Community advocates and elected officials are asking decision-makers to “reject” proposed Memphis Light, Gas, and Water (MLGW) rate increases.
The utility company is looking to raise its gas and water rates from 2027 through 2029. The increase was approved by MLGW’s Board of Commissioners during its Wednesday, October 21st board meeting.
On Thursday, City Council member JB Smiley, Jr. asked his fellow council members and Mayor Paul Young to refuse proposed gas and water increases from the utility company.
The councilman said it’s important for the city to sustain its infrastructure, yet the responsibility should not come at a financial impact on families. He noted Memphis residents are facing increasing grocery and housing prices.
“We cannot claim to be fighting poverty while making it more expensive to be poor,” Smiley said in a statement. “We cannot talk about attracting families to Memphis while making it harder for the families already here to stay.”
Smiley called on fellow councilors and Young to intervene on the proposed rate hikes. He also asked them to urge MLGW to “review its spending, operational efficiencies, infrastructure priorities, and alternative funding sources.”
“I’m calling on Mayor Young and my colleagues on the City Council to draw a line in the sand,” Smiley said. “No more rate hikes on the backs of Memphis families.”
This request comes after a number of community groups asked MLGW to look at a number of options prior to its board approving the rate increase. Protect Our Aquifer (POA) recently delivered a petition of more than 1,000 signatures calling for changes in the company’s whole water-rate structure and to stop “regressive discounts” for “major industrial water users.”
POA’s executive director Sarah Houston appeared in front of MLGW’s board prior to its vote on Wednesday. Houston believed the company could look at how other cities have constructed their water rates.
“We understand that MLGW needs revenue to maintain and modernize its infrastructure, and that’s something we’re not debating,” she said. “We want to look beyond how much a revenue rate-increase generates, and ask how that revenue is collected and whether a rate structure encourages responsible water use.”
Glenda Hicks, co-founder of 21st Century Memphis or Bust!, said she was “deeply concerned” by the proposal for rate increases. Hicks acknowledged MLGW’s service improvements, but noted customers still face “consistent” outages. Hicks called for a more equitable system for residential customers.
“We come on behalf of the citizens asking that there be more alignment in fairness to cost-per-use of our water,” Hicks said. “Please do not burden our citizens anymore,” Hicks said.
Doug McGowen, CEO of MLGW, said the company has previously suffered from not having consistent rate increases. The company’s systems and service rely on revenue, and McGowen said recurring investment is key.
McGowen said not increasing rates would mark zero investment into their system and a “cutback on spending.” A one-year rate increase would make rates higher than the three-year proposal.
“I can say with 100 percent certainty that MLGW has suffered from a lack of recurring and regular rate increases that kept pace with the costs of goods and services that prevented necessary investment in our system to provide the reliability and quality of service that customers should expect ” McGowen said.
The CEO added that their fee structure is built to maintain “equity” between commercial and residential customers. He said the three-year increase is “thoughtful” and allows MLGW to organize its spending “over a long period of time.”
Following approval by the board MLGW’s budget and rate-increase proposal will appear in front of Memphis City Council for consideration.
