Appeals court sides with Olthof Homes against Chesterton imposing a $100,000 fine

Chicago Tribune

5 hours ago

The Indiana Court of Appeals has ruled that Chesterton's Storm Water Management Board was in error when it levied an additional $100,000 fine in April 2022 against Olthof Homes for muddy water runoff violations during construction of the Springdale subdivision.
The Appeals Court on June 12 reversed a decision by Porter Superior Court that had upheld the stormwater board's right to impose the $100,000 fine. That penalty was on top of $37,400 in fines and a stop work order that lasted 11 days in March and April 2022.
Chesterton's Storm Water Management Board has the right to levy a penalty for stormwater runoff violations, the court found.
However, the court agreed with Olthof Homes that the town erred in citing its authority under sections of the town code to issue fines of up to $2,500 or $7,500 per violation, which contributed to the $100,000 penalty. The court found that the amounts should have been $100 or $250 per violation.
The court gave the town's Storm Water Management Board the option of redetermining a new fine, but the penalties had to be $100 or $250 per violation, not the much higher figures.
Associate Town Attorney Charles Parkinson advised the board not to discuss the decision during Monday's Chesterton Storm Water Management Board meeting. The board and council could discuss the matter and determine strategy in a closed executive session.
The town can request that the Indiana Supreme Court hear the case.
The town of Chesterton had battled for months with Olthof Homes between October 2020 and March 2022 over how the construction of the Springdale Homes subdivision was being conducted off County Road 1050. The problems included mud-clogged street inlets and rear yard drains, mud-encrusted curbs, downed silt fences and muddy streets.
Differences reached a boiling point in March 2022, when the Storm Water Management Board ordered an administrative hearing.
Town officials believed that Olthof Homes had been unresponsive to complaints, even after $37,400 in fines had been issued for 63 violations.
Chesterton officials contended that Olthof Homes ignored the town's complaints and treated the fines as a cost of doing business.
As a result of the hearing on March 29, 2022, the town stormwater board issued a stop-work order. Olthof Homes wasn't allowed to resume work until the town was satisfied on April 8 that year that the violations were addressed and there was a plan moving forward.
The appeals court upheld that the town was clearly within its authority to issue a stop-work order.
'The Town issues such an order here, and Olthof Homes quickly came into compliance. In short, this isn't an enforcement scheme that is rendered ineffectual without the option of higher fines,' the decision said.
The Storm Water Management Board on April 18, 2022, issued its finding and determination that imposed the additional $100,000 fine, which the appeals court ultimately found not supported by the town code.