Chesterton Tribune

Porter council okays 27 percent sewer rate hike

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Corrected 8/26/2010

By KEVIN NEVERS

Porter residents will be seeing their bimonthly sanitary sewer bills increase by around 27 percent.

At its meeting Tuesday night, the Town Council voted 5-0 to approve an ordinance raising the base rate per 1,000 gallons of usage from $7.25 to $9.25, a hike of 27.58 percent.

Brass tacks: the monthly bill of an average residential metered household which uses 5,000 gallons will increase by $14.47, from $52.81 to $67.28.

Households without water meters will see their monthly bill go from $45.44 to $67.28.

Town Engineer Matt Keiser told the Chesterton Tribune after the meeting that the last sanitary sewer rate hike in Porter was enacted in 2008, when an initially recommended increase of 60 percent was lowered to 30 percent. The last time the sewer rate in Porter was hiked before 2008? Keiser was unable to say. It had been years.

Contracted rate consultant Karl Cender opened a public hearing on the increase by noting the following: the Town of Porter has been given a 2012 deadline by the Indiana Department of Environmental Management to stop all sanitary sewage overflows; it will cost around $5 million to fund projects necessary to meet that deadline; and in order to save residents the burden of a massive rate hike to generate sufficient revenues to implement those projects, the Porter Redevelopment Commission issued a $4.1 million bond—to be re-paid with TIF funds—while the Town Council approved an expenditure of $1 million in CEDIT funds.

In short, residents will see no impact at all on their pocketbooks so far as the $5 million project schedule goes. (Once more by way of comparison: in January 2009 the Chesterton Town Council enacted a 14 percent sanitary sewer rate hike specifically to generate sufficient revenues to make payments on a $5.1 million sewer bond issued later in the year.)

Even so, Cender said, the Porter sanitary sewer utility is running an annual shortfall of $205,000, with $1.415 million in basic operations expenses and only $1.11 million in revenues. Had not the Redevelopment Commission and Town Council ponied up the $5.1 million in TIF and CEDIT funds, Cender emphasized, the rate hike being discussed on Tuesday wouldn’t be 27 percent but more along the lines of 60 percent. “We’re keeping this rate increase as low as possible,” he said. “But we need to get the utility back in the black.”

For his part, Keiser reminded folks that the utility does not operate on the basis of property-tax revenues. It’s a stand-alone, independent, self-sufficient operation funded solely by rates and associated fees.

Public Comment

Five people spoke against the rate increase, three—reluctantly—in favor of it.

Nancy Costello—speaking for seniors—noted that the town “collects a lot of money from different areas” and “we don’t see any of that. I don’t understand why you need more money to do that.”

Rita Newman wanted to know whether the revenues generated by the increase will go solely to the sanitary sewer utility. (They will, Keiser said later in the meeting.)

Nina Kizer-Herschman—who presented members with a petition against the rate hike—warned the council that “we have a lot of unhappy people, a lot of angry people who see their rates go up and their services go down.”

Tim Herschman wanted to know specifically why the sanitary sewer utility is operating in the red. (Keiser was unable to provide Herschman immediately with the numbers, although after the meeting he spoke generally to the Tribune about the steep increases in items like insurance, purchased power, and fuel.)

And David Nolbertowicz complained that “nobody ever comes out to pump my septic tank.”

Roy Bush and Brad McNabb, on the other hand—both of whom sat on the rate committee which recommended the hike—remarked that, while they understand people’s concern, the town’s infrastructure is collapsing and in dire need of attention.

“We do see a lot of rate increases,” Bush said. “But when we talk about sewer rate increases, the only one I see are in Chesterton.” For years, he added, the town has “put Band-Aids on the system as much as we can. We’ve got to bike the bullet. Sometimes it just is what it is.”

“To keep rate historically low over the last 30 or 40 years, the town did essentially the minimum,” McNabb said. “Only emergency repairs. It’s all built up to a head to the point it’s a do-or-die situation. We’re just reaping what we’ve sown.”

Heather Ennis, executive director of the Chesterton/Duneland Chamber of Commerce and also a Porter resident, made the same point. “For the future of the community it’s important to have working sewers,” she said. “It makes Porter much more marketable. We’ve had low rates for a long time.”

Discussion

Member Dave Babcock, after the public comment portion of the public hearing was closed, that a rate hike was always the last option. “We tried selling the system to a private entity,” he said. “We tried to get funding from the State Revolving Loan. We chased grants. The money we did have we used to the best of our ability. We’re really tried to do the best we can with people and equipment. I don’t want a rate increase but I don’t know where else to get it.”

Babcock added that “IDEM has got us under its thumb.”

President Michelle Bolinger—who noted that she ran for the council on a platform of public improvements—made much the same point. “It’s not a quick decision,” she said. “We’ve been exploring it for years. And it was our last resort. We have to do something to address the aging infrastructure. I have to pay this increase too. We’re doing exactly what we were elected to do.”

Members then voted unanimously to approve the rate ordinance on second reading. The ordinance had been previously introduced at the council’s July 27 meeting.

 

Posted 8/25/2010