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The Plain Dealer & Sun - 2/11/2009
JNRU eyes assistance
Restructuring of debt, arrangement with NV could be in offing

After years of being left to fend for itself despite staggering debt from state-approved projects that failed, Jennings Northwest Regional Utilities could soon be receiving some badly-needed financial help. The beleaguered utility has been earmarked for a $787,000 temporary loan from the state. More assistance could be on the way, too.

"Hopefully, this will work out to where the utility will be in better shape," said Ed Whitaker, president of JNRU's board of directors. "We want to reduce our rates."

The money would come from the proposed federal stimulus package, part of which are funds slated to be divvied out to states for utilities and infrastructure repair.

Also in the offing for JNRU is more restructuring of loans that are part of the utility's $9 million debt.

"In the next six to eight months, we hope to have more debt restructuring," Whitaker said.

Even further down the road could be improvements to JNRU's wastewater treatment plant or a possible sewer connection with North Vernon whereby the utility can abandon its troubled plant.

A public hearing on preliminary engineering report on options concerning upgrading JNRU's plant and its collection system will be held Monday, Feb. 16, at 7 p.m. at the Country Squire Lakes Clubhouse. The report addresses deficiencies in JNRU's sanitary sewer system and plant. It also addresses costs to make improvements.

The plant, which was built at a cost of $1.8 million and went online in 2001, has never worked properly, according to officials. Experts say the plant, which relies on sequencing batch reactors, was poorly designed, causing big problems during cold weather when effluent can't be adequately treated. That has led to numerous discharges into Six Mile Creek that do not meet state compliance for ammonia, nitrogen and dissolved oxygen content.

Part of the problem, according to experts, is that the plant was designed to treat considerably more wastewater than it does now. Officials were counting on a massive sewer system expansion project outside of CSL, JNRU's base, to feed more sewer into the plant. That expansion failed in the face of public outcry and legal challenges.

Several experts have said it would not be cost-effective to repair the JNRU plant, which would cost around $2.5 million according to Commonwealth Engineers.

The better option might be sending JNRU's sewer to North Vernon for treatment.

"We have had a couple of discussions with North Vernon officials and are encouraged," Whitaker said. "If North Vernon ever builds a new treatment plant, it would be a natural for us to connect there."

North Vernon Mayor Harold "Soup" Campbell said a new plant on the city's southwest side is being considered, but that if JNRU sends sewer to the city it probably would be routed to North Vernon's current wastewater treatment plant on Greensburg Street.

"Since most of the gravity flow in the city is to the south and west, it might be better for much of the city's sewer to go in that direction," Campbell said. "Then we would connect the JNRU sewer to our older plant with lift stations along the way."

Whatever happens, the stimulus could be a godsend for JNRU, said Jim McGoff, director of enviromental programs with the Indiana Finance Authority.

"The economic recovery project could not have come at a better time for JNRU," he said. "The state is now in a better position to be more accommodating. Four years ago when JNRU's state loan (a $5.3 million note originally issued in 2002 to pay off bond anticipation notes for the failed expansion project and wastewater plant) was restructured, everything seemed to be OK. But a decline in its customer base (now at about 1,300 customers) has hurt JNRU."

McGoff gave much credit to State Rep. Dave Cheatham (D-North Vernon) for interceding on JNRU's behalf.

"Dave has been very helpful, both in making us aware of JNRU's financial problems and in meeting with us and the other parties involved," McGoff said.
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