CHAPTER 23. MUNICIPAL SEWAGE WORKS
IC 36-9-23
Chapter 23. Municipal Sewage Works
IC 36-9-23-1
Application of chapter
Sec. 1. This chapter applies to all municipalities.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-2
Municipal powers
Sec. 2. A municipality may:
(1) acquire, construct, improve, operate, and maintain sewageworks under this chapter;
(2) acquire, by gift, grant, purchase, condemnation, orotherwise, all lands, rights-of-way, and other property that arenecessary for the sewage works;
(3) issue revenue bonds to pay the cost of acquiring,constructing, and improving the sewage works and property;and
(4) lease sewage works from a person, an entity, a corporation,a public utility, or a unit for a term not to exceed fifty (50)years.
A sewage works leased under this section is subject to IC 5-16-7.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.35-1990,SEC.68.
IC 36-9-23-3
Supervision and control
Sec. 3. The construction, acquisition, improvement, operation, andmaintenance of sewage works under this chapter shall be supervisedand controlled by the municipal works board. However, themunicipal legislative body may, by ordinance, transfer the powersand duties of the works board under this chapter to:
(1) a sanitary board established under section 4 of this chapter;or
(2) the utility service board, if the municipality has such a boardoperating one (1) or more municipally owned utilities.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-4
Sanitary board
Sec. 4. (a) A sanitary board established under this chapter consistsof:
(1) the municipal executive; and
(2) two (2) persons appointed by the municipal legislative body,one (1) of whom must be a registered professional engineer.
The legislative body may not appoint any paid or unpaid municipalofficer or employee to the board.
(b) One (1) of the original appointees to the sanitary board servesfor a term of two (2) years, and the other serves for a term of three
(3) years.
(c) When the term of a member of the sanitary board expires, asuccessor shall be appointed for a term of three (3) years in themanner prescribed by subsection (a).
(d) Vacancies on the sanitary board shall be filled for theunexpired term in the manner prescribed by subsection (a).
(e) The municipal executive is the chairman of the sanitary board.
(f) The sanitary board shall select a vice chairman from itsmembers, and shall select a secretary and a treasurer, who need notbe members of the board. However, the board may combine theoffices of secretary and treasurer into a single office ofsecretary-treasurer. The officers selected under this subsection serveat the pleasure of the board.
(g) Each member of the sanitary board is entitled to thecompensation, if any, that is fixed by:
(1) the executive, with the approval of the legislative body, ina city; or
(2) the legislative body, in a town;
as a salary or as payment for meetings attended. Each member is alsoentitled to payment for reasonable expenses incurred in theperformance of his duties.
(h) The compensation of the secretary and treasurer of the sanitaryboard shall be fixed by:
(1) the executive, with the approval of the legislative body, ina city; or
(2) the legislative body, in a town.
(i) The municipal legislative body shall fix the bond required ofeach member of the sanitary board and of the treasurer of the board.These bonds shall be filed with the county recorder underIC 5-4-1-5.1.
(j) The sanitary board may establish rules and bylaws for its owngovernment.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-5
Board defined
Sec. 5. As used in sections 6 through 37 of this chapter, "board"means:
(1) the municipal works board; or
(2) if the municipality has transferred the powers and duties ofthe works board under section 3 of this chapter, the:
(A) sanitary board; or
(B) utility service board;
to which those powers have been transferred.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.1-2007,SEC.247; P.L.114-2008, SEC.28.
IC 36-9-23-6
Contracts
Sec. 6. (a) The board may enter into all contracts or agreements
necessary or incidental to the performance of its duties and theexecution of its powers under this chapter. However, the board maynot obligate itself or the municipality beyond the extent to whichmoney has been or may be provided under this chapter.
(b) A contract relating to the financing of the acquisition orconstruction of any sewage works, or to any trust indentureauthorized by this chapter, is not effective until it is approved by themunicipal legislative body.
(c) A contract or an agreement with any contractor or contractorsfor labor, equipment, or materials shall be let and entered into underthe statutes governing the letting of contracts by agencies ofmunicipalities.
(d) The board or any public utility (as defined in IC 8-1-6-3)contracting with the board for the treatment, purification, or disposalin a sanitary manner of liquid and solid waste, sewage, night soil, orindustrial waste may contract with a water utility furnishing waterservice to users or property served in the municipality or by thepublic utility to do the following:
(1) Ascertain the amount of water consumed.
(2) Compute the amount of the charge to be billed for sewerservices to each user or property served.
(3) Bill and collect the amounts due for sewer services.
(4) Discontinue water service to delinquent sewer users.
A contract under this subsection is enforceable without the approvalof the Indiana utility regulatory commission.
(e) The procedures in IC 36-9-25-11.5(a) throughIC 36-9-25-11.5(e) apply to the discontinuance of water service to adelinquent sewer user under a contract between the board and awater utility described in subsection (d).
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.27-1995,SEC.7; P.L.34-1999, SEC.6.
