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As soon as infrastructure out west is in place, the City of Des Plaines will become another water customer of the City of Evanston. On Oct. 6, the member communities of the Northwest Water Commission – Arlington Heights, Buffalo Grove, Wheeling and Palatine – voted to accept Des Plaines as a customer. As a customer of the Commission, which buys water from Evanston, Des Plaines will then purchase water from Evanston, said Utilities Director Dave Stoneback.
“Once a pipeline is built from the Commission’s reservoir, located in Des Plaines, to the reservoir owned by Des Plaines, Des Plaines will begin to receive 5 million gallons per day (MGD) maximum from the Commission. Des Plaines will need to continue to receive some water from Chicago, as the daily average use in Des Plaines is more than 5 MGD,” Mr. Stoneback said.
The present infrastructure of the City’s water utility is capable of handling the additional 5 million gallons per day, said Mr. Stoneback.
“Des Plaines’ water use will fall under our agreement with the Commission to provide the Commission up to 55 MGD. Right now the Commission is only using about 23 MGD,” he said.
The City estimates that the additional water sales to the Commission – which will then be passed on to Des Plaines – will increase the City’s revenue by about $500,000 per year. Some of that revenue will remain in the Water Fund, said Mr. Stoneback, but “we assume that some will be transferred to the General Fund.”
The Water Fund and the General Fund are internal funds in the City’s budget. The Water Fund, an enterprise fund, is meant to cover the costs of operating the City’s water and sewer systems, including payments for loans. The General Fund is the City’s main operating fund, which for the most part covers salaries and other personnel costs.
Mr. Stoneback said the Northwest Water Commission has said it anticipates a mid-2015 date for starting to provide water to Des Plaines.
While the added revenue may help to limit water-rate increases down the line, he said, “We do not anticipate this will have any effect on the Evanston residents’ water rates in the near future.”
Discussions continue with Lincolnwood, another community interested in buying water from Evanston. As a smaller community, Mr. Stoneback has in the past said that adding Lincolnwood would result in a very modest revenue increase.
Niles, Park Ridge and Morton Grove have together hired a consultant to study the possibility of purchasing water from Evanston, said Mr. Stoneback. Doing so would require the construction of a pipeline from Evanston west, and the capital cost of such construction appears to be the largest roadblock in closing the deal. It is not clear what the revenue impact would be of adding the three communities as customers in part because the capital costs are unknown.
Skokie continues to purchase water under a long-term contract, but that contract expires in 2017. A new contract, if agreed to, will include a different pricing structure that should result in a significant increase in revenue to Evanston.