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Portage City Hall

Portage City Hall

Tony V. Martin, The Times

PORTAGE — The discord between Mayor James Snyder and members of the City Council over the operation of the Utility Services Board is continuing.

Snyder recently sought an opinion from an Indianapolis law firm on the legality of the operation of the Utility Services Board, in particular since its control was taken from his hands by the City Council last March.

A memorandum from Bingham Greenebaum Doll, made public last week, concludes the present USB has no authority to supervise and control the city's sanitary sewer utility. Because a utility service board only has the authority to control "municipally owned utilities," it is governed by a different state code than under which the board was formed in 2009, and the present USB was improperly created and fails to comply with the correct state code, according to the memo.

Traditionally, the mayor has served as the chairman of the USB. However, citing concerns about Snyder's spending habits, including attempting to use $93,000 of USB funds to pay his personal legal bills involving his federal public corruption indictment, the City Council moved early last year to take over control of the USB, which includes both the city's sanitary sewer and stormwater departments. The present USB was formed in 2009, consolidating previously separate boards that individually controlled the two departments. Even before the consolidation, the mayor was the traditional head of the sanitary sewer board.

City Attorney Gregg Sobkowski said Snyder sought the opinion after talking to several people who indicated they didn't believe the council's takeover of the USB was legal. Snyder referred all questions on the matter to Sobkowski.

"He sought the decision to determine if it is right or not," Sobkowski said, adding, "I reviewed the memo, and it seems to me it is right. I agree with his (consultant's) opinion."

USB and City Council attorney Ken Elwood isn't so sure.

"We find it interesting that the mayor was chair of the board for six years before he attacks the validity of the board," said Elwood, who said he has reviewed the document and doesn't think it is correct.

Elwood, who was city attorney in 2009 under then Mayor Olga Velazquez, said he is researching the issue.

Elwood said that back then consultants and bond counsel recommended the combination of the two boards to allow for more bonding power. After the two boards consolidated, the USB issued a $10 million bond that funded the Stone Avenue stormwater project.

"His concern is that the council is in control," Elwood said, adding the mayor is claiming all actions by the USB prior to March 1, 2017, are valid, but those taken after that date — when the City Council took control — are invalid.

That concern, said Clerk-Treasurer Chris Stidham, has caused the USB to delay implementing a new stormwater fees system adopted by the USB and City Council last year. 

The new system altered fees from being based on water meter size to impervious surface measurements. The change affected only businesses and industries.

Stidham said they did not implement the new fee system in January as scheduled because of concerns over Snyder's action and the possibility of a lawsuit challenging the USB's operations. He added the new fee system would generate an additional $116,000 per month for the USB.

Sobkowski said there is no plan at present for a lawsuit.

"The plan has been to get this information to the council and Ken. Assuming it is right, we want to come up with a plan to properly organize to a different system," Sobkowski said, adding it would likely go back to a two-board system like prior to 2009. "Our hope is that we will come to an agreement."

The USB has called an executive session for Feb. 6, prior to their regular public meeting, to discuss Elwood's findings.


Porter County reporter

Joyce has been a reporter for more than 38 years, including 23 years with The Times. She covers municipal and school government in Valparaiso and Portage.