FOR PUBLICATION

ATTORNEY FOR APPELLANTS:    ATTORNEYS FOR APPELLEE:

MICHAEL L. CARMIN    VICKIE RENFROW
Andrews, Harrell, Mann, Carmin & Parker, P.C.    Bloomington, Indiana
Bloomington, Indiana
     LINDA RUNKLE
     Bloomington, Indiana
    

     IN THE COURT OF APPEALS OF INDIANA

NANCY SALMON, et. al.,      )

                                 )
Appellants,                      )
                                 )
vs.                              )    No. 53A01-0107-CV-256
                                 )
CITY OF BLOOMINGTON,             )
                                 )
Appellee.                        )

    APPEAL FROM THE MONROE CIRCUIT COURT
    The Honorable J. David Holt, Special Judge
    Cause No. 53C02-0001-CP-132

    January 11, 2002

    OPINION - FOR PUBLICATION

BARNES, Judge

Appellant’s Appendix pp. 63-64. There was some argument made at the time the annexation was proposed that its effective date be postponed until January 1, 1997, to allow the Residents more time to consider its potential impact, but the City Council voted not to delay the effective date. There is no record that a remonstrance was filed against the annexation.
At the City Council meetings where the Browncliff annexation ordinance was debated, Rule 13 of the City’s Utility Service Board (“USB”) was mentioned and discussed. USB Rule 13, which applies to “predominantly residential additions other than apartment developments,” provides that before the City will extend sewer service to a neighborhood, several steps must be followed. Appellant’s Appendix p. 87. First, sixty percent of the neighborhood residents must sign a petition expressing interest in receiving city sewer service; this does not obligate the signatories to obtain sewer service. After receiving a petition, the USB prepares the required engineering plans and obtains construction cost estimates. After receiving those estimates, the USB notifies the residents of the estimated cost per resident of constructing the sewer. At that point, sixty percent of the residents must commit to hooking on to the new sewer and pay a deposit before construction will begin. The Rules and Regulations of the USB were attached to the annexation fiscal plan as an exhibit.
    On November 13, 1997, the Residents submitted a petition to USB indicating that owners of sixty-nine of the eighty-four Browncliff properties were interested in possibly receiving City sewer service. At that time, USB officials indicated that the cost of extending the sewer would likely exceed the initial cost estimate mentioned in the fiscal plan, and it was agreed that the City would pay for a detailed engineering design plan for the sewer and would conduct rock borings in the Browncliff Subdivision to arrive at a more precise cost estimate for the project.
The City hired a consultant, at a cost of $37,250, to estimate the cost of the project. Rock borings were also conducted, at a cost of $5,000, although some Browncliff residents, including parties to the disannexation petition, did not agree to allow borings to be conducted on their property. Sometime after the consulting work was completed, the Residents were invited to an October 1, 1998, meeting to discuss the results. The City disclosed at this meeting that the estimated cost of constructing a gravity sewer was $7,700 per resident, and that the design followed the “lay of the land” and would require the acquisition of easements through private property. It also reminded the Residents that a “good faith” deposit would be required from sixty percent of the property owners before any sewer construction would begin. See footnote However, the City agreed to investigate a low-pressure pump sewer system for the Browncliff Subdivision, which the City indicated would not require the acquisition of easements because it would follow the street right-of-ways, and additionally might result in a lower construction cost. Thus, the Residents were asked not to commit to the gravity sewer design at that time.
    The City expended an additional $27,927 for a consultant to obtain cost estimates for a low-pressure pump system. In early 1999, the City also began exploring its ability to obtain the forty-six easements from Browncliff property owners that would be necessary for the gravity sewer design; after six months of effort, only nine property owners had agreed to grant easements. The City conducted another meeting on March 25, 1999. At that meeting, the results of the low-pressure sewer design consultation were communicated to the owners of forty-four Browncliff properties. The City received only eighteen responses to a questionnaire handed out at that meeting asking which sewer design option they preferred. On June 24, 1999, City officials met with William Kroll, president of the local neighborhood association, and it was decided that the City would seek bids on both the gravity and low-pressure sewer designs, and the Residents could decide which option to pursue, if any, after receiving the results of the bids.
    The City received three responsive and responsible construction bids on September 27, 1999, the lowest of which resulted in a per household construction cost of between $8,900 and $9,000.See footnote This was communicated to Kroll, and additionally the City obtained an agreement from the low bidder to extend the sixty-day statutory period for keeping a bid open by ninety days, or until February 27, 2000. Additionally, the City obtained a construction permit from the Indiana Department of Environmental Management and sought approval for “up-front” funding for the project from the USB in the amount of $665,000. The Residents, however, did not choose a sewer construction design, but instead filed suit on January 26, 2000, seeking to disannex their properties from the City because of its failure to complete the sewer extension within three years of the annexation’s effective date, or by February 10, 1999. The City moved for summary judgment, which was granted on June 12, 2001. This appeal now follows.

