Decatur Introduces 15% Water Rate Increase Tied to Lead Line Replacement

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DECATUR, Ind. — The Decatur City Council on Tuesday introduced a 15% water rate increase tied to the city’s major water infrastructure project, setting up a public hearing and final vote for early June.

The increase is needed to cover new annual debt service associated with the State Revolving Fund financing (SRF) package the city is using to replace aging water mains and remove lead service lines. Financial advisor Jennifer Wilson of Crowe told council members the new SRF loans add $726,921 in yearly debt payments that were not included in the city’s previous rate plan.

Decatur is receiving what bond counsel described as an unusually favorable package: $5.5 million in grants, a $2.5 million loan at 0% interest, and $14 million at 2.98% over 35 years. Bond attorney Kim Blanchet of Barnes & Thornburg called it “one of the best SRF funding packages” she has seen.

For typical residential customers using 5,000 to 7,000 gallons per month, the increase would add $8 to $10.80 to monthly bills inside the city and $9.90 to $13.50 for customers outside city limits.

Wilson said she does not anticipate another rate adjustment for at least five years, noting that the city’s debt service will remain stable for more than a decade.

The water project, now in the bidding phase, is expected to begin construction around August. Engineers estimate the city may have as many as 2,000 lead service lines, though ongoing potholing has revealed more copper and poly lines than originally expected.

Ordinance Timeline

  • May 19: The council introduced the water rate ordinance (2026‑10) on first reading and tabled it until the next meeting.
  • By May 23: The city will publish legal notice of the required public hearing at least 10 days before adoption.
  • June 2: The council will hold the public hearing, then consider final adoption of the rate ordinance and the companion bond ordinance (2026‑11).
  • June 11: A virtual pre‑closing with SRF is scheduled.
  • June 25: The city expects to close on the financing, allowing construction contracts to be issued.

 

 

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