Why did Memphis water infrastructure crumble?
Some on city council admit political pressure, lobbying from outside interests delayed vital decision-making
The deep freeze that wreaked havoc on Memphis’ water system showed MLGW CEO J.T. Young has the benefit of foresight.
On Dec. 17, 2019, after years of urging Memphis City Council to approve rate hikes, the city-owned utility had just received a water rate hike and a gas rate hike, but failed to get an electric one, Young expressed worry about the delay.
“What I’m concerned about now is the more delays that we have now… puts more of our customers at risk in terms of their service and our equipment,” Young said. “That’s why we want to be able to move as quickly as we can to get that resolved.”
And, in 2021, unprecedented, prolonged cold attacked MLGW’S
aged wells and pumping stations, infrastructure that a 2019 outside audit had rated as on the verge of collapse. The freezing temperatures led to low water pressure, hundreds of broken pipes and mains, and a precautionary boil advisory that has lasted for days.
Last year, delayed more still by the COVID-19 pandemic, MLGW started fixing its infrastructure, beginning a yearslong, hundreds of million-dollar process to bring the antiquated utility up to snuff. The investment did little to alleviate the water system's issues before the freeze, showing the politicians' delays last decade, as Young had worried, might be costing their constituents now.
The emergency could soon pass, and the water infrastructure could soon get fixed. But the political construction of Memphis' governance that led to the delay in infrastructure spending will persist.
On Monday, some members of the City Council, the ones who vote on MLGW rate hikes, described the council, a group of elected representatives, as the best body to decide on rate hikes and big MLGW spending decisions, but also acknowledged that the system is not immune to political pressure and lobbying from outside interests.
“A strength of that [governance] is that you have people who are directly accountable to the ratepayers, and the voters of Memphis,” Councilman Martavius Jones said. “The weakness is that the Memphis City Council votes.”
Councilman Chase Carlisle said the council's political nature opens the door to the elected officials being influenced.
“Sometimes outside influence and heavy influences, whether it's lobbying or pressure, can sometimes, I think, cloud the judgment or cloud the decision-making matrix of the body, or individuals on the body,” Carlisle said.
Lobbying impacted rate hike votes
The fall and winter of 2019-2020 is one pandemic and presidential election ago, but, at that time, in the aftermath of the Memphis municipal elections, the hottest political issue in Memphis was electricity and spending money on infrastructure.
In his second year on the job, Young, for the second time as MLGW CEO, was trying to get the City Council to pass rate hikes for all three of MLGW'S divisions. The council had said no the year before.
Part of the reason behind that defeat was, as with any tax or rate hike, the council's reluctance to add any more financial burden to Memphians' bills. In a city that struggles with poverty, raising rates is an anathema to many elected officials.
There was considerable outside interest in Memphis' rate hikes as well. Proponents for Memphis leaving the Tennessee Valley Authority, the federal power provider, opposed the rate hikes, fearing that it would erase the need for Memphis to examine its electricity alternatives.
Lobbyists for various groups who could benefit from Memphis leaving TVA worked the council ahead of the votes, meeting with members privately and then watching the vote from the audience in the council chamber.
MLGW leadership, knowing the electric rate hike was a political football, worked to split up the different rate hikes, and got approval for the gas and water hikes, legislative permission that could have come a full year earlier, in late 2018. The electricity rate hike would pass in January 2020, after a new version of the city council had been sworn in.
Then Councilman-elect Carlisle watched the 2019 rate hike and political drama with unease. He noted that the rate hikes were delayed “over and over again” to apply pressure on MLGW leadership to leave TVA.
“It's a travesty that politics gets in the way of good policy decisions,” Carlisle said. He added he hopes his colleagues on the council vet the information they receive about leaving TVA, an issue that is still unresolved and stalled.
Outside interest in MLGW persists
In October, in the midst of heavy lobbying, the council voted down a contract for a company that would've bid out Memphis electricity supply. Some on the council said the contract should go to another firm, one that had pitched members of the City Council directly on wanting to do the bidding.
To Jones, that vote, and the larger influence campaign pushing Memphis to leave TVA, were political events he did not see coming.
“I never foresaw that things would get to get to where they are,” Jones said. “I think some of those alliances and influences are taking place.”
Jones, like Carlisle, expressed some concern over attempts to influence Memphis' decision-making process.
“I am not married to TVA. If we go through a process, and the process says it's in our best interest to [leave], I'm all for it. Where the politics of it comes in, is doing anything besides what would be a fair and independent process for us to assess what our current and future energy needs are,” Jones said.
Carlisle said, “I am agnostic to whether we leave TVA and seek alternate power, or stay with TVA, so long as when the decision is made, it is made with ... all the information necessary to make a fully informed decision that will ensure the best economics and reliability for our ratepayers.
...And, if that means leaving TVA, we better make sure that we fully understand any risk and or cost involved with seeking the savings associated with leaving our current provider.”
Water issue highlighted a lack of investment
The cold snap and snow were winter weather Memphis had not seen in decades. Without the successive storms and enduring cold, the city's aged water system might have held up, MLGW leadership said during multiple news conferences this weekend.
Young, and Nick Newman, the utility's head of engineering, acknowledged this weekend that other local water systems, Germantown, Collierville and Bartlett, endured the same cold but didn't have the same problems and that the age and condition of the water system played a significant role in the boil water advisory.
When asked about the city council's decision to delay rate hikes in the past, Young did not take the bait Sunday, telling Fox 13's Greg Coy that the utility was “blessed” to receive the rate hikes.
Young, as he often does, tiptoed around political controversy. He knows that he'll be back before the city council again. It does not make much sense for him to anger the people who vote on his organization's budget.