ELKHART — The city of Elkhart moved closer Thursday, Nov. 7, to phasing out the maligned commercial compact sewer policy after Mayor Dick Moore agreed to reduce the transition to two years.
The council could end the 11-month controversy on Nov. 18, but still has a few sticking points to resolve, according to Republican council member David Henke.
However, Democrat Dave Osborne said he believes major concerns have been resolved.
After a three-hour meeting, the council was left with a plan that would phase in a surcharge for all commercial customers outside of the city beginning in 2015.
A plan arranged by Henke, Osborne and council president Ron Troyer had sought to shift commercial and residential sewer customers to a surcharge based on a rate study, but Moore continues to resist the inclusion of residential.
As of Thursday, 60 or so companies that are currently on the compact policy would be charged a rate based on 75 percent of assessed value for 2013 while the companies that were being shifted to the compact policy this year would pay a fee based on 25 percent of assessed value.
All customers would move to a compact fee based on 25 percent for 2014.
The movement came amid new threats of a lawsuit from the business coalition led by companies being shifted from the sewer service agreement to the more costly compact policy.
Coalition spokesman Rocky Enfield reiterated that any deal that include fees based on assessed value would not be acceptable. He believes the existing plan is unfair and illegal. Earlier this week, the group forwarded a 22-page legal complaint to the administration.
He urged the council to negotiate directly with the coalition.
“The clock is ticking,” Enfield told the council. “You have two weeks to settle this or the suit will be filed.”
He also criticized the council for not entirely rejecting any plan that relies on assessed value.
That didn’t sit well with Republican council member Mary Olson who reminded Enfield that a majority of the council passed a plan a few months ago that would have immediately eliminated the compact policy, but was quickly vetoed by Moore.
“Some of you have a real short memory,” Olson said. “To chastise the council for not being responsible is not accurate.”
A sense of compromise took a dramatic turn midway through the meeting after Moore and his staff walked out of the meeting and huddled briefly before returning. Minutes later, Moore informed the council the administration was willing to begin the surcharge in 2015.
For weeks, Moore had sought to wait until 2018 for the surcharge to kick in.
Moore’s willingness to compromise came after Osborne, Henke and Troyer worked out an alternative plan earlier this week.
The council at times struggled to wade through a series of procedural steps and Republican councilman Brian Thomas called much of the maneuvering “sloppy.”
The evening included a warning from Troyer that speakers needed to remain respectful after odd incidents in which members of the public were seen passing notes to council members in the middle of debate.
Much of the council’s concern in resolving the dispute focused on ensuring the city could transition smoothly from the loss of compact fees to new tax revenues that will come from the upcoming annexation.
Henke chided the administration for not having details available that clearly lay out the financial expectations, especially since the city has already spent $200,000 for consultants.
Concerns continued to be expressed over how residential customers — namely Valley View homeowners — would be treated.
Republican councilman Brian Dickerson asked why Valley View residents, some of whom have been paying extra fees for as long as 27 years, were not among the first 16 areas targeted by the administration for annexation when several other suburbs are on the list.
Moore said the city want to avoid annexing entirely around unincorporated areas. At the same time, he said annexing residential is not financially worthwhile for the city.
Republicans, led by Henke, continue to argue that Valley View deserves to be annexed after paying additional fees for so long.
Osborne pointed out that the council had agreed to reduce the monthly residential compact fee from $50 to $35 and reminded the council that the subdivision can seek friendly annexation.