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The Birmingham Water Works may be raising rates again in 2023 to fund a $128 million budget, part of which will be used to pay for new public relations (PR) positions.
According to WBRC, the Birmingham Water Works Board (BWWB) is considering recommendations made by consultants and the board's staff, which were presented to the BWWB Finance Committee on Wednesday.
To cover the recommended $128 million budget, a nearly 11% increase from 2022, the board proposed raising rates by an average of 8.3%, well above last year's increase of 3.9%. However, a consultant projected water demand could decrease by around 2.5%.
So where is the extra money going? Part of it will go toward an additional $1.5 million in labor costs, which includes two new PR positions.
Even with the new positions, the BWWB voted at its last meeting to outsource a second PR firm, meaning it is now paying $50,000 to outside firms every month on top of providing salaries for its current PR staff, according to WBRC.
The BWWB charges its customers based on a tiered structure, meaning the rate increase could be as much as 19% for customers using larger amounts of water.
This rate increase likely won't endear the board to its customers, many of who were already upset over issues with their service.
Earlier this year, thousands of customers reportedly didn't receive bills for months at a time. Later, they received much larger or multiple bills all at once.
The bills were also not based on accurate meter readings but estimations based on previous months. Birmingham Water Works blamed the issues on a lack of meter readers and insufficient staffing.
The BWWB hired Macaroy Underwood of Underwood Financial Consultants, LLC, to review customer billing and collections from Jan.1, 2022, through July 31, 2022. Underwood was the general manager of Birmingham Water Works from 2005 to 2018.
Underwood's hiring was questioned by several of BWWB's finance committee members due to ethical considerations surrounding hiring a former general manager.
The BWWB accepted the retirements of most of its purchasing department on Aug. 25 amid accusations of poor practices and kickbacks.
Sources told WBRC in August the BWWB voted to accept the sudden retirements of three employees, including the purchasing department manager. The BWWB will begin paying lifetime pensions to them upon retirement.
According to the WBRC report, BWWB retired the employees abruptly over uncovered improper purchasing activity and kickbacks.
Reis Logan was hired in September to fill the open manager position.
On Sept. 6, BWWB Chairman Chris Rice submitted his resignation to Birmingham Mayor Randall Woodfin. He tried to rescind his resignation last week, but, according to the city attorney, he won't be able to.
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