G'town gets 60-day extension from NASB
April 1 deadline gives town officials time to see if O'Brien property remains viable option for sewer plant
December 17, 2008
Last Thursday, representatives of Georgetown approached the New Albany Sewer Board to again request relief from contractual penalties due to kick in on Feb. 1 that would increase Georgetown's sewer rates by as much as 54 percent and fine the town $450,000 if progress had not been made on a sewer plant by that time. Georgetown didn't get the answer it was hoping for, but was given a two-month extension on the penalties.
Georgetown and Floyd County signed an agreement just over a month ago stating the town would move the site of its proposed wastewater plant from the 23-acre O'Brien property east of Georgetown that is due to be officially annexed into the town on Dec. 30 to an alternative site west of town. In return, Floyd County would provide the funding for the additional costs of moving the site from a USDA Rural Development loan up to $1.4 million.
A major contingency of the agreement is that the NASB grant relief from the contractual penalties outlined in the 2006 Georgetown-NASB agreement.
Last month, the NASB told Georgetown Town Attorney D.A. Andrews and Floyd County Commissioner Steve Bush to return with a time frame for construction of the sewer plant and a physical location west of town where it would be built. At that meeting, Andrews said the O'Brien property would be the most economical location for a sewer plant and suggested construction could begin almost immediately following annexation. Conversely, he said, construction on another location would take up to two years to begin because of the time needed to acquire the USDA Rural Development loan, purchase the property with those funds and obtain the proper site permits.
At this meeting, Andrews began with an overview of the situation involving Georgetown, Floyd County and New Albany. He then recapped all of the legal battles Georgetown has been embroiled in that have delayed the construction of a sewer plant and told the board that, unfortunately, yet another legal roadblock could prevent Georgetown from building on the O'Brien property in 2009 if New Albany fails to grant relief.
Andrews explained that several residents who live within a half-mile of the O'Brien property — none of whom live adjacent to the property — have filed complaints in the Floyd County courts that the property is not contiguous with the Georgetown town limits.
These complaints, he said, are baseless because the previous town council ensured the O'Brien land was contiguous with town property before it began the annexation process, even having a surveyor make sure the properties lined up. However, the complaints still have to be looked at by Floyd County Circuit Judge Terrance Cody to see if they are viable, Andrews said, adding it is the residents' strategy to delay the annexation past Dec. 30, into 2009. Since 2010 is a census year and Indiana law prohibits property from being annexed in the year preceding a census year, the O'Brien property annexation would be delayed until 2010, he explained.
Therefore, if the sewer board doesn't grant relief, causing the agreement between Georgetown and Floyd County to terminate, there is no guarantee that construction of a sewer plant on the O'Brien property could begin by Feb. 1, Andrews said. However, even if this scenario happened, this would only save Georgetown from paying the $450,000 fine and not the 54-percent rate increase because Georgetown will still be on New Albany's system.
At one point during Andrews' presentation, Bush expressed displeasure regarding Andrews' touting of the O'Brien property.
"We're here to go through with this agreement and take care of the residents of Georgetown," Bush said, adding that months of negotiation and the approval of the Floyd County-Georgetown agreement by three governmental bodies — the third being the Floyd County Council — should not be ignored.
Bush also said the town and the county are looking at a property west of town owned by Georgetown Truss Company.
After this, Andrews moved on to talking about plans for a sewer plant west of town, presenting the board with a construction time frame. The final numbers ranged from 2-1/2 to three years due to property acquisition, construction time and government red tape related to the Rural Development loan, he said. During this time, Georgetown would still be connected to New Albany's system.
Keeping Georgetown on the system would create a financial issue for New Albany, NASB Attorney Lee Buchanan said. The sewer line that runs from Georgetown to New Albany had been downsized after the 2006 agreement, when Georgetown said it was going to build its own plant. It could cost up to $1 million to increase the capacity of the line again to account for Georgetown's current sewer customers and additional customers who would be added in the next three years, Buchanan explained.
After much deliberation, it became clear that the issue of relief could not be solved without representatives from the NASB and Georgetown sitting down to discuss the terms of the current contract before proposing any sort of amendments or a new contract altogether.
Andrews asked that the board show mercy and grant Georgetown a short extension to the Feb. 1 deadline.
"Sixty days' relief will spare us from having to raise the rates on Tuesday night," Andrews said, referring to the last Georgetown Town Council meeting of the year that was to take place the following week.
Georgetown Town Council President Billy Stewart informed the NASB that he had already received notice from some Georgetown citizens that there would be lawsuits if the sewer rates are raised at the next meeting.
NASB Chair Ron Carroll and fellow board member Bill Utz agreed to extend the deadline to April 1 and to keep the sewer rates for Georgetown the same, with the exception of annual adjustments paid by all of New Albany's sewer customers, until that time. Andrews said the town could absorb the cost of the small rate increase on Jan. 1 for a few months to keep residents from paying it. The third board member, Elizabeth Coyle, was absent.
No date was set for the proposed meeting between all the parties concerned.
Buchanan originally opposed Floyd County's involvement in the talks, but conceded after Andrews and Stewart insisted the county be present.
"It would be impossible for Georgetown to go through with its plans without the county," Stewart said.
Carroll asked what could be accomplished by Georgetown with the 60-day extension besides the meeting. Andrews told him the town would be able to determine if the O'Brien property is still a viable property and, if needed, be able to move forward with acquisition of the property west of town owned by Georgetown Truss Company.