Third-party manager: Extend judicial oversight over Jackson water until federal money is spent

JACKSON, Miss. (WLBT) - Jackson’s third-party water manager is proposing an extension of judicial oversight governing Jackson’s water system, at least until the federal funds allocated to repair the system are spent.

Interim Third-Party Manager Ted Henifin announced his plans at a press conference on Friday, only days after he condemned an effort by some state lawmakers to create a utility authority to govern Jackson’s water, sewer, and stormwater systems.

“What I’m really recommending is [the] extension of the judicial oversight for some period of time, because I think it’s what benefits Jackson,” he said.

On Tuesday, S.B. 2889 was passed out of the Senate Economic and Workforce Development Committee.

The bill would transfer ownership of the city’s water, sewer, and stormwater systems from the city to the Mississippi Capitol Region Utility, a new agency governed by a nine-member panel with members appointed by the mayor, governor, and lieutenant governor.

Henifin, who was appointed receiver over the city’s water system and water billing system as part of a federal court order, was critical of the bill, saying the state was “clearly trying to get access and control” of the federal funds, adding that the bill was “a pure grab for money.”

Provisions of the bill mandate that the authority would have the ability to “accept, receive, and administer gifts, grants, appropriations and donations of money, materials and property of any kind, including loans and grants from the United States” as long as the authority follows the terms and conditions associated with those gifts.

Sen. David Parker, the bill’s author, says the measure is not about control of federal funds, but more about creating an exit plan to take on the water system after the third-party administrator leaves.

“I would like there to be a structure in place so that after those expenditures are made, and the improvements have been made, the system is left in good hands and prepared to move forward after that,” he said. “So, the bill is about what happens next, not about what happens now.”

Boundaries of the district would include all areas served by Jackson water and sewer, with those areas having the right to leave the authority if they choose.

The authority would be required to submit annual reports to the state, the State Auditor, the Legislative Performance Evaluation and Expenditure Review Committee, and the governing authorities of the municipalities served. All authority meetings would be subject to the Open Meetings Act and Open Records Act.

Parker, who represents DeSoto County, has a second home in Jackson and says the city’s water woes have also impacted him and his family.

“I have a daughter who lives here... She loves living in the Jackson area. But we’ve had some challenges as a family. She has many times come home because she couldn’t flush her toilet, she couldn’t take a shower, she couldn’t do things like that and she had to stay with friends in other areas,” he said. “When I’ve been here, I’ve personally gone down, [taken] water from the swimming pool, and put it into the toilet so that we can flush it.”

Jackson residents have experienced numerous interruptions in service in the last two years, from the February 2021 crisis to the Christmas crisis of 2022.

In both cases, some people were without water for weeks.

In December, Congress passed a $1.7 trillion omnibus spending bill that included $600 million for Jackson water. Earlier this month, Jackson Mayor Chokwe Antar Lumumba announced that nearly $800 million in federal dollars had been allocated for Jackson. At his press conference on Friday, Henifin said there was nearly $1 billion in federal allocations.

The $800 million includes $600 million from the omnibus bill, $120 million from the Water Resource and Development Act, and more than $71 million in American Rescue Plan Act funding from both the federal government and the state. It was not known where the additional money is coming from.

“The legislation that I’m proposing did not start after the... awarding of the money. This legislation is legislation that has been worked on throughout this year,” Parker said. “There were rumors, as you recall, earlier in the year of a special session. So, there have been people working to try to find a solution to this.”

Another lawmaker, speaking on background, confirmed that the state began working on creating an authority last year, months before federal funds were awarded. They also said that the bill was written to provide additional oversight on Jackson water, in part, to encourage the state to help fund system improvements.

Previous efforts to seek state funding for the city’s system have fallen flat. In 2021, amid the winter crisis, the mayor sent a letter to Gov. Tate Reeves seeking funding to repair the O.B. Curtis Water Treatment Plant. Curtis is the epicenter for most of the city’s water system failures. That request was never acted on. Last year, Rep. Shanda Yates introduced a bill to create an account also to fund Jackson water work, but no money was ever set aside.

The state did allow Jackson to apply for funding through the Mississippi Municipality and County Water Infrastructure grant program but required the city to submit to additional oversight on how the money is spent. Jackson was ultimately awarded more than $35 million through the program.

If passed, the authority would take over Jackson’s water after the receivership ends, and the first president of the authority would be appointed by the board with the input of Henifin.

“The board will be in place, the president will be in place, but they will have absolutely no authority over any of the money until the receiver leaves,” Parker added. “And then, at that point, they will be required to make sure that the money is used within the district, as the receiver has kind of seen fit.”

“There is absolutely no desire by the legislature or myself to manage that money.”

Henifin and his expenses are funded by an EPA grant for at least a year, according to court records. However, he has long contended that he’s not sure how long he’ll be needed in the city.

He says extending the judicial oversight could also speed up the time it takes to repair the city’s system. “I’ve been freed up to really just try to live to the spirit of public procurement, transparency, and competition,” he said.

He told the press that Jacobs Engineering, the firm brought on to manage the city’s water treatment plants, also is concerned about the potential change in ownership.

“The contract we’re going to enter with them is for five years. They are very concerned about what happens when the judicial oversight [ends]. And, so, the only way I think I’m going to get them to ultimately commit to five years is to have the order amended to get the judge to at least keep some touch, light touch... some sort of judicial oversight,” he said. “That’s the driving force for me at this point.”

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