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Pingree Grove board adopts CPI-based water rate policy with 7% cap, promises review if increase tops 5%
Summary
Trustees approved an ordinance continuing an automatic annual water/wastewater rate adjustment — the greater of 2% or CPI — and added a 7% cap. Board also required a pre-implementation discussion if a year's CPI calculation would push rates above 5%.
Pingree Grove trustees voted March 16 to adopt an ordinance tying future water and wastewater user-rate increases to the greater of 2% or the Consumer Price Index, with a cap of 7% in any single year and a board review if an annual CPI-based increase exceeds 5%.
The measure, introduced by staff member Andy, extends a policy first adopted seven years ago and is intended to create predictable revenue to cover major water and sewer projects, including a planned second water tower and a multi-million-dollar wastewater treatment program. "This ordinance is drafted nearly identical to the ordinance that was drafted previously with one exception that there is a cap in here of 7%," Andy said, adding the village's rate study estimated the water tower cost at about $7.3 million.
Trustees said the floor of 2% provides a baseline to keep pace with recurring costs such as salaries and operating expenses. Trustee Hall said, "I think it's really important that you have a floor of 2%. If inflation doesn't go up as far as 2%, at least you have a minimum that would be in line with what's been going on in order to keep up with costs." The board also agreed to add language requiring the board to meet and discuss any single-year CPI increase above 5% before implementation, not as a mechanism to block an increase but to ensure trustees have the information and context.
Staff explained the ordinance affects only user rates and not separate base capital fees and noted by law such revenue must be restricted to water and sewer system expenses. Andy said the village previously used a schedule that raised rates annually over seven years and that continuing the policy helps avoid sudden, larger step increases. The village manager and engineers cited ongoing capital needs and debt-service obligations tied to projects already constructed and under construction.
Next steps: the ordinance approved on March 16 will remain subject to standard ordinance-signing and publication processes. The board asked staff to be prepared to discuss any year when the CPI calculation approaches the 5% review threshold.
Sources: Staff presentation and trustee discussion during the March 16, 2026 Pingree Grove board meeting.
