Who pays for progress?

Expanding the Midwest Industrial Park’s sewer capacity might be a worthy endeavor, but several Richmond residents addressing Richmond Common Council on Aug. 18 balked at being asked to pay the $38 million price tag.

“If this is for the industrial park, let the industrial park occupant pay for it,” Nick Wilson said during the public hearing for an ordinance proposing increased sewer and stormwater rates. “They’re the ones benefiting from it, they’re the ones using it. The residential customers are not.”

Council delayed taking action on the ordinance, leaving the public hearing open until its next meeting. Because of Labor Day, that meeting will be at 7 p.m. Tuesday, Sept. 2, in the third-floor chambers of the Richmond Municipal Building, 50 N. Fifth St., Richmond. Members of the public will again be able to speak about the rate increase.

During 2022, the city added 326 acres to the industrial park, knowing sewer capacity would need to increase from the current 290,000 gallons per day to more than 2 million gallons per day. Richmond Sanitary District, the city and the Economic Development Corp. of Wayne County spent $2 million for engineering of the project’s three phases.

Valerie Shaffer, president of the EDC, said industrial park newcomers, such as Anchor Ingredients and Liberation Bioindustries, and expansions by Blue Buffalo and Richmond Beverage Solutions, chip away at the remaining sewer capacity. The project’s first phase would nearly triple that capacity.

“With so many industrial parks across Indiana and even the nation, it’s important for us to stand out and truly have shovel-ready sites, meaning that we have all utilities in place and can support a company’s needs not only when they first establish an operation here but as they continue to grow,” Shaffer said.

Incentives offered Blue Buffalo for its expansion pledged only half of the new tax revenue the expansion generates to the company. The rest, Shaffer said, would help pay for the sewer expansion’s third phase.

Mike Resh said he understands business attraction helps everyone, but it’s “ridiculous” to put the burden on residents.

“I think a business should be the one paying for the infrastructure, not the residents,” he said.

The sanitary district first implemented user fees during 1981 when the U.S. Environmental Protection Agency required them for the district to receive three grants. The initial monthly rate included a $3.50 meter charge for those measuring five-eighths or three-quarters of an inch — standard residential sizes — and $1.03 per 1,000 gallons of water used. A typical home using 4,000 gallons per month would have paid $7.62.

It took until 2006 for a 4,000-gallon user’s bill to double, when the second year of a two-phase increase boosted the bill to $15.23. Since then, however, that typical bill rose 110.7% to $32.09 by 2013, then another 72.1% to $55.23 this year.

The sanitary district needed additional funding to pay for a court-ordered project to separate sanitary and storm sewers and prevent raw sewage from entering the Whitewater River during heavy rains. That project began in 2009 and must be completed by 2030.

To pay for the industrial park project, the proposed four years of rate increases would boost a 4,000-gallon user’s bill to $67.74 in 2029, a 22.7% increase from this year. That would mean sewer district rates would rise seven consecutive years, a 55.9% increase from $43.44 for a 4,000-gallon user. Council member Jerry Purcell said that’s a big deal, because residents won’t receive comparable wage increases.

The meter charge would increase from $28.55 this year to $30.26 in 2026, $32.08 in 2027, $34.00 in 2028 and $35.02 in 2029 for meters measuring five-eighths or three-quarters of an inch. The charge per 1,000 gallons of water used would increase from $6.67 this year to $7.07 in 2026, $7.49 in 2027, $7.94 in 2028 and $8.18 in 2029.

Misty Hollis, a former Common Council member, recalled a motion when a rate increase passed in 2014 to sunset paid-off bonds and lower rates. Council President Larry Parker said he doesn’t think that’s happened. Hollis asked if a promise could be made that rates would revert when the sanitary district’s six current bonds sunset.

Wilson, who asked council if any constituents had asked them for a rate increase, expects that rates would never decrease if they’re raised.

“If you take out a loan for a project and you pay that project off, you don’t keep charging for that loan that’s paid off; yet, that’s exactly what we do every time: The bond gets paid off, the rate just keeps increasing,” he said. “It has to stop, and you are the ones who can stop this.”

Eric Sandlin and Belinda Miller were among three residents in the 2000 and 2100 blocks of South 11th and 12th streets complaining about a lack of storm sewers in the small neighborhood near Boston Pike. They said they’ve complained about their homes flooding to the sanitary district, but they’ve gotten no responses. The ordinance under consideration will also increase the stormwater rate for the first time since 2009. It would rise from $6 this year to $6.90 in 2026, $7.95 in 2027, $9.15 in 2028 and $9.40 in 2029. Both Sandlin and Miller said they shouldn’t have to pay a stormwater bill when they don’t have stormwater sewers. 

“We shouldn’t have to keep paying for something we don’t have, don’t use,” said Miller, who has started an online petition opposing the rate increases. “For some reason, they can’t find the money to help the residents, but they want to go out here and help the factories. Well, make them pay for it. Don’t be putting it off onto us.”

Elijah Welch, the sanitary district’s engineer, told council that stormwater projects get attention in order of priority. Fixing the South 11th and South 12th issue would cost more than $750,000, he said.

“We don’t have enough money to go fix every stormwater problem right now,” Welch said. “We have a pot of money and every year we budget from that, but we try to go down the list from what’s ranked the highest to the lowest.”

Tim Long, who owns property on South 11th and South V streets, said he has three sump pumps in his V Street house and two in the 11th Street house. He said the sanitary district needs to help residents who repeatedly deal with water damage.

“I don’t mind the cost going up. That’s a fact of doing business,” Long said. “If you want the industry to come, your systems have to be able to handle them. The problem I have is you need to fix the systems that the people are using, too.” 

Council members, too, are sanitary district customers, and at meeting’s end, Parker said to Long: “You mentioned the fact that you don’t mind paying that bill. I hate it.”