Michigan City backs up to $60.5 million in waterworks revenue bonds to fund mains, upgrades
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Summary
Council voted 9-0 to support the Department of Waterworks in pursuing up to $60,500,000 in revenue bonds and an IURC rate case to finance capital projects and main replacements; officials said the work is not for the new data center and will be phased to soften rate impacts.
The Michigan City Common Council on Dec. 16 voted unanimously to support the Department of Waterworks' plan to pursue waterworks revenue bonds not to exceed $60,500,000 and to seek approval from the Indiana Utility Regulatory Commission as required in a rate case.
Chris Johnson, superintendent of the Department of Waterworks, told the council the bonding package is intended to finance large construction projects, upgrade booster stations, make disinfectant improvements for remote portions of the system and dedicate roughly $3 million a year to water-main replacements. Johnson said the system comprises "243 plus miles of water main," much of it more than 100 years old, and stressed the move is intended to maintain water quality and system reliability.
Johnson also said that "not a single one of the projects involved in the bonding nor in our cash activities is in any way, shape, or form for the benefit of the new data center," addressing public questions tying major projects to the data center. The mayor earlier said the city received a $6,800,000 permit payment from a data center but the water department said existing supply and mains already serve the area.
Public commenters objected to a multi-year rate plan that phases increases across three years, arguing the staged increases would burden residents on fixed incomes. Ernie Holloway, a resident, asked why rates would increase three years in a row and said fixed-income households could be harmed. Councilors asked Johnson why the increases are phased; he said phasing helps match bond proceeds to construction schedules and eases rate impacts.
The council approved the resolution supporting the board's efforts and the IURC filing by unanimous vote; the resolution limits board action to principal not to exceed $60,500,000 and requires IURC approval before issuance. Johnson said the bond process is the start of a longer rate-case process that will return specific rate schedules and timing to the board and the public.
Provenance: topic introduced SEG 1236; discussion and passage concluded SEG 1640.
Speakers (as identified in the transcript): Chris Johnson (Superintendent, Department of Waterworks), Ernie Holloway (resident).
