Indianapolis Department of Waterworks and Citizens Energy Group and Local Government and Sewer and Water and Utility rates and Utilities and Government & Economic Development and Government

Key vote ahead for utilities transfer

July 26, 2010

A plan to transfer the city's water and sewer utilities to Citizens Energy Group faces a key vote Monday night at a meeting of the City-County Council.

The council is scheduled to vote on Mayor Greg Ballard's proposal to transfer the utilities in a bid to generate $425 million in cash for infrastructure improvements such as roads and bridges. Members of the council's utility transportation oversight committee OK'd the measure last week.

Citizens, which provides gas, steam and chilled water service to residents in Marion County, says combining the utilities under its umbrella will provide a number of efficiencies and keep rates lower than if the utilities remained in city hands. Ballard announced his plan for the $1.9 billion deal in March.

Several government bodies, including the Indianapolis Board of Waterworks, have blessed the proposal, but it still needs approval of the City-County Council and the Indiana Utility Regulatory Commission. It could take months to get the IURC's blessing.

The city acquired the water utility in 2002 from Merrillville-based NiSource. Indianapolis Water is managed by Veolia, a private firm that would continue to be tapped to help run the utility under Citizens, the city’s gas utility. The extent of that partnership has not yet been specified.

Currently, the water utility has a 33-percent rate hike request pending before the IURC. Citing questionable oversight by the city’s waterworks board and other problems with the water utility, the state’s Office of Utility Consumer Counselor says Indianapolis Water’s rate request should be limited to 17 percent.

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