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Michigan City Water Works seeks bonds, proposes phased water-rate increases
Summary
Superintendent Christopher Johnson told the city council the Water Works board plans to file with the Indiana Utility Regulatory Commission for rate adjustments and seek roughly $35 million in initial bonds to fund urgent water-main, booster-station and treatment projects; proposed residential bills would rise from $23.09 to $39.20 over three years.
Christopher Johnson, superintendent of Michigan City Water Works, told the Common Council on Dec. 2 that the utility needs to sell bonds and request a rate adjustment to pay for a prioritized set of capital projects.
Johnson said the department’s last rate change was in 2015 and that inflation and rising operating costs — including chemical prices up about 69% and higher prices for pipe, hydrants and meters — have outpaced revenue growth. He said the Water Works Board approved a rate ordinance at its Nov. 10 meeting and a debt declaratory resolution Nov. 25 to enable bond sales and to file a case with the Indiana Utility Regulatory Commission (IURC).
“What does this mean for my rates? Our current residential average monthly bill for water is $23.09,” Johnson said. He outlined a three-year phased increase that would raise the typical residential water-only bill to $32.30 in 2027, $35.58 in 2028 and $39.20 in 2029 — an overall increase of $16.11 from today’s average.
Johnson described a multi-phase capital program with roughly $43.6 million in construction costs and $7 million in non‑construction expenses (engineering, permitting), for a total close to $50.0 million. He said the board plans an initial bond sale of about $35 million and a second phase of approximately $15.6 million in 2029, with contingencies added on legal advice to avoid repeat votes if scope shifts.
The superintendent emphasized the regulatory path: the city will file with the IURC using a 2024 test year; the Office of Utility Consumer Counselor will review the proposal; there will likely be public hearings in the IURC process; and any final rate changes would follow negotiation and a commission order, earliest in 2026. Johnson said the department would phase the work and prioritize safety, water‑quality and pressure projects, including storage and booster stations in annexed and industrial areas.
Johnson encouraged public review: the Water Works Board will hold a public hearing at its Dec. 9 meeting and will seek a confirmatory resolution to accompany a bond ordinance. He offered to make the presentation materials available on the city website and provided contact information for follow‑up questions.
The council took no binding action on the bond ordinance at the Dec. 2 meeting; the Water Works Board will complete its public process and the city’s confirming resolution would follow if the board seeks council support.
