News and Tribune

Clark County

December 19, 2013

Clarksville won’t pass hydrant fees to taxpayers...yet

Town council will supplement fire department budget for one year

— Fire hydrant rental fees account for more than a third of the Clarksville Fire Department’s budget, and the department’s chief is looking for alternatives.

Chief Tom Upton appeared before the Clarksville Town Council at a work session Monday to ask the council to move the rental fees paid to Indiana American Water onto the water bills of Clarksville water customers. Upton noted that Clarksville is the only municipality in the state that doesn’t apply the fee via water bills.

“When I started researching this years ago, there were five municipalities that the fire departments paid that [fee], and since then, all of those municipalities have switched that to the water bill,” Upton said. “So that just leaves the town of Clarksville.”

Clarksville water customers’ monthly water bills would increase by $2.27 at residential properties and by more at commercial properties. But that won’t happen until at least 2015, as the council chose to supplement the fire department’s budget to pay for the rental fees.

“We decided to not do that for a year,” said Council President Bob Polston. “We want to think about not the fire department, but another fund from the clerk treasurer’s office for a year and figure out what to do after that.”

According to correspondence between Upton and Charlie Pride of the Indiana State Board of Accounts, the hydrant rental fees could be paid in whole or partially out of the town’s rainy day, CEDIT, CCI or riverboat funds. Polston said the council will likely take action on the matter at its first meeting of 2014, which will be held Jan. 6.

Upton’s operating budget totals about $563,000 for 2013, which includes $217,324 in hydrant rental fees. Upton said the training line item in his budget could be significantly affected by the rising cost of the fees.

The town was charged $11,480.70 per month in 2008 through April 2010. In May 2010, the monthly fee increased to $12,948.67, and then to $15,737.82 per month between June 2010 and June 2012. In July 2012, the cost per month increased again, this time to $18,110.40, which is where it stands today.

The Clarksville Fire Department operates on funds generated through the Clarksville Fire Protection District tax levy, which is outside of the town’s general fund. Upton said with stagnant property valuations and circuit breaker tax caps, his budget could be further impacted in the future.

Council member John Gilkey voiced opposition to passing the fee on to water customers, calling it “tantamount to levying a new tax.”

“You are taking away an expense from the fire department budget, but leaving the money in the budget,” Gilkey said. “Ratepayers will have to pay for the hydrant rental through a separate mechanism and still pay the same amount in the fire department levy. That’s not fair.”

Gilkey went on to say that he feared Indiana American Water would seek to move Clarksville from the proposed $2.27 for a single-family residence to the same $4.12 flat fee it charges rate payers in every other municipality it services.

“That’s a windfall for Indiana American and a burden on ratepayers.”

Indiana American Water Spokesperson Joe Loughmiller acknowledged that the company charges water customers the same fee for hydrant rental, but denied it would be a windfall for the company.

“More than 95 percent of our customers are on the same rate in Indiana, and that includes the fire protection surcharge rate,” Loughmiller said. “We don’t break it out by neighborhood or by municipality or anything. That’s what you get. You look at all your costs to provide the service statewide, and then you portion that cost out throughout the state in the same way.”

Loughmiller said the company is simply covering its costs by charging that same fee uniformly throughout the state, and explained that the practice of charging one fee uniformly through all areas serviced by Indiana American Water protects individual communities in which the hydrant infrastructure needs to be significantly expanded or renovated.

Gilkey said the fire protection district isn’t generating enough revenue to operate the way Upton wants to run it, and wants the council to address the root problem.

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