Surprise bills. Lawsuit settled. Now, Phenix City works to fix water system failure
Phenix City resident Janet Sneed didn’t know what happened when she opened her water bill last month.
Usually, she pays about $124 for her water utility. But this time it was $353.
Sneed and her family began trying to find out whether her home had a water leak or something else that caused her bill to dramatically increase.
The higher bill was not because of a leak. It was a result of the systemic failure of water registers. And that led to the Phenix City suing the manufacturer and taking steps to adjust customer accounts where the estimated usage was not accurate.
Some customers had a higher or lower-than-normal balance owed because the previous estimates were higher or lower than their actual usage.
“We’re not just fixing the problem with underbilling,” Phenix City assistant city manager Chan Gamble said during the 2025 State of Phenix City address. “But we’ve also overbilled. So, we’ve also been issuing refunds. It’s not a one-way street.”
How this happened
Fifteen years ago, Phenix City contracted with the Texas-based company Master Meter for a new system of water meters and registers, Gamble said. This was an automated system.
Before the system was installed, workers had to go to every address, flip open the lid on the meters and write down the number of gallons used to put in the system. Master Meter’s water registers were supposed to transmit a signal with the reading every 11 seconds.
This allowed a meter technician to drive along the routes in a truck outfitted with an antenna to receive the information from the registers.
With the registers transmitting information every 11 seconds, Gamble said, it was guaranteed that a reading would come through.
“The first five years, it worked great,” he said.
But by 2015 and 2016, Phenix City meters began failing exponentially. Phenix City had to get Master Meter to give the city 10,000 new registers.
“They said the 15,000 (registers) that were already installed were ‘impacted,’” Gamble said. “And what impacted means is that the registers were failing.”
The glitch occurred because instead of emitting a signal every 11 seconds, as designed, the registers were emitting every millisecond until the battery died prematurely.
When the truck rides by, Gamble said, it cannot pick up a signal if the battery is dead. Since there wasn’t an actual reading, the computer system created “estimated bills.”
“That estimated bill uses a formula to estimate based on prior months’ consumption,” Gamble said.
Because of the scope of the systemic failure beginning in 2015, it is difficult to estimate or calculate the amount of actual revenue that was lost, Gamble told the Ledger-Enquirer.
Getting actual reads and a lawsuit settlement
In 2021, the Phenix City filed suit against Master Meter and the company that supplied the equipment, Empire Pipe of Irondale, Alabama.
The goal of the lawsuit was to recover funds the city believes it was owed because of these ongoing problems with faulty equipment, purchasing new equipment and installing equipment, Gamble said.
“The city has spent enormous amounts of money trying to correct this problem,” he said.
They have settled, Gamble told the Ledger-Enquirer, but the amount the city will receive has not been finalized.
“We’ve reached an agreement that we believe is favorable to the city,” he said. “And once the mayor and council sign off on it, and there’s ink on the contract, the details will be released.”
Phenix City Utilities released a public notice last year announcing the systemic failure of the water registers, and warning customers that after registers were replaced the verified readings could result in accounts having higher or lower than normal balances.
When the city began to get actual reads, Gamble said, they realized some customers had been getting estimated bills from six months to over a year.
Some customers had actual usage lower than their estimates, which resulted in them receiving refunds. Others had actual usage higher than the estimates.
Phenix City took an average of customers’ actual consumption for up to six months. Around 1,600 accounts were corrected in January, Gamble said.
From this point on, whether registers are emitting an actual reading or not, customers’ bills will be accurate, he said.
“If it’s not emitting the signal, there will be an actual person pulling the data off your meter every month,” Gamble said.
This is a short-term solution because the city will install a new system soon, Gamble said. The money from the settlement with Master Meter is expected to go toward improving the water meter system and recouping some of the money that citizens lost, he said.
Confusion and payment options
After Sneed received her water bill, she became frustrated because of the lack of information about why it had increased.
When she called to ask why her bill was higher than normal, Sneed said, it seemed like representatives couldn’t answer her questions. And she didn’t think she was alone in feeling this way.
“I think a lot of people felt that they had been overcharged, just like I did,” she said.
Gamble understands residents with higher bills are frustrated, he told the Ledger-Enquirer.
“Don’t panic,” he said. “There’s this rumor going around that you either pay it, or we’re cutting you off.”
The department is offering payment plans for any amount to anyone affected by the registers failing, he said.
Before attending the State of Phenix City address and speaking with Gamble, Sneed was not aware that she could receive a payment plan, she said. Sneed believes this was a failure of communication with the department’s customer service.
“That was not an option,” she said. “It was just pay it or get your water cut off.”
Now that Sneed knows more about what happened, she plans to investigate her bill again to determine the reason for the higher cost. Sneed looks forward to learning more about the settlement and how the money will be used.
“I’m hoping that maybe they would just do a courteous thing and reimburse,” she said. “Send a check out to everybody, even if it’s only $10.”
Gamble asks for patience as Phenix City officials work to fix the system.
“The system is intricate and large,” he said. “It’s not something that you can just unplug and plug. So, stick with us as we change and improve the department. I hope we regain their trust.”
