Councilor Banks foils $ 7 million emergency loan
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One-time city councilor vote will prevent Jackson from ‘stabilizing’ his ailing IT hardware and billing system as he struggles to pay off debt and avoid what officials say could lead to a possible take federal control of the system.
A majority of city council on Thursday – despite several concerns – voted for an emergency loan of up to $ 7 million to make immediate improvements to the city’s water meter and billing system.
The 5-1 vote follows a controversial debate between council members and the administration and a warning from Stephen Edds, a lawyer for Butler Snow who is helping the city reconsider its financial options.
“Unless improvements are made to the water and sewer system, it is very unlikely that it will have generated sufficient revenue to debt service payments. Failure to do so would have a huge negative effect on the city itself, ”he said.
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Since the town is under a consent decree, Edds went on to raise the possibility of the EPA puts city in receivership where he would take charge of all financial decisions if it were determined that the city cannot pay its debts.
Councilor Aaron Banks, whose Ward 6 covers south Jackson, was the only no to vote and City Councilor Kenneth Stokes was absent. The banks vote prevented the loan from going through because emergency resolutions require a unanimous vote.
Banks said he made the decision after speaking with several residents in his neighborhood, including a “task force.” He cited previous requests from the Department of Public Works to cover departmental deficits, wondering how this money was spent.
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The city councilor then accused department head Bob Miller of not being transparent with the public about the city’s water system, and said he was not convinced the additional funding “Would guarantee” a solution.
He asked Miller and the administration officials to give this assurance.
“I will stress that this is a standard that this board has never asked for in any previous decision that has never been made,” Miller said.
“This represents my best professional judgment. It represents our best option to stabilize the system,” he said.
The mayor retaliates against the municipal councilor
Shortly after the vote, Mayor Chokwe Antar Lumumba – in an unusual gesture – summoned the media to a side room at City Hall.
There he accused Banks of “advising” with former city contractors. who are now being sued with Siemens by the city for the incorrect installation of the water meter system.
“This vote was absolutely critical,” began the mayor. “But just one vote from the people who installed the system will prevent us from fixing it.”
Several council members expressed dissatisfaction with the request, but said they saw no other way forward.
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City Councilor Melvin Priester Jr. described the stalemate the city finds itself in, where it needs funds to fix the billing system, but at the same time is counting on increased collections to pay it off.
The counselor compared the situation to a cancer patient.
“This system was cancer for us. The chemo didn’t work. My doctor came up with a plan. Is there a guarantee? No. What I do know is that the adverse consequences of it ‘discontinuation of treatment is horrible. ”
“And until someone shows me another option, it feels like stopping cancer treatment, and honestly, I don’t see any other options,” he said.
City Councilor De’Keither Stamps warned that if this “solution” did not work, it could lead to increased water and sewer rates and property taxes.
Water collection is the key to the city’s financial future
Miller said collections are improving and cited a month-over-month increase for 13 of the past 17 months. But that’s not enough.
Over the past two years, the ministry has borrowed $ 13.5 million from the City’s general fund. Another $ 2.77 million was paid to contractors to fix the system.
Administration officials say this is the price to pay for making improvements to a system that loses more than $ 20 million in water collection per year. Securing these revenues is widely seen as one of the most important financial measures the city can do for its future.
“We have a bad system, period. We have to stabilize it to move forward,” Lumumba said.
“When you lose control of your water, you lose control of your city,” the mayor said.