One of the benefits to having a Historian as mayor is that I'm keenly aware of how the past affects our present and our future. Charlestown's trajectory was permanently altered by the construction of the Indiana Army Ammunition Plant - a fact we all know. While the plant's operation blessed our community with the arrival of new families who still call Charlestown home, it's hasty construction, short-lived production, and eventual closing left us with major challenges to our city's infrastructure. In some ways we've not yet caught up to where we need to be....yet.
When the plant was built, Charlestown had only a rudimentary sewer system and many homes still operated with outhouses. Thankfully a brand new facility was constructed and an even more advanced update was built in 1989. Wastewater plants don't magically last forever, and when regular maintenance and upgrades are not applied it's easy to find cities in great need of this particular type of infrastructure improvement - and that's where we are.
Neglect over the years and a lack of maintenance have left just about every major part of our existing wastewater plant useless. We're still meeting our permit requirements, but our efforts to do so are complicated by aged equipment, outdated technology, lack of adequate staffing, and a history of poor financial management. When I took office January 1 of 2020, the entire department had only $74,000 in operating funds - a number that should have been in the millions! Facing these challenges and keeping my promise to repair our infrastructure for our residents and prepare it for future growth has taken up much of my energy these last two years. It's also resulted in some tough decisions.
In August of 2021, the City Council adopted a series of rate increases to help overcome the failures of the past several years. State statute requires municipal utilities to charge a rate that adequately funds the department - these are not tax-based utilities, only user rates fund the sewer department. Charlestown's sewer serves approximately 2,500 customers, meaning that only a small portion of our residents bear the burden of covering the costs of the utility. Faced with a poorly managed utility with no cash reserves, failing equipment, and a revenue stream that had not been adjusted for 16 years, a rate increase was the only option to keep the department from bankruptcy.
When the city turned to our financial advisors for a rate study the initial report showed that to function and build a new plant we needed a rate increase of 256% - I balked. There was simply NO WAY that a raise that high could be tolerated! I was determined to find a better solution. In order to meet our financial obligations for the year 2021, the rates increased by 47%. Then in March of 2022, they went up again by 11% so that the department can make repairs required by the Indiana Department of Environmental Management.
These increases are painful - no doubt - but they're a far cry from the recommended 256%.
The rate analysis showed that for every $5 million in extra funding we can provide, the average household bill will avoid an additional increase of $15 per month. So for the last year I've worked to identify as many $5 million buckets I can. The first comes from the money that remains from the sale of the city's water utility and our portion of the American Recovery Plan Act allocation. The second (and largest to date) was announced last week - a $12 million contribution from the River Ridge Redevelopment Authority. As a member of the RRDA I've advocated for this contribution so that the full cost of the new wastewater treatment plant doesn't fall on the wallets of our residents. With this generous, and record-breaking gift, the RRDA has acknowledged my request and demonstrated a compassionate and ethical brand of development. A third anticipated part of our funding awaits final word - the $5 million I've requested from the READI Grant awarded to our region.
If my requests are all successful these packages and awards will cover 63% of our construction costs and decrease the burden on our average households by $60 per month!
I know the rate increases we've experienced lately are hard to take, especially considering the increases in our overall cost of living in this post-COVID environment. You have my assurance, however, that I'm doing everything I can to keep our costs as low as possible and to practice sound, conservative financial management of our budget.
Our new wastewater plant is currently in the design phase and we anticipate being able to bid the project in January 2023, with construction to start that summer. I understand this isn't the type of project that has the biggest excitement factor - it doesn't have the appeal of a new park, restaurants, shops, festivals, etc - but it's an essential part of our infrastructure, one that history has taught us is worth our investment.
For city news and updates related to the Wastewater Department check out our September 2021 Newsletter and our recent Press Release - $12 Million Award. And as always - if you have questions, I'm happy to chat.