(2)    That the municipality has not provided police protection, fire protection, sanitary sewers, and water for human consumption within the specific time limit for implementation, unless one (1) of these services is being provided by a separate taxing district or by a privately owned public utility.

(3)    That the annexed territory is not receiving governmental and proprietary services substantially equivalent in standard and scope to the services provided by the municipality, regardless of topography, patterns of land use, and population density similar to the annexed territory.

The Residents claim they are entitled to relief under subsections (1) and (2), but make no argument under subsection (3). We address the Residents’ two arguments.
The Residents first argue that the City breached the annexation fiscal plan without justification because it did not provide hookups to the sewer main within three years of the annexation effective date, in violation of Indiana Code Section 36-4-3-16(b)(1). The City’s first response to this argument is that it has fully complied with the fiscal plan by virtue of its compliance with municipal policy regarding sewer construction, as embodied in USB Rule 13. If the City’s fiscal plan had explicitly stated that sewer hook-ups would be made available in accordance with USB Rule 13, i.e. only after a petition had been submitted by sixty percent of the residents, etc., there clearly would not have been a breach of the fiscal plan in this instance. That was not the case, however. The fiscal plan here could have been more clearly written. The plan suggests in some places that sewer hook-ups would be made available to the Residents regardless of compliance with USB Rule 13. It states that “the City will ensure that sewer mains are available for hookup to the Annexation Area’s properties.” Appellant’s Appendix p. 63 (emphasis added). Additionally, section 8.01 of the fiscal plan, “Sanitary Sewer Service,” never references Rule 13. We cannot say there has not been a breach of the fiscal plan, to the extent it suggests in places that the installation of sewer hook-ups was to be entirely self-executed by the City within three years of annexation.
    However, under the plain language of the disannexation statute, a plaintiff seeking disannexation or other relief must not only prove that the fiscal plan was breached, but also that such breach was “without justification.” “Justification” is defined as “[a] lawful or sufficient reason for one’s acts or omissions” or “[a] showing, in court, of a sufficient reason why a defendant did what the plaintiff . . . charges the defendant to answer for.” Black’s Law Dictionary 870 (7th ed. 1999). Here, we find no material issue of fact with respect to whether the City acted “without justification” in failing to provide sewer main hookups within three years of the annexation’s effective date; it is clear the City did have justification or a plainly sufficient reason for not having provided sewer main hookups to the Residents within three years of the Browncliff annexation.
    Although not explicitly mentioned in the fiscal plan, USB Rule 13 was discussed at City Council meetings where the Browncliff annexation was considered and its provisions were explained to the Residents in attendance at those meetings. The Residents were on notice as to its provisions and that the City intended to follow them. Furthermore, the fiscal plan clearly provided that the City would not pay the cost of constructing a sewer extension and that the cost would be borne by the Residents. When the Residents filed the requisite sixty percent interest petition in accordance with USB Rule 13 approximately twenty-one months after the annexation’s effective date, the City initiated efforts to design and receive cost estimates for the extension of sewer service to the Browncliff Subdivision. The City also communicated the information it obtained to the Residents through group meetings or through the neighborhood representative, Kroll. The City attempted to address concerns of the Residents regarding costs and the granting of easements by investigating alternative sewer designs, and by offering alternative payment plans for construction. The City asked the Residents to choose which sewer design they preferred, but no choice was made.
These facts establish the prima facie existence of justification for the City’s failure to provide sewer main hookups within three years of the annexation date, thus negating a necessary element of Residents’ cause of action – that the City acted without justification. Rather, the City followed the procedures for extending sewer service provided in USB Rule 13 and varied from that rule in an attempt to accommodate the Residents’ wishes and concerns. It expended considerable expense and time in developing engineering plans and obtaining cost estimates. Before proceeding to construction of the sewer, the City had good cause to insist on some assurance from the Residents that the construction would be paid for. In fact, it would be unreasonable and a waste of government resources for a municipality to press forward with a large capital improvement project such as this, the cost of which is to be entirely paid for by the benefiting property owners according to established municipal policy, without first obtaining some assurances that a large percentage of those property owners were actually willing to pay for the project.
