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Georgetown, Floyd Co. agree on sewer deal

November 05, 2008
After months of negotiation and with the threat of a 54-percent sewer rate increase for Georgetown quickly approaching, Georgetown and Floyd County agreed last week on a deal for the county to obtain up to $1.4 million in the form of a USDA Rural Development loan to finance the cost of moving the site of Georgetown's future wastewater plant from the O'Brien property east of town to a yet-to-be-named site west of town.

The excitement began with a public hearing in Georgetown on Monday night. With about 150 residents in attendance, in addition to county commissioners Steve Bush and Chuck Freiberger, County Attorney Rick Fox and County Planner Don Lopp, the Town Council took the brunt of the public outrage early in the meeting, but people eventually calmed down as more and more information came to light and they realized that the town council was working to resolve the situation so that residents would not have to suffer under a possible 54-percent sewer rate increase.

Floyd County Attorney Rick Fox explained that he and Town Attorney D.A. Andrews worked out the deal to move the site of the wastewater treatment plant because the O'Brien site, which is not in the town limits, did not fit with the county's comprehensive plan as put forth by the County Plan Commission in 2005.

Georgetown will also have the ability to expand the plant and take on additional customers in Greenville and unincorporated Floyd County, Fox said.

Fox even suggested that after future expansion, eastern Harrison County may even wish to hook on to Georgetown's plant, which will mean more customers and lower rates for Georgetown residents.

After Fox spoke, Lopp said that after negotiations between Georgetown and Floyd County had started, he and his associates initially approached the town with 15 sites west of Georgetown that they deemed suitable for a wastewater treatment plant. Of the 15, Georgetown chose four sites that best suited their plans.

Andrews also spoke at the hearing and defended the O'Brien property purchase. He said the reason O'Brien was originally chosen as the site for a wastewater treatment plant was because it was the most economical choice for Georgetown. It met all the requirements of a wastewater plant since it was 650 feet from any residence or business and it sat next to existing sewer lines, so little money would have to be spent laying new lines, which cost around "$50 a foot," Andrews said.

Illustration by Alisha Sonner
"Every dollar more we spend results in higher sewer rates," Andrews said, noting that Floyd County should pay the additional costs if Georgetown is forced to move the plant to an alternate site.

The public hearing was stopped at 9 p.m. and slated to reconvene on Dec. 1 at 6:30 p.m.

The following night, the Georgetown Town Council met for its regular October meeting with the intent of deciding the fate of the Georgetown-Floyd County agreement.

Andrews passed out version 18 of the Floyd County-Georgetown Settlement for the board to vote on. The original agreement, drawn up on Aug. 18, had gone through many revisions before a final version had been agreed upon by the County and Georgetown on the morning of Oct. 28.

Stewart said if the agreement does not get passed, the town will go forward with plans of building a wastewater plant on the O'Brien property, after it has been formally annexed on Dec. 31.

Stewart explained some of the main components of the agreement, including the $1.4-million USDA loan that the county will be giving Georgetown and the $350,000 that Georgetown is required to pay up front to the county. He also mentioned that Floyd County will have the option to buy the O'Brien property for $440,00 for six months after the closing of the USDA loan and the closing of Georgetown's sewer bonds that will be used to finance the building of the sewer plant.

Stewart also made all of the contingencies of the agreement clear: The Rural development loan must go through; the New Albany sewer board must provide relief to Georgetown from contractual obligations that will increase sewer rates in February 2009; and a suitable alternate site must be found west of town that meets all of the requirements of agencies, such as the Indiana Department of Environmental Management, the Environmental Protection Agency and the Department of Natural Resources. All of these must take place or the agreement is terminated.

After much deliberation, the agreement was approved by the town council, 4-1 (Mike Mills against).

