City files suit against Siemens’ subcontractor

JACKSON NOW has its sights on Mueller Systems, the firm that provided the meters for its $90 million water billing system overhaul.

Last week, the city submitted an amended complaint in Hinds County Circuit Court.

The city is now seeking $450 million in damages and has named Mueller as one of the defendants.

Mueller served as a subcontractor on the Siemens contract. Siemens was brought on in 2012 to completely overhaul Jackson’s water billing system. Work included replacing 60,000 analog water meters with electronic ones and adding a new billing system in the water/sewer billing office.

According to court records, “the city estimates that at least 10,000 of the 60,000 new meters (were) not functioning correctly, resulting in numerous unpaid accounts and water usage that is not accurately captured.” Attorneys for the city go on state that the meters “are either installed incorrectly, not transmitting readings, or not communicating with the Mueller network and/or billing system.”

The overhaul included installing the meters, as well as a network of repeaters and transmitters that was designed to transmit water usage data to the city’s billing office.

However, problems with the meters and other equipment in the field has caused thousands of bills to become “stranded.” An account becomes stranded when bills are no longer being sent out. 

Last week, Public Works Director Robert Miller told the Sun that some 10,500 customers were not receiving bills, in part, because of faulty meters. 

The new billing system went live in 2015. In the spring of 2018, the city announced that its water/sewer enterprise was in danger of running out of money, in part, because some 23,000 customers were not receiving statements and therefore not paying.

Jackson claims those accounts are having to be manually corrected, even though the new system installed by Siemens was designed to be “automated.”

The city brought on Siemens in 2012, under former Mayor Harvey Johnson. The contract was sold as being revenue-neutral, meaning that the work would pay for itself over time.

In fact, Jackson argues that Siemens promised more than $122 million in savings over the course of 15 years, more than enough to pay off the roughly $90 million in bonds issued for the work.

Instead, the Lumumba administration claims the “project has devastated the city’s finances. The city has fallen well short of its budgeted revenue target for water and sewer services since Siemens installed the new water system.”

Also, the city states that it has “lost revenue of more than $175 million (and has) funded more than $75 million for system stabilization, repairs and ongoing maintenance and operation costs.”

The city filed the initial suit earlier this summer.

Click here to read a copy of the suit:

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