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Terms for city's water utilities sale announced

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A press release Tuesday from Mayor Greg Ballard's office outlined the terms of an agreement transferring control of Indianapolis' water and wastewater systems to Citizens Energy Group, a public charitable trust. The proposed acquisition, negotiated by the Indiana Office of Utility Consumer Counselor (OUCC), has been officially filed with the Indiana Utility Regulatory Commission (IURC), which will review the outlined provisions.

Most notable in the agreement's terms made public:

- Citizens would adopt existing rates and conditions of water service that the IURC had approved in its rate order for the Department of Waterworks in February of this year, as well as the current rates and charges for wastewater service as approved by the City-County Council through 2013;

- Citizens would document and make periodic reports of savings generated by the transfer to both the IURC and the OUCC — these reports would then be made available to the public;

- Citizens would continue to take input from technical advisory and environmental groups invested in water concerns;

- Citizens would work with the OUCC and IURC to address issues like future rate design, water conservation planning and the elimination of septic tanks in Marion County.

News of the planned $425 million transfer first broke in March 2010. The City County-Council of Indianapolis and Marion County gave its approval in July, and the IURC held public hearings in December 2010 and February of this year as part of its review.

NUVO reported on the issue in July of last year ("Thirsty for answers," News, Jul. 7-14, 2010), laying out the myriad objections raised about the privatization of a public service. Chief among those were concerns about lowered accountability, decreased transparency and a loss of public access to assets like the Canal and Geist Reservoir.

Quoted in Tuesday's press release, David Stippler, Indiana Utility Consumer Counselor, offered these words of reassurance:

“The OUCC has engaged in extensive negotiations with the City and Citizens over the past two months since recommending approval of these system transfers, subject to a number of conditions, including documentation and reporting of savings derived from the transactions as well as increased accountability in regard to the systems’ operations... This agreement resolves our concerns and we are pleased that the negotiations have led to a fair resolution for customers.”

The future of public properties and resources like the recreational waterways mentioned was not addressed.

Ballard is touting the sale as a lucrative solution for the city's financial woes; his office's press release goes on to say that "the transfer is expected to result in $60 million in annual savings and combined rates 25 percent lower than current projections." (For more on the transfer's extolled benefits, see the Overview on the Mayor's office site.)

The mayor spoke to concerns about the potential for politicizing and greed in the sale:

“This agreement strengthens our plan to ensure well managed, more affordable utilities for our community without partisan politics. We look forward to IURC approval of the utility transfer so Citizens can begin implementing synergies among the combined utilities while passing on significant annual savings to customers.”

In an effort to establish that promised transparency early on, the IURC has made documents for the pending sale available online through its Electronic Document System. To access, head to the 'Cases' tab and enter 43936 into the docket number field; click 'Search.' The OUCC's website also has a page for its involvement in the transfer, providing PDFs of the office's testimonies and filings by joint petitioners.

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