Steps and Timeline for Forming a District
This section includes Basic steps for filing a petition, example petition and flowchart.
These steps and timelines are not to be solely relied upon but merely to aid the community in understanding the process as completed by one district. Every district is different; therefore, steps and timeline will vary for each district.
The Basic Steps for Filing a Petition
Prior to or While Filing a Petition
Be sure that you have completed or have nearly completed the planning process. As a reminder, the planning process includes, but is not limited to the following steps:
- Have an engineer complete a preliminary engineering report (PER). The PER should include preliminary cost and rate structures.
- An engineer may do all or some of this; you may also want to hire a rate consultant.
- Identify funding sources. Funding sources are detailed in the finding resources section of this guide.
Filing a Petition
Remember it does not cost anything to file the petition with IDEM. There is a cost to having a PER written, and there may be costs associated with the petition review by an attorney.
There are certain requirements which must be completed and attached to a petition. Included below are the documents necessary to file a complete petition. Two petition examples have been provided within this section of the guide. One is for a county-wide district and the other is for a specific region. The petitions can be used to examine how the requirements fit together with the technical statutory checklist.
- The petition itself;
- A resolution by the legal entity petitioning the Indiana Department of Environmental Management for the formation of the district;
- A resolution is needed from every county or legal entity (in the case of multiple towns) which may be included in the regional or county-wide district;
- Sewer district boundaries;
- A feasibility study or Preliminary Engineering Report (PER) should be attached showing that a sewer or water system is possible.
Evaluating Your Preliminary Engineering Report
Some questions to ask when reviewing a preliminary engineering report:
- Has the engineer considered multiple collection system types? This may include gravity collection, pressure collection, septic tank-effluent pump (STEP) systems, and vacuum collection.
- Do you want the engineer to consider multiple treatment system types? This may include conventional treatment (such as package plants, activated sludge, extended aeration, constructed wetlands, recirculating sand filters, individual septic systems, mound systems, lagoons, and potentially transporting waste or regionalizing with another system.
- Has the engineer included detailed cost estimates for all possible options? This should include a detailed breakdown of what you'll be paying for and unit costs for all materials. Line items like "Non-Construction Costs" should be broken down.
- Has the engineer considered more than one means of final disposal? That is, have they examined both surface water discharge and land application?
- Has the engineer employed creative problem solving? Has he or she considered different configurations, such as "clustering"? Clustering allows different segments of the community to utilize the treatment solution that best suits them. For example, one segment of the community could tie into a mound system, one segment into a separate mound system, and another segment of the community could keep their septic systems and become part of a septic maintenance program. For many small communities, creative solutions like these may be the only way to keep a project affordable.
- Has the engineer (or rate consultant, in some projects) considered the full range of funding sources? The consultant may want to consider State Revolving Fund, Rural Development, Office of Community and Rural Affairs, and Special Appropriations Projects, in a variety of combinations.
Following is the statutory checklist for formation of a district. The checklist can be used to ensure the petition meets all the requirements of the statute. The Indiana Code being referenced is in brackets after the requirement.
- Has the petition been filed with the executive office of each government entity having territory within the proposed district no later than ten (10) days of filing with IDEM [IC 13-26-2-1]?
- Has the signed affidavit confirming the above requirement been submitted to IDEM?
- Was the petition filed by an eligible entity?
- Has the plan been authorized by the fiscal body of the eligible entities?
- Does the petition state the proposed name of the district [IC13-26-2-3(3)(A)]?
- Does the petition state the location of the district's principal office, including a required mailing address (which may be temporary) [IC 13-26-2-3 (2)]?
- Does the petition specify the need for the district [IC 13-26-2-3(3)]?
- Does the petition specify the purpose to be accomplished [IC 13-26-2(3)(B)]?
- Does the petition specify how water supply, sewage collection, sewage treatment, and sewage disposal are currently provided [IC 13-26-2-3(3)(C)]?
- Does the petition state whether there is indebtedness for the purpose proposed? This merely proposes that if there is debt for supplying clean water or sewer service, it must be acknowledged and explained [IC 13-26-2-3(3)(D)].
- Does the petition establish how the proposed district will be conducive to the public health, safety, convenience, or welfare [IC 13-26-2-3(3)(C)]?
- Does the petition explain how the current situation creates or contributes to pollution or health hazards or impeded development in the area [IC 13-26-2-3(3)(D)]?
- Does the petition state the proposed area [IC 26-2-3(4)]?
- Is the territory within an area so that this one district will promote public health, safety, convenience, or welfare [IC 13-26-2-3(4)]?
- Does the petition state recommendation on selection, number, and term (no more than 4 years) for the board of trustees? This must conform with the trustee requirements in IC 13-26-4 [IC 13-26-2-3(5)].
- Does your Preliminary Engineering Report contain the following costs?
- Cost of operations until revenue from operation or proceeds from bond sales are received;
- Cost of accomplishing the purpose of the district;
- Cost of operating and maintaining the works; and,
- Estimated rates and charges that will be required
- If not, have you consulted with a rate consultant or an association to find those costs? Are those costs included in the petition through any of these consultation methods?
