NineStar plans to plumb Hancock County’s ‘frontier’ for development
About two-thirds of Hancock County, just east of Indianapolis, lacks public water or sewer service. Wells and septic tanks suffice, but not for officials trying to attract large businesses or residential developments.
“This 38,000 acres essentially has been frontier,” said Michael Burrow, president and CEO of NineStar Connect, a Greenfield-based electric and fiber-optic communications cooperative.
But that’s about to change.
The Indiana Utility Regulatory Commission last month approved NineStar’s plans to acquire Sugar Creek Utilities and Philadelphia Waterworks, as well as Greenfield Central’s wastewater plants in Eden and Maxwell.
According to NineStar, the acquisitions make it the first rural co-op in the nation to own four utilities offering electric, fiber optic communications, water and sewer service. NineStar has more than 18,000 customers.
The co-op plans to use its relatively tiny acquisitions as a springboard to install water and sewer service in a territory that stretches roughly north and northeast of county seat Greenfield.
“It brings the availability to open up thousands of acres for development,” said Nolan “Skip” Kuker, executive director of the Hancock County Economic Development Council.
Kuker said he’s already been “quietly discussing” potential development with a handful of clients. In the past, homebuilders were forced to build fewer houses on larger lots that could accommodate wells and septic, Kuker explained. But if NineStar can bring public water and sewer services to a parcel, a developer would have room to build additional houses in the same space, making the investment more lucrative.
“It is just a boon for us. This advantage is incredible. It’s a great tool for me to have,” Kuker said.
Likewise, Burrow has been reaching out to developers and investors who had previously overlooked land in Hancock County. He credits NineStar’s newfound “wet utilities” capability for helping the 80-employee County Materials Corp. decide to expand its existing plant in Maxwell rather than look in Illinois.
Burrow told the Indiana Utility Regulatory Commission that NineStar would bring economies of scale to the wet utilities, given how much of their functions, such as billing, could be rolled into NineStar’s back office systems with little or no extra cost. He sees better utilization of fixed assets such as construction machinery “to the extent you can spread those fixed costs over a greater number of services.”
NineStar invited former Citizens Gas CEO Carey Lykins to speak to its board about his experience in steering Citizens through the acquisition of Indianapolis’ water utility. Unlike Citizens, which had to deal with modernizing and upgrading large portions of Indianapolis’ water system, “we’re basically starting from scratch,” Burrow said of undeveloped areas of Hancock County.
Another advantage is NineStar’s existing fiber optic network, which can be used for automated water meter readings and monitoring for leaks. The co-op is already using that fiber backbone to monitor electric use, which it began offering five years ago following a merger of the then-Hancock Telecom with Central Indiana Power. At the time, the only other known electric-telecommunications combo was the Nushagek Cooperative in southwestern Alaska.
As for what kind of capital budget NineStar has for water and sewer expansion, Burrow would only say that at this point the co-op is at the discussion stage about potential projects. His team has talked with current customers who live in subdivisions not served by public water or sewer.
“The most successful communities are the ones that invest in infrastructure,” Burrow said.
That statement has been evident in Hancock County, where development has come principally to Greenfield. The city is home to most of the county’s industrial base, consisting of companies such as Covance, Eli Lilly and Co.’s Elanco Animal Health division and automotive suppliers Indiana Automotive Fasteners and Keihin North America.
By Chris O’Malley