09-08-08 Common Council Minutes - Laserfiche WebLink

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REGULAR MEETING SEPTEMBER 8, 2008 City had improperly charged its non-resident Clay Utilities customers for debt service after the City’s debt to acquire Clay Utilities had been paid and retired. Both the City and the rate payers asked the Court to reconsider its decision. The City claimed that the Court exceeded its power by altering an existing utility rate schedule; the class members claimed the City owed Clay customers $145,998 more principal that what the Court ordered and that the City also owed prejudgment interest of $304,229.85. The Court denied both request and affirmed the prior judgment of $614,725.64 on May 12, 2008. Ms. DeRose further stated that presently, this case is in the process of appeal to the Indiana Court of Appeals. If the City were to prevail on appeal, the result would be a $0 judgment. If Clay customers prevail, the judgment would be in excess of One Million Dollars (1,064,953.39 to be precise) plus post judgment statutory interest at 8% from February 14, 2008. As of August 14, 2008 post judgment interest alone is about $24,600. Ms. DeRose stated that considering the financial risks of an adverse judgment notwithstanding the City’s firm belief in the merits of its legal position, it is wise and prudent to resolve this dispute. The City’s Legal Department and attorneys for Clay Utilities have agreed to settle this claim in full for the sum of $710,000 subject to Court approval. Hearing on the Court’s approval was set for today, September 8, 2008. This bill would authorize the appropriation of funds necessary to pay the agreed settlement promptly on Court approval. The Sewer Works General Fund No. 641 has sufficient funds to pay this sum. This being the time heretofore set for the Public Hearing on the above bill, proponents and opponents were given an opportunity to be heard. There being no one present wishing to speak to the Council either in favor of or in opposition to this bill, Councilmember Rouse made a motion for favorable recommendation to full Council concerning this bill. Councilmember Puzzello, seconded the motion which carried by a voice vote of nine (9) ayes. RISE AND REPORT Councilmember White made a motion to rise and report to the full Council. Councilmember Oliver Davis seconded the motion which carried by a voice vote of eight (8) ayes. ATTEST: ATTEST: _________________________ _________________________ John Voorde, City Clerk Derek D. Dieter, Chairperson Committee of the Whole REGULAR MEETING RECONVENED Be it remembered that the Common Council of the City of South Bend reconvened in the Council Chambers on the fourth floor of the County-City Building at 7:16 p.m. Council President Tim Rouse presided with eight (8) members present. BILLS, THIRD READING 4