- Does the petition state the funding sources for accomplishing the purpose of the district [IC 13-26-2-3 (7)(C)]?
- Are there any utilities within the proposed district territory with public water or wastewater systems?
- If yes, please provide a written plan regarding the district’s proposed method of protecting the investments of the eligible entities to assist the Indiana Department of Environmental Management with complying with IC 13-26-2-10(b)(3).
Recommendations: Items to Include with Your Petition
- A map of the boundary limits and land description.
- An affidavit signed by a representative of the eligible entity. The affidavit states the district has already or will give a copy of the petition to every government entity with territory in the district within ten days of filing the petition with IDEM. The affidavit within the example petition provides one way to organize the needed components.
- Letters of support from the county commissioners of every county involved, health departments of every county involved, and the Indiana State Department of Health.
- A property owner (commonly known as a “freeholder”) list should be included. This list is comprised of names and addresses of the district’s potential customers. IDEM requires that a “reasonable effort” be made to contact residents or property owners. During district formation, contact the District Coordinator at IDEM to determine whether a property owner list will be required of your community. To access an updated property owner list, work with your county assessor’s office.
After you file your petition, it will be processed as in the petition flowchart [PDF].
Example Notices from IDEM
Two important steps in the formation of a district are the notice of public hearing and notice of formation decision. Here are examples of notices generated by IDEM.
Note: the purpose of these sample notices is to provide assistance to small and medium sized rural communities for water, wastewater, and solid waste services. This notice is merely to aid the community in understanding the process and the documentation typically issued by IDEM.
After District Formation: What to Expect from the Indiana Department of Environmental Management (IDEM)
After the petition has been filed with IDEM and the notice of formation decision has been issued by IDEM, the district is formed. A district is a regulated entity and subject to all rules and regulations as set forth in state statute. Your district should expect inspectors to visit periodically to ensure compliance with your NPDES permit and other environmental statutes. Inspectors may perform compliance sampling to test for certain substances and chemical elements. Their main goal is to ensure all substances are at acceptable levels.
NPDES Permits Overview
IDEM issues National Pollutant Discharge Elimination System (NPDES) permits. An entity must apply for an NPDES permit if flow will be discharged into the waters of the State. Once a permit is granted, the entity will have to pay fees related to discharge and monitoring requirements.
IDEM issues these permits from its Office of Water Quality. A description of NPDES permits from the IDEM Web site follows:
"The purpose of the NPDES permit is to control the point source discharge of pollutants into the waters of the State such that the quality of the water of the State is maintained in accordance with the standards contained in 327 IAC 2. The NPDES permit requirements must ensure that, at a minimum, any new or existing point source must comply with technology-based treatment requirements that are contained in 327 IAC 5-5-2. According to 327 IAC 5-2-2, Any discharge of pollutants into waters of the State as a point source discharge, except for exclusions made in 327 IAC 5-2-4, is prohibited unless in conformity with a valid NPDES permit obtained prior to discharge. This is the most basic principal of the NPDES permit program.
"The majority of NPDES permits have existed since 1974. This means that most of the permit writing is for permit renewals. Approximately 10% of each year's workload is attributed to new permits, modifications and requests for estimated limits. NPDES permits are designed to be re-issued every five years but are administratively extended in full force and effect indefinitely if the permittee applied for a renewal before the current permit expires.
"U.S. EPA, Region 5, has oversight authority for the NPDES permits program. Under terms of the memorandum of agreement, Region 5 has the right to comment on all draft Major discharger permits."
Major and minor treatment facilities are measured by the amount of their flow. A major municipal treatment facility releases over a million gallons a day. A minor municipal treatment facility releases any amount less than that.
Other Things to Consider
An IDEM inspector will periodically inspect operations and documentation. In addition, State Board of Accounts (SBOA) will perform a financial audit once every two years. However, both IDEM and SBOA may visit more often if needed. For more details about the SBOA, please see the section entitled Planning the Financial Administration of Your District.
During the course of this process, the district may wish to seek the assistance of trade organizations, associations, and agencies. They are available to offer assistance and guidance throughout the process; but district responsibility remains with the district. Organizations and associations can assist your district in start-up, counsel the district, and train the district in capacity development or help the district find materials. The capacity development section of this guide details more specifically what capacity development is and what resources are available.
Capacity development will continue to be an important consideration for the utility. Your district should, at the very least, operate at the levels needed and complete a capacity development assessment biannually or as major changes occur. The district will also need to assess and care for its finances, establish a capital improvement fund, and revise rates, as necessary.
Your board will need to regulate the district and ensure that monies are being collected, rates are updated, repairs are funded and are being completed, and the operator is certified and keeping the plant safe.
Associations such as the Alliance of Indiana Rural Water, Indiana Rural Water Association and the American Water Works Association provide water and wastewater requirement updates and also provide training opportunities for operators. The district board should have a basic understanding of operator requirements and plant operations, so that the district can ensure the operator is doing his or her job properly. To contact them, please see the association list [XLS].