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Lisle officials back multi-year water rate plan; consultants recommend 9% increases in first two years
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Summary
The Village of Lisle’s Committee of the Whole heard a rate study recommending a five-year plan that would raise water rates 9% in FY27 and FY28 and 7% thereafter (sewer increases ~1.5% annually), use $9.5M in reserves to fund capital, and keep connection fees unchanged while raising late-payment penalties to 10%.
Alex Craven, project manager for 18 98 and company, presented a five-year financial plan for Lisle’s water and sewer utilities and recommended a multi-year rate path to address rising operating and capital costs.
Craven told the board the village starts the current fiscal year with about $9.5 million in unrestricted utility reserves and that projected capital needs total roughly $17 million over the next decade, including an estimated $700,000 for federally mandated lead service line replacements. “We’re proposing a 9% in fiscal year 27 and 9 percent in fiscal year 28 and 7 percents thereafter,” Craven said, describing a levelized approach intended to minimize rate volatility while meeting reserve and capital targets.
The consultant’s model shows the water utility generates just over $6 million in annual revenue while the sewer utility is significantly smaller; as a result, the consultant recommended more modest sewer increases (about 1.5% annually). For a typical residential customer using 10,000 gallons per bimonthly billing period, Craven said the proposed increases translate to a $7–8 rise per bimonthly bill (about $3–$4 per month), and he projected the board’s plan would keep Lisle near the lower end of regional peers over the forecast period.
A public commenter asked how revenue from the village’s wheeling agreement with Illinois American Water (IAW) for Oak View usage was treated in the analysis and whether those wheeling fees could be increased to offset costs for village-served customers. Craven said wheeling revenue was included in the analysis and that the current wheeling revenue is roughly $300,000; CFO Mitchell added the contract language gives the village discretion on whether to pass increases through to IAW customers. “That study does include it, but it would have minimal impact to the overall,” Mitchell said.
Trustees questioned the presentation’s inflation and project assumptions, including the conservatism of long-term projections and whether to tie future adjustments to CPI or a Bureau of Labor Statistics water/sewer series. Craven said the team applied a 3% construction-inflation factor for linear projects in later years and used roughly 4% annual operating-cost inflation for water. Several trustees urged staff to consider smoothing or averaging any benchmark tied to BLS data to avoid one-year volatility.
By the end of the discussion trustees expressed reluctant agreement with the recommended five-year rate path as necessary to sustain the utilities, while asking staff to return with refined policy language about indexing, potential renegotiation of the wheeling agreement, and clearer implementation mechanics. The board also agreed there should be no change to connection fees now and signaled support for raising late-payment penalties from 5% to 10% to align with regional peers.
Next steps: staff and consultants will refine policy language and implementation details for the proposed rate path; the budget item that incorporates the recommended rate changes will proceed through the village’s budget process.