The following afternoon, Oct. 29, Floyd County held a special joint council/commissioners meeting. At the meeting, many of the same presentations heard at the previous two meetings were given. Lopp, however, did go into more detail about the loan saying the $1.4 million came from running the numbers of building on the property that was furthest from the town limits of the four chosen by the town. If Georgetown chooses to build on a site closer than this property, the loan could be significantly less, he said. Lopp added that the USDA loan will be for 40 years at a 4.5-percent annual interest.

He also mentioned that the entire construction and land acquisition process will be subject to oversight from Rural Development branch of the USDA.

According to the agreement, Floyd County plans to cover additional costs for Georgetown to acquire property west of town, to acquire easements for lines and the construction of lines leading to the property, to pay contract penalties for terminating the contract with a construction firm for building a sewer plant on the O'Brien property, to pay for money lost in building a bridge on the O'Brien property and for various permits that Georgetown must acquire to build west of town.

The loan will be paid back by the use of state and federal grants jointly applied for by Georgetown and Floyd County. The initial contribution of $350,000 by Georgetown to the county can be used to pay down the loan, if the county chooses; however, there is no stipulation as to how the $350,000 is to be spent by the county. Developmental impact fees in unincorporated areas of Floyd County served by the sewage treatment plant will also be used to pay back the loan.

The maximum amount the county will have to pay back annually is $75,000, which means, as Stewart pointed out later in the meeting, that Georgetown's $350,000 payment to the county basically would cover the first five years of loan payments.

The only major roadblock in the meeting was a disagreement between Andrews and County Council Attorney L. Contner. They were in disagreement as to whether the joint meeting was properly called. Contner was advising the council to postpone its vote until the next regular meeting on Nov. 12, but Andrews argued that it needn't be "languished on past the election." Eventually, Andrews and Contner came to an agreement that the council would vote at the current meeting and at the Nov. 12 meeting to rule out any chance that a third party could contest the legitimacy of the vote.

Andrews also addressed the commissioners and the council formally in a lengthy presentation about the history of the conflict between Georgetown and Floyd County over the O'Brien property as well as the history of sewage issues in general that Georgetown has faced over the years. All of it led up to his case for the county to sign the agreement.

"Georgetown is among the five highest municipality sewer rates in the state of Indiana," Andrews said, adding that residents literally could not afford another rate increase.

Commissioner Chuck Freiberger made sure that the 50-plus in attendance, mostly from Georgetown, understood that the commissioners had not been sitting on their hands.

"We've been trying to resolve this from the beginning," he said, adding that Georgetown definitely needs a sewer plant and that it was "not a matter of if" but "a matter of where."

Near the end of the meeting, Carol Shope of the county council and Freiberger both wanted clarification on the section of the agreement dealing with eminent domain. The agreement states that the wastewater plant is a public purpose and that Georgetown may, if necessary, use eminent domain to acquire property or easements for the laying sewer lines, etc., and that Georgetown will notify the Floyd County commissioners if any required takings for the construction at the alternate site are located outside Georgetown's corporate limits.

Freiberger voiced concerned that he would not vote for an agreement that gave Georgetown "carte blanche" to use eminent domain powers outside its corporate limits without approval of the commissioners. Andrews eventually convinced Freiberger and Shope that the commissioners would have the final say in whether or not eminent domain powers will be granted for the purpose of acquiring land for the construction of the wastewater plant outside of Georgetown's limits.

After the eminent domain issue was cleared up, the commissioners passed the agreement, 3-0.

The county council passed the agreement, 7-0, on the condition that the guaranteed funds in the event of a co-obligor situation with Floyd County and Georgetown would come from the Riverboat Fund instead of the Economic Development Incentive Tax Fund. The council will vote Nov. 12 at its regular meeting to make sure the vote goes uncontested.

The next step in the process requires representatives from Floyd County and Georgetown to go before the New Albany Sewer Board during its next meeting, Nov. 18 at 3:30 p.m., to ask for relief from the sewer rate increase set to occur if Georgetown remains on New Albany's system.

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