A contract to discontinue water to delinquent Detroit homes has gone up to $12.7 million in three years without approval from City Council.
Joel Kurth of the The Detroit News reports the city's contract with Homrich Wrecking Inc. was supposed to resolve the plethora of delinquent water bills in Detroit in two-years by requiring residents to accept payment plans. The contract signed in 2013 was for $5.6 million, but it has received four extensions since then.
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The shutoffs that began months later, in 2014, have led to disconnections of more than 70,000 homes, the equivalent of every household in Grand Rapids.
The News received documents that show shutoffs are expected to continue at an average rate of 540 per week. The city shuts off water to residential accounts that are $150 and 60 days overdue. Shutoffs are currently on track to number around the same as last year, nearing 22,000 residents.
“This is much more challenging than anyone expected two to three years ago,” said Gary Brown, who this year became director of the city’s Water and Sewerage Department...
Brown said the program is working, pointing to 44,000 residents who are now on payment plans and increases in overall collection rates from 76 percent in the 2013-14 fiscal year to 87 percent in the 2015-16 fiscal year.