FORT WAYNE, Ind. (WANE) Mayor Tom Henry and the president of Aqua Indiana today announced an agreement that will lead to the purchase of the water utilities' remaining assets in Allen County and nearby to the City of Fort Wayne.
The deal, which needs approval by Fort Wayne City Council, Aqua's Board of Directors and the Indiana Utility Regulatory Commission , was announced at a 1 p.m. news conference at Fire Station 19 on Covington Road.
Fort Wayne will pay Aqua $50.1 million in addition to the $16.9 million it paid to Aqua in 2008 for the acquisition of Aqua's northern Allen County facilities. The deal is not expected to result in water rate increases for current Aqua customers.
The announcement comes just months after the city began condemnation process to force Aqua to give its business over to Fort Wayne.
"Neither one of us wanted to go through the condemnation process," Fort Wayne Mayor Tom Henry said. "To make sure that didn't happen, we weren't going to leave the table until we were able to work this out. We were both committed to that."
Aqua Indiana President Tom Bruns said it was nice to see the city and his company work together, and quickly, rather than go through a possibly lengthy legal battle.
"The condemnation issue is one that is very complex, and it involves a lot of attorneys," Bruns said. "By the time it's done, it might have taken three or four years for it to have made it to an ultimate decision."
Aqua employees will be offered positions with the City. Bruns said that was one of his top priorities during negotiations. He also said it was important to make sure the company didn't just hand over operations without anything in return.
"We'll sell the system to [Fort Wayne], but we need something in return to offset the loss of customers," Bruns said. The wastewater agreement is that. It's the equivalent of about 5,000 new customers with wastewater coming into our system and being treated by us. That's the big hurdle we got over, I think. That made this work."
Fort Wayne will become Aqua's largest customer in Allen County by agreeing to a ten-year wholesale contract allowing the City to send more than half a billion gallons of sewage each year to Aqua for treatment.
Aqua will invest $25,000 annually for 20 years in sanitary sewer infrastructure improvement projects providing for economic development or septic system relief.
Also as part of the deal, Aqua will become a member of the FW-Allen county Economic Development Alliance, now part of Greater FW Inc. The idea being that the increased involvement will provide the community more tools when retaining or attracting new businesses or addressing long-standing environmental and public health hazards resulting from failed or failing septic systems.
The transaction is expected to be completed in the first quarter of 2014. Within days of final approval of the closing, many former Aqua customers will receive city water in their homes.
Kumar Menon, the director of City Utilities said the hope was to have 20 to 30 percent of home connected within 30 days of the sale going final. He added once Aqua's Aboite Township customers are connected to the city, they should save $100 to $140 a year.
"When more people are willing to lift the load, everyone benefits because the load is so much lighter on each person," Menon said.
A more precise schedule for the complete transaction of all former Aqua customers located in the city is expected to be finalized by the time of the closing, and is not expected to be longer than a year.
The agreement ends years of a contentious relationship between Aqua and the City of Fort Wayne.
Henry said he hopes this private-public transaction will help pave the way for sewage negotiations between Fort Wayne and Huntertown.
"This may show Huntertown that even in a big situation, we can work something out," Henry said.
Aqua Indiana Conflict
June 7, 2012: Aqua Indiana changes its mind on voluntary water use reduction request. Aqua Indiana issued a request for its customers in Aboite Township to reduce lawn watering through from June 7 until June 18. A short time after this announcement, the water utility decided to sit on that request until sometime next week. A reason for the change was not given at that time.
June 8, 2012: Aqua Indiana asks customers to cut back on lawn watering. Aqua Indiana issues another notice asking customers in Allen County to conserve water by cutting back on lawn watering until June 14.
June 20, 2012: Aqua taps city water line to boost pressure. After voluntary efforts failed to reduce demand, the utility announced that it would tap into the City of Fort Wayne's water supply.
July 2, 2012: Aqua Indiana faces inquiry from Indiana Utility Regulatory Commission. Indiana Senate President Pro Tem David Long (R-Fort Wayne) started an inquiry with the Indiana Utility Regulatory Commission into Aqua Indiana on because, as he said, he is "genuinely concerned about the ability of this utility to continue to provide adequate
service to my constituents."
August 21, 2012: Aqua Indiana lifts irrigation ban. Amidst announcements that a new well is officially online, Aqua Indiana announced an end to its voluntary ban on lawn irrigation, allowing customers to resume use of automatic sprinkler systems.
October 17, 2012: Aqua Indiana allowed to disconnect from city water supply . While a study into why customers experienced low water pressure during the summer of 2012 did not return any conclusive answers, Aqua Indiana was given permission to disconnect from Fort Wayne's Water system.
November 15, 2012: Fort Wayne begins condemnation process against Aqua Indiana. After receiving more than 20 petitions urging the city to take over Aqua, Mayor Henry instructed City Utilities to ask city council to approve an ordinance to begin condemnation proceedings
February 5, 2013: City Council holds off on Aqua Indiana public hearing . The city and Aqua asked the City Council to put a scheduled vote on hold saying they were engaging in constructive discussions about the condemnation of Aqua Indiana.
April 11, 2013: Supreme Court rules in favor of Aqua Indiana in 2002 city takeover. The court ruled that Aqua Indiana will have a new hearing and trial-by-jury to determine how much the city owes the water utility for its 2002 city takeover of the utility's northern facilities.
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