DeKalb County hearing finds customer notice flawed; majority of commissioners say amended sewer rates meet state standard

DeKalb County commissioners heard nearly five hours of testimony and public comment before concluding that the St. Joe'Spencerville Regional Sewer District did not comply with the statute's notice requirements but that, on the evidence presented, the rates adopted by the district met the statute's substantive "just and equitable" standard.

The hearing focused on a rate ordinance the district approved that raised charges by more than 5%. Counsel for the district acknowledged the customer notice required by Indiana Code 13-26-11-15 was mailed one day late and omitted the required statement of ratepayers' rights to appeal; he asked the commissioners to waive the defect so the hearing could proceed because a petition had already been filed. "I wanted to start out by disclosing that ... that statutory required notice was a day late and it didn't include the notice to appeal," the district's presenter told the panel.

Petitioners Nucor Fastener and Volcraft, represented by attorney Michael Hawke, filed a formal remonstrance arguing two issues: that the district did not provide the statutorily mandated notice and that, even if notice were cured, the rates were not "just and equitable" as required under Indiana law. Hawke summarized the legal claim: the statute's mandatory language uses "shall" and "must," so the failure to include the required content and timing is not merely technical.

Technical witnesses gave competing financial and engineering evidence. Commonwealth Engineers project manager Ben Adams testified the existing plant had outlived its 20'25-year useful life, was having component failures and needs replacement to meet a new zinc limit in its NPDES permit. Adams recounted two bidding rounds and said the low rebid, including alternates, was about $5.7 million; he said inflation and constrained site conditions raised the eventual estimate.

Greg Gutierrez of Financial Solutions Group described the consultant's October 29, 2024 rate report, which used a $6.8 million project estimate and categorized customers into three classes. He and other district witnesses explained that three large industrial customers account for a disproportionate share of measured flow in the plant's five-year dataset, which the district used to allocate charges.

Objectors commissioned their own analysis. Mark Amendola, an environmental engineer engaged by the objectors, reviewed lift-station and regulatory filings and told the commissioners he found gaps and data-entry errors in the district's spreadsheet. Using Nucor-supplied measurement data from Jan. 2019 to Nov. 2024, Amendola estimated the major industrial users' contribution at roughly 36.8% of flow (rising to about 42'45% when including another plant), lower than the 56'58% figure the district's materials reported.

Caitlin Schafer, a rate consultant for the objectors (Reedy Financial Group), said the 2024 study shifted most of the additional project cost onto the Class 3 industrial users without presenting equivalency factors or the concise flat-charge calculations the statute requires for unmetered systems. In cross-examination, district consultants said they relied on a five-year average and IDEM-submitted reports to smooth anomalies.

The hearing also highlighted timeline risks: the county's OCCRA grant for the project was increased to $750,000 but required financing to be in place by a release-of-funds deadline; Mike Kleinpeter (grant administrator) said the district had requested an extension and currently appeared on OCCRA's overdue list, and prolonged delay could jeopardize that money. Consultants warned the accepted bid had a 90-day hold expiring Jan. 8, 2025, and that the contractor had extended the hold 30 days by agreement; if financing and the rate order were not finalized, bids could expire and rebidding would likely raise costs further.

Public comment emphasized affordability and local impacts. Dozens of residents and small-business owners urged commissioners to consider phased work, alternative procurement or more local engagement. "I think there should be a survey sent out," a small-business owner said, arguing some homes use far more water than certain businesses and that flat charges would be inequitable without better metering or equivalency calculations.

After closing argument and a brief deliberation, commissioners answered the two statutory questions they are required to resolve when a petition is filed. On the first question—whether the district followed the notice and procedural requirements—the commissioners voted that the procedure had not been followed. On the second question—whether the rates adopted by the district are just and equitable according to the statutory factors—the majority (two commissioners to one) answered yes for the rates as presented in the record.

Votes at a glance: - Did the district comply with the notice procedure in IC 13-26-11-15? Commissioners: majority determined "no" (procedural compliance not met). - Are the adopted rates just and equitable under IC 13-26-11-9? Commissioners: majority determined "yes" (2'1).

What happens next: the commissioners' conclusions resolve the two statutorily required questions on the petition record; the transcript reflects competing factual records and contested data that objectors said would support revisiting allocations or exploring alternative financing or procurement. The hearing record also documents immediate practical risks: a Jan. 8 bid-hold deadline (plus a contractor-granted 30-day extension) and the possibility of losing a $750,000 OCCRA grant if the project remains delayed.

The commissioners adjourned the hearing after announcing their votes; the transcript does not record a formal entry of an order overturning or upholding the district ordinance beyond the panel's statutory answers recorded in open session.