Lebanon Utilities taps Reynolds Construction for 8 MGD wholesale water BOT amidst LEAP project pushback

Lebanon Utilities taps Reynolds Construction for 8 MGD wholesale water BOT amidst LEAP project pushbackThe utility board voted to tentatively select Reynolds Construction for the second phase of its wholesale water supply program, advancing the build-operate-transfer procurement despite heavy public criticism regarding environmental impacts on the Eagle Creek Reservoir and project transparency.

Reynolds Construction was tentatively selected over three other shortlisted developers to negotiate a public-private agreement for Phase 2 of the wholesale water supply program.

Phase 2 will deliver an additional 8 million gallons per day (MGD) of wholesale water from Citizens Energy Group, targeting operation by January 2028.

The board's decision faced intense public pushback over the LEAP industrial district's water demands, with residents citing concerns over the depletion and pollution of the Eagle Creek Reservoir.

Residents criticized the utility's transparency, citing last-minute revisions to the Preliminary Engineering Report that reportedly included a $15 million cost difference and new wetland routing impacts.

Lebanon Utilities has advanced the second phase of its massive wholesale water supply program, tentatively selecting Reynolds Construction as the developer for an 8 million gallon per day (MGD) build-operate-transfer (BOT) contract. John Lightner of Butler, Fairman, Seifert (BF&S) detailed the procurement process during the April 8, 2026, Utility Service Board meeting. The phased program will supply Lebanon with wholesale water purchased from Citizens Energy Group (CEG). Phase 1, currently under construction, is expected to deliver 2 MGD by January 2027. Phase 2 will bring an additional 8 MGD online by January 2028, with a future Phase 3 slated to add another 15 MGD. Operating under Indiana Code 5-23 for public-private agreements, the utility received proposals from five developers in January 2026. A scoring committee shortlisted and interviewed four firms: Bowen Engineering, F.A. Wilhelm Construction, Kokosing Industrial, and Reynolds Construction. The board unanimously approved the committee's recommendation to tentatively select Reynolds, allowing the utility and developer to begin design collaboration and develop guaranteed maximum price (GMP) reports. Reynolds is already a major contractor for Lebanon Utilities. During a project update later in the meeting, staff noted that Reynolds is currently constructing the LEAP Regional Lift Station, which involves installing a 48-inch diameter ductile iron gravity sewer at depths of up to 30 feet, alongside 5,000 feet of dual 30-inch force main. Despite the unanimous board approval, the Phase 2 BOT public hearing was dominated by residents vehemently opposing the utility's water infrastructure plans, which are heavily tied to the controversial LEAP industrial district. Multiple citizens voiced concerns over the strain the project will place on the Eagle Creek Reservoir, both from water extraction and future wastewater discharge. One resident referenced a 10-page letter signed by 21 members of the Indianapolis City Council expressing deep concerns over the LEAP project's impact on the reservoir. Public commenters also criticized the utility's transparency regarding project documentation. Residents pointed to a recently updated Preliminary Engineering Report (PER) that reportedly contained a $15 million difference in project costs, major changes to the Phase 2 routing, and new environmental corridor impacts involving wetlands. Commenters requested that the board delay the contract award until the public could adequately review the updated documents, citing limited office hours and outdated files on the utility's website. Utility staff defended the evolving nature of the PER, noting that engineering designs and routing naturally change as the project advances from its initial 5% to 10% schematic design phase. Staff acknowledged that they could have done a better job uploading the latest revisions to the website but stressed that the changes were part of the standard engineering process. The board ultimately closed the public hearing and moved forward with the selection of Reynolds Construction.