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UTILITIES COMMITTEE
The April 7, 1988 of the Utilities Committee was called to
order by its Chairman Councilman Don Niezgodski at 4:00 p.m.
in the Council informal meeting room.
Persons in attendance included Councilmen: Luecke,
Niezgodski, Puzzello, Slavinskas, Coleman, Duda, and Voorde;
Joseph J. Guentert, Irene Mutzl, Mayor Kernan, Thomas
Bodnar, Irene Gammon, Joseph Agostino, Jack Dillon, Dick
Maginot, Jim Wensits, other members of the news media, and
Kathleen Cekanski-Farrand.
Councilman Niezgodski then introduced members of the
Utilities Committee namely Councilman Slavinskas, Councilman
Puzzello, himself as Chairman and Councilman Zakrzewski who
was absent.
Councilman Niezgodski noted that the purpose of the meeting
was to review Bill No. 138-87 which would establish a
schedule of rates and charges for services rendered by the
South Bend Waste Water Treatment Plant.
Mr. Jack Dillon, the chief chemist, Mayor Kernan, and Joseph
Agostino, each spoke in favor of Bill No. 138-87. Mr.
Joseph Guentert voiced opposition to the proposed Bill. He
stated that he believed it would be unfair to raise to
minimum rate by $2. 07 per month. He took exception to the
projected figure of $15 million proposed by Tenech
Engineering, Inc. , $5 million to be used to restore the
capacity, $5 million for various ETA mandates, and $5
million for sludge beds.
Councilman Puzzello noted that the City Council passed
Ordinance No. 7728-87 dealing with heavy demand substances.
As a result of that Ordinance, a sur-charge was being
charged to such companies as the Ethanol Plant.
Mr. Jack Dillon noted that New Energy is monitored on a
frequent basis and has self monitoring in place. He stated
that they are currently being sur-charged and are meeting
the pre-treatment program requirements. He further stated
that the State of Indiana has no problems with New Energy
and the way its waste is being treated.
In response to a question from Mrs. Mutzl, Councilman
Niezgodski stated that he would share the February 2, 1988
letter from the Indiana Department of Environmental
Management (copy attached) with Mr. Dillon.
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Councilman Luecke questioned when the rate study would be
completed. Mayor Kernan noted that it should be done in
May. He was further advised that it would review a cost of
service study and would also look at a sliding scale
approach. Councilman Luecke questioned how many customers
are using less than the minimum and was advised that that
information would be provided to him later.
Mayor Kernan noted that the Public Service Commission must
approve water rate increases but is not involved with sewer
rate increases.
Mr. Dillon further noted that it was his understanding that
since New Energy has a compatible waste system that it is
appropriate for the sur-charge procedure to be in effect.
Councilman Voorde noted that it would be unfair to put all
of the problems on New Energy. He stated that the plant in
question is over 30 years old, has had maintanance problems,
and is dealing with this strong effluent from the New Energy
Corporation. Before the 1987 Ordinance, New Energy was not
required to pay an extra sur-charge. He further requested
and update on the New Carlisle situation. Mayor Kernan
noted that the City is in a discussion situation only and
that approximately 500,000 gallons may be involved from New
Carlisle. Councilman Niezgodski requested a copy of the
current rates being charged by the Town of New Carlisle. He
also noted that this is a point of concern from many of the
residents in his district that a fair charge be assessed if
New Carlisle is brought on line.
Councilman Slavinskas stated that he had read several
studies and that regional plants were being promoted. He
envisioned New Carlisle as one of many communities which may
be added to the South Bend system. He questioned whether a
"special deal" had been struck with New Energy and was
advised that there was not such action. There were no sur-
charges in effect before 1987. He also noted that in
reviewing the budget it would appear that the former City
Council was aware that there would be a deficit budget
situation.
Councilman Voorde and the Council Attorney stated that the
former City Council was aware of the deficit situation and
that they were looking at the budget and the proposed rate
increase which was filed in November as a means of dealing
with the deficit.
Councilman Voorde questioned whether T. Brooks Brademas had
voiced concern with regard to the language proposed in the
Ordinance. Mayor Kernan stated that the City administration
was presently in the process of coming up with mandatory
language with regard to multiple users like apartment
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complexes. He also advised the Council that they were
attempting to reach an out-of-court settlement since the
City of South Bend lost the last case with Mr. Brademas.
Councilman Voorde questioned whether the City could continue
to include approximately $250, 000. 00 for salt in the Utility
budget. Mayor Kernan stated that this is a policy decision
which has been going on for the past ten years. It was his
understanding that the State Board of Accounts and the City
of South Bend had reached agreement that this was proper,
however, ongoing discussions were still taking place.
Councilman Luecke questioned when the last sewage rate
increase took place. He was advised that the minimum rate
had not changed since 1980, however, the other rates have
changed since then.
Mayor Kernan noted that there is a deficit situation and
that in a few months there will be more information
available. In his opinion, the responsible thing to do was
to infuse capital and make a sound business decision.
Councilman Slavinskas stated that in his opinion it would be
irresponsible for the City not to have proper rates in
effect to address the deficit situation. He further stated
that he would like to keep the increase to a minimum.
Councilman Niezgodksi stated that he was hoping to reach a
compromise and make an even rate adjustment.
Mayor Kernan stated that many of the details with regard to
financing will not be available until September but that the
cost of service material will be available next month.
After considerable discussion, Councilman Puzzello made a
motion seconded by Councilman Slavinskas that Bill No. 138-
87 which incorporates a 36% rate increase be recommended
favorably to Council. The motion passed by a 3 to 1 vote
with Councilman Niezgodski in the minority.
There being no further business to come before the Council,
the meeting was adjourned at 5: 30 p.m.
Respectfully submitted,
Councilman Don Niezgodski, Chairman
Utilities Committee
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