SALEM, Indiana — Talks stalled to update the water system in Salem, Indiana last week, after the city council denied a $3.3 million bond to replace a large amount of the system.
The mayor and city staff were proposing to raise water rates as much as 40% over three years to replace 10,000 linear ft. of water lines, including watermains, 135 service lines, fire hydrants and valves. The work would be done along Main Street/State Road 135.
In the 3-2 vote, the majority said the city couldn’t manage any more debt, and that this proposal “contained an extreme amount of non-construction-related costs.”
“We can’t allow our water department and wastewater department to keep running in the red. I mean, it just can’t happen,” Councilman Dylan Moore said before voting “no.”
WHAS11 was the first station to report about brown water concerns in Salem in early October.
Soon after, the FOCUS team found the city had a roughly two-year history of not doing all required water tests, and not notifying residents in a timely manner.
Salem was fined $7,762 by the Indiana Department of Environmental Management for these issues. IDEM spokesperson Barry Sneed said Salem was released from the legal order on November 1, 2022.
Sneed has also repeatedly said the water in Salem is safe to drink.
Councilmen Moore, Roger Pennington and Randy Lee voted against the $3.3 million bond on February 12. They provided a joint statement explaining their vote:
“As members of the City of Salem Common Council, we take our fiduciary obligations very seriously. Considering the mayor’s proposal to increase water rates again by more than 40% over the next three years, while also increasing the city’s debt by more than $3 million. We believe it is in the best interest of the residents of this community that we pursue another route,” the statement said. “This proposal also contained an extreme amount of non-construction-related cost. In light of the fact that our city currently holds more than $25 million in debt (approximately 13 million of that in water utility)…we must find creative and efficient solutions to reduce the burden on our residents."
Mayor Justin Green responded over email late Thursday afternoon and said, “USDA loan is being paid,” in response to the $13 million in water utility debt.
He also said, “Hopefully further discussions will be had,” when discussing what is next for the water system updates.
Green said there is currently no issues with Salem’s drinking water, and this effort is purely preventative.
Councilmen Steve Crane and Danny Libka voted yes on the proposal. Crane sent a statement over text.
“I felt like it made sense considering our water line infrastructure from the south side of the Courthouse to the edge of the city limits at Becks Mill Rd. is over 80 years old. Obviously, this would be a major expense for the city, but it should be considered a ‘need’ not a ‘want’. We can choose to pay now or risk paying much more in the future due to constant rising costs and inflation,” Crane said.
City officials and their financial consultants said on Feb. 12 that water rates are still likely going to go up because of inflation and other factors. A water rate increase meeting is scheduled for Monday Feb. 26.
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