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REGULAR MEETING JULY 28, 2008 <br /> <br /> <br /> <br /> SECTION III. This Resolution shall be in full force and effect from and after its <br />adoption by the Council and approval by the Mayor. <br /> <br /> <br /> <br /> s/Timothy A. Rouse <br /> Member of the Common Council <br /> <br />Councilmember Oliver Davis, Chairperson, Utilities Committee, reported that this <br />committee held a Public Hearing on this bill this afternoon and voted to send it to the full <br />Council with a favorable recommendation. <br /> <br />th <br />Mayor Stephen Luecke, 14 Floor County-City Building, South Bend, Indiana, made the <br />presentation for this bill. <br /> <br />Mayor Luecke thanked the Council for their consideration of this Resolution tonight. He <br />stated that he is asking for a favorable vote to allow the placing of a question on the ballot <br />in the November 2008 General Election, which allows the residents of the City of South <br />Bend to vote, whether the Council becomes the final authority in setting rates for the <br />Water Works or whether they will continue to go before the Indiana Utility Regulatory <br />Commission. He stated that he believes that the Council is the appropriate final body to <br />enact these rates as the Council does with the Wastewater Utility and Solid Waste. The <br />additional regulatory review adds time to the rate process and also adds significant costs <br />to the rate process and he believes that it best resides with the Council and allows the <br />City to plan rate increases in a more gradual manner rather than waiting until it warrants <br />the extreme expense of the additional review. <br /> <br />Mr. John Skomp, Crowe, Chizek and Company, LLC, stated that what they would like to <br />accomplish tonight is to adopt a resolution to allow the voters to decide the issue in the <br />November election. He stated that the overall reason to withdraw from the IURC is <br />Home Rule. The elected officials of the City of South Bend will decide the path for <br />South Bend. The officials will have the flexibility to address the local issues in a way <br />that is acceptable to the local public. Issues can be addressed in a more efficient and <br />timely manner. The elected officials of the City of South Bend will decide the path for <br />South Bend. Water Utility rates and debt policies will be established in the same manner <br />as the Sewage Works and other City fees. Public policy will be adopted by implemented <br />at the local level without revisions from officials in Indianapolis. The officials will have <br />the flexibility to address the local issues in a way that is acceptable to the local public. <br />The owners of a municipal utility are the municipality’s citizens. Out-of-town customers <br />are not owners of the system. Home Rule or Local Control will allow the flexibility to <br />address owner versus non-owner issues and municipal service unbundling such as inside <br />city outside city subsidies such as police, haz-mat, parks, and roads. The Hojnacki <br />independent study confirms that residents of incorporated South Bend and Mishawaka <br />pay a disproportionate share of the cost of government services and resident of <br />unincorporated areas do not pay enough. Out of town residents receive services for <br />which they do no pay; in-town residents pay for services they do not receive. Providing <br />municipal utility service allow the development of densely populated subdivisions on the <br />outskirts of the city which attract wealthier residents to these areas enjoying lower tax <br />rates and subsidized services. Thos left behind are less affluent and must shoulder a <br />larger and larger share of the cost of government. Mr. Skomp stated that issues can be <br />addressed in a more efficient and timely manner. An example is that on January 28, 2005 <br />filed a rate case petition. July 13, 2005, Clay customers intervened to oppose out-of- <br />town surcharge (which was in place for nearly 25 years) The Office of the Utility <br />Consumer Counselor (OUCC) supported their position. On February 8, 2006, (one year <br />later) – the IURC approved a rate increase but ordered cost of service study (COSS) with <br />respect to surcharge on a prospective basis. On August 8, 2006, South Bend submitted <br />COSS which overwhelmingly supported current outside-City charge. South Bend also <br />submitted substantial evidence on the effect of “unbundling” municipal services. OUCC <br />and Clay Customers did not submit a COSS but merely complained (without rebutting.) <br />A hearing was held on March 6 & 7, 2007 and last brief was filed on June 13, 2007, and <br />still no final order, 3 ½ years after filing petition, almost 2 years after the City filed with <br /> 24 <br /> <br />