Quick Facts About Skokie Water Rates
Read Mayor Hagerty's message to the community regarding Skokie's water rates. Below are a few quick facts:
1. Evanston has been subsidizing Skokie’s water needs.
Skokie’s current water rate does not fully account for the significant infrastructure, maintenance and delivery costs required to provide the village with fresh, safe Evanston drinking water. Skokie enjoys three connection points for water services, which in turn maintain water pressure throughout the village. Evanston has made it clear that the next water agreement with Skokie must address the utilization of all City of Evanston assets, including the Evanston Water Treatment Facility and all water distribution mains.
In the next years, the City will be required to complete a necessary replacement of a water reservoir more than 85 years old, which will cost approximately $20 million. Communities receiving Evanston water, including Skokie, should share in these infrastructure costs.
2. Evanston’s methodology for calculating water rates is widely accepted.
The American Water Works Association Manual of Water Supply Practices sets forth generally accepted industry standards for setting a reasonable wholesale water rate. This widely used and accepted formula was used in calculating the new proposed water rate for Skokie of $2.06 per 1,000 gallons.
This same formula was used in calculating Niles and Morton Grove’s initial water rate set to begin in late 2018 of $0.78 per 1,000 gallons. Unlike Skokie, however, those communities are investing $90 million into a distribution and transmission system that will connect to Evanston’s Water Treatment Facility.
3. Skokie’s water rate is among the lowest in the Chicagoland area.
According to a recent Tribune analysis, Skokie’s current water rate is among the 24 lowest of 162 Chicagoland communities.
4. Skokie has options.
Evanston is proposing a rate of $2.06 per 1,000 gallons, nearly 50 percent lower than the $3.88 Chicago charges more than 60 municipalities.
The rate proposed for Skokie is fair and reasonable. Rates paid by similar nearby communities, including Glenview ($1.78), Deerfield ($2.69) and Riverwoods ($3.06), illustrate this point.
5. Evanston has negotiated in good faith with Skokie.
Evanston has negotiated responsibly and in good faith with Skokie. Beginning in 2010 – seven years before the expiration of Skokie’s water contract – Evanston initiated meetings with Skokie to discuss a new long-term agreement. Since 2010, the City has held 14 meetings with Skokie to discuss water, including ten meetings since the beginning of 2016.
6. Evanston will continue to provide Skokie with water until an agreement is reached.
Evanston has been providing Skokie with fresh, safe drinking water since 1944. The City will continue to provide Skokie with Evanston water until a new agreement is reached or Skokie elects to purchase water from another water service supplier.
What price did Skokie pay under its previous water contract with the City of Evanston? Was the rate the same for 20 years or did it adjust?
The initial base rate included in the agreement between the City of Evanston and the Village of Skokie for water delivered during the service year beginning March 1, 1997 was 72.5 cents per 1,000 gallons. That base rate adjusted each year during the 20-year contract based on the average percentage change of the Consumer Price Index and Producer Price Index, with an annual adjustment floor of 3.75 percent and an annual ceiling of 9 percent, minus 1.75 percent from annual inflation. In a typical year, Skokie’s rate increased by 2 percent.
What price did Skokie pay under the interim agreement?
Skokie's previous water contract was extended through June 30, 2017 while the City of Evanston and Village of Skokie negotiated a new water supply and purchase agreement. Skokie paid a water rate of $1.0797 per 1,000 gallons for Lake Michigan water from March 1, 2017 through June 30, 2017.
When did the rate of $2.06 go into effect?
The Village of Skokie water rate of $2.06 per 1,000 gallons went into effect on October 1, 2017 (see City Ordinance 95-0-17).
What rate has Skokie paid since October 1, 2017?
Skokie is currently paying the City of Evaston 78 cents per 1,000 gallons. Skokie is currently in arrears $2,294,533.07.