Lake Zurich's Village Board meeting on November 6, 2023 included an overview of recommended funding approaches to transition to Lake Michigan water. The project will replace the groundwater wells that are currently the primary source of water.
5 Things to Know About This Project
The decision to transition to Lake Michigan water vs. staying with our current deep well system is extremely complex and has been studied for decades. The transition to Lake Michigan water is now imperative, as the Village faces substantial improvement costs to long-term regulatory compliance if the Village continues to rely on the deep aquifer.
1) This is not a rushed decision. The Village has been considering Lake Michigan water since at least 2009. There have been many Village Board discussions, community workshops, and engineering studies over the years. This is an important decision that has been studied in great detail, including evaluating alternative strategies for staying on the existing deep aquifer.
2) This is a big, expensive decision but doing nothing is not a responsible option. Nothing about transitioning to Lake Michigan water is easy or cheap. The Village recognizes there are substantial costs that will impact the entire community but securing a safe and sustainable long-term water supply for generations is as important as it gets. Staying on the deep aquifer system would require comparable long-term investment costs, but with greater long-term risks.
3) Our water remains safe. Lake Zurich water is safe and has always been safe to consume. The deep-well water has naturally occurring radium in the aquifer. The technology to safely remove radium has existed for decades. Historically, the Village pushes the radium down sanitary sewer pipes to a Lake County treatment plant. Future EPA regulations are forcing an end to the County accepting Lake Zurich radium, prompting the Village to transition to Lake Michigan, which does not have radium.
4) It will cost about $154 million to switch to Lake Michigan water. This makes it the most expensive infrastructure project in Lake Zurich's history. There are low-interest loans available through the Illinois Environment Protection Agency that will allow the Village to finance the improvements for up to 30 years. This approach would require $7.5 million annually to meet the loan payments, which would likely start in 2027-2028.
5) Water rates will have to increase. There are limited ways to raise the $7.5 million to cover the loan payments – primarily based on each customer’s water usage. The recommended approach is two-pronged: increase the water rates to cover 2/3 of the costs and increase the local non-home sales tax rate by 0.5% (or 1/2-cent on a $1 purchase) to cover the remaining 1/3 of the cost.
- The rate increase would be phased in over five years, starting with $3/1,000 gallons-used starting in January 2024.
- For a typical medium-sized Lake Zurich household with usage of 5,000 gallons a month, this first-year increase will cost about $15 extra a month.
- For a typical medium-sized Lake Zurich household using 4,500 gallons each month, the monthly increase will cost about $13.50 extra each month.
The rates would then be increased annually over the next four years to eventually reach $10/1,000 gallons by 2028. The local non-home rule sales tax increase would require voter referendum approval, which will likely be on the ballot in November 2024.
More information is already available on the Village’s website at LakeZurich.org and updates will be published there and online as the Village makes progress toward Lake Michigan water.