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Aurora staff recommend 6% water-rate increases in 2025–26 as lead-line and main replacements rise
Summary
City staff recommended a two-year, 6% water rate increase to cover rising operating costs and to fund lead service line and water-main replacement; staff outlined compliance timelines, federal and state mandates, and proposed a phased funding approach.
City of Aurora public works officials told the Committee of the Whole on June 3 they recommend raising water rates 6% in both 2025 and 2026 to keep the utility fund solvent while meeting new lead-service-line and infrastructure obligations.
Jason Bauer, director of Public Works, and Bob Lively, superintendent of water production, outlined the utility’s budget and obligations: a roughly $58 million annual water budget with a $49.5 million cost-of-service estimate, ongoing repayment of prior loans and a multi-year program to replace lead service lines and worn water mains.
CFO Chris Minnick said the utility’s projected shortfall for 2025 — if rates are not increased — is about $2.8 million. Staff examined 4%, 5% and 6% options and concluded a 6% rate increase would close the projected gap. Under the 6% scenario, the city estimated an average residential two-month bill would rise roughly $6.60 (about $3.30 per month) for the typical customer.
Bauer said the water fund covers treatment-plant operations, distribution maintenance, billing, engineering and debt service. Lively described Aurora’s central drinking-water treatment plant and noted the utility’s efforts to maintain high water quality standards.
Officials also briefed the council on new testing and replacement timelines. City staff said Illinois law previously set a 3% per-year replacement schedule beginning in 2027; a federal action announced in late 2024 increased the replacement expectation to 10% per year in some federal proposals, which would dramatically raise annual replacement costs. Aurora has about 16,000 service lines believed to be lead or suspected lead; the city plans to replace 5.5 million dollars’ worth of lines per year beginning in 2026 under current budget assumptions and has received about $7 million in Illinois EPA grants to date for lead-line work.
Bauer and Minnick said the city is tracking both state and federal rules and may need additional revenue or federal/state grants if higher replacement percentages are imposed. They also told the council the new Illinois testing protocol (first- and fifth-liter samples) likely will show higher action-level results than older testing protocols because the fifth-liter sample captures water that has been sitting in the service line.
Council members asked whether the water fund can be used for other purposes and about the timing of federal grants. Minnick said the water fund is an enterprise fund and revenues must be used for utility operations; he noted the city can abate property-tax-supported debt-service payments if alternate revenue (for example casino receipts) becomes available.
No formal rate ordinance was adopted at the meeting; staff said a proposal will go to the Finance Committee and then return to council as part of the regular July 1 rate-update cycle.