IC 36-9-23-7
Board; operation of works
Sec. 7. After the completion or acquisition of the sewage works,the board shall operate, manage, and control the works and mayorder and complete any extensions or improvements it considersnecessary. The board shall adopt rules for the use and operation ofthe sewage works and of other sewers and drains connected to theworks, to the extent that they may affect the operation of the works.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-8
Board; restoration of works
Sec. 8. If requested to do so by the proper authority, the boardshall, to the extent possible from money provided under this chapter,restore to their original condition any public ways or public worksdamaged by the board in the performance of its duties.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-9
Board; authority relating to employees; payment of expenses
Sec. 9. The board may employ, fix the compensation of, andprescribe the duties of engineers, architects, inspectors,superintendents, managers, collectors, attorneys, and any otheremployees it considers necessary. The expenses incurred under thissection shall be paid solely from money provided under this chapter.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-10
Ordinance prior to construction or acquisition of works; contents;notice
Sec. 10. (a) Before the construction, acquisition, or lease of anysewage works under this chapter, the municipal legislative body shalladopt an ordinance or ordinances:
(1) setting forth a brief general description of the works and, ifthe works are to be constructed, a reference to the plans andspecifications prepared and filed by an engineer chosen by theboard;
(2) setting forth the cost of the works, as estimated by theengineer;
(3) ordering the construction, acquisition, or lease of the works;
(4) setting forth an estimate of the fees for the several classes ofusers or property to be served;
(5) ordering the issuance of revenue bonds of the municipalityunder this chapter, in the amount necessary to pay the cost ofthe works; and
(6) containing any other necessary provisions.
(b) Unless all or part of the works is being constructed incompliance with an order of the department of environmentalmanagement to abate water pollution, notice of the adoption and thepurport of the ordinance or ordinances shall immediately be given bypublication in accordance with IC 5-3-1.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.143-1985,SEC.197; P.L.35-1990, SEC.69.
IC 36-9-23-11
Cost estimate
Sec. 11. The engineer's estimate of costs under section 10(a)(2) ofthis chapter must include:
(1) the cost of acquiring or constructing the sewage works;
(2) the cost of all property, easements, franchises, and otherrights considered necessary or convenient for the works;
(3) interest on bonds before and during the construction oracquisition, and for a period not exceeding twenty-four (24)months after completion of the construction or acquisition;
(4) engineering expenses, including expenses for plans,specifications, and surveys;
(5) legal expenses;
(6) expenses for estimates of cost and of revenues; (7) administrative expenses; and
(8) other expenses necessary or incidental to:
(A) determining the feasibility of the works;
(B) financing the works;
(C) constructing or acquiring the works; and
(D) placing the works in operation.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-12
Petition objecting to construction or acquisition of works; courthearing; notice; bond; further proceedings on project prohibitedif petition sustained
Sec. 12. (a) This section does not apply to undertakings incompliance with orders of the department of environmentalmanagement for which no objections are authorized.
(b) Forty (40) or more owners of property connected or to beconnected to and served by sewage works authorized by an ordinanceunder section 10(a) of this chapter may file a written petitionobjecting to the construction or acquisition of the works. The petitionmust be filed with the municipal legislative body, must contain thenames and addresses of the petitioners, and must set forth thefollowing objections:
(1) The works are not required by the public needs.
(2) The cost of the proposed works would be excessiveconsidering the value of the service to be rendered to theaffected community.
(3) Any other ground of objection.
The petition shall be filed within twenty (20) days after thepublication of notice under section 10(b) of this chapter.
(c) Unless the proposed works are abandoned, the municipal clerkshall file in the office of the clerk of the circuit or superior court ofthe county a copy of the ordinance or ordinances together with thepetition. The court shall then set the matter for hearing at the earliestdate possible, which must be within twenty (20) days after the filingof the petition with the court. The court shall send notice of thehearing by certified mail to the municipality and to the first ten (10)signers of the petition at the addresses shown on the petition. Allinterested parties shall appear in the court without further notice, andthe municipality may not conduct any further proceedings concerningthe works until the matters presented by the petition have been heardand determined by the court.
(d) The petitioners shall file with their petition a bond in the sumand with the security fixed by the court. The bond must beconditioned on the petitioners' payment of all or part of the costs ofthe hearing and any damages awarded to the municipality if thepetition is denied, as ordered by the court.
(e) Upon the date fixed in the notice, the court shall, without ajury, hear the evidence produced. The court may confirm thedecision of the municipal legislative body or sustain the objectingpetition. The order of the court is final and conclusive upon all
parties to the proceeding and parties who might have appeared at thehearing, subject only to the right of direct appeal. All questions thatwere presented or might have been presented are considered to havebeen adjudicated by the order of the court, and no collateral attackupon the decision of the municipal legislative body or order of thecourt is permitted.
(f) If the court sustains the petition, or if it is sustained on appeal,the municipal legislative body may not institute any furtherproceedings for the construction of the sewage works described inthe ordinance or ordinances for a period of one (1) year after the dateof the order, unless the construction is required by a subsequentorder of the state department of environmental management to abatewater pollution.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.143-1985,SEC.198.
IC 36-9-23-12.5
User moving to new residence; forwarding final bill
Sec. 12.5. Whenever a sewer user moves to a different residencefrom the one being supplied sewer service, but within the samemunicipality, the sewer utility shall forward the user's final sewer billto the new address.
As added by P.L.349-1985, SEC.4.
IC 36-9-23-13
Preliminary expenses; payment from general fund; repaymentfrom bond proceeds
Sec. 13. (a) All necessary preliminary expenses actually incurredby the board before the issuance and delivery of revenue bonds,including expenses incurred in:
(1) making surveys;
(2) estimating costs and revenues;
(3) employing engineers or other employees;
(4) giving notices; and
(5) taking options;
may be paid in the manner prescribed by this section.
