Bolingbrook presses to take over water system, but details are murky

Debbie Honn has lived in Bolingbrook since 1979, long enough to remember subpar well water gushing from the tap before a company bought the village’s water system and piped in a finer Lake Michigan product in 2001.

But the improvement came with a price, as Illinois American Water steadily raised its rates for area customers in the past decade, according to Illinois Commerce Commission data.

Despite now paying about $80 monthly for water and sewer, Honn said she remains wary of a plan being led by longtime Mayor Roger Claar to lower these bills by wresting control of the company that pipes lake water to Bolingbrook and surrounding suburbs.

“I’ve heard Mayor Claar say he’s going to take it over for the people,” Honn said. “I haven’t heard details.”

An eminent domain lawsuit brought by Bolingbrook and four other villages to seize control of the privately owned water pipeline now lumbers into its second year, and how the costly effort will reduce residents’ bills remains murky.

Claar and the mayors of Homer Glen, Romeoville, Woodridge and Lemont, which formed the Northern Will County Water Agency last year to take over the Bedford Park water line, refused interview requests about the process and math behind the plan. The mayors have yet to present any plans to the public.

Bolingbrook and Homer Glen denied a Freedom of Information request by the Tribune for studies the villages have cited as evidence that they could run the system for the same price or cheaper. Officials from both villages first said such documents didn’t exist, then later said they would not provide them because they were in draft form or connected to the ongoing legal action.

Meanwhile, costs continue to add up while questions linger about the effort’s efficacy and how much it will ultimately cost taxpayers.

Bolingbrook has 23,000 customers receiving water through the pipeline and is bankrolling about 80 percent of the agency’s tab as a result, according to Homer Glen’s website.

Homer Glen’s 6,000 pipeline customers means it covers about 20 percent of the expenses. Woodridge has 200 pipeline-supplied customers, while Lemont has 17 and Romeoville has just six, the website says.

The lawsuit is not expected to go to trial until late 2014 or early 2015, water agency attorney James Boan said at a September meeting.

Bolingbrook and Homer Glen have spent thousands in recent years assessing the feasibility of acquiring water systems before the agency was formed, according to documents obtained by the Tribune.

By this spring, the agency will have spent nearly $1 million since its inception, budgets and invoices show.

All told, the agency’s members are prepared to spend up to $50 million on the water pipeline, according to a 2012 resolution.

While acquiring the pipeline will be costly, officials with the pipeline’s owner, American Lake Water Co., say any public takeover will have minimal impact on a resident’s water bill.

Bolingbrook has at times leaned on dubious calculations to make its case for seizing the pipeline, conflating its impact on a water bill with the rates set by the pipeline owner’s sister company, Illinois American Water, which is largely responsible for the rate hikes.

An undated fact sheet on Bolingbrook’s website tallies up Illinois American rate increases of 44 percent, 5 percent, 29 percent, 5 percent and 1 percent and erroneously states that the company raised rates by 84 percent.

“This is why (the towns) are trying to create a water agency to acquire the system and to stop the unending rate increases,” a line beneath the faulty math states.

Illinois American Water spokesman Michael Smyth said the rate increases reflect the “true cost” of maintaining and operating expensive water infrastructure.

Rate increases go through an 11-month Illinois Commerce Commission gantlet of approval, Smyth said, and the towns would face no such regulation when setting rates.

The water agency claims in its January eminent domain lawsuit that it would have no profit motive and could therefore operate the pipeline more efficiently.

While the current pipeline action works through the courts, Bolingbrook and Homer Glen are exploring individual takeovers of their respective towns’ water systems in the name of lowering water bills.

“I’d rather own my own water system,” Claar told the Tribune in 2009. “We should control our own destiny, not turn it over to some private operation.”

But Claar was the one who turned it over when he oversaw the sale of Bolingbrook’s water system to private hands in the late 1990s and early 2000s.

The deal replaced well water with lake water and poured millions into Bolingbrook’s coffers.

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The agreement called for more than $9 million to be paid by Illinois American to Bolingbrook in twice-yearly installments. The village also received $550 for each new water customer who connected to the company’s system in the Bolingbrook service area, with payments maxing out at $4.4 million, according to the agreement.

Regardless of how many new water customers are connected, the contract called for at least $275,000 to be paid annually to the town for each of the first six years after closing.

Those new customer connection payments would increase with each rate increase the water company received from the Illinois Commerce Commission after the first increase, according to the agreement, meaning Bolingbrook made more money off the deal while residents’ water bills increased and Claar’s rhetoric heated up.

The village swapped ownership of the water system for what had been a privately owned sewer system, and payments reflect the differing values of the systems, according to Boan, the village attorney. Boan said those payments ended this year.

The agreement also established a “white knight fund,” where Illinois American pays Bolingbrook $3 annually for every customer in town. The fund can be used to assist water customers who suffer hardship, and any remaining balance at year’s end can be donated to charity or civic groups.

Sparked by what Claar says are exorbitant rate increases, Bolingbrook’s Village Board agreed to look into a public takeover of the waterworks with other towns in 2006.

That same year, the Illinois attorney general’s office filed a complaint with the Illinois Commerce Commission against the company, accusing it of bilking customers, shoddy customer service and failing to maintain meters and fire hydrants. Illinois American refunded customers and was ordered to fix the problems, a 2007 commission report states.

Claar has not hesitated to criticize the water company, but Bolingbrook’s mayor since 1986 appears to have forecast the current struggle.

Nearly 20 years ago, Claar said he was concerned about water rate hikes if the town brought in lake water via a private company.

“This is a career decision,” he said in 1995. “You don’t make the decision and then reverse it.”

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