Water rates to raise $1.5 million in Beaumont

Terminating “special rates” agreements with seven entities that receive city of Beaumont water although their operations are outside of the city, Beaumont Chief Financial Officer Cheryl Ray advised, would raise roughly $1.5 million in revenue moving forward. 

During the onset of discussion at the July 2 meeting of the Beaumont City Council, members balked at terminating the agreements, considering the clients served by the specialized billing included government facilities and a nonprofit. But, not all were in agreement that any such discounted billing should have ever existed. 

“I really do struggle with these deals being off the books for so long,” Councilmember AJ Turner said. 

City Attorney Sharae Reed said at least one agreement dates back 50 years, and “continued into perpetuity.” 

“Some of them we couldn’t even find,” she said. “They were so old.” 

Ray advised that the city entered into a contract with Water Company of America to find lost revenue in the water system. The company reported back that outside-city commercial water customers granted special inside-city rates for water and sewer in old contracts is costing the community roughly $1.5 million in lost revenue annually. 

Customers that would be affected by the termination of special rate pricing include the Jefferson County Correctional Facility, Beaumont Dream Center, LIT/Lamar University, Texas Department of Criminal Justice, Federal Correctional Complex, Lower Neches Valley Authority, and the Jefferson County Sheriff’s Office. 

“We identified several agreements,” Reed said, approximately 12. “There’s probably two or three that are still valid.” 

Mayor Roy West clarified to the city attorney’s agreement that the move to terminate special rates will still allow the outside-city entities to negotiate a rate beneficial to all concerned. 

“It’s taking care of business,” Councilmember Audwin Samuel said of endorsing the move to drop special rates, adding that seeking proper payments for goods and services is not a personal attack. “We need to tighten up and move forward.”