed for during the year, so you’re not looking at inflated numbers, and then at the end of the year, $7 million disappeared because it’s not going to be collected.”

Hodges says for the 2020 fiscal year, about $7 million in projected revenues were eventually written off as uncollectible, while another $1 million or $2 million in sanitation funds were. However, the city had already spent the money by then, leaving water/sewer in the hole.

“Revenues, as they’re billed, because of the problems with the system, all those amounts are not collectible,” he said. “And the city realizes those amounts are not collectible, but all that revenue has been recognized as it’s billed, rather than reducing it to the amount that’s expected to be collected.”

He told the council the amounts were not brought in, in part, due to complications with the billing system that was put in place by Siemens....

Despite the Siemens settlement being sold as a huge success for the capital city, auditors say Jackson only benefited from about $15 million in settlement proceeds, auditors explained.

“Your gross settlement was $90 million. You paid $30 million to the attorneys. So, the city netted $60 million,” Hodges said. “That settlement related to problems with the water billing system and water meters, and so, you had to write those assets off because they were impaired... That write-off was $45 million. You take $60 million, less $45 million written off... that gets (you a) $15 million net gain.”

That $15 million went to shore up enterprise funds for water/sewer and sanitation. Even with the additional revenue, Jackson’s water/sewer fund ran a deficit of around $6.6 million.

About $7.1 million of that went to water/sewer, while $7.6 million went to sanitation.... Article.

Keep in mind some of the money was used to repay part of the $90 million bonds that were sold to finance the Siemen's project.  The Mayor fired off a response almost immediately: 

A couple years ago, my administration took on the Herculean task of addressing past wrongs that have led to a dysfunctional, unreliable and inconsistent water meter and billing problem.

 It is the result of the City’s disasterous contract with Siemens Industry, Inc. to update and modernize our system. Instead of passing on savings to the City of Jackson, it instead led to long term problems we face today.

 With the help of an outside legal team specifically tailored to these kind of municipal contracts, the City of Jackson sued Siemens, eventually settling for the entire amount of the City’s largest ever contract. If we did not take that risk, we would not even be having a discussion about the about $60 million dollars that we recouped.

 Since we took receipt of the funds over two years ago, my administration moved to use that money in the most fiscally conservative way possible and shore up existing debt from the original contract, from emergency transfers for water sewer repairs from the general fund, and ensuring we had a reserve to stabilize our credit rating.

 Not doing so would have been catastrophic. It could have led to a receivership where an outside entity takes over the system, or possibly even bankruptcy. Just about all of Siemens settlement cash went to paying the city’s debt and it was all related to water/sewer issues. There is no mystery. We have discussed all of this at length in public forums. I talked about it as recently as Monday.

 I should also note that it isn’t just since 2018 that we’ve operated under a deficit. We have had a deficit on the water/sewer side of the ledger well before that, the result of an inability to read faulty water meters. This too has been well-reported on in the past.

 The larger, more important question should be what are we doing to right the ship? We recognized a while ago that it is unsustainable to run a water department when you aren’t receiving water revenue. We are currently installing new water meters for all water customers across the city. This follows our push for a water forgiveness plan for residents.

 Jackson has many problems. It has limited financial resources. So, the Siemens money, which we recouped after taking the risk of suing the international corporation, can be accounted for down to the last penny. We are very thankful for it because without it, we would be in a much, much worse position then we are today.

Perhaps its time to republish these charts JJ created last year. 




Anonymous said...

A/R forgiveness isn’t cash. Where did the cash go?

Anonymous said...

Mayor Blame doing Mayor Blame things. Fix the meters and collect some money you dumb sac of boo boo.

Anonymous said...

Hey mayor cry baby!!! Get over it. No one thinks your smart or credible at all. People cringe that are actually successful and educated and earn a good living not on tax payers dimes. Mostly the people from NEJ that eat at char laugh once you walk by.

Anonymous said...

I have a question. So the Siemens contract was maybe $90,000,000 for 60,000 meters. That is a cost of $1500 per meter. Obviously this includes the billing systems as well.

So I would expect a utility with 10,000 meters to do a similar project for $15,000,000. I would expect a utility with 5000 meters to do a similar project for $7,500,000.

Why do other successful utilities do these projects for far less? It makes e think that other stuff was in the Siemens contract. It wasn't just meters, meter software, billing system, etc.

Anonymous said...

Sold former house in October; moved into new house in November. Still no water bill 6 months later. Mayor, please tell me how the water system has improved under your "herculean" efforts?

Anonymous said...

Voo Doo economics?

Anonymous said...

If Jackson is that close to being in receivership as mentioned by his honor, hope for Jackson is just over the next financial speed bump.

Krusatyr said...

1. Send Public Service bills to the property owner, not the renter;

2. Property Owner can collect from his tenant, not burden the City;

3. File a lien against Property Owners in default;

4. Pay aggressive collection agency x% to collect past due amounts;

5. Get State oversight to approve account'g of Public Service revenue.

6. Jackson needs a competent mayor, perhaps Aaron Banks.

Anonymous said...

Where is Auditor White when you need him.

Anonymous said...

Mayor Talk Alot should try some of that action type stuff.

Someone should tell him the constant yammering and pandering to the cameras, while playing a victim does not seem to be helping.

