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Aqua Indiana sale nearly official

Switchover to city water lines likely to take 5 months

– It’s almost official.

Residents in southwest Fort Wayne wondering when City Utilities will take over Aqua Indiana’s southwest water system now have actual dates to look forward to.

Ordinances authorizing the purchase and the loan to pay for it will be introduced Tuesday to the City Council. While the introduction is largely a formality, it starts the official wheels turning. A public hearing and debate on the issue is set for May 6, and the council could give final approval May 13.

The agreement needs approval from the Indiana Utility Regulatory Commission. Aqua America’s board of directors has already approved the agreement.

The transition to city water will occur in three phases beginning in October or November and will take about five months to complete.

“I applaud the efforts of my city team and Aqua for coming together to meet the needs of residents and businesses in our community as we invest in the future,” Mayor Tom Henry said in a statement with the announcement of a deal. “A commitment to reliable and high-quality water at an affordable price for all residents is critical as we position ourselves as a leader in quality of life, economic development, and job growth.”

Officials announced in July they had signed a letter of intent for the city to buy Aqua’s southwest water utility and settle the ongoing lawsuit over the price the city must pay for its 2007 purchase of the private utility’s north system.

The city will pay Aqua Indiana $50.1 million in addition to the $16.9 million the city paid Aqua for the north system. The $67 million will cover the cost of all of Aqua’s drinking water facilities in Allen County.

Aqua Indiana President Tom Bruns said he is pleased with the final agreement.

“It took a lot of work to figure out something that works for everyone,” Bruns said. “But hopefully by end of the year we’ll have a transition taking place.”

Under the agreement, Aqua will not only keep its sanitary sewage utility but will be the destination for some of Fort Wayne’s wastewater. City Utilities will be a wholesale customer of Aqua’s sewage utility, paying it for treatment of waste from the southwest and western parts of the city, which will help the city’s efforts to avoid sewage overflows into the rivers.

“Even though we’re losing water customers to the city of Fort Wayne, the sewer agreement provides a long-term area that we serve exclusively,” Bruns said. “I think it’s a nice conclusion of a number of years of infighting to where now we’re looking at something that each party gets something good out of.”

One of the ordinances to be introduced Tuesday calls for borrowing $63 million to pay for the purchase. According to the ordinance, the city already has $99.7 million in waterworks loans outstanding.

The move is long awaited by many of Aqua’s 12,000 water customers in southwest Fort Wayne, who often have complained about poor water quality and pressure. In 2012, during a severe drought, some customers had to be switched over to Fort Wayne City Utilities water because Aqua’s wells couldn’t keep up with demand.

During the 2012 drought, Henry said the city could no longer ignore the pleas of residents served by Aqua and announced plans to condemn the system and buy it by force. That led to negotiations culminating in the 2013 announcement of the purchase.

After the switch to City Utilities, Aqua’s nearly 12,600 customers are expected to save $100 to $140 each year on their bills, city officials said.

Officials have not yet said whether a surcharge will be required for the new customers to pay for the $50.1 million purchase of the southwest system, the bonds required to finance it, the infrastructure needed to connect the systems and improvements the Aqua system will require.

But officials have vowed that current City Utilities customers would not have to pay for the purchase and that even with a surcharge, the new customers will still pay less than they do now.