OIG Audit of Metered Water Billing Finds That Errors and Poor Communication between the Department of Finance and the Department of Water Management Have Led to Billing Spikes

FOR RELEASE:
May 6, 2026

PRESS CONTACT:
Deanna Shoss, Communications, 773.478.8417

The City of Chicago Office of Inspector General (OIG) has completed an audit of the Department of Finance (DOF) and Department of Water Management's (DWM) processes for billing water use at metered properties, and for addressing customer billing issues, including billing spikes. OIG found that, while rare, billing spikes can amount to thousands of dollars in unanticipated charges, and that resolving this can be a confusing, scary, and months-long process for those impacted.

"The cost of living is rising for all Chicagoans. Therefore, it is imperative that the City do what it can to ensure it always bills accurately for services so as not to increase the burden on people who live here. Ultimately, public trust in government diminishes when service users have to jump through hoops to resolve issues for basic City services," said Tobara Richardson, Interim Inspector General for the City of Chicago.

OIG found that water meters are typically accurate and do not cause billing spikes. However, DOF and DWM's processes related to service orders and estimate calculations may introduce errors that lead to or worsen spikes for some customers. Additionally, infrequent written notices and unsatisfactory customer service can compound the frustration customers face when attempting to resolve errors.

Because customers are not promptly informed of spikes in their water use, they cannot quickly take action to resolve potential leaks. Once DOF has resolved the billing complaints, the department did not always follow up with the customer, creating confusion and delaying the resolution of billing issues.

In order to mitigate billing spikes, OIG recommends that DOF and DWM work together and with their vendors to ensure their meter reading and billing system has features to identify and respond to errors, define roles and responsibilities within the service order process, and thoroughly train customer service representatives to explain billing and service policies. Additionally, as DOF and DWM look to modernize the City's meter reading and billing system, the departments should ensure that the new systems include features designed to prevent duplicate service orders and ensure that calculations of estimated water use and credits to correct account balances are thoroughly documented and reviewed. Furthermore, to reduce customer misunderstandings, DOF and DWM should distribute clarifying information on water meter functionality and the water distribution system.

In response to OIG's audit findings and recommendations, DOF and DWM stated that they will continue to work together on process changes and training to ensure meter readings are properly recorded and bills are correct, and will distribute information about water meter functionality to customers. DOF stated that it will correct some of the account adjustment calculation errors identified in OIG's report, that it has already improved its customer service training and quality management, and that it will continue to work with its customer service vendor to improve response times. DWM stated that it will continue to train staff completing service orders and to review their accuracy. The departments also stated that the City intends to move from Automated Meter Reading to Advanced Meter Infrastructure technology, at which point it plans to acquire a customer-facing portal that will allow account holders to access their water use information. However, the departments also stated that other improvements, such as modifying Banner to identify excessive or deficient readings and modifying DOF's meter change-out report to identify all meter change-outs, would require substantial additional cost to the City. DOF and DWM agreed with some of the report's conclusions and disagreed with others, and thus have not committed to all corrective actions. Without appropriate corrective actions, the issues identified in the report are likely to persist.

Read the Report

Link to read the full report and departmental response, published on May 6, 2026: https://igchicago.org/publications/water-billing-audit/

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