In the face of the City’s designated evidence, Residents were required to designate evidence that would create a material issue of fact as to justification so as to avoid summary judgment. They failed to do so. The only piece of evidence that requires some discussion comes from the deposition of Mike Phillips, the City’s Director of Utilities. Phillips acknowledged that some sewer extension projects are not initiated by a neighborhood petition as provided in USB Rule 13, but the City’s HAND Department. See footnote The Residents essentially claim this creates a question of fact as to whether the Browncliff Subdivision, as an annexed territory, is treated unfavorably as compared to other parts of the City, and that the City should have constructed the sewer extension without regard to USB Rule 13. We disagree. Phillips also indicated that the HAND-initiated projects were ones that would be financed in part by community development grants intended to assist low-to-moderate income families and, therefore, that only part of the cost of constructing the sewer extension would be recouped from the users. The Residents have not pointed to any sewer construction projects that were City-initiated outside of these special redevelopment projects and there is no reason to believe that USB Rule 13 is anything but uniformly applied otherwise. The fact that the City may choose to initiate sewer projects on certain occasions in the absence of a sixty percent neighborhood commitment does not render its reliance on USB Rule 13 unfair or unreasonable in other cases, particularly where it is expected that the cost of the project will be fully funded by the benefiting residents and not by special government grants.
As for the cost of providing sewer main hookups to the Residents, it is true that the cost estimates for doing so greatly exceed the $3,000 estimate mentioned in the fiscal plan. This does not constitute a breach of the fiscal plan. Indiana Code Section 36-4-3-13(d)(1) and (2) states that a fiscal plan must indicate the estimated cost “of planned services to be furnished to the territory to be annexed” and the “method or methods of financing the planned services.” (Emphasis added.) Here, the fiscal plan plainly provided that the cost of constructing the necessary extension of the sewer main would be borne by the Residents. The City essentially agreed to handle the administrative, logistical, and engineering aspects of arranging for the sewer main extension, but it did not agree to “furnish” a service to the extent of paying for the construction itself. This process is in accordance with USB Rule 13, which applies throughout Bloomington and states that neighborhood residents who wish to have sanitary sewer service must pay the necessary construction costs to extend the main, unless the construction cost is less than three times the estimated annual sewer revenue from the potential customers, which was not anticipated to be the case with the Browncliff Subdivision. Additionally, Indiana Code Section 36-9-23-29 permits a municipality to charge a fee for connections to a sewer based on the pro rata cost of constructing a local or lateral sewer sufficient to serve the property. See Town Council of New Harmony v. Parker, 726 N.E.2d 1217, 1226 (Ind. 2000). We do not view the cost estimate as an integral part of the annexation fiscal plan, because the City never guaranteed that the cost would not exceed a certain level, or that it would pay a portion of the construction cost, and the Residents were not required to pay for an extension of sewer service as an obligation that would attach after annexation. They were free to reject paying for the sewer extension if they found it to be too expensive, as long as the existing septic systems did not fail. Hence, there is no breach of the fiscal plan based upon the City’s failure to obtain a construction bid that was close to the cost estimate reflected in the fiscal plan. See footnote
The Residents also argue with respect to the cost of extending the sewer main, particularly in their reply brief, that the City breached the fiscal plan by making the construction of a sewer service extension “dependent upon [Residents] first paying the costs associated with providing the sewer mains.” Reply Brief p. 3. We have already observed from the full text of the fiscal plan regarding sanitary sewer service that the Residents were always expected to pay for the cost of this service. To the extent Residents now claim that a municipality cannot charge the cost of extending sewer service to the residents of an annexed territory, notwithstanding Indiana Code Section 36-9-23-29, such a claim should have been raised in a remonstrance challenging the annexation ordinance and/or fiscal plan. No remonstrance was filed within the sixty-day-after-adoption time limit of Indiana Code Section 36-4-3-11, and thus Residents are precluded from attacking the validity of the annexation and the accompanying fiscal plan, which requires the Residents to pay for any extension of sewer service. See Albion Nat’l Bank v. Department of Financial Institutions, 171 Ind. App. 211, 219-20, 355 N.E.2d 873, 878 (1976) (holding a collateral attack on annexation may be maintained only where annexation was made by a body or tribunal acting without jurisdiction or power to make the annexation, and is not available as to alleged errors, irregularities, and informalities not going to the jurisdiction of the tribunal).
