DWSD deputy director: outcry over Detroit water shutoffs likely connected to ongoing bankruptcy

July 9, 2014
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Darryl Latimer, Detroit Water & Sewerage Department deputy director, explains the utility's widening efforts to shutoff service to customers in arrears at a press conference on July 9, 2014. (Photo by: Gionni Crawford)

Darryl Latimer, Detroit Water & Sewerage Department deputy director, explains the utility’s widening efforts to shutoff service to customers in arrears at a press conference on July 9, 2014. (Photo by: Gionni Crawford)

Yesterday, you may have caught a segment on MSNBC where Maureen Taylor, state chairwoman of the Michigan Welfare Rights Organization, blasted WDIV reporter Hank Winchester for comments he made about the ongoing water shutoffs in Detroit.

The segment highlighted some of the city’s commercial accounts with substantial outstanding fees, something also reported in an NBC nightly news broadcast over the weekend. We also touched on it again in this week’s Metro Times

For months, the Detroit Water & Sewerage Department has indicated all accounts would be treated the same in its shutoff initiative: If a residential customer owes $150, or, in the case of commercial accounts, happen to be 60 days past-due, a notice would be sent saying to pay the fees within 10 days, or their water would be shutoff.

But, as we reported this week, it’s more complicated than that. And the reason that 6o-day threshold has misled some appears to be tied to DWSD’s communications with the public and press since shutoff efforts commenced in March. In actuality, Ford Field, VA Hospital, city-owned golf courses and more, may be in dispute over stormwater drainage fees — an entirely different scenario than residential water use, as one DWSD spokesperson explained this week.

Thing is, the department hadn’t phrased the situation as such until this week. Maybe it’s a communications breakdown. Maybe not. Regardless, it’s pissed off quite a few people.

Which brings us to today.

The Detroit News reported that about 200 commercial and industrial accounts were being 10-day warning notices, including the state of Michigan, Olivet Cemetery and Vargo Golf. The department reiterated its stance to the News that it was ramping up efforts to collect what it’s owed, something it’s failed to adequately enforce in recent years.

That’s what we figured would fill this space today. Instead, around 10:15 a.m., we received a call from a DWSD spokesperson asking if we could make a press conference in forty-five minutes at the utility’s main office. Deputy Director Darryl Latimer wanted to talk with the press about the widening shutoff efforts.

The word “hasty” comes to mind.

So we hopped in the car and made it to the office on West Randolph in downtown with a few minutes to spare. A half-dozen reporters and cameramen were ushered into Latimer’s office to chat.

We asked a DWSD spokesperson if the increase in shutoffs is tied to the proposed spin-off of the utility to a regional authority, or a private operator. The spokesperson said it’s “absolutely not connected.” (Since last summer, Detroit Emergency Manager Kevyn Orr has worked with officials from Wayne, Oakland and Macomb counties to create a regional authority to govern the utility. When talks appeared to fall apart, Orr sought bids to privatize the department. The bankruptcy judge overseeing Detroit’s Chapter 9 case later ordered a mediator to work through issues with the city over the regional authority.)

DWSD has pursued shutoffs for years, Latimer pointed out. The outcry this year, he said, is likely tied to Detroit’s ongoing bankruptcy, adding DWSD is pursuing a more aggressive shutoff campaign this year to settle “bad debts.” Rate increases in Detroit are higher than suburban customers due to the high delinquency rate, he said. Detroit City Council approved an 8.7 percent rate increase for city customers last month, bringing residents monthly bill to about $75, nearly twice the nation’s average.

“We’re not trying to have customers with no water, we’re trying to make sure those customers that can pay, pay,” he said. “And those customers that cannot, come talk to us.”

Between April and May, roughly 7,550 customers had service cut, with about 85 percent paying their fees within 48 hours. In June, Latimer said today, about 7,200 accounts were cut, and 3,118 had service restored.

Using DWSD’s numbers and estimates, that means nearly 14,800 accounts were shutoff over the last three months, and about 9,600 had service turned back on — a roughly 65 percent restoration rate. DWSD says it has 176,879 active residential accounts, with about 80,300 in arrears, with an accumulated $43.4 million in outstanding fees. That’s a lot of numbers, and a lot of customers who went without water. A spokesperson previously told Metro Times the department is investigating what happens to other customers who didn’t restore service. So it’s unclear if those who didn’t pay their bill simply couldn’t afford the fees, or if they were unresponsive account holders.

