City officials are rightly saying that any talk of City Utilities taking over Aqua Indiana’s southwest utility are on hold until a court determines how much the city owes for its purchase of the company’s northern Allen County utility. A hearing today in the Indiana Court of Appeals illustrates just how far off that determination could be.
In short, if Tom Henry is a two-term mayor, it may be up to his successor – or even his successor’s successor – to address the issue.
Today, just a little more than four years after the City Council voted to buy the northern utility, the appeals court will hear arguments on whether a trial by jury – rather than a judge’s review – should determine the purchase price. This one issue has been pending at the appeals court virtually the entire year.
The case deals with something of a quirk in state law that led to the deal in January 2008 for the city to take over Aqua Indiana for $16.9 million, with the understanding that a court could change the price. The Indiana Supreme Court had ruled that the city has authority to declare eminent domain and take over the private water and sewer utility – though the final price was subject to court review.
The city said independent appraisers valued the company at $16.9 million, a price Aqua Indiana claims is too low. So the utility immediately challenged the price in the courts, and the case has been languishing most of the time since.
In the coming months, the appeals court will decide whether the case ultimately goes to trial. The losing side could appeal. So an actual trial, if it happens, is likely at least a year away, most likely even longer.
Without a firm agreement between the city and Aqua Indiana, the lower court’s decision is almost certain to be appealed, and there’s a good chance the appeal will be challenged.
If the courts ultimately determine that the $16.9 million was appropriate, the city would gain much negotiating strength and have confidence that an evaluation of the southwest/Aboite area utility would lead to the real sale price. But if the courts determine the utility was undervalued, the city will have to come up with more money to pay Aqua Indiana, and officials could well decide a purchase of the southwest utility would be cost prohibitive. Though owned by the same company, the northern Aqua Indiana utility that the city bought is distinct from the southwest Aqua Indiana that some customers would like the city to take over.
Stay tuned … the final answer on price should come before the 2019 city election.
Backing Romney
Mitt Romney’s campaign issued a news release naming Hoosier politicians backing the former Massachusetts governor. They include U.S. Rep. Todd Rokita; former state Reps. Randy Borror and Matt Bell, the executive director of the Regional Chamber of Northeast Indiana; and former state GOP Chairman Jim Kittle.
