By Shelley Swift | Daily Reporter
FORTVILLE — Fortville water customers may soon see rates go up if a proposed increase is passed.
Fortville Town Council will decide whether to pass a proposed rate hike of 49.3% on final reading, after a public hearing at its next meeting June 16. The proposal was passed on first reading in May.
The new rate would increase Fortville water bills by $8.61 a month for 3,000 gallons usage and $12.92 per month for 4,000 gallons usage.
The rate hike would help eventually pay off an $11 million Bond Anticipation Note (BAN) issued in 2021 to build the town’s new water treatment plant, which was completed in 2023.
Town Council President Tonya Davis anticipates the new rate to pass next week, but said Fortville residents would still have some of the best water rates in the area.
Last month the council heard from Buzz Krohn, executive partner of Krohn & Associates, who laid out the details of a water rate analysis and the proposed water rate adjustments.
He shared a chart comparing monthly water bills from comparable cities and towns throughout the region, based on 3,000 gallons usage.
Anderson had the lowest average bill at $16.95, but has proposed an increase pending final approval that would bring that same bill to $37 per month.
Fortville’s current rate was the next-lowest on the list at $17.64 per 3,000 gallons, followed by Cambridge City at $18.03 and McCordsville at $23.05.
If Anderson’s and Fortville’s rate hikes both pass, Fortville would still be the fourth-lowest rate compared to the 20 other cities and towns on the list, including Ingalls, Shirley, Lapel and Lawrence.
All but five municipalities currently charge over $30 a month for 3,000 gallons usage, while Fortville’s proposed rate would come in at $26.25.
Krohn said it’s been 16 years since Fortville’s last water rate hike was approved by Indiana Utility Regulatory Commission in 2009.
Fortville is no longer part of the IURC, which leaves water rates in the hands of the town council.
‘Growing pains’
Davis said an eventual rate hike to cover the cost of the water plant was inevitable.
“I know everyone feels the slightest bit of (cost increase), but this is something that has to be done,” she said.
The proposal comes two years after the town’s water treatment plant expansion, which doubled the plant’s capacity, first started serving residents.
Officials at the time said the previous plant, built in 1955, was showing signs of deterioration and needed to be expanded to address the growing needs of the town.
Krohn said that before the last rate increase, the IURC approved a three-phase rate adjustment, but the Town of Fortville implemented only the first phase.
Krohn & Associates first proposed another rate adjustment in 2022, after the town was issued the short-term, $11 million BAN in 2021 to build the new water plant.
At the time, Krohn suggested a gradual three-phase rate adjustment over a three-year period to reach a cumulative increase of roughly 45%.
The town council opted to postpone any rate increase until the new water treatment plan was completed in 2023, and further postponed an increase until water quality issues detected later that year were rectified.
Krohn advised the council in May that the town must address rates as soon as possible to refinance the $11 million BAN, which matures in October.
He proposed that the town refinance the bond using over $1 million in capacity fee funds, along with an additional $500,000 of other available water funds, to “buy down” the bond issue from $11 million to $9.5 million.
Krohn proposed a 20-year term on the refinancing, adding that rates were currently near 5% as of early May.
The water plant expansion and bond issue are all part of growing pains, Krohn said, pointing out that the number of Fortville water customers has increased by nearly 40% over the past five years.
In January 2020 the town had approximately 2,600 water customers.
By January 2025 the customer base had increased to nearly 3,600, an increase of about 200 customers per year.
Krohn noted that since the town prepaid its 2009 bond issue in 2021 with accumulated cash stemming from growth between 2009-2021, the proposed bonds would be the town’s only long-term debt tied to the water utility.
Davis feels confident the council can obtain a reasonable rate to refinance the bond through GBC Bank, which has a longstanding relationship with Fortville and a branch at the center of town.
“They always take really good care of us,” she said.
Those wanting to learn more about the proposed water rate increase or voice their opinion can attend the public hearing at the next town council meeting, set for 6:30 p.m. Monday, June 16, at Town Hall, 714 E. Broadway St. in Fortville.
