Cub (Citizens Utility Board) hosts press conference on Homer Glen Water Costs

Officials, residents urge governor to veto water bill they say would harm communities

Patrick M. O'Connell and Cecilia ReyesContact ReporterChicago Tribune

Flanked by state senators and the mayors of Homer Glen and Bolingbrook, the Citizens Utility Board urged Gov. Bruce Rauner to veto an amendment to the Illinois Water Systems Viability Act on Monday, saying the provisions are bad for consumers and a boon for private water companies.

The consumer watchdog group said the bill will allow private companies to grow unchecked at the expense of Illinois residents. The morning event was held at the Village Hall of southwest suburban Homer Glen, where residents served by Illinois American Water complained of skyrocketing monthly bills.

Introduced earlier this year by Rep. Nick Sauer, R-Lake Barrington, the bill would renew the act’s amendments for another 10 years and remove a 7,500-connection cap on the size of water systems that private companies can buy. That would, consumer advocates fear, increase the chance of a monopoly on the resource.

“Getting rid of the cap on the size of the system lays bare the utilities’ profiteering motivations,” said Bryan McDaniel, director of governmental affairs for CUB. “That will speed up the pace of acquisition. The bigger the system, the higher the price tag.”

The legislation, House Bill 4508, passed in the Senate but failed to obtain a veto-proof majority in the House. Rauner has until mid-August to sign or veto the bill.

“This legislation is a bad deal for customers, and it would make it much easier for private companies to purchase water systems and then to dramatically increase the customer rates,” said state Sen. Sue Rezin, R-Morris, herself a customer of Illinois American Water.

The Tribune calculated and verified the costs associated with 5,000 gallons of Lake Michigan water use for customers of Illinois American and Aqua Illinois. On average, Illinois American charges $74.95 and Aqua Illinois $53.16. The two companies serve about 52,000 customers in the Chicago area, and their prices were 20 to 70 percent higher than the 2017 price tag a resident under a publicly managed water system would pay for the same Lake Michigan water, taking service fees and other base charges into account.

Aqua Illinois said in a statement that the bill allows the company to improve water quality and system reliability, enhances fire protection across the state and will help struggling systems gain compliance with Illinois Environmental Protection Agency regulations. The viability act, Aqua said, enables communities to focus on other priorities, and the company emphasized that even with the amendment, municipalities retain control over whether to sell their water system to a private operator.

“It is important to remember that the opportunity afforded by this bill is simply an option for municipalities,” Aqua said.

Signed into law in 2013, the Illinois Water Systems Viability Act allows private water utilities to buy out water utilities and spread the costs of doing so across its existing ratepayers. The legislation is part of the Public Utilities Act, which designates the Illinois Commerce Commission as the gatekeeper of “reasonable” rate increases and a competitive energy market.

Under the current bill, the commission is allowed to reject a pending municipal acquisition if it’s not in the public interest, Marianne Manko, director of public affairs at the commission, said via email. Manko noted, however, that a decision by a municipality’s local leaders to privatize makes the move “very difficult” to reverse.

With regard to size, “it’s conceivable the Commission would reject such a transaction,” Manko wrote, if the acquiring utility “would find it difficult or impossible to provide safe, adequate and reliable service to a greatly-expanded customer base.”

Rezin said there needs to be a cap on future rate increases, which she lamented as already “out of control,” and said the length of the amendment — 10 years — is far too long. Homer Glen Mayor George Yukich and Bolingbrook Mayor Roger Claar also spoke out against the bill.

“(Water) is a life necessity; we have to have it,” Yukich said. “And unfortunately, we’re stuck with very high bills. So we’re asking the governor the same thing, he’s gotta veto this bill, otherwise it lets them keep raising it, keep raising it.”

Several senior citizens on fixed incomes, Yukich said, have told village officials they sometimes do not flush their toilets because of worries about the cost of water.

Residents of Homer Glen, with a population of about 24,000, paid $85.58 a month per 5,000 gallons, not including sewer charges — a figure higher than all but one of the Chicago area’s publicly managed systems that use Lake Michigan water, according to a survey conducted by the Tribune for its 2017 series “The Water Drain.” The average bill for 5,000 gallons in that survey was $44. The embattled southwest suburb filed an official complaint with the Illinois Commerce Commission regarding its water rates in 2016.

“You know, it’s outrageous, and we have to stop it,” said Homer Glen resident Stephen J. Balich, a Will County Board member.

Watering the lawn, other residents said, is out of the question. One Homer Glen resident on Friday posted to one of the residents’ community Facebook pages a picture of her $2,000-plus water bill, the result, she said, of watering new sod.

State Sen. John Curran, R-Downers Grove, said water rates are a top concern among many of his constituents, especially those in Homer Glen. Curran voted against the bill and urged Rauner to veto it so the bill can be reworked with additional consumer protections.

“The difference between what public utility water customers pay and private is alarming in this state, in this area,” said Curran, whose district includes Homer Glen. “We talk about property taxes all the time and people being taxed out of their home. In Homer Glen, I’ve heard resoundingly from individuals I represent that water bills are also barrier to homeownership here. They just can’t afford the monthly freight. There’s a big disparity between public and private.”

McDaniel said the bill can be improved by requiring shareholders to pay a portion of the purchase price of a newly acquired system; adding a referendum requirement so that local residents can register their opinion on turning a municipal system over to a private company; maintaining a cap on the size of the system that can be purchased; and shortening the term length of the amendment.

Reached by phone, Elizabeth Tomev, deputy director of communications for the governor’s office, said the bill was still under review and that she could not comment on specifics in the legislation.

Homer Glen Trustee Keith Gray, who frequently hears from residents complaining about water bills at board meetings, said privatization leaves residents with few options and little recourse.

“If I’m unhappy with Ford, I can go buy a Chevy,” Gray said. “I can’t pick up my pipes and go find another water system.”

poconnell@chicagotribune.com

creyes@chicagotribune.com