Magnolia Water tells Lush Parish Council its investments drove rate increases, offers local contacts after complaints

Steve Ernst, a Magnolia Water representative, told the Lush Parish Council on May 12 that Magnolia entered Louisiana in 2019 and has invested about $23.5 million in parish wastewater systems, buying and rehabilitating dozens of failing systems.

“Since that time we've spent almost $23.5 million in Lafouch Parish buying wastewater systems and upgrading them,” Ernst said, and he introduced Scott Olman, Magnolia’s vice president for operations. Ernst and Olman said most local systems recently inspected received A grades from the state health department and that Magnolia completed a move in May to 100% insourced operations to increase accountability.

The council’s questions focused on sudden and sizable residential bill increases. Councilman Pierce said constituents reported bills jumping “from $23 a month to $76 a month” and described at least one resident facing a $1,400 arrearage after rate changes. Pierce and other council members asked how rates are set and whether bills can be tied to water consumption where data exist.

Olman explained the mechanics: the Louisiana Public Service Commission audits company finances and allows utilities to recover operating costs dollar-for-dollar and to earn a return on capital investment (the PSC’s allowed range is approximately 8–10%). “When we spend a million dollars putting a ... sewer plant in, the public service commission will allow Magnolia to earn,” Olman said, adding that Magnolia has generally not reached the upper end of that return since operating in the state.

Council members pressed Magnolia to improve transparency and to give residents neighborhood-level information about what capital work their bills have paid for. Parish President Oer said the parish expects clearer, photo-backed summaries so councilmembers can explain investments to constituents; Magnolia agreed to provide neighborhood-specific updates and to coordinate town-hall–style outreach.

Council members also raised emergency-response and environmental concerns after a resident supplied photos alleging a sewage spill in the Waverly area that killed fish and returned E.coli levels the resident said were “10 times the amount allowed by law.” Magnolia said it investigated the location, sampled the site using an independent certified lab, notified state regulators and performed cleanup work. Ernst noted that for state enforcement labs must be state-certified and said Magnolia’s sampling and a subsequent DEQ inspection did not corroborate the resident’s lab results.

Magnolia provided a 24/7 customer-service hotline—855-643-8152—and the company offered to move more customer functions to Louisiana from its St. Louis call center to shorten response times. Ernst also offered his direct contact information to councilmembers to help escalate urgent constituent complaints.

Council members urged Magnolia to a) publish clear neighborhood-level reports showing the value of recent capital work, b) notify the parish promptly of spills or other incidents, and c) meet locally so elderly or fixed-income residents need not travel to distant forums. Magnolia confirmed it will supply the requested materials and pursue local outreach.

The briefing closed after roughly an hour of presentation and exchange; Magnolia answered follow-up questions about rates, service responsibilities and regulatory oversight and the council moved on to its regular agenda items.