Mandated water/stormwater/sewer projects heighten need for water rates increase

Upcoming projects required by the state have led the City of Logansport, its city council, and Logansport Utilities to consider future rate increases for water, wastewater, and stormwater.

On September 27, 2022, the Logansport Utilities’ service board approved rate change resolutions. These resolutions will be forwarded to the city clerk treasurer and the city council for review and creation of a rate ordinance to increase water, wastewater, and stormwater rates. The increases would happen in four phases over the next four years.

This request will coincide with the municipal utilities’ capital improvement plan and the state’s required “Long-Term Control Plan (LTCP)” which includes future requirements for the city of Logansport from the Environmental Protection Agency (EPA)’s “Clean Water Act” and the Indiana Department of Environmental Management (IDEM)’s “Combined Sewer Overflow (CSO)” project.

Launched federally and by the state in 1996, then revised in 2001, the unfunded and mandated CSO program is to help eliminate combined sewer overflows and prevent raw sewage from spilling into local rivers and waterways during heavy rain events. Logansport Utilities’ CSO projects began in 2013. The “Melbourne Avenue Wet Weather Project” was the most recent improvement, with Wilhelm Construction leading the installation of two new 10-foot-diameter pipes to store and process five million gallons of stormwater water during heavy rains. That project was completed in the winter of 2021. In 2018, water, wastewater, and stormwater rate increases were approved in two phases (2018, 2019) to help fund the massive project. The directive from the EPA and IDEM is all remaining CSO projects are to be completed by 2026.

The cost for the upcoming required CSO projects affecting the rates from the years 2023 – 2026 is an estimated $51,384,108. This number includes construction of the wastewater treatment plant’s headworks, replacing the original headworks built in 1958. The headworks must be replaced to process flows from the new CSO systems being installed. To complete the remainder of the capital improvement plan, which includes a 2025 mandate from IDEM for a secondary water source (supplemental wellfield, wells, and well houses), service line replacements, and the EPA’s phosphorus removal protocol requirement, the remaining amount needed is $43,696,770. This brings the total funding need to $95,080,878. Logansport is ahead of the curve with state mandated CSO projects, with neighboring communities behind in accruing funding and creating action plans.

Logansport Utilities has taken proactive steps to help keep rate increases to the community as low as possible by applying and being awarded the “State Revolving Fund (SRF)” grant and loan money. The SRF Loan Programs provide low-interest loans to Indiana communities for projects that improve wastewater and drinking water infrastructure. The utility company applied for $24 million dollars to replace 4,500 service lines in the city. The SRF will fund 80% of the company’s requested funds which will not have to be repaid. The request will be broken down into thirds, $8 million dollars to be requested and be awarded each year for three years. This year Logansport Utilities will obtain $6.4 million dollars and borrow the additional $1.6 million dollars with 0% interest on a 30-year loan from the SRF. If Logansport Utilities had not acted on applying for additional funds, the rate increase for customers would have been more. The move helped save each average rate payer $4 dollars per month. The utility company will also be obtaining proposed waterworks, sewer works, and stormwater revenue bonds in 2023 and 2025.

The upcoming rate ordinance on water, wastewater, and stormwater will affect residential and commercial customers. The current average combined rate (for in-city residents using 5,000 gallons a month for water, wastewater, and stormwater services) is $77.15 per month. The proposed 4 phase plan, along with the cost saving actions done by Logansport Utilities, the increase will raise rates roughly $50.13 monthly in total for those averaged residential customers in four years, instead of $62.13. Depending on services used, some residents may see less of a rate increase. Averaged small (2-inch main) commercial customer using 15,000 gallons monthly will see an increase of $220.86 in four years.

The proposed combined water/wastewater/stormwater monthly rate changes for in-city
residential customers include:
• 2022 – $77.15 (current)
• 2023 + $16.21 (Phase I)
• 2024 + $12.03 (Phase II)
• 2025 + $13.91 (Phase III)
• 2026 + $7.98 (Phase IV)

The proposed combined water/wastewater/stormwater monthly rate changes for small
commercial customers include:
• 2022 – $299.06 (current)
• 2023 + $67.03 (Phase I)
• 2024 + $55.86 (Phase II)
• 2025 + $58.96 (Phase III)
• 2026 + $39.01 (Phase IV)

Public meetings for the city council readings of the proposed rate ordinances will be scheduled in the coming months.

SOURCE: News release from Logansport Utilities

About Logansport Utilities (formerly Logansport Municipal Utilities: LMU) is a municipal owned, board operated electric and water utility serving the city of Logansport and surrounding county areas in northern Indiana. Started in 1894, the utility offers carbon free electricity and clean water to more than 20,000 residents and businesses. LU continues to serve and drive redevelopment in the region. For more information about LU: