IBJOpinion

EDITORIAL: City water utility in over its head

Back to TopCommentsE-mailPrintBookmark and Share
IBJ Editorial

As missteps by the city’s water utility threaten to drown local ratepayers with dramatically higher bills, Mayor Greg Ballard’s administration is exploring a complete overhaul of the system. The mayor’s initiative—even though it’s not driven entirely by the water utility’s woes—can’t produce results soon enough.

The city’s purchase of Indianapolis Water Co. in 2002 has clearly backfired due to lack of execution.

A consultant’s report filed along with the Department of Waterworks’ pending request for a whopping 35-percent rate hike says the department was never adequately staffed to responsibly oversee the utility after it was purchased from Merrillville-based NiSource.

When important decisions must be made, the city staff too often defers to consultants, its own volunteer board and Veolia Water, the French firm that was hired to manage the utility, according to the report prepared by a Colorado utility consulting firm hired by the city to assess the utility.

The damning report is part of the case before the Indiana Utility Regulatory Commission, which must decide whether to grant the utility’s hefty rate increase. The higher rates would pay for $111 million in capital improvements to the city’s water utility infrastructure.

If the rate hike is granted, it will be the second one this year. The IURC earlier approved a 12.3-percent hike to cover more than $25 million in annual debt servicing costs caused by the utility’s overreliance on variable-rate bonds.

The Department of Waterworks already has taken some steps to get its house in order. In March, it hired the former head of enforcement at the Indiana Department of Environmental Management to run the department. Since then, some key positions, including chief financial officer, have changed hands, and there’s a greater emphasis on long-term financial planning.

More drastic changes are in the works.

In an effort to raise cash that could be used to pay for all manner of city infrastructure needs, including a sewer system in need of $2 billion in upgrades, the city is exploring selling the city’s water and sewer utilities outright.

The city’s Infrastructure Advisory Commission is considering proposals from 23 firms that cover a range of options. Among them is a pitch from Citizens Energy, which supplies natural gas here, to pay $1.5 billion for the water and sewer utilities.

The city must carefully consider which of the proposals will maximize the cash that can be generated to fund the city’s considerable infrastructure needs. But equal weight must be given to which proposal would result in responsible stewardship of the city’s water resources.

It’s unlikely the steep rate hike now being considered by the IURC would have been necessary had the utility’s daily operation and long-term capital requirements been handled with sufficient city oversight.•

__________

To comment on this editorial, write to ibjedit@ibj.com.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. Blocking two blocks of a street along Broadripple Ave. is not going to stop "pedestrians" from walking around. The article stated that seven people were injured as a result of a skirmish between two gun-toting "pedestrians"...not drive-bys. Most of the crimes that are committed in BR area are done by "pedestrians" that are walking in the area...not driving by. This may alleviate traffic going through the area and may steer some folks away from coming to the area because of the extra inconvenience but it will not stop a pedestrian, on foot from toting a gun while walking in that area....period.

  2. Please run for mayor Joe. We need someone to come in and clean house. They past two mayors have run administrations rampant with corruption. We need to clean house before corruption is accepted as normal like Chicago.

  3. Marriage is a religious sacrement ... civil / legal unions pertain to the various desires expressed by many in this debate. There is big difference between your civil right and my religious rite. Both are addressed in the constitution.

  4. This is a terrible idea. I have an enormous amount of respect and appreciation for all the men and women who wear a uniform and serve the Indy Metro area. They don't get paid enough for all the crap they have to take. Low Pay and Benefits. Every thug and crazy taking pot shots at them. The statistics, demographics, and data that we have accumulated for umpteen years DO NOT LIE. Let's focus on making sure that the politicians that are "mandating" this crap are living where THEY are supposed to be living. Let's make sure that the politicians are not corrupt and wasting resources before we start digging into the folks on the front lines trying to do a difficult job. Since we are "hip" to "great ideas" Let's round up all the thugs in the Indy Metro area who are on parole violation as well as those in Marion County Jail that are never going to be rehabilitated and ship them down to Central America or better yet...China. Let's see how they fare in that part of the world.

  5. Once a Marion Co. commuter tax is established, I'm moving my organization out of Indianapolis. Face it, with the advancement in technology, it's getting more cost effective to have people work out of their homes. The clock is running out on the need for much of the office space in Indianapolis. Establishing a commuter tax will only advance the hands of the clock and the residents of Indianapolis will be left to clean up the mess they created on their own, with much less resources.

ADVERTISEMENT