(b) The board shall, from time to time, certify the items ofexpense to the municipal fiscal officer, directing him to pay theamounts certified. The fiscal officer shall draw a warrant or warrantsin the correct amounts on the general fund, without appropriation. Ifthere is no money in the general fund, the fiscal officer shall requestthe municipal legislative body to transfer from other funds of themunicipality an amount sufficient to meet the items of expense, or tomake a temporary loan for this purpose. The legislative body shallcomply with the request promptly.
(c) Money transferred under subsection (b) shall be repaid by theboard to the fund from which it was taken, out of the first proceedsof the sale of revenue bonds and before any other disbursements aremade from those proceeds. The amount advanced to pay thepreliminary expenses constitutes a first charge against the proceeds
resulting from the sale of the revenue bonds until repaid.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-14
Condemnation; authority; security for damages to owner fromfailure to accept and pay for property; purchase or condemnationof existing works; option or contract; repair estimate
Sec. 14. (a) A municipality may, in the manner prescribed byIC 32-24, condemn:
(1) sewage works; and
(2) any land, easements, franchises, and other property itconsiders necessary for the construction of sewage works or forimprovements to sewage works.
However, the municipality may pay for any property condemned orpurchased only from money provided under this chapter.
(b) In any proceedings to condemn, orders that are just to themunicipality and to the owners of the property to be condemned maybe made. An undertaking or other security securing the propertyowners against any loss or damage resulting from the failure of themunicipality to accept and pay for the property may be required, butthe undertaking or security imposes liability upon the municipalityonly in the amount that may be paid from money provided under thischapter.
(c) If the board wants to purchase sewage works, it may obtainand exercise an option for the purchase of the works, or may enterinto a contract for the purchase in the manner and under the termsand conditions that it considers proper.
(d) If the board wants to purchase or condemn sewage worksalready constructed, it must, at or before the time of adoption of theordinance authorizing the acquisition, determine what repairs,replacements, additions, and other actions are required to make theworks effective for their purpose. An estimate of the cost of theseactions shall be included in the estimate of cost made under section11 of this chapter. These actions shall be taken upon the acquisitionof the works, as a part of the cost of the acquisition.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.2-2002,SEC.122.
IC 36-9-23-15
Acquisition of property subject to lien or other encumbrance
Sec. 15. Property upon which any lien or other encumbranceexists may not be acquired under this chapter unless, at the time theproperty is acquired, a sufficient sum of money is deposited in trustto pay and redeem the lien or encumbrance in full.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-16
Sewage treatment plant prerequisite; contracts and revenues;construction of connecting sewers; payment of cost; effect onmaturity date of bonds Sec. 16. (a) A municipality that does not have a sewage treatmentplant, and wants to acquire, construct, improve, operate, andmaintain sewage works other than a sewage treatment plant, mayproceed under this chapter only if it first contracts for the requiredtreatment of the sewage emanating from its works.
(b) A municipality owning and operating facilities for sewagetreatment may contract to treat all or part of the sewage of:
(1) any other municipality;
(2) any facility of the department of correction; or
(3) if a contract described in subdivision (2) is in effect, anyperson or entity, a municipal corporation, a private corporation,or a federal government facility that is located within five (5)miles of the sewer line connecting the municipality to thefacility of the department of correction under the contract.
The contracts must be authorized by ordinance and are subject toapproval by the department of environmental management accordingto rules adopted by the water pollution control board as to thesufficiency of the provision for sewage treatment.
(c) Unless otherwise provided in the authorizing ordinance orgoverning indenture, the revenues received by the owner under thecontract are considered a part of the revenues of the owner's sewagetreatment facilities, and shall be applied in accordance with theapplicable statutes.
(d) The necessary intercepting and connecting sewers andappurtenances to connect the sewage treatment facilities and sewageworks of the contracting parties may be constructed in part or inwhole by either of the contracting parties, as provided in the contract.For a municipality, the money to pay for this construction may beprovided by the issuance of bonds under the applicable statutes, aspart of the cost of the facilities or works of the respective parties.
(e) All bonds issued under this section are payable before theexpiration date of the contract. The parties may contract for the termsof the bonds, and for any term or terms beyond the last maturity ofthe bonds.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.143-1985,SEC.199; P.L.318-1989, SEC.1.
IC 36-9-23-17
Sources of funds
Sec. 17. (a) This chapter does not authorize a municipality tomake any contract or to incur any obligation that is not payablesolely from money provided under this chapter.
(b) Money for the costs of the sewage works or any improvementof the works may be provided only:
(1) by the issuance of revenue bonds of the municipality;
(2) from a cumulative fund established by the municipality forthat purpose; or
(3) by grant or loan from the federal government or any of itsagencies.
(c) A municipality obtaining a loan from the federal government
or a federal agency may issue its obligations under this chapter to thefederal government or federal agency to evidence its indebtedness.The obligations are not a corporate indebtedness of the municipality,are payable solely from the revenues of the sewage works, and maybe made of equal priority or subordinate to any other revenue bondsissued or to be issued under this chapter.
(d) Notwithstanding subsection (b), money to finance theconstruction of any of the self-liquidating works authorized by thischapter may be obtained from any state or federal agency.
