Lebanon Utilities Water Capacity

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1. Overview

Our Lebanon City government has created its own water shortage, and wants our utility ratepayers to foot the bill. There is a considerable risk that current Lebanon Utilities water ratepayers will have to pay up front with rate increases for additional water sources that developers need to profitably complete their projects.

2. Development & Capacity Summary Table

This Development & Capacity Summary Table was presented to the Lebanon Utilities Service Board on October 4, 2023. This Table lists Equivalent Dwelling Units (EDUs). NOTE: A more readable PDF version of this Table is available upon request to taxless3@comcast.net.

3. Conversion of Equivalent Dwelling Units to Gallons Of Water Per Day

NOTE: The Water EDUs (Equivalent Dwelling Units) in the preceding Development & Capacity Summary Table are converted to Gallons Of Water Per Day.

3.1 WATER EDU DEFINITION: Indiana law requires the Indiana Department of Environmental Management (IDEM) to use for regulatory purposes a water capacity Equivalent Dwelling Unit (EDU) of 500 gallons per day. 

3.2 WATER SYSTEM CAPACITY: Lebanon Utilities can now provide customers up to 3.22 million gallons of water per day (6,440 water EDUs multiplied by 500 gallons per day per water EDU). 

3.3 CURRENT WATER USAGE: Lebanon Utilities now provides to current customers 1.66 million gallons of water per day (3,320 water EDUs multiplied by 500 gallons per day per water EDU).

3.4 AVAILABLE WATER FOR ALL FUTURE CUSTOMERS: Lebanon Utilities now has up to 1.56 million gallons of water per day available for future customers (3.22 million gallons capacity less 1.66 million gallons currently used). 

3.5 WATER CAPACITY ALLOCATED TO 17 FUTURE CUSTOMERS: Seventeen future customers have paid their water availability fees to reserve for their use a total of 1.235 million gallons of water a day (2,470 water EDUs multiplied by 500 gallons per day per water EDU). 

3.6 WATER CAPACITY AVAILABLE FOR 25 MORE FUTURE CUSTOMERS: There is up to 325,000 gallons of water a day available for the identified 25 future customers who have not yet paid their water availability fees to reserve the water they need (650 water EDUs multiplied by 500 gallons per day per water EDU).

3.7 WATER CAPACITY NEEDED BY 25 MORE FUTURE CUSTOMERS: Twenty-five identified future customers will need a total of 4.276 million gallons of water a day (8,552 water EDUs multiplied by 500 gallons per day per water EDU). NOTE: Water for the LEAP 1 (south of Eli Lilly) project of 1,240 EDUs (620,000 gallons per day) is not supposed to be provided by the City’s water resources – but is supposed to be provided by the Indiana Economic Development Corporation (IEDC) through an agreement with Indiana American Water Company and/or Citizen Energy Group to provide up to 15 million gallons of water a day.

3.8 WATER CAPACITY SHORTFALL: Lebanon Utilities will need additional water sources that provide at least 3.951 million gallons of water a day (4.276 million gallons needed less 0.325 million gallon available) to meet the needs of just the presently identified 42 future customers who have presented preliminary concept plans to the City.

3.9 ADDITIONAL IEDC WATER SOURCE: Lebanon Utilities has an agreement with the IEDC where up to 1.35 million gallons of water a day will be provided by the IEDC to the City for its discretionary use within the City outside the LEAP District. This IEDC agreement with the City is subject to the IEDC entering into a separate definitive water supply agreement with Indiana American Water Company and/or Citizen Energy Group by December 31, 2024, that contemplates delivery of the additional water to the City by January 1, 2028.

3.10 REMAINING WATER SUPPLY SHORTFALL: Even IF the IEDC delivers on its agreement to provide the City with up to 1.35 million gallons of water a day, Lebanon Utilities will still need additional water sources that provide at least 2.601 million gallons of water a day (3.951 million gallons shortfall less 1.35 million gallons from the IEDC) to meet the needs of just the presently identified 42 future City customers.

4. Lebanon Utilities 2024 Water Budget

The Lebanon Utilities 2024 budget for its water utility includes $30 million for an additional water source that is yet to be identified. Even though the City’s water ratepayers in 2022 finished absorbing a 5-year phase-in of a 61.2 percent rate increase, Lebanon Utilities water ratepayers will be forced to endure another rate increase to pay for a bond issue to secure the additional water source for the benefit of developers.

5. Conclusions

5.1 To protect the City water supply to current customers, IDEM regulations will not allow water to be allocated to developers in excess of what is actually available.

5.2 There are no currently identified sure-thing additional water sources to meet the City’s present water capacity shortfall of 3.951 million gallons of water a day.

5.3 Why has the City let developers believe that the City has enough water available for all their projects when there is clearly a water capacity shortfall?

5.4 The LEAP Lilly project reserved 0.864 million gallons per day, which is 70 percent of the 1.235 million gallons per day that is reserved but not currently used. The City’s decision to use its current water capacity to serve Lilly is driving the City’s rush to obtain additional water sources.

5.5 Does Henke know that the sources of the 2.3875 million gallons of water a day it needs for the full buildout of its Waterford project (4,775 water EDUs multiplied by 500 gallons per day per water EDU) have not been definitively identified, much less paid for?

5.6 Why is it good public policy for current Lebanon Utilities water ratepayers to pay up front with rate increases for additional water sources that developers need to profitably complete their projects? 

5.7 Why can’t the City use its ample resources instead of ratepayer increases to obtain additional water sources?

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This page was last updated on 02/05/24 .