DeKalb County approves $51.5m Shoal Creek sewer contract, weighs rate hikes

DeKalb County approves $51.5m Shoal Creek sewer contract, weighs rate hikesThe Georgia utility advances a major capital project under its federal consent decree but delays a $50 million assessment contract pending audit review, as leadership emphasizes the necessity of rate increases to maintain debt service coverage.

The Board approved a $51.5 million contract with JDS, Inc. for Section 1 of the Shoal Creek Trunk Sewer Replacement.

A $49.8 million contract for ongoing sewer condition assessment and rehabilitation (CD-OSCAR) was deferred pending an audit report.

County leadership confirmed the necessity of continued water and sewer rate increases to satisfy bond rating agencies and debt service coverage.

A $7.55 million contract amendment for the enQuesta customer billing system was deferred.

DeKalb County Commissioners moved forward with significant wastewater infrastructure investments during their February 10 meeting, approving a major trunk sewer replacement while grappling with the financial requirements of the county’s federal consent decree. The Board approved a contract with JDS, Inc. valued at $51,486,473.55 for the Shoal Creek Trunk Sewer Replacement (Section 1). Based in Stone Mountain, JDS, Inc. (formerly John D. Stephens Inc.) has specialized in heavy civil pipeline construction for water and sewer systems since 1962. The project, identified in the agenda as 'CD Trunks,' is a critical component of the Department of Watershed Management’s (DWM) obligations to upgrade aging conveyance infrastructure. The item cleared the Public Works and Infrastructure (PWI) Committee after passing a review for projects exceeding $3 million. However, a second major consent decree item was put on hold. The Board deferred a $49,752,501.00 contract for 'Consent Decree - Ongoing Sewer Condition Assessment and Rehabilitation (CD-OSCAR).' The contract, intended to be split between Kemi Construction Company, Inc. and Southeast Pipe Survey, Inc., covers assignments to meet urgent needs arising from operational events within the sewer system. The PWI Committee recommended deferral to allow time for an audit report from the Office of Independent Internal Audit (OIIA). **Financial Pressures and Rates** The capital approvals occurred against the backdrop of the FY2026 budget public hearing, where water and sewer rates were a focal point of discussion regarding the utility's financial health. During the budget presentation, Commissioner Michelle Long Spears requested clarification on a 'flag' raised previously regarding the county's bond rating. The Chief Financial Officer explained that the concern stemmed from the county’s implementation of rate increases required to fund the consent decree program and capital needs. 'It’s ensuring that we have the water expenses set so that they are covered by all the revenues, plus our debt service is covered,' the CFO stated, noting that contracts with investors require net revenues to cover 1.2 times the debt service (principal and interest). Chief Operating Officer Williams added context regarding the rate trajectory, referring to a '10 by 10' strategy—implying a series of 10% increases—noting that the budget assumes these rate adjustments to support the level of services and infrastructure investment required. **Other Water Business** The Board also deferred a $7.55 million sole-source contract amendment with Systems and Software, Inc. for the annual hosting and maintenance of the enQuesta customer information system (CIS), which manages billing for DWM. Additionally, a resolution to establish a 'DeKalb County Water Customer Bill of Rights' was deferred to late February. In a minor procurement approval, the Board authorized a change order adding funds to a granite rubble stone contract with Bedrock Granite Co., Inc., raising the total not-to-exceed amount to $925,000. This material is used by DWM and other departments for erosion control.