(e) Notwithstanding subsection (b), any industrial cost recoveryreceived by the municipality and required to be paid by industrialusers under the terms of a federal grant are not considered revenuesunder this chapter. The municipal legislative body may use industrialcost recovery grants as provided by the terms of federal grants.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-18
Bonds; liability of municipality; interest; redemption; form;registration; sale; temporary bonds; additional bonds; exemptionfrom taxation
Sec. 18. (a) Revenue bonds issued under this chapter are payablesolely from the revenues of the sewage works for which they areissued, and are not a corporate indebtedness of the municipality.
(b) The revenue bonds bear interest at a rate not to exceed themaximum rate per annum specified by the municipal legislativebody, payable annually or at shorter intervals, and mature at the timeor times determined by ordinance.
(c) The revenue bonds may be made redeemable before maturityat the option of the municipality, to be exercised by the board, at notmore than their par value plus a premium of five percent (5%), underthe terms and conditions fixed by the ordinance authorizing theissuance of the bonds.
(d) The principal and interest of the revenue bonds may be madepayable in any lawful medium.
(e) The ordinance authorizing the issuance of the revenue bondsmust determine the form of the bonds, including any interest couponsto be attached to them, and must fix the denomination ordenominations of the bonds and the place or places of payment oftheir principal and interest, which may be at any bank or trustcompany in Indiana or another state.
(f) The revenue bonds must contain a statement on their face thatthe municipality is not obligated to pay the principal or interest onthem, except from the special fund provided from the net revenuesof the sewage works.
(g) The revenue bonds are negotiable instruments.
(h) Provision may be made for the registration of any of therevenue bonds in the name of the owner as to principal alone, or asto both principal and interest, but fully registered bonds shall bemade convertible to coupon bonds at the option of the registeredowner. (i) The revenue bonds shall be executed in the same manner asother revenue bonds issued by municipalities are executed.
(j) The revenue bonds shall be sold by the municipal fiscal officerin the manner that is determined to be in the best interests of themunicipality, but at not less than par value and only at public sale inaccordance with the statutes concerning the sale of municipal bonds.
(k) Before the preparation of the definite revenue bonds,temporary revenue bonds may be issued with or without coupons.The temporary revenue bonds, which shall be issued in the mannerprescribed by this section, may be exchanged for the definite revenuebonds when they are issued.
(l) If the proceeds of the revenue bonds are less than the cost ofthe sewage works, additional revenue bonds may be issued under thissection to provide the amount of the deficit. Unless otherwiseprovided in the ordinance authorizing the first issue, or in the trustindenture authorized by section 22 of this chapter, the additionalrevenue bonds are considered part of the first issue and are entitledto payment from the same fund, without priority for the first issue.
(m) Subject to the provisions and limitations of any ordinance ortrust indenture pertaining to any outstanding revenue bonds,additional bonds payable from the revenues of the sewage works maybe authorized and issued in the manner prescribed by this section, forthe purpose of improving any works acquired or constructed underthis chapter.
(n) Revenue bonds issued under this section are exempt fromtaxation for all purposes.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-19
Bonds; actions to contest validity; limitations
Sec. 19. Any action to contest the validity of revenue bonds issuedunder this chapter must be brought at least five (5) days before theadvertised date for the sale of the bonds.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-20
Bonds; disposition of proceeds; lien of holders or trustee
Sec. 20. (a) The first proceeds of any revenue bonds issued underthis chapter shall be used to repay all amounts advanced forpreliminary expenses under section 13 of this chapter. The remainingproceeds of the bond issue shall be applied to the cost of acquiring,constructing, or improving the sewage works.
(b) After the payments required by subsection (a) have been made,any proceeds of the bond issue that have not been spent shall bedeposited in the sinking fund established by section 21 of thischapter.
(c) The holders of the revenue bonds, or the trustees under section22 of this chapter, have a lien on the bond proceeds until they areapplied under this section.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-21
Bonds; sinking fund
Sec. 21. At or before the time of issuance of revenue bonds underthis chapter, the municipal legislative body, by ordinance, shall:
(1) establish a sinking fund for the payment of:
(A) the principal of and interest on the bonds; and
(B) the charges of banks or trust companies for making paymentof the principal or interest; and
(2) pledge the net revenues of the sewage works, after thepayment of the reasonable expense of operation, repair, andmaintenance of the works, to the payment of the expensesdescribed in subdivision (1).
The ordinance may also provide for the accumulation of reasonablereserves in the sinking fund as a protection against default, and forthe payment of premiums on bonds retired by call or purchase underthis chapter.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-22
Bonds; security by trust indenture permitted; terms of indenture
Sec. 22. (a) The municipal legislative body may secure revenuebonds issued under this chapter by a trust indenture between themunicipality and a corporate trustee, which may be any trustcompany or bank having the powers of a trust company in Indiana,or another state. However, such a trust indenture may not convey ormortgage any part of the sewage works.
(b) The ordinance authorizing the revenue bonds may providethat:
(1) the trust indenture may contain reasonable provisions forprotecting and enforcing the rights and remedies of thebondholders, including covenants setting forth the duties of themunicipality and the board in relation to:
(A) the construction, acquisition, improvement, operation,repair, maintenance, and insurance of the sewage works; and
(B) the custody, safeguarding, and application of all money; and
(2) the works shall be contracted for, constructed, and paid forunder the supervision and approval of consulting engineersemployed or designated by the board and satisfactory to theoriginal bond purchasers or their successors, assigns, ornominees, who may be given the right to specify the security tobe given by contractors and by any depository of the proceedsof bonds, revenues of the works, or other money pertaining tothe works.
