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Friday, September 16, 2005

Ind. Decisions - City takeover of Fort Wayne utility blocked

As reported today in a story by Niki Kelly in the Fort Wayne Journal Gazette:

The city of Fort Wayne’s plans to forcefully obtain Aqua Indiana’s north water system took a major hit Thursday when the Indiana Court of Appeals ruled the city used the wrong procedure to initiate condemnation proceedings.

The 2-1 decision reverses an earlier trial court judgment by Allen Circuit Court Judge Thomas Felts.

The city started an eminent domain action in 2002 to acquire the utility’s north system, which serves about 8,000 customers who have mostly been annexed into the north side of Fort Wayne. * * *

According to Thursday’s ruling, there is a general state law regarding a city’s right to eminent domain and a separate law more specific to utilities.

The city filed its action using the more general rule, and Aqua Indiana sued, saying the city must follow the specific utility statute, which was enacted in 1999.

It is the first time the Indiana Court of Appeals has ruled on the question of the competing statutes, and the court found the city is required to use the more specific statute related directly to utilities.

The court also ruled the 1999 statute is not limited to only “troubled” utilities, something the city had argued and the Indiana Utility Regulatory Commission had found in a separate matter in 2001.

The 1999 statute was authored by Sen. David Long, R-Fort Wayne, who signed an affidavit in the case that was not allowed into evidence. * * * Because of Long’s law, the process the city must now use is very different and potentially puts the project in jeopardy. * * *

A dissent filed by Judge Margret Robb said the end result of Thursday’s decision is that cities can only buy troubled utilities. She doesn’t think that’s what the legislature intended and believes that in the absence of a troubled utility the regular eminent domain statute applies.

The case is Utility Center, Inc. v. City of Fort Wayne, and was the focus of this ILB entry yesterday, that looked particularly at the ruling's discussions of "the question of the admissibility of the affidavit of a state senator as to his intent in authoring a piece of legislation."

Posted by Marcia Oddi on September 16, 2005 06:19 AM
Posted to Ind. App.Ct. Decisions