By PAULENE POPARAD

Town of Porter sanitary sewer customers are facing a likely 30 percent rate hike this fall and a second 30 percent increase in 2009, it was announced Tuesday.

A public hearing on the proposed increases is set for the Aug. 12 Town Council meeting.

According to financial consultant Damon Tsouklis of Cender & Company, a typical residential customer will see their monthly $40.51 sewer bill, based on 5,000 gallons of usage, go to $52.81 in about two months and next year to $68.52.

The first rate hike anticipates a future 13 percent rate increase from the town of Chesterton to process Porter’s sewage. Chesterton will hold a public hearing Aug. 11 on a proposed 14 percent rate increase. Without its own rate hike, said Tsouklis, Porter’s sewer utility could face a $350,000 shortfall this year.

The 2009 increase primarily would fund a $4 million revenue bond issue to finance a major upgrade of Porter’s long-neglected sewer collection system and lift stations.

Porter is under an agreed order with the Indiana Department of Environmental Management to address the system’s deficiencies aggressively over the next five years. Timelines and milestones to be met have been laid out in a compliance plan recently adopted by IDEM. Porter Public Works superintendent Brenda Brueckheimer said quarterly reports showing continuing progress must be submitted.

Porter last raised sewer rates by 33 percent in 2005, primarily in response to a rate increase from Chesterton.

Tsouklis was asked by Porter council president Bill Sexton, who later announced he is resigning from the board, to prepare a comparative study of municipal sewer rates for the Aug. 12 public hearing.

Town attorney Patrick Lyp said the town has final jurisdiction over its sewer rates, which do not have to reviewed by the Indiana Utility Regulatory Commission.

Outgoing Park Board President Zathoe Sexton said her department did not submit a budget anticipating a 60 percent sewer rate hike for 2008-09 and suggested the town appeal to the Indiana Department of Local Government Finance seeking to raise additional funds to cover the park’s sewer bills.

Sale being investigated

Councilman Dave Babcock confirmed Porter still is investigating whether to sell its sewer system to the Town of Chesterton, which he said is a possibility, or to a private company that operates sewage systems; two such firms have expressed an interest.

Porter resident Jennifer Klug said private firms are for-profit and customers could face even more rate increases to maintain the sewer system. “You really should just keep it.”

B. Sexton said the town might be in a position to use the interest alone and not touch the principal from a sewer sale. However, he stressed, before any sale decision is made a thorough analysis would need to be done.

Klug suggested residents get a rebate from a sale if one occurs. Sexton said the sale proceeds would come back to the town and be used by it to help keep property-tax rates at a lower level, but it’s all speculation at this point.

“Those are hypotheticals and we don’t have the answer. (It’s) something we have to look at and investigate. We don’t want to close the door. You won’t have answers until a proposal is made,” he added.

Brueckheimer said it doesn’t matter to IDEM who owns the sewer system. “There has to be money to fund the compliance plan.”

Earlier this year Porter officials discussed whether to have the town resume handling its own sewer billings, which now are done under contract by Indiana American Water Co. Sexton said that decision is on hold until the council decides whether to sell Porter’s sewer system.

2009 hike unavoidable

Town Council members said faced with IDEM’s mandate, they have no choice but to seek a $4 million bond issue next year. At one time the estimate of necessary improvements ranged from $4 million to $10 million.

There is a chance that the bond issue could be reduced by about $380,000 if developers of the proposed 190-home The Trails subdivision in the 63-acre Iron Triangle north of Wood Street make good on a pledge to donate that amount toward upgrading the Porter Avenue lift it will use.

Brueckheimer reported that lift station overflowed 348 gallons July 8 after heavy rain.

Councilman Jon Granat asked if $4 million in upgrades would satisfy IDEM. Town engineer Warren Thiede said it would meet the agency’s goals for the next five years.

“We don’t have an alternative. IDEM said if we don’t (do the upgrades), we need to find an alternative for disposing our waste,” commented Babcock. “We have to have a (sewer) system. We’re not doing overkill. We’re doing what has to be done.”

Council member Michele Bollinger clarified that the proposed rate increases provide for future maintenance of the sewer system so the town doesn’t fall behind again; realistically, she noted, a 60 percent rate increase may not be the end of it.

Sexton said part of the $4 million in work includes inspections of the sewer system, but Granat said his concern is, “There could be a can of worms we don’t know about. There could be a hidden cost. There’s a lot of lineal feet of sewer.”

Brueckheimer agreed that an unforseen infrastructure failure in Porter could happen tomorrow like the recent emergency replacement of a key sewer force main in Chesterton, now estimated to cost about $450,000.

Sexton said Porter’s sewer system has been neglected. “Consequently we’re paying the price now for what wasn’t done 30 years ago. Only when it quits working you do the maintenance; we’ve reached that point.”

More stringent rules also have been put in place, said Sexton. Requirements to separate stormwater infiltration from actual sewage has prompted Porter to undertake projects to reduce infiltration and inflow into sewers that otherwise was sent to Chesterton’s processing plant for costly sewage treatment.

Posted 7/23/2008