(b) The trust indenture may set forth the rights and remedies ofthe bondholders and trustee, restricting the individual right of actionof bondholders as is customary in a trust indenture securing bondsand debentures of corporations. Except as otherwise provided in thischapter, the municipal legislative body may, by ordinance or in thetrust indenture, specify:
(1) the officer, board, or depository that shall collect the
proceeds of the sale of the bonds and the revenues of thesewage works; and
(2) the method of disbursing the proceeds and revenues.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-23
Bonds; enforcement rights of holders; receivership
Sec. 23. (a) The rights granted by this section are subject to anyrestrictions contained in the ordinance authorizing the issuance ofrevenue bonds or in any trust indenture securing the bonds.
(b) The holder of any revenue bonds or any coupons attached tothem, and the trustee, if any, may, either at law or in equity, protectand enforce all rights granted by this chapter or under the ordinanceor trust indenture, including the making and collecting of reasonableand sufficient fees for services rendered by the sewage works.
(c) If the principal or interest of any of the revenue bonds is notpaid on the date named in the bonds for payment, any court havingjurisdiction of the action may appoint a receiver to administer thesewage works on behalf of the municipality, the bondholders, and thetrustee, if any. The receiver may:
(1) charge and collect fees sufficient to provide for the paymentof the expenses of operation, repair, and maintenance of theworks;
(2) pay any revenue bonds and interest outstanding; and
(3) apply the revenues in conformity with this chapter, theordinance authorizing the bond issue, and the trust indenture, ifany.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-24
Fees; municipality subject to fees of sewage works
Sec. 24. The municipality is subject to the fees established underthis chapter or to fees established in harmony with this chapter, forservices rendered the municipality, and shall pay the fees when due.The fees are considered part of the revenues of the sewage works andare subject to the disposition authorized or required for otherrevenues of the works.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-25
Fees; factors used to establish; persons obligated to pay;disposition of certain fees; adoption of different schedulespermitted
Sec. 25. (a) Subject to section 37 of this chapter, the municipallegislative body shall, by ordinance, establish just and equitable feesfor the services rendered by the sewage works, and provide the dateson which the fees are due.
(b) Just and equitable fees are the fees required to maintain thesewage works in the sound physical and financial conditionnecessary to render adequate and efficient service. The fees must be
sufficient to:
(1) pay all expenses incidental to the operation of the works,including legal expenses, maintenance costs, operating charges,repairs, lease rentals, and interest charges on bonds or otherobligations;
(2) provide the sinking fund required by section 21 of thischapter;
(3) provide adequate money to be used as working capital; and
(4) provide adequate money for improving and replacing theworks.
Fees established after notice and hearing under this chapter arepresumed to be just and equitable.
(c) The fees are payable by the owner of each lot, parcel of realproperty, or building that:
(1) is connected with the sewage works by or through any partof the municipal sewer system; or
(2) uses or is served by the works.
Unless the municipal legislative body finds otherwise, the works areconsidered to benefit every lot, parcel of real property, or buildingconnected or to be connected with the municipal sewer system as aresult of construction work under the contract, and the fees shall bebilled and collected accordingly.
(d) The municipal legislative body may use one (1) or more of thefollowing factors to establish the fees:
(1) A flat charge for each sewer connection.
(2) The amount of water used on the property.
(3) The number and size of water outlets on the property.
(4) The amount, strength, or character of sewage dischargedinto the sewers.
(5) The size of sewer connections.
(6) Whether the property has been or will be required to payseparately for any part of the sewage works.
(7) Whether the property, although vacant or unimproved, isbenefited by a local or lateral sewer because of the availabilityof that sewer. However, the owner must have been notified, byrecorded covenants and restrictions or deed restrictions in thechain of title of his property, that a fee or assessment for seweravailability may be charged, and the fee may reflect only thecapital cost of the sewer and not the cost of operation andmaintenance of the sewage works.
(8) The cost of collecting, treating, and disposing of garbage ina sanitary manner, including equipment and wages.
(9) The amount of money sufficient to compensate themunicipality for the property taxes that would be paid on thesewage works if the sewage works were privately owned.
(10) Any other factors the legislative body considers necessary.
Fees collected under subdivision (8) may be spent for that purposeonly after compliance with all provisions of the ordinanceauthorizing the issuance of the revenue bonds for the sewage works.The board may transfer fees collected in lieu of taxes under
subdivision (9) to the general fund of the municipality.
(e) The municipal legislative body may exercise reasonablediscretion in adopting different schedules of fees, or makingclassifications in schedules of fees, based on variations in:
(1) the costs, including capital expenditures, of furnishingservices to various classes of users or to various locations; or
(2) the number of users in various locations.
As added by Acts 1981, P.L.309, SEC.96. Amended by Acts 1981,P.L.317, SEC.23; P.L.35-1990, SEC.70; P.L.114-2008, SEC.29.
IC 36-9-23-26
Fees; hearing; notice; adoption; readjustment
Sec. 26. (a) After the introduction of the ordinance establishingfees under section 25 of this chapter, but before it is finally adopted,the municipal legislative body shall hold a public hearing at whichusers of the sewage works, owners of property served or to be servedby the works, and other interested persons may be heard concerningthe proposed fees. Notice of the hearing, setting forth the proposedschedule of fees, shall be:
(1) published in accordance with IC 5-3-1;
(2) mailed to owners of vacant or unimproved property if theordinance includes a fee for sewer availability to vacant orunimproved property; and
(3) mailed to users of the sewage works located outside themunicipality's corporate boundaries.