Anonymous said...

As usual, he starts by spitting out a phrase 90 percent of his
constituents probably can't comprehend ... while within the same sentence, blames "past wrongs" for his failure to even provide water to flush a toilet.

"my administration took on the Herculean task
of addressing past wrongs that have led to a dysfunctional, unreliable and inconsistent water meter and billing problem."

In all honesty, I doubt many of those that voted for this Mayor have even heard of Hercules,(much less his tasks).

And while it's very understandable Greek mythology is not a familiar topic to most of his voters, they do understand the smell of
"Boo Boo" in their homes, their Grandmother's home, and their neighbor's homes.

Right ?

Krusatyr said...

As others here have noted, Lil Choke will never be confused with Hercules. Perhaps he more resembles the "Sirens" of myth: women or winged creatures who wailed and sang to lure sailors onto the rocks.

Certainly this fake mayor has the wailing and destruction down pat.

Anonymous said...

The first two graphs tell this mayor's story. Operating income went to 0 the year after he was first elected. Cash went to 0 the year after that.

As to "the risk of suing the international corporation," the risk would have been entirely borne by the plaintiff's attorneys, if this was a standard contingency-fee agreement. That allocation of the risk is what justifies a percentage-of-recovery fee.

As I understand it, Jackson paid much more per hookup for the Siemens system that other cities, as much as double, if I remember correctly. But the costs and the failure to function was due to local and incompetent sub-contractors, which were forced down Siemens throat.

I suspect the Siemens execs decided it wasn't worth the bad press, etc., to fight an 85% black city that required local black sub-contractors, just as race issues were dominating the news cycles. Getting branded a racist company probably would have done Siemen's a lot more damage than $90 million, which was likely covered by its insurance policy.

Anonymous said...

Hey Choke,
Don't try to bullshit us. We live here. We remember when you grabbed the microphone to announce no one's water would be cut off!! regardless of payment.
Is it any wonder that people stopped paying??? FREE WATER!!! FREE WATER FOR EVERYONE!!! That's what you said. FREE THE LAND!!!
What a load of crap. Resign and go somewhere folks will still buy what you're selling.
We're all stocked up on raw boo boo here.
Anyone But Choke For Mayor

Anonymous said...

If, as the mayor contends, the information presented by the City of Jackson audit firm is incorrect, the mayor needs to fire the audit firm.

Anonymous said...

4:41 PM
He'll portray himself as Sisyphus

Anonymous said...

So they netted $60 but are still paying for the bond till 2040 something. Genius!!!

I blame everyone including Bob Miller. They could have brought in a company to physically READ the meters and send out bills till they figured it out. Even if it cost $4-5M a year they would still be way ahead with revenues.

Also, why did they use Siemens settlement funds to shore up trash division???

Anonymous said...

Ill call Bull on this one Baby chok. We have heard numerous times Siemens offered to just void the contract and return any fees but no Chok had to sue so his cronies could get paid. Now he has blown all the settlement money and still crappy system.

Anonymous said...

I hate to say it but maybe some of Jackson’s money is going to the beautiful girl, driving a $250,000 car, who goes to private parties where late in the night all ‘non-Chokwe friends’ are kicked out (right before he arrives at these parties with his security) because he doesn’t want anyone exposing his secret life.

Anonymous said...

I blame everyone including Bob Miller. They could have brought in a company to physically READ the meters and send out bills till they figured it out.

Yeah, like Miller could have done as you suggest even if Gumflapper opposed. Get real. Miller was competent with a track record of achievement but worked for a totally incompetent greenhorn micro-managing executive.

Anonymous said...

@Krusatyr 3:20:
Get Aaron Banks to run for mayor with that platform and I'll be a campaign donor. There should also be a minimum monthly payment due from customers who aren't being billed or who are disputing their bills, until those issues are resolved.

@Anonymous 5:39:
Do tell. I'd think the list of women driving $250,000 cars would be pretty short. Is this in Atlanta? Hard to believe it hasn't been talked around if it's actually in Jackson...

Anonymous said...

Our mayor is a short dog walking in tall weeds.

Anonymous said...

@9:06 and many others - do you think the list of available candidates to take Baby Chock's place is limited to the seven stooges currently on the Council? Hell, that's how we got here - Lumumba SR, Yarber, Lumumba Jr.....

Yes, we need change. And yes Banks has sounded 'reasonable' for the past six months; hell, for that matter so has Stokes. But lets go back over the past five or six years and check their meter. Both were leading the fight to keep the moratorium on cutting off water meters since the beginning in 2015 - which is what created the disaster that is the current utility system of Jackson. Banks was right up in the middle of the spending sprees of Lumumba until the garbage fiasco came about. Just because he has recently seen the light - of Lumumba's incompetence shouldn't give him a free pass in people's mind thinking he is the 'next' savior for the Bold New City.

Wow said...

Apparently I got some of these new water meters 3 months ago.

Yet, my past 3 bills have been based off estimated reads.

They are estimating an overage.

I try to call the call center. The phone tree disconnects and automatically hangs up.

I call another number. They say I need to call back the number that is disconnecting. They eventually tell me there are only 3 people working a call center for water for the entire city.

Sad state of affairs.

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Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).

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In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.

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There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

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