S&WB wrestles with cash reserve problems on top of billing issues

Sewerage and Water Board trouble

NEW ORLEANS (WVUE) - As New Orleans City Council members keep the heat on the embattled Sewerage and Water Board over billing and other issues, the agency continues to face cash reserve problems that could affect its ability to borrow money for projects.

Complaints from dissatisfied S&WB customers flowed during Public Works Committee meeting Monday (Oct. 15).

"The billing issue is on Sewerage and Water Board because the reason is for years and years and years, they have not had qualified people who they had sent to school, or sent to training to read those meters,” resident and S&WB critic Larry Morgan said.

A newcomer to the city brought complaints about not receiving water bills.

"Now we’re in our new home, and I have not received a water bill and I live in fear of getting that water bill,” said Danielle Beverly.

Over the past couple of years, many customers received overly inflated water bills that they maintain are flat-out erroneous. The Sewerage and Water Board acknowledges the billing system issues.

“As for billing, recognizing the agony and the burden we have imposed on our customer, it is our priority to solve that issue. We have been looking at every step of the billing process, and due to your urging and direction, we have hired a third party to provide an independent set of eyes to scrutinize the process,” S&WB Executive Director Ghassan Korban said. Korban has been in the position for less than two months.

Also during the meeting, the council members questioned representatives of Cogsdale, a Canadian company that installed the billing system in 2016. Many of the questions focused on how well Cogsdale trained S&WB personnel.

"So you all said this works great, all of the employees are ready to go and checked it off?” Councilwoman Helena Moreno asked.

Cogsdale representative Judy Wells said their contract was fulfilled.

“At the time of project closed though the bills are correct, we were able to pass a successful audit, so it met the criteria of our contract,” Wells said.

The S&WB is strapped for cash. While agency representatives said the water system portion of the system has over 100 days in cash reserves, the sewer system is down to 50 days of cash reserves and the drainage system just seven days. A financial scenario that affects obligations the agency must meet, in terms of its bonds and the ability to borrow money for projects, according to Yvette Downs, chief financial officer for S&WB.

"It would definitely have an impact on our ability to go to the market and how we would be viewed and probably not do well for us with the rating agencies,” Downs said.

“We are trying to keep it together, but we’re very concerned obviously and the only thing at this point that we can control is spending,” said Korban.

Additionally, S&WB could be owed as much as $40 million due to delinquent accounts and account transfer issues.

Councilman Joseph Giarrusso, III, who is chairman of the Public Committee called on delinquent customers to pay up.

“Speaking now to our customers if you are not paying your bill you are a cheat,” he said. “Customers who game the billing system are hurting your neighbors by cutting off money needed to operate.”

Despite the myriad problems at the Sewerage and Water Board, council members said they will hold its leaders accountable because customers must have a system they can trust.

"The public deserves as much transparency as possible on the operations of the board,” Giarrusso said.

All the while a new resident pondered publicly whether she and her husband made a mistake in moving their family to New Orleans.

"We own a property in Michigan and we own a property in Ohio and I say to my husband regularly I don’t think we’re in the right place. It’s costing us way too much and I have to live in fear of getting a simple water bill,” said Beverly.

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