The notice may be mailed in any form so long as the notice of thehearing is conspicuous. The hearing may be adjourned from time totime.
(b) After the hearing, the municipal legislative body shall adoptthe ordinance establishing the fees, either as originally introduced oras modified. A copy of the schedule of fees adopted shall be kept onfile and available for public inspection in the offices of the board andthe municipal clerk.
(c) Subject to section 37 of this chapter, the fees established forany class of users or property shall be extended to cover anyadditional property that is subsequently served and falls within thesame class, without any hearing or notice.
(d) The municipal legislative body may change or readjust thefees in the same manner by which they were established.
(e) Fees collected under this chapter are considered revenues ofthe sewage works.
As added by Acts 1981, P.L.309, SEC.96. Amended by Acts 1981,P.L.45, SEC.62; P.L.77-1991, SEC.4; P.L.114-2008, SEC.30.
IC 36-9-23-26.1
Objections to rates and charges; bonds; hearings
Sec. 26.1. (a) Owners of property connected or to be connected toand served by the sewage works authorized under this chapter mayfile a written petition objecting to the rates and charges of the sewageworks so long as: (1) the petition contains the names and addresses of thepetitioners;
(2) the petitioners attended the public hearing provided undersection 26 of this chapter;
(3) the written petition is filed with the municipal legislativebody within five (5) days after the ordinance establishing therates and charges is adopted under section 26 of this chapter;and
(4) the written petition states specifically the ground or groundsof objection.
(b) Unless the objecting petition is abandoned, the municipal clerkshall file in the office of the clerk of the circuit or superior court ofthe county a copy of the rate ordinance or ordinances together withthe petition. The court shall then set the matter for hearing at theearliest date possible, which must be within twenty (20) days afterthe filing of the petition with the court. The court shall send noticeof the hearing by certified mail to the municipality and to the firstsigner of the petition at the address shown on the petition. Allinterested parties shall appear in the court without further notice, andthe municipality may not conduct any further proceedings concerningthe rates and charges until the matters presented by the petition havebeen heard and determined by the court.
(c) At the discretion and upon direction of the court, thepetitioners shall file with the petition a bond in the sum and with thesecurity fixed by the court. The bond must be conditioned on thepetitioners' payment of all or part of the costs of the hearing and anydamages awarded to the municipality if the petition is denied, asordered by the court.
(d) Upon the date fixed in the notice, the court shall, without ajury, hear the evidence produced. The court may confirm thedecision of the municipal legislative body or sustain the objectingpetition. The order of the court is final and conclusive upon allparties to the proceeding and parties who might have appeared at thehearing, subject only to the right of direct appeal. All questions thatwere presented or might have been presented are considered to havebeen adjudicated by the order of the court, and no collateral attackupon the decision of the municipal legislative body or order of thecourt is permitted.
(e) If the court sustains the petition, or if it is sustained on appeal,the municipal legislative body shall set the rates and charges inaccordance with the decision of the court.
As added by P.L.77-1991, SEC.5.
IC 36-9-23-27
Fees; collection upon commencement of construction; amount
Sec. 27. After a contract for the construction of sewage works hasbeen let and actual work has commenced, the municipality may billand collect fees for the services to be rendered, in an amountsufficient to pay:
(1) the interest on the revenue bonds; and (2) other expenses payable before the completion of the works.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-28
Deposit to ensure payment of fees; amount of deposit; refund;forfeiture; use to pay judgment; unclaimed deposits
Sec. 28. (a) The legislative body of a municipality that operatessewage works under this chapter may, by ordinance, require theowners, lessees, or users of property served by the works to pay adeposit to ensure payment of sewer fees.
(b) The deposit required may not exceed the estimated averagepayment due from the property served by the sewage works for athree (3) month period. The deposit must be retained in a separatefund.
(c) The deposit, less any outstanding penalties and service fees,shall be refunded to the depositor after a notarized statement fromthe depositor that as of a certain date the property being served:
(1) has been conveyed or transferred to another person; or
(2) no longer uses or is connected with any part of themunicipal sewage system.
A statement under subdivision (1) must include the name and addressof the person to whom the property is conveyed or transferred.
(d) If a depositor fails to satisfy costs and fees within sixty (60)days after the termination of his use or ownership of the propertyserved, he forfeits his deposit and all accrued interest. The forfeitedamount shall be applied to the depositor's outstanding fees. Anyexcess that remains due after application of the forfeiture may becollected in the manner prescribed by section 31 or 32 of thischapter.
(e) A deposit may be used to satisfy all or part of any judgmentawarded the municipality under section 31 of this chapter.
(f) A deposit made under this section that has remained unclaimedby the depositor for more than seven (7) years after the terminationof the services for which the deposit was made becomes the propertyof the municipality. IC 32-34-1 (unclaimed property) does not applyto a deposit described in this subsection.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.236-1993,SEC.2; P.L.31-1995, SEC.8; P.L.2-2002, SEC.123.
IC 36-9-23-28.5
Unclaimed overpayments of sewer fees becoming property ofmunicipality
Sec. 28.5. (a) This section does not apply to a deposit made undersection 28 of this chapter.
(b) IC 32-34-1 does not apply to an overpayment described insubsection (d).
(c) As used in this section, "payor" refers to the owner, lessee, oruser of property served by the sewage works who has paid for servicefrom the sewage works.
