NEW ALBANY —
The New Albany Sewer Board, which includes Mayor Jeff Gahan, put Environmental Management Corp. on notice for alleged contract violations Friday.
Sewer officials faulted EMC — which oversees the city’s wastewater treatment plant — with actions that led to a failure of an air pressure valve in the Mount Tabor lift station, and thus a $17,000 repair bill. EMC also neglected to staff a three-person crew consistently for maintenance work, further violating its contract with the city, according to the sewer board’s motion, which was passed unanimously during a special meeting.
According to sewer board attorney Shane Gibson, EMC has 90 days to respond to the complaints and remedy the situation or face further action, which could include a call by the utility to end the contract.
EMC is paid about $1.77 million annually, Gibson said. The deal is set to expire at the end of the year.
“The contract allows them time to correct those issues,” Gibson said following the meeting.
Board member Ed Wilkinson said the utility has commissioned a study by Clark-Dietz to determine if the issue at the Mount Tabor lift station was an isolated incident or part of a bigger problem. Sewer officials described the violations as serious in nature.
“We ended up with a $17,000 repair because of one single air relief valve,” he said.
A message left with EMC Facility Manager Rob Sartell seeking comment Friday had not been returned as of press time. Also, Gahan did not comment on the matter during the meeting, and also hadn’t returned a phone call for comment as of the press deadline.
When he placed himself on the sewer board in January, Gahan said part of the reason was to help transition the utility away from privatization.
“If it will work, and make financial sense, we’d like that utility in the hands of the public,” Gahan said last month.
In 2008, the New Albany Stormwater Board paid EMC $200,000 to end its contract two years prematurely. EMC’s sewer contract with the city was sliced by Mayor Doug England’s administration in 2011, as it was lowered from $3.6 million annually to $1.7 million.
New Albany City Council President Diane McCartin-Benedetti and Vice President Kevin Zurschmiede attended Friday’s special meeting. Zurschmiede agreed with the board’s decision.
“I think it was the right thing to do to protect the interests of the ratepayers,” he said.
But Benedetti and Zurschmiede said they feel the council isn’t getting enough information about the stormwater and sewer utilities. In addition to other reports, Wilkinson has been providing the council with regular financial updates for the sewer department for more than a year.
But the council passed a resolution last month calling for all boards to submit their meeting minutes and agendas to the body for review.
“I think that’s going to be a huge success for us legislators,” Benedetti said of the resolution.
EMC has had legal dealings with area cities before. In September, Indiana’s Court of Appeals affirmed a ruling that the city of Jeffersonville did breach a contract in 2008 when it seized control of its sewer treatment plant, expelling EMC from running operations at the plant. However, it reversed the trial court’s decision that the city violated Indiana Open Door law, based on the fact that EMC didn’t make its complaint on time. And it remanded the case back to Clark County in order to figure out how much is owed in attorney fees.
The city was ordered to pay $268,560 in damages for the contract breach.
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Kevin Zurschmiede, New Albany city councilman
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Shane Gibson
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New Albany puts EMC on notice
Sewer board cites contract violations; company has 90 days to respond
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