The Residents also claim entitlement to disannexation because the City has not provided them with a sanitary sewer system, and Indiana Code Section 36-4-3-16(b)(2) permits disannexation if “the municipality has not provided police protection, fire protection, sanitary sewers, and water for human consumption within the specific time limit for implementation . . . .” (Emphasis added.) Here, the Residents ask us to interpret the statutory term “and” to mean “or,” and that by the City’s not providing one of the enumerated services – i.e., sanitary sewers – they are entitled to disannexation . Even if we were to accept the argument that a plaintiff may be granted disannexation if a municipality has failed to “provide” any, as opposed to all, of the four listed services, the Residents here are not entitled to disannexation under this subsection as a matter of law.
We ordinarily endeavor to give words appearing in a statute their plain and ordinary meaning, absent a clearly manifested legislative purpose to do otherwise. Department of Natural Res. v. Town of Syracuse, 686 N.E.2d 410, 412 (Ind. Ct. App. 1997). Additionally, statutory provisions covering the same general subject matter are in pari materia and should be construed together to produce a harmonious statutory scheme. WorldCom Network Serv., Inc. v. Thompson, 698 N.E.2d 1233, 1238 (Ind. Ct. App. 1998), trans. denied. We also seek to harmonize our reading of a statute with precedent of our supreme court. See Black v. ACandS, 752 N.E.2d 148, 152 (Ind. Ct. App. 2001), trans. pending. Here, we conclude, based on the entirety of the annexation statutory scheme and precedent of our supreme court, that although a municipality must “provide” sanitary sewers to an annexed territory, “provide” necessarily means to provide in a manner similar to that in which sanitary sewers are provided to the rest of the municipality.
Acceptance of the Residents’ construction of Indiana Code Section 36-4-3-16(b)(2) would lead to the requirement that all annexing municipalities must actually construct sanitary sewers in an annexed territory or else face disannexation. Indiana Code Section 36-4-3-13(d)(5), however, merely provides that services of a capital improvement nature, such as sewer facilities, must be provided to the annexed territory in the same manner such services are provided elsewhere in the municipality. It does not absolutely require the extension of sanitary sewers to an annexed territory. Moreover, in Chidester v. City of Hobart, 631 N.E.2d 908 (Ind. 1994), our supreme court clearly indicated that an annexing municipality has no absolute duty to provide sanitary sewers to an annexed territory. In that case, the City of Hobart contained large areas that were served by septic systems as opposed to sanitary sewers, and it was acceptable that the annexation fiscal plan simply provided that the same policy regarding whether sanitary sewers are extended to a certain area would be applied to the annexed territory; the fiscal plan contained no assurance that sanitary sewers actually would be extended to the annexed territory. Id. at 912. As the City of Hobart did in Chidester, the City of Bloomington has decided to apply a municipal policy regarding extension of sewer service to an annexed territory, namely USB Rule 13. It logically follows that if a municipality is not required by statute or supreme court precedent to extend sanitary sewer service to an annexed territory, a plaintiff cannot obtain disannexation solely on the ground that sanitary sewers in fact were not extended. Here, the designated evidence indicates the City “provided” sanitary sewers to the Residents in a manner similar to that in which sanitary sewers were “provided” to the rest of the City. The Residents are not entitled to disannexation pursuant to Indiana Code Section 36-4-3-16(b)(2).
After examining the statutory scheme, we find the existence of legislative intent that a plaintiff seeking disannexation and the granting of other relief under Indiana Code Section 36-4-3-16 carries a heavy burden, once an annexation has become final after the time period for remonstrating has passed, or a remonstrance has been rejected. Such relief is not impossible to obtain, but there must be a showing of egregious action (or a lack of action) on the part of the annexing municipality, such as the treating of the annexed territory differently from other parts of the municipality, a complete failure to provide basic municipal services, or a failure, without justification, to implement the terms of the annexation fiscal plan. We find that no genuine issue of material fact exists that would support disannexation of the Residents’ properties under any of these theories, and thus we conclude that the City is entitled to judgment as a matter of law.

SULLIVAN, Judge, concurring

    I concur but with a slight caveat.
    I do not agree with the majority, as stated on page 13 of the slip opinion, that the Residents “ask us to interpret the statutory term ‘and’ to mean ‘or’.” They are, however, stating that they are entitled to disannexation because the City has failed to provide “one of the enumerated services – i.e., sanitary sewers.” Id. This contention by the Residents is undoubtedly drawn from use of the word “and” in the disannexation statute itself. That provision states that disannexation is permissible if the City has not provided all of the enumerated services. Thus the absence of any one of the services is a failure to provide all of the services as required by use of the conjunctive “and.”

Ind. Code § 36-4-3-13(d)(5).