Legal Memos Released Regarding Homer Water Sale to Mine

Deal faces significant hurdles and would open Homer ratepayers to potential liability

Homer, Il. – On Friday, Prairie Rivers Network and local residents concerned about Sunrise Coal’s proposed mine in southwest Vermilion County released memoranda and letters that have been circulated between their attorneys, the Village of Homer, and Sunrise Coal. The memo’s regarding the legality of the sale have been made available here for the benefit of the public:

“We want the residents of the Village of Homer and the community to be aware that the sale of water and providing sewage hookup has numerous potential legal ramifications that could haunt the village for years,” explained Keith Rohl, a rural Homer resident and farmer. “People need to be informed.”

Together, the documents raise serious questions about the legality of the water sale, and paint a cautionary picture of the risks and liabilities the Village may be exposed to as a result of a deal to sell water to the proposed coal mine.

“There does not appear to be express statutory authority for this arrangement, where the primary purpose of the additional wells and facilities would be to furnish water to Sunrise Coal Company, a non-resident located a substantial distance (6 +/- miles) from the Village and not within the waterworks system operated by the Village,” explained Paul Hendren, attorney for the Village of Homer, in his initial memo submitted on September 10th.

“The only specific statutes that authorize the sale of water outside a municipality’s limits refer to ‘particular localities’ and ‘specified areas’ requesting service. The Village is not contemplating sales to localities or areas, but instead to a single, non-resident commercial entity,” affirmed Chad Beckett, attorney for Prairie Rivers Network and several local residents. “The absence of clear authority to sell water to Sunrise Coal under the circumstances contemplated still leaves that action open to legal challenge.”

Both attorneys also highlighted numerous other potential risks and liabilities that the Village could face if a water sale is approved. These include liability for damages to neighboring groundwater or surface water users and the cost of any associated litigation.

Additionally, both attorneys pointed out that the Sunrise’s ability to pay could change in the event of a bankruptcy, which could put the Village at risk of catastrophic financial loss if Sunrise Coal does not provide sufficient up-front payment to complete the project.

“As the preliminary report of Village Attorney Paul Hendren makes clear, there are literally dozens of ‘known unknowns’ that must be determined,” explained Mr. Beckett, in his memo to the Village of Homer. “The Village has better things to do than to worry about the repercussions of this non-essential, non-residential use of precious resource outside of its municipal boundaries. The request by Sunrise Coal for more than half a million gallons of water per day can (and should) simply be rejected.”

While offering no recommendations, Mr. Hendren similarly cautioned that, “It seems possible that this project is so substantial, costly, controversial and difficult that it may interfere with many other Village staff and projects which would impose a cost that would be hard to measure.”

At the meeting of the Homer Village Board on October 8th, the Homer Village Board approved a reimbursement agreement with Sunrise Coal to provide up to $50,000 towards retaining a municipal utility legal expert to provide additional input on the question of the sale’s legality. Based on that information, Village Board members have indicated they will decide whether or not to proceed. However, local residents have called for the opportunity to provide input before any decisions are made.

“Considering the scope of Sunrise’s request for water, and the potential impact it may have on the area’s water resources, the Village Board needs to proceed cautiously to ensure that Village residents aren’t left on the hook to deal with unintended consequences,” said Brian Perbix, an organizer with Prairie Rivers Network. “Residents of the Village and surrounding areas should have the opportunity to decide whether or not the water sale should move forward.”


Reproduced with permission from Prairie Rivers Network, a not-for-profit clean water advocacy group that works to protect Illinois’ rivers and streams for people, fish and wildlife.

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