The Process of Condemnation

By Max Resnik

November 16, 2012 Updated Nov 16, 2012 at 6:54 PM EDT

FORT WAYNE, Ind. (www.incnow.tv) – Mayor Tom Henry’s office will submit an ordinance to condemn Aqua Indiana to Fort Wayne City Council before year’s end.

Submitting the ordinance is the city’s first step in the condemnation process, the announcement made Thursday by the mayor. The troubled utility, which is being investigated by the Indiana Utility Regulatory Commission, has come under fire from customers in Aboite Township. Chief among them is President Pro Tempore of the Indiana Senate David Long. The area has voiced complaints over water pressure and quality issues.

In July, the mayor raised condemnation as a possibility for the utility but regarded the move as an option only to be utilized if mutual agreements could not be reached. Henry and City Utilities feel that an agreement has not been reached and will pursue condemnation.

After the city submits its ordinance to city council and if approved, the city will then make its final “good faith” offer to buy the utility. Aqua Indiana will have 30 days to respond to the offer, according to City Utilities Program Manager Ted Nitza. If Aqua declines the offer or refuses to provide an answer, the city will then file a condemnation complaint in court. Nitza says Aqua is running out of options.

“I think the best case scenario is that Aqua Indiana would recognize that this is a problem that they can't solve, that they've had their opportunity to bring in their management, their engineering, their attempts at fixing the issues that they were presented with when they took over operations quite some time ago. City Utilities is well equipped with the engineers, the scientists, the managers. We have equipment, the facilities, the capacity to better serve the customers in the Aboite area.”

Nitza says a court battle could take three to five years because a judge would be charged with bringing in an outside firm to appraise Aqua Indiana’s worth. That appraisal would be the dollar figure used by the City of Fort Wayne to purchase the utility. Appeals from each side for the best price could make condemnation a lengthy process.

In 2002, the City of Fort Wayne condemned Aqua Indiana on the city’s north side. That battle end in 2007, and the water transition did not take place until 2008. The final agreed to price for the utility was $17 million. Nitza says Aqua’s cooperation during condemnation could result in a much quicker transition.

“The condemnation process, with Aqua Indiana's full cooperation, could be concluded within a year.”

Nitza says the transition, whether it takes place a year from now or in five years, should be easy and would require minimal infrastructure upgrades of Aqua’s facilities, which the city plans to use. Aqua’s Aboite area water customers number around 12,000. The city says the revenues incurred from gaining those customers would pay for Aqua’s acquisition and subsequent upgrades, bearing no cost to residents of southwest Fort Wayne.

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