(d) An overpayment of sewer fees that remains unclaimed by a
payor for more than seven (7) years after the termination of theservice for which the overpayment was made becomes the propertyof the municipality.
As added by P.L.40-1996, SEC.12. Amended by P.L.2-2002,SEC.124.
IC 36-9-23-29
Connections to sewer by abutting property; approval required;fees; liens; disposition of fees
Sec. 29. (a) If, as part of the construction of sewage works underthis chapter, a municipality constructs a sewer suitable for use as alocal or lateral sewer by abutting or adjoining property, it may chargea fee for connections to the sewer. The fee must be based on the prorata cost of constructing a local or lateral sewer sufficient to servethe property.
(b) The board may approve or disapprove applications forconnections and may fix the amount of the connection fee.
(c) A person who applies for a connection shall agree to pay theconnection fee. If payment is not made as agreed, the fee constitutesa lien on the property for which the connection is made. Such a lienmay be enforced in the manner prescribed by section 34 of thischapter.
(d) The municipal legislative body shall determine by ordinancewhether the proceeds of connection fees collected under this sectionand other laws are to be used as:
(1) net revenues of the sewage works;
(2) payment toward the cost of construction of the works; or
(3) payment toward the cost of improving the works in thefuture.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-30
Municipal power to require connections to sewer anddiscontinuance of privies, cesspools, septic tanks, and similarstructures; conditions; penalties; court order; attorney's fees
Sec. 30. (a) Subject to subsection (b), a municipality that operatessewage works under this chapter or under any statute repealed byIC 19-2-5-30 (repealed September 1, 1981) may require:
(1) connection to its sewer system of any property producingsewage or similar waste; and
(2) discontinuance of the use of privies, cesspools, septic tanks,and similar structures.
(b) A municipality may exercise the powers granted by subsection(a) only if:
(1) there is an available sanitary sewer within three hundred(300) feet of the property line of the affected property; and
(2) it has given notice by certified mail to the property owner atthe address of the property, at least ninety (90) days before thedate specified for connection in the notice.
(c) A municipality may establish, enforce, and collect reasonable
penalties for failure to make a connection under this section.
(d) A municipality may apply to the circuit or superior court forthe county in which it is located for an order to require a connectionunder this section. The court shall assess the cost of the action andreasonable attorney's fees of the municipality against the propertyowner in such an action.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.3-1990,SEC.135.
IC 36-9-23-31
Fees; nonpayment; delinquency penalty; civil action to recover
Sec. 31. If fees assessed against real property under this chapteror any statute repealed by IC 19-2-5-30 (repealed September 1, 1981)are not paid within the time fixed by the municipal legislative body,they are delinquent. A penalty of ten percent (10%) of the amount ofthe fees attaches to the delinquent fees. The amount of the fee, thepenalty, and a reasonable attorney's fee may be recovered by theboard in a civil action in the name of the municipality.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.3-1990,SEC.136.
IC 36-9-23-32
Fees; nonpayment; creation of lien; priority; time of attachment;notice; subsequent owners; release
Sec. 32. (a) Fees assessed against real property under this chapteror under any statute repealed by IC 19-2-5-30 constitute a lienagainst the property assessed. The lien is superior to all other liensexcept tax liens. Except as provided in subsections (b) and (c), thelien attaches when notice of the lien is filed in the county recorder'soffice under section 33 of this chapter.
(b) A fee is not enforceable as a lien against a subsequent ownerof property unless the lien for the fee was recorded with the countyrecorder before the conveyance to the subsequent owner. If theproperty is conveyed before the lien can be filed, the municipalityshall notify the person who owned the property at the time the feebecame payable. The notice must inform the person that payment,including penalty fees for delinquencies, is due not more than fifteen(15) days after the date of the notice. If payment is not receivedwithin one hundred eighty (180) days after the date of the notice, theamount due may be expensed as a bad debt loss.
(c) A lien attaches against real property occupied by someoneother than the owner only if the utility notified the owner withintwenty (20) days after the time the utility fees became sixty (60) daysdelinquent. However, the utility is required to give notice to theowner if the owner has given the general office of the utility writtennotice of the address to which the owner's notice is to be sent. Anotice sent to the owner under this subsection must be sent bycertified mail, return receipt requested, or an equivalent servicepermitted under IC 1-1-7-1 to:
(1) the owner of record of real property with a single owner; or (2) at least one (1) of the owners of real property with multipleowners;
at the last address of the owner for the property as indicated in therecords of the county auditor on the date of the notice. The cost ofsending notice under this subsection is an administrative cost thatmay be billed to the owner.
(d) The municipality shall release:
(1) liens filed with the county recorder after the recorded dateof conveyance of the property; and
(2) delinquent fees incurred by the seller;
upon receipt of a verified demand in writing from the purchaser. Thedemand must state that the delinquent fees were not incurred by thepurchaser as a user, lessee, or previous owner, and that the purchaserhas not been paid by the seller for the delinquent fees.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.131-2005,SEC.7; P.L.113-2010, SEC.153.
IC 36-9-23-33
Unpaid fees and penalties
Sec. 33. (a) An officer described in subsection (b) may deferenforcing the collection of unpaid fees and penalties assessed underthis chapter until the unpaid fees and penalties have been due andunpaid for at least ninety (90) days.
