Investing in infrastructure to deliver relief from flooding

The Village understands that any major investment in aging infrastructure needs to happen with an eye toward maintaining its financial health over the short and long-terms. So, while recognizing that delivering meaningful relief is an expensive proposition, the Village Board, staff and residents also need to be mindful of the financial impacts potential solutions may have. What follows is a brief summary of project costs and different financing options that the Village may pursue should it proceed.

Financial Summary

The Village’s financial position is strong. It has been able to limit the rate of increases in taxes and fees over the past decade through sound financial management and careful oversight of public expenditures. As a result, the Village has a Aaa bond rating, the highest possible rating that a municipality can obtain. This rating allows us to borrow money for infrastructure at a lower interest rate than would otherwise be possible.

Since 1990, the Village has spent approximately $80 million on sewer system improvements to provide flood relief throughout Wilmette. These improvements have been funded by bond issuances which are repaid through sewer user fees. More than 70% of the sewer user fees paid by residents go directly to funding past and ongoing sewer system improvements.

Financing Options

Any of the three proposed stormwater solutions would be financed by a 30-year bond issuance. The annual debt payments on the bonds could be repaid through one of the following methods:

  • Sewer fee (historically how all sewer improvements have been funded in Wilmette)
  • A new stormwater utility fee (calculated based on the amount of impervious surface area of each property)
  • Property taxes

Moody’s Investor Services has indicated that a property tax increase to repay the stormwater improvements debt would likely result in a downgrade of the Village’s bond rating, thereby making the cost of the projects more expensive. Accordingly, the Village Board is focusing on the sewer and stormwater utility fees as the most fair and equitable repayment vehicles.

Cost Per Household

The typical Wilmette household utilizes 21 units of water per quarter, equating to an annual sewer bill of $356. The following analysis demonstrates the estimated impact of the three projects under consideration. All figures are subject to change based on timing of construction, actual bid pricing, and interest rates.

 

Relief Sewer Improvements

Hybrid Relief Sewer & Neighborhood Storage

Neighborhood Storage

Cost- 2017 Dollars

$80 - $95M

$70 - $80M

$48 - $55M

Median Sewer Bill Increase

$366 - $428

$320 - $366

$219 - $248

Cost- Construction Inflationary Projection

Up to $108M

Up to $91M

Up to $60M

Median Sewer Bill Increase

Up to $487

Up to $416

Up to $260

To receive an estimate of the increase to your sewer bill, enter your address below or visit the Wilmette Community Portal. On this page, you will see the impact to your sewer bill over time. Note that the sewer rate is incrementally increased over time, thereby lessening the immediate impact on individual homeowners sewer bills.

CommunityPortal

Find the estimated stormwater project impact on your sewer bill.


Cityscape

What about other funding mechanisms?

The Village will continue to exhaust all possible funding sources, including grants and low interest loans, to reduce or offset the cost of the potential improvements. The Village plans to submit a grant application to the Metropolitan Water Reclamation District in February seeking grant funds to complete the Sewer Expansion project.