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Homewood to pass along 2.5% water, sewer rate hike

Homewood trustees approved a 2.5% rate increase Tuesday, Jan. 23, covering the additional cost for Lake Michigan water from Chicago Heights, the village’s water supplier.

According to Finance Director Amy Zukowski, combined water and sewer service rates per 1,000 gallons will go from $14.41 to $14.77, an increase of 36 cents. For water service only, the rate per 1,000 gallons goes from $10.70 to $10.97, a 27-cent increase. For sewer service only, the rate per 1,000 gallons goes from $3.71 to $3.80, a 9-cent increase.

The increase also applies to administrative charges.

Zukowski estimated that a household using 10,000 gallons per month will see its water bill increase less than $4 per month.

Homewood will pass the rate increase along to its municipal customers, the villages of Flossmoor and East Hazel Crest.

The increase will take affect on March 1 bills.

Rate increases are subject to a contract between Homewood and Chicago Heights that was approved in 2020. Rate increases are tied to the Consumer Price Increase (CPI) but are limited to no less than 1% and no more than 3% regardless of how high the CPI goes.

One of the reasons the village changed water suppliers from Harvey to Chicago Heights was a series of increases passed through from Harvey’s Lake Michigan water source, the City of Chicago. Starting in 2012, Chicago raised rates annually, 25% in 2012, 15% in 2013, 15% in 2014, and 15% in 2015.

When village officials made the switch in 2020, they cited that the contract with Chicago Heights enabled the village to contain and stabilize rates.

The village has not passed on a water rate increase to its residents and businesses since 2015, Zukowski said.

In a memo, Zukowski reminded the board that the village’s Water and Sewer Fund operates similar to a business.

“The intent is that the cost of providing water and sewer services to the community will be recovered primarily through user charges,” she wrote. “The rates should be sufficient to cover the ongoing costs of operations, maintenance, administration and future capital needs within the Water and Sewer Fund. Village tax dollars are not used to pay any of the costs associated with water and sewer services.”

Costs of transitioning from Harvey to Chicago Heights as the village’s water supplier were covered by the fund. The project required a new water line to connect with Chicago Heights. The village paid the $12 million cost out of the Water and Sewer Fund, saving interest costs that would have been incurred if it had to borrow the money.

The village currently is working to rebuild the fund in preparation for the replacement of the downtown water tower in a few years.

Stoney Point Grill deadline
The board agreed to extend the deadline for opening Stoney Point Grill to March 31.

The restaurant is under construction on the first floor of The Hartford, 2033 Ridge Road, which was completed last year. The residential portion of the building officially opened in August 2023.
The redevelopment agreement between the village and HCF Homewood, the developer of the building, called for the restaurant to open by Oct. 25, 2023.

In a memo to the board, Economic and Community Development Director Angela Mesaros said the purpose of the deadline in the agreement “is to ensure the project does not languish once approved. It is evident that construction is well underway.”

Developer Tim Flanagan said the current estimate for opening is mid-February. 

Reimbursement resolution
The village recently acquired the property at 3003-3025 183rd St., a business strip that includes American Bagel Company, through the Cook County No Cash Bid program. The building is just east of the former Brunswick Zone/Big Lots building. Both properties will be part of a new tax increment financing district that is in the planning stages.

In order for the village and any future developer to recoup qualified costs incurred prior to the establishment of the TIF district, the board approved an inducement resolution. 

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