Water meter installation resumes in Jackson, weeks after third-party manager orders it to stop

JACKSON, Miss. (WLBT) - Water meter installation in the capital city has resumed, more than a month after Jackson’s water manager told contractors to halt work.

In December, Interim Third-Party Manager Ted Henifin ordered Sustainability Partners to stop work on a project to replace some 50,000 residential meters across the city.

He said the meter boxes were installed too high and they needed to be fixed flush with the ground before work could move forward.

Since then, Henifin says he and Sustainability Partner officials have reached an agreement that will allow meter installation to again pick up.

“The plan is they’re still supposed to be adjusting the ones that are already in place while they’re installing some new ones to move forward,” he said. “There wasn’t a great savings to stopping them at the moment. In fact, there were no savings.”

In all, about 24,000 meters still must be installed.

Meanwhile, Henifin says additional inspections will be done to make sure meter boxes and meters are put in properly.

Sustainability Partners also is compiling a list of meters where the company says the boxes could not be installed lower.

“They’re still some that they’re challenged, for a variety of reasons, to get them flush,” he said. “They’re developing that list and providing it back to us so we can go out and see what the real issues are and figure out if something else needs to be done.”

“It’s going to be an ongoing process over the next several months.”

Henifin issued a stop work order in late December, saying the company would have to readjust thousands of meter boxes installed several inches above ground before it could continue with new installations.

He was worried the placement of the boxes would cause meters to freeze in inclement weather, something Sustainability leaders rejected.

“We got the manufacturer involved, the vendor experts involved, to provide evidence that the height of the meter boxes... [has] no impact on the meters freezing,” SP Chief Operating Officer and General Counsel Adam Cain said. “The only thing you can do to keep the meters from freezing is actually lowering the whole service line.”

Cain also contended that the meter boxes, in many cases, could not be installed lower due to the placement of the city’s service lines.

He explained lowering the boxes would likely require lowering the service lines connected to the meters, something that could be an expensive undertaking. He said lowering the lines was not in the original scope or plan for the project.

“You’re talking about heavy equipment, digging up everyone’s yards,” Cain said. “That’s much more than replacing the meters and boxes that are falling apart.”

Sustainability Partners’ contract with the city required Jackson to provide a certificate of acceptance before it can use the meters.

An open record request filed by WLBT on January 30 shows no certificates exist.

“The city can either sign a certificate of acceptance or start using them,” said Carla Dazet, a senior advisor with SP. “The contract specifically says in Section 3.12 in the last sentence that customer usage of units ‘constitutes a certificate of acceptance for such units.’”

Section 3.12 states that customer payments “with respect to any material customer usage of units” constitutes a certificate of acceptance.

Henifin issued the stop work order around the same time he began rolling out a new proposal for water billing based on property values, a new structure that would allow the Water Sewer Billing Administration to bypass the meter system altogether.

Bills passed by both the House and Senate would prohibit the city from implementing a billing structure based on anything other than water usage.

Legislation aside, Henifin intimated he was looking for a way to end the city’s contract with Sustainability Partners during a press conference on January 27.

“For me, the metering is two-fold. It’s expensive to continue. It’s also going to be expensive to get out of,” he told reporters. “So, all the scenarios have the metering in it, because we’re in a contract that’s not easy to get out of, and I’m not sure we’ll find a way out.”

The financial plan includes four options for billing over the next two decades, including one that would do away with the metering system by 2031.

Sustainability Partners was brought on by Jackson to help it procure meters to replace the devices installed as part of the Siemens contract. In 2021, the city council amended its contract with the firm allowing it to replace the meters.

Under terms of that deal, Sustainability put up the initial costs for the work, which it will recoup once the meters are in the ground and operating.

Henifin argues the Sustainability contract is “plagued with challenges” and “while there was no up-front cost to the city... the city is obligated to pay on-going fees for each meter read generated.”

Those costs, he says, are about $10 million a year and include $5.1 million in ongoing fees to Sustainability Partners to maintain the devices, $1.2 million a year for an information technology contract associated with the meters, and $3.5 million in administrative costs.

For fiscal year 2022, Jackson brought in about $57.5 million in water revenues, with about half of the new meters in place. The amount was about $8.7 million more than the city brought in the previous year, but about $8.8 million short of budgeted projections.

By comparison, Henifin says ending the contract now would cost Jackson about $60 million.

“That’s not something we cannot build into the financial plan easily,” he said. “So, at this point, once I got that information, I thought, ‘well, let’s go ahead and put them in the ground and see if we can find a better way to use them.’”

Want more WLBT news in your inbox? Click here to subscribe to our newsletter.

Copyright 2023 WLBT. All rights reserved.