By BOB SHRALUKA
WZBD.com
Decatur City Council is poised to place another 15% increase on its water rates due to a federally mandated project.
Following a 12% hike last year, council on Tuesday night passed on one of two required readings an ordinance which would put the new increase in effect.
Ordinances approving bonding for the program and for the 15% hike were approved on a unanimous vote on first reading, then tabled until the next council meeting, June 2.
A second and final vote to approve is expected at that time.
A typical residential customer within the city limits would see an addition of $8 to $10 to a monthly bill, while a typical customer outside the city limits would have a hike of $9.90 to $13.50 a month, according to officials.
The project, mandated by the federal government, is designed to remove lead from service lines throughout the city and also to replace numerous aging water mains.
Ben Adams, a project manager with Commonwealth Engineers of Fort Wayne, said at the meeting: “This is being mandated on everyone that has lead service lines. A lot of people are under the gun” to get such a project under way.
Adams, who has worked with the city on numerous projects, joined at the meeting with Jennifer Wilson, a director in the Crowe LLP performance consulting services group in Indianapolis.
Her rate study, which she detailed for council, demonstrates the need for the second rate increase to cover the new annual debt service associated with the project.
This latest boost, she said, would likely be the last needed for approximately five years.
“Everybody is facing this,” Councilman Matt Dyer noted.
“With inflation, this is hard. But good water is needed for everyone’s health, so I feel this is the right direction,” added Councilwoman Jenny Bowers-Shultz.
Mayor Dan Rickord talked about how the project will be replacing the city’s large number of aging water mains. (In all, the city has an estimated 25 miles of water mains.)
Main breaks have risen substantially in recent years, he said, and each repair job can cost $10,000 to $20,000.
The normal life span for a water main is 50 years, Assistant Water Superintendent Bill Carpenter pointed out. “And we are well over that” with many water mains in the city.
BIDDING: Bidding on the $21 million project is already under way.
“Bids are coming in phenomenally well,” Adams told council, for what he described as “a very large project.”
He said he could see trending a savings of perhaps $1 million, maybe $2 million, from the original estimated cost of the project.
Construction could begin in August.
City officials decided to get the project going now due to an extremely favorable loan-grant agreement offered by the Indiana’s State Revolving Fund (SRF): grants totaling $5.5 million, a $2.5 million loan at 0% interest, along with a loan of $14 million at 2.98% interest to be paid over a period of 35 years.
“You received a great package from the State Revolving Fund,” Wilson said.
Kate Blanchet, a bond attorney with Barnets & Thornburg in Fort Wayne, jointed the meeting virtually.
“I’ve been doing this for over 28 years and this is one of the most impressive packages I’ve ever seen,” she told the mayor and council.
“You could not be any more proactive than you are being,” Adams said.
Adams said at a previous meeting that over 100 other Indiana communities – also under federal mandate – applied for SRF funding, but only Decatur and 13 others were getting the sweet offer.
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