Chesterton Tribune

Divided Porter Town Council okays sewage treatment pact with Chesterton

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By PAULENE POPARAD

Let the construction begin, but it could cost Porter developers more in the future.

Town Clerk-treasurer Carol Pomeroy was authorized Tuesday to send a $799,000 check to the town of Chesterton to purchase 170,000 gallons per day of additional Porter sewage-treatment capacity at Chesterton’s wastewater plant.

Porter currently has reached its previous 513,000 gpd limit and development there including about 100 new homes and a hotel/restaurant is stalled pending a sewer agreement, which has been under negotiation for nearly one year. Chesterton officials inked the pact Monday.

The Porter Town Council voted 3-2 to approve a new 20-year intermunicipal agreement between the towns that provides for optional purchase of an additional 42,000 gpd in each of the next five years at a cost of $197,400 annually. The total cost to Porter if all 380,000 gpd is purchased is $1,786,000 based on $4.70 per gallon.

Council members supporting the sewer pact said they believe it can be financed without hiking sewer rates for Porter customers if a new sewer capital-improvement fee is charged to future construction, and if Porter’s tap-on fees for sewer connections are increased as well.

Porter financial consultant Karl Cender recommended implementing both as soon as possible and after the meeting said the capital fee would be a pass-through cost, not an impact fee.

Council members Sandi Snyder, Bill Sexton and Lorri Wickberg voted for the agreement; President Paul Childress and Jennifer Granat voted no saying the agreement favors Chesterton at Porter’s expense and creates costly future obligations Porter can’t afford.

Sexton agreed that while Porter has the initial $799,000 in its sewer construction fund, the annual $197,400 payments are unfunded but partially will be offset by a decrease in the treatment rate Chesterton will charge Porter. And Porter can decline to purchase additional capacity in any of the five years if it doesn’t need or can’t afford it, Sexton noted, however that year’s capacity would be lost.

“Negotiations are usually a two-way street. Here I can find everything went Chesterton’s way and the town of Porter got nothing,” said Childress. Added Granat, “I was very disappointed. We could have been a little tougher in negotiations.”

Sexton said if the agreement wasn’t approved not another new house, structure or business could be built or developed. “It seriously would hinder any further growth in the Town of Porter. Some would say that’s alright but it will affect your (property) taxes if we don’t grow.”

Last year Porter sold developer Lake Erie Land sewer capacity for its Munson Place commercial/light industrial park at Indiana 49 and U.S. 20. At approximately $5 per gallon Childress said LEL paid about $185,000. According to Sexton, without the new agreement with Chesterton, having sold LEL capacity Porter doesn’t have creates a problem.

Although she tried to get Chesterton to sell Porter more capacity at $3.90 per gallon, Snyder said having the price remain at $4.70 over five years is a good deal. “I think we should jump on it.” Replied Childress, “I believe it’s a great deal for the town of Chesterton.”

Sexton said $4.70 is slightly below the median of the statewide rate structures for similarly-sized utilities. “I believe this is the best we can get.” He emphasized that Porter needs sewer capacity for the next 15-20 years. “The only way to get that is through this agreement.”

Snyder, who with Sexton were Porter’s negotiators in the sewer talks, reminded, “It’s Chesterton’s sewer plant. We can’t shop around. We have nowhere to turn except to Chesterton.” Granat said Porter never has excluded building its own treatment plant; Snyder said Porter couldn’t afford it and Sexton said there’s no guarantee the state would allow it.

Granat and Childress also cited a clause in the new agreement that would prevent Porter from resorting to litigation like its previous lawsuit, withdrawn earlier this year, hoping to gain access to Chesterton’s plant for an appraiser in the event Porter wanted to condemn, buy and operate the plant, which is located in Porter. Such action is forbidden in the new agreement.

Granat asked how Porter could resolve future problems if it has no bargaining power through the courts. Sexton said the cost for a protracted legal battle would be more than it would cost to purchase additional capacity.

Childress and Granat, the latter attending the meeting in an ankle cast due to a recent injury, also rapped terms of a penalty clause that allows Chesterton to assess Porter a surcharge for exceeding its allotted capacity. Replied Sexton, “There was a great deal of give-and-take; we went back and forth several times.”

Childress said the agreement commits Porter to making serious upgrades in its sewer infrastructure, which he supports doing, with the work to be monitored by Chesterton. Porter also is committing to conduct studies, file detailed reports and develop an action plan to reduce groundwater infiltration, he added.

Snyder said the town is expected to save money with Indiana America Water Co. taking over its sewer billing soon, and there is great benefit to maintaining good standing with Chesterton. “I believe they’re sincere. I believe they’re honest.”

Newly seated Town Council member Lorri Wickberg said she’s consulted several officials about the sewer agreement and expressed confidence that its associated costs won’t have to be passed along to ratepayers. Porter sewer rates were hiked by 34 percent earlier this year after Chesterton increased its cost for sewage treatment.

Wickberg called the question, which should have ended the discussion and prompted a vote, but Childress said he wanted to allow the public to comment.

Linda Hodges said her concern was that senior citizens on fixed incomes don’t pay more. Said Snyder, “We’re looking out for the senior citizens and the town as well.” When Zathoe Sexton asked about capacity, Bill Sexton said Porter already eliminated groundwater infiltration in its Porter Avenue sewer and is planning to do the same in the Beam Street sewer to help free up as much capacity as possible.

Bill Cantrell said he realizes the town is in a bind but future councils will be, too, if they have to pay $197,400 every year.

Bill Sexton conceded it will be tight but reminded a council can pass on each year’s purchase. “We’re every bit as concerned as you are.” Later in the meeting town attorney Patrick Lyp was asked to determine if any of the approximately $660,000 the town will receive Friday in Major Moves funds from the state can be used for sewer-related expenses.

While the vote to approve the sewer agreement was 3-2, a later vote to pay the $799,000 was 3-1 with Childress voting no and Granat having left the meeting because of her injury.

Childress again voted no blocking adoption in one night under suspension of the rules of an ordinance for Porter sewer users that mirrors Chesterton utility regulations; the new language lays out sanitary sewer pre-treatment requirements that are mandated by the Indiana Department of Environmental Management.

Childress said he hadn’t had time to review the ordinance; Snyder said Porter’s had it since January.

 

Posted 9/13/2006

 

 

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