Stormwater Utility Fee Under Consideration

What is a stormwater utility fee?

A stormwater utility fee would pay for projects that reduce flooding in Lake Bluff. The fee would be charged to each property based on the estimated amount of stormwater runoff from the property. Communities throughout the North Shore and the United States use fees like this to fund stormwater management. These fees can pay for new and replacement infrastructure as well as operations and maintenance.

How much would the fee be?

The typical homeowner would pay about $20 per month, which is equal to about $60 per water bill or $240 annually. This fee would generate about $1 million annually to reduce flooding. This amount could be used to borrow $10 million as a bond repayable over 15 years.

Why is a stormwater utility fee being considered?

Like other communities throughout Chicagoland, Lake Bluff experiences flooding during heavy storms. This flooding damages property and interferes with critical community functions like commerce, education, and emergency response. In part, this is because a “heavy” storm in Lake Bluff now drops more water faster than it did 50 years ago. This makes heavy storms even harder to manage than they were.

What other funding options were considered?

The Village’s Finance Committee reviewed many funding options, including changes to property or sales tax or the creation of a new real estate transfer tax. The Finance Committee considered a stormwater utility fee to be the most fair option because the properties that create the most stormwater runoff pay the largest fee. It is also more stable than sales or transfer taxes, which are subject to fluctuations in the economy. The Village has had success obtaining grants for stormwater improvements and will continue to apply for grant funding. However, grant funds cannot close the funding gap. A dedicated stormwater utility would allow Lake Bluff to improve the system to perform better during severe storms.

Who would pay the fee?

Every developed parcel in Lake Bluff would pay a stormwater fee, including homeowners, apartments, businesses, institutions, and government agencies. This includes property owners that are exempt from property taxes such as schools or churches. The Village does not believe it can lawfully exempt these categories of users from the fee.

How would these funds be used?

Because much of Lake Bluff’s stormwater flows through the Scranton Avenue Viaduct, improving the viaduct’s drainage would make many other projects possible. The Village and Lake County are partnering to design plans to redirect the viaduct into a new, 5-foot diameter “trunk” sewer line from the viaduct, north up Sheridan Road, and then east along North Avenue to Lake Michigan. This project is currently estimated to cost about $17 million to build.

Even with the fee in place, Lake Bluff will need help from the county, state, or federal government. The Village Board believes that this project is a strong candidate for outside funding and that creating the fee would give Lake Bluff the best chance of success. If grant funding is obtained, the fee would pay for the local share of the “trunk” sewer.” It would also be used to build other projects that direct more water into this new sewer line.

It may take time to secure additional grants. In this case, the Village would spend the fee revenue within its means to help maintain the Village’s existing system and build other system improvements.

How would the fee be determined?

The fee is proportional to how much runoff a property sends into Lake Bluff’s stormwater system. This amount is estimated based on how much impervious surface exists on the property. “Impervious surface” is the area covered by buildings, asphalt, concrete, or other materials that shed stormwater rather than absorb it.

Homeowners would pay based on the average amount of impervious surface present among similar nearby residences. All other properties, such as businesses, would pay based on their actual property conditions as measured by plans or aerial photography. In both cases, the measurements are based on records the Village already has. No person would need to enter your property to take measurements.

How would the fee be paid?

Stormwater utility fees would be paid through the Village’s existing utility billing process.

How was this proposal developed?

After the flood event of July 2017, the Village decided to comprehensively study Lake Bluff’s stormwater challenges and solutions. Lake Bluff’s Stormwater Master Plan was completed in 2019. The Master Plan identifies over $50 million in possible improvements. The improvements are distributed throughout the Village. Lake Bluff’s Finance Committee and Board of Trustees carefully studied and debated the right level of investment and how to pay for it for two years before presenting this option to the community.

What are the next steps for this proposal?

The Village is hosting three public information sessions at the end of January 2023 for residents who would like to know more. After the sessions are complete, the Village Board will consider all of the comments received. If the Board believes creating the stormwater utility is appropriate, it can create the utility by a majority vote (adopting an ordinance involves consideration at two separate public meetings by Board policy).