LANSING, Mich. — One of Jackson's biggest employers is suing the city. Consumers Energy accuses the city of breaking a contract that kept the company's water rates lower than the standard rate.
Jackson signed he contract with Kinder Morgan in 2000 when the company built a new gas-powered electric plant. The contract was transferred to Consumers Energy in 2013. It called for the company to pay 46% of the standard city water rate.
Last September the Jackson city council voted to end all special rates and have all customers pay the same $3.14 per 100 cubic feet of water. The change has the potential to cost Consumers Energy upwards of $1 million per year.
The company negotiated a new deal with Jackson's city manager that would have set Consumers Energy's rate at 52% of the standard rate. Spokesman Brian Wheeler tells wilx.com the proposal would have paid the city an extra $50 million over the next 20 years.
The Jackson city council voted to table the proposal at its meeting on January 28. It was expected to revisit the idea at its Feb. 11 meeting. But city spokesman Aaron Dimick tells wilx.com he can no longer confidently say how the council will revisit the issue now that Consumers Energy has sued. He provided the following statement about the suit
“Now that this is a legal matter behind handled in court, City administration does not wish to comment further on this issue.”
Consumers Energy spokesman Brian Wheeler says the company believes the contract signed in 2000 is still in effect and that the city is in breach. He also released a statement to Fox 47.
Consumers Energy is taking action to protect our customers from unnecessarily high costs. We filed a lawsuit against the City of Jackson because the city has broken the contract that sets water rates for our Jackson power plant. We worked hard with the city on a new agreement that would resolve the legal dispute and would result in $50 million of new revenue for the city over the next 20 years. Unfortunately, the City Council has not approved the agreement. We remain committed to working with the city and are hopeful the City Council approves this new agreement. The City Council’s approval of the new agreement would resolve the lawsuit, ensure that the Jackson power plant remains a water customer of the city for years to come, and benefit all customers.
Want to see more local news ? Visit the FOX47News Website.
Stay in touch with us anytime, anywhere.
Download our free app for Apple and Android
and
Sign up for newsletters emailed to your inbox.
Select from these options: Breaking News, Severe Weather, School Closings, Daily Headlines and Daily Forecasts.
