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updated: 4/18/2012 6:03 PM

DuPage County scrutinizes sanitary districts

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An ongoing analysis of taxing bodies in DuPage County has found problems -- some of them significant -- with two sanitary districts serving residents in Lombard and Villa Park.

As a result, the consulting firm the county hired to do the review is suggesting that the Highland Hills and Salt Creek sanitary districts consider whether they should continue operating as stand-alone entities.

"We further recommend that a study be performed to consider the consolidation of the Salt Creek and Highland Hills sanitary districts with another entity to afford more opportunities to be efficient and gain some economies," Crowe Horwath LLP concludes in its report released Wednesday.

Meanwhile, one of the agencies that prompted DuPage to pay Crowe Horwath $85,000 to examine two dozen DuPage entities received a positive assessment.

The DuPage Housing Authority "has made significant improvements in addressing issues" since a series of federal audits showed the agency misspent or failed to account for more than $10 million, according to the consultants.

DuPage County Board Chairman Dan Cronin, who overhauled the housing board last year after the financial scandal broke, said what has happened since is an example of how an agency in crisis "can be quickly reformed when immediate action is taken."

But when it comes to the Highland Hills and Salt Creek sanitary districts, Cronin said that some of the findings are "disconcerting."

Salt Creek, which provides sanitary sewer service to more than 7,500 properties in Villa Park, has been considered a stable organization. Now it's showing signs of decline.

"The erosion of the district's net assets over the past four years due to deficit spending, the age of the facility, the sensitivity of significant required rate increases and changes in key personnel call into question the ability of the district to remain a sustainable organization," the consultants wrote in their report.

Meanwhile, the consultants said there are "significant concerns" about the sustainability of the Highland Hills Sanitary District.

The district, which manages sanitary sewer service and water operations for 499 properties in Lombard, has been deficit spending since 2008 and has aging infrastructure. Those issues, coupled with a lack of response from district management, are "indicators of a condition requiring further attention."

In addition to consolidating with another entity, the consultants suggested that Highland Hills stabilize its financial condition, consider a rate increase, increase transparency and limit its use of credit cards.

Alphonse Sarno, who serves on the district's board, said he didn't have an opinion about the recommendations because he hadn't seen the report.

Fred Dale, the Salt Creek Sanitary District manager, said he needs more time to evaluate the report. Still, he admits he was surprised by its findings.

"My opinion is a lot different from theirs," said Dale, adding that there's never been any discussion before of merging the district with another entity.

While DuPage doesn't have the authority to force the sanitary districts to make any changes, Cronin said he hopes to work cooperatively with them.

"I can't do it alone," Cronin said. "I invite them to participate. But we are determined to realize the efficiencies. And we are determined to get those recommendations implemented because that's my responsibility to the taxpayer."

The county next month plans to release more Crowe Horwath reports examining the DuPage Election Commission, DuPage Airport Authority, Emergency Telephone System Board and several fire protection districts.

When all the reports are completed, officials will consider ways to improve efficiency, streamline operations, share services and increase transparency. Cronin has said there also might be ways to consolidate or eliminate agencies.

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