Some customers with shutoff notices have reported they’ve tried contact DWSD to ask questions about their bill, but say they’ve been unable to reach a human being for two, sometimes three days. That’s why state Rep. Thomas Stallworth III (D-Detroit) said the department should halt shutoffs until it address its apparent inability to answer customers in a timely fashion. Stallworth said in a statement last week that some families “are being told that after they have paid their water bill they will have to wait two to three days before water service is restored, and that they must be available over a 24-hour period to meet the water department crew.”

Asked by Metro Times if anything has been done to address that problem, Latimer said DWSD has 12 additional employees answering phones, with 10 more soon to be trained. He also said customers can visit the department’s three payment stations at 735 Randolph Street, 13303 E. McNichols, and 15600 Grand River.

In total, the department says it has recouped $802,420 from delinquent customers over a three-month period.  That’s a $547,449 increase compared to 2013 numbers provided today by DWSD officials.

Latimer then said a program was launched Monday to provide $1 million in aid for low-income residents. He said customers who are under 200 percent of the poverty line with a bill $2,500 or less are eligible to receive up to $1,500 in assistance.

But why did it take until now to launch an aid program? The deputy director said the Detroit Department of Human Services, which previously administered the program, was abolished two years back. DWSD struggled to find a group to administer the funds, but recently tapped The Heat & Warmth Fund (THAW). The numbers to call for assistance are (877) 646-2831 or 313-267-8000.

When Latimer was asked to explain why accounts such as Ford Field hasn’t been shutoff, yet residents who owe $150 were cut, his response focused on the difficulty he says DWSD faces with its larger customers. (Latimer said he wasn’t sure what entity is DWSD’s largest customer.)

“Some of the larger accounts just take a little more work,” he said. “It’s not as simple of a process as shutting off water at a residents’ home, he said. And, as Metro Times reported this week, some may dispute assessed stormwater drainage fees, while others — for instance, Joe Louis Arena — had actually paid their bill, but DWSD misapplied or misplaced the check. Latimer reiterated that point today, as well.

“When you get into the larger [accounts] we have to activate a crew to go out there,”  he said. “It’s something that can’t be executed by the contractor that we have.”

He added: “There’s multiple connections in a lot of different buildings. And you have to look at maps, you have to look at drawings to make sure you’t hit exactly all of those connections.” The department’s contractor isn’t equipped to handle large-scale customers, he said, so the department has to send its own staff to conduct the shutoff. Currently, DWSD has 33 staff-members conducting shutoffs, he said.

Asked if those particular larger accounts are being held to the same 60-day standard, Latimer said, “Yes.” As The New York Times reported over the weekend, none of the accounts identified in a WDIV Channel 4 investigation back in April as having substantial fees, like Ford Field, haven’t paid anything, yet. The segment aired over three months ago. Like we said, it’s been a bit unclear.

Latimer’s response begs this question: If that’s the case — that the largest accounts are just more complicated to address — why didn’t DWSD simply make that point from the onset? Sure, all additional hell would be raised if, say, Ford Field, VA Hospital, and Joe Louis, and numerous small businesses lost water on the same day. But why not just say, “Look, those accounts will take additional work, but we’re going to go after them.”

In recent weeks, a number of national outlets have highlighted the enormous figures those large accounts have accumulated without any action. The issue has drawn international attention. Rather than get ahead of the curve, it took DWSD an impromptu press conference to clarify that point.

If anything, it’s been a total communications failure, something Latimer conceded may have been a factor after the press conference.

Latimer also said today that customers can dispute their bill. Charges are put on hold while DWSD conducts an investigation, Latimer said, and if the department finds it erroneously charged the account, the issue would be corrected. If the charges are found to be correct, customers can ask an independent hearing officer to review the dispute. One the officer renders their decision, Latimer said, it’s “binding on the customer and the department.” During the process, customers disputing their charges will not have their water shutoff, he said. Latimer couldn’t say how many accounts are currently disputing their charges.

A portion of the press conference can be viewed below.

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  • sauliussimoliunas

    Detroit water rates are twice the national average. Everywhere else water rates are going down due to advances in technology ( last week’s AAAS Science magazine ).