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Evanston’s water and sewer systems are skating on thin ice, Dave Stonebeck, head of the City’s new Utilities Department reported to the City Council on April 12. The dilapidating infrastructure, coupled with projections of declining water revenues, make it imperative that the City look for new revenues or issue more bonds – or both – to meet expenses, make infrastructure repairs and maintain a healthy reserve.

The City recently completed the 18-year, $210 million sewer project, but Mr. Stonebeck said that project – a relief sewer built to handle storm water – did not address the existing sewer system. “We have 7.2 miles of sewers more than 100 years old,” he said, “and replacing them would cost about $14.4 million.”

The water mains are equally ancient: The City has 157 miles of water main, 52 miles of which are more than 100 years old and 29 miles are 80 to 99 years old, he said. The expected life of a water main is 100 years. The City spends about $3.1 million each year to replace 1.5 miles of water main.

Residents will make it through the current fiscal year without a hike in water or sewer rates, but one or both of those is likely to increase early next year, said Assistant City Manager Martin Lyons.

Spreading the Burden of Rate Increases and Additional Debt

Evanston’s water rates are below those of many surrounding suburbs and just slightly higher than Chicago’s, said Mr. Stonebeck. The City charges $2.03 per 1,000 gallons of water; this includes the water itself, plus treatment and distribution. Skokie, which purchases water (treatment and distribution only) from Evanston, charges its residents $3.53 per 1,000 gallons.

Mr. Lyons presented three options to increase water revenues and two to increase sewer revenues next year, most involving a combination of increased rates and additional debt.

The bonds (debt) would help address infrastructure costs.

One option in conjunction with the issuance of new bonds would be to shift the debt service (interest and other costs of the bond issuance) from the Water or Sewer Fund to the General Fund. This would allow the debt-service cost to appear on the property tax bill (rather than a rate increase on the water or sewer bill) and would be an advantage to home-owners, he said.

 In addition, Mr. Lyons proposed a “reasonable charge” – such as a 25 percent increase in the sewer rate – to the largest of the City’s not-for-profit customers “to offset the debt service that is in the property tax.”

City Attorney Grant Farrar said he thought this charge – or one to an even greater number of not-for-profits – would withstand a court challenge of denial of equal protection.

The Cost of Green

Noting the decline in projected revenues from water sales in Evanston, Alderman Ann Rainey, 8th Ward, said that showed how expensive being green can be.

The decline in water consumption – a 16 percent decline in usage since 1998 – is not just an Evanston phenomenon, said Mr. Stonebeck. It extends to the City’s water customers as well: Skokie and the Northwest Water Commission (Morton Grove, Arlington Heights, Palatine and Wheeling). He said that since 1998, Skokie’s water usage has decreased 26 percent, the NWC’s usage has decreased by 13 percent, while the population has increased by 11 percent.

“Water-sense devices” such as showerheads, toilets and dishwashers in homes and in the new condominiums account for part of the decrease, Mr. Stonebeck said. New toilets can use as little as two-and-a-half gallons per flush, as compared with 30 gallons with an older toilet, he said. A dishwasher will use about four gallons of water, but doing [the same amount of] dishes by hand could use between 30 and 50 gallons, he added. 

Customers Sought

The City plans to try to woo water customers from the City of Chicago. Chicago recently raised its water rates to the point that Evanston’s rates are now competitive. Suburbs contiguous to Skokie, such as Park Ridge, Niles, DesPlaines, Lincolnwood and another major water-use agency could purchase water from Evanston more cheaply than from Chicago, Mr. Stonebeck said.

At present the City’s water utility has an excess capacity of about 15 million gallons per day, and with likely “minimal transmission-system improvements” the City could add some customers in the short term. Other major overhauls to the water utility would be necessary to add more and larger customers, Mr. Stonebeck said.

Only communities permitted to use water from Lake Michigan are potential customers, Mr. Stonebeck said, and the City does not sell water to them: It provides treatment and distribution of the customer’s allotment of Lake Michigan water.

Next Steps

The City proposes measures that aim at water conservation and sustainability: promoting the use of tap water rather than bottled water and educating the public about water conservation, such as identifying and fixing water leaks, and installing showerheads and toilets that use less water, as examples.

The City also will investigate the use of alterative energy, such as solar and wind power, fuel cells and geothermal energy.

Wind energy was an item on last night’s City Council agenda. Among the options for wind energy are creating an off-shore wind farm, installing large wind turbines on the shoreline at the water utility, purchasing renewable-energy credits and entering into a long-term contract with an off-site power-generation facility.

“There is a variety of scenarios here,” said City Manager Wally Bobkiewicz, “and with other more creative ways we can get through [the financial problems].” He added, “It is incumbent upon us in the City of Evanston to be more creative than our neighbors.”