Kadner: War over drinking water in south suburbs
By Phil Kadner email@example.com August 4, 2014 6:36PM
Updated: September 6, 2014 6:10AM
Water is better than slot machines when it comes to making money, Hammond Mayor Tom McDermott once said.
The crisis facing the residents of Toledo, caused by an algae bloom in Lake Erie, has the nation focusing on the importance, the very necessity of clean drinking water.
But in the southern suburbs of Chicago, the focus for some years now has been on the cost of water, today and in the future.
When Chicago decided to increase the cost of water to more than 100 suburbs by 25 percent in 2012 and 15 percent in each of the next three years, ending in 2015, it precipitated a chain reaction in south Cook County, which includes some of the poorest communities in the state.
Seven suburbs (Alsip, Blue Island, Calumet Park, Harvey, Markham, Midlothian and Robbins) formed the South Suburban Joint Action Water Agency, or JAWA, with the idea of creating their own water system as an alternative to Chicago.
They would build water intakes in Lake Michigan near Hammond, construct a pipeline to the south suburbs and even develop their own filtration system.
They sold a $5.8 million bond issue to develop an engineering plan to move the project forward.
Plans hit a major roadblock this year when it was revealed that the Securities and Exchanges Commission was accusing the city of Harvey and its comptroller, Joseph Letke, of fraud.
Letke is listed as the financial consultant for the JAWA.
The bank financing the operation has now notified the communities that it is pulling out, as have some of the original seven suburbs.
Yet, Alsip Mayor Patrick Kitching has said lowering the cost of water to commercial enterprises in his town is so important that he will continue the fight, although the cost of such a new water system is likely to be more than $300 million.
As for Hammond, it has quadrupled the price of Lake Michigan water to some south suburbs since Chicago announced its increases.
But Mayor McDermott has strategically set his water prices 12 percent below the cost of Chicago water.
Indiana regulations prohibit Hammond from selling Lake Michigan water at a profit to municipalities within the state, but there are no such restrictions on the price of water to communities in Illinois.
“So I prefer to sell to Illinois communities for more money,” McDermott has said.
Chicago Heights buys its water from Hammond and in turn sells it to Glenwood, Thornton, South Chicago Heights and Ford Heights.
Unrelated to the cost of Chicago water, The Northern Will County Water Agency was formed in 2011 by the communities of Bolingbrook, Homer Glen, Lemont, Woodridge and Romeoville, all clients of Illinois American Water, a privately run utility company that charges the highest water rates in Illinois.
While Chicago raises its water rates to pay for infrastructure improvements, Oak Lawn, which provides Chicago water to 12 suburbs (including Orland Park, Tinley Park and New Lenox), is about to tack on additional charges for its own improvements.
No independent agency regulates the cost of Lake Michigan water.
But in Toledo today, my guess is the price of water is the least of their concerns.