(b) Except as provided in subsection (l), the officer charged withthe collection of fees and penalties assessed under this chapter shallenforce their payment. As often as the officer determines is necessaryin a calendar year, the officer shall prepare either of the following:
(1) A list of the delinquent fees and penalties that areenforceable under this section, which must include thefollowing:
(A) The name or names of the owner or owners of each lotor parcel of real property on which fees are delinquent.
(B) A description of the premises, as shown by the recordsof the county auditor.
(C) The amount of the delinquent fees, together with thepenalty.
(2) An individual instrument for each lot or parcel of realproperty on which the fees are delinquent.
(c) The officer shall record a copy of each list or each individualinstrument with the county recorder who shall charge a fee forrecording the list or each individual instrument in accordance withthe fee schedule established in IC 36-2-7-10. The officer shall thenmail to each property owner on the list or on an individual instrumenta notice stating that a lien against the owner's property has beenrecorded. Except for a county having a consolidated city, a servicecharge of five dollars ($5), which is in addition to the recording feecharged under this subsection and under subsection (f), shall beadded to each delinquent fee that is recorded.
(d) This subsection applies only to a county containing aconsolidated city. Using the lists and instruments prepared under
subsection (b) and recorded under subsection (c), the officer shallcertify to the county auditor a list of the liens that remain unpaidaccording to a schedule agreed upon by the county treasurer and theofficer for collection with the next cycle's property tax installment.The county and its officers and employees are not liable for anymaterial error in the information on the list.
(e) Using the lists and instruments prepared under subsection (b)and recorded under subsection (c), the officer shall, not later than ten(10) days after the list or each individual instrument is recordedunder subsection (c), certify to the county auditor a list of the liensthat remain unpaid for collection in the next May. The county and itsofficers and employees are not liable for any material error in theinformation on this list.
(f) The officer shall release any recorded lien when the delinquentfees, penalties, service charges, and recording fees have been fullypaid. The county recorder shall charge a fee for releasing the lien inaccordance with IC 36-2-7-10.
(g) On receipt of the list under subsection (e), the county auditorof each county shall add a fifteen dollar ($15) certification fee foreach lot or parcel of real property on which fees are delinquent,which fee is in addition to all other fees and charges. The countyauditor shall immediately enter on the tax duplicate for themunicipality the delinquent fees, penalties, service charges,recording fees, and certification fees, which are due not later than thedue date of the next installment of property taxes. The countytreasurer shall then include any unpaid charges for the delinquentfee, penalty, service charge, recording fee, and certification fee to theowner or owners of each lot or parcel of property, at the time thenext cycle's property tax installment is billed.
(h) After certification of liens under subsection (e), the officermay not collect or accept delinquent fees, penalties, service charges,recording fees, or certification fees from property owners whoseproperty has been certified to the county auditor. This subsectiondoes not apply to a county containing a consolidated city.
(i) If a delinquent fee, penalty, service charge, recording fee, andcertification fee are not paid, they shall be collected by the countytreasurer in the same way that delinquent property taxes arecollected.
(j) At the time of each semiannual tax settlement, the countytreasurer shall certify to the county auditor all fees, charges, andpenalties that have been collected. The county auditor shall deductthe service charges and certification fees collected by the countytreasurer and pay over to the officer the remaining fees and penaltiesdue the municipality. The county treasurer shall retain the servicecharges and certification fees that have been collected, and shalldeposit them in the county general fund.
(k) Fees, penalties, and service charges that were not recordedbefore a recorded conveyance shall be removed from the tax roll fora purchaser who, in the manner prescribed by section 32(d) of thischapter, files a verified demand with the county auditor. (l) A board may write off a fee or penalty under subsection (a)that is for less than forty dollars ($40).
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.354-1987,SEC.1; P.L.45-1990, SEC.8; P.L.1-1993, SEC.249; P.L.57-1993,SEC.18; P.L.88-1995, SEC.11; P.L.236-1997, SEC.1; P.L.10-1997,SEC.36; P.L.98-2000, SEC.29; P.L.171-2002, SEC.2; P.L.174-2003,SEC.1; P.L.39-2008, SEC.6.
IC 36-9-23-34
Liens; foreclosure; attorney's fees
Sec. 34. (a) A municipality or board may foreclose a lienestablished by this chapter in order to collect fees and penalties. Themunicipality or board shall recover the amount of the fees andpenalties, and a reasonable attorney's fee. The court shall order thesale to be made without relief from valuation or appraisement laws.
(b) Except as otherwise provided by this chapter, actions underthis chapter are subject to the general statutes regarding municipalpublic improvement assessments.
As added by Acts 1981, P.L.309, SEC.96.
IC 36-9-23-35
Proceedings under other chapters not required; powers ofdepartment of environmental management, water pollution controlboard, and state department of health not affected
Sec. 35. No proceedings other than those prescribed by thischapter are required for:
(1) the construction or acquisition of sewage works;
(2) the issuance or sale of bonds; or
(3) the establishment of fees;
under this chapter. However, the functions, powers, and duties of thedepartment of environmental management, the water pollutioncontrol board, and the state department of health are not affected bythis chapter.
As added by Acts 1981, P.L.309, SEC.96. Amended by P.L.143-1985,SEC.200; P.L.2-1992, SEC.894.
IC 36-9-23-36
Municipal powers; areas outside corporate boundaries
Sec. 36. (a) Except as provided in subsections (b) and (c), amunicipality may exercise powers granted by this chapter in areaswithin ten (10) miles outside its corporate boundaries.