City Hits Impasse In Hammond Water Negotiations

The City of Chicago Heights has purchased its water from Hammond, Ind., for 30 years, but the initial term of that agreement is set to expire in November. At the Oct. 1 city council meeting, Corporation Counsel T.J. Somer briefed the council and the public about the status of the city's ongoing negotiations with Hammond to renew that contract at a rate that would be "fair and reasonable for all parties."

However, Somer said negotiations have come to an impasse because of the high rates Hammond is asking for.

"Hammond has unilaterally suggested and imposed a renewal rate upon the city approximately four times higher than the rate currently paid by the city," Somer said. "That proposed increase is essentially going from 57 cents per 1000 gallons to $2.20 per 1000 gallons. That same rate is almost twice as high as the rate Hammond recently charged to the village of Lansing, just a couple of months ago."

The city filed for an injunction from the Indiana Utility Regulatory Committee on Sept. 27, asking for a hearing to establish a new water rate. The city also filed a complaint in the Federal Court of Northwest Indiana on Oct. 1. Somer said this complaint was filed because the rates Hammond is asking for don't comply with Indiana state statutes, which require factors like the cost of producing and delivering water to be taken into consideration when setting rates.

"The renewal contract proposed by Hammond completely disregards those statutes and instead attempts to mandate that our future water rates shall be directly tied to the exorbitant rates imposed by the city of Chicago on the suburbs," Somer said. "In other words, the contract says that our rate after the first two years will be 88 percent of whatever the Chicago rate is, and we've all read what's happening there in the newspapers."

The city is looking into other options for its water purchasing, but one of the problems that went into the decision to file the injunction is that there aren't many other sources to choose from.

"Currently, there is no immediate option, and that is part of the injunction that we filed," Mayor David A. Gonzalez said when asked if there were any other options on the table. "Because there's no immediate option for the city, we look for the courts to get us relief in terms of an injunction for us, for them not to shut the water off until we negotiate a reasonable term between both of us."

Somer said that besides Hammond, the City of Chicago is really the only other game in town.

"Unless you're going to go to a well," he said. "And the well water hasn't proved real fruitful around here lately."

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