St. Charles raises utility rates nearly 50% as city council vows to look for other revenue options

Entering what one resident described as a “crisis,” St. Charles approved utility rate hikes that will result in bills rising by about 50% by 2029.

The increases will help cover $417 million in sewer and water improvements, including $84 million to replace lead pipes.

If your current monthly utility bill is $200, by 2029 it will be $298.31, according to the city. This includes a 17.3% spike in monthly bills starting this June, a 14.7% jump in the second year, a 6.4% increase in the third year, and a 4.1% increase in June 2029.

Electricity, sewer and water costs are combined into one monthly bill in St. Charles.

The city council approved the increases during its meeting on Monday. Alderpersons Ryan Bongard and Jayme Muenz voted against the measure.

Of the $471 million in planned improvements, $183 million is slated for sewer system upgrades over the next decade. The remaining $234 million is for water infrastructure work, including the $84 million lead service line replacement project, which is an unfunded mandate by the state.

Work on the lead replacement project is due to start later this year. The city must replace lead service line connections for roughly 3,400 water customers, and the work is expected to be done over 10 years, according to city documents.

While comments from Mayor Clint Hull and a few residents focused on the unfunded lead line replacement mandate, even without that health and safety project, the city would likely still be increasing bills to cover the remaining $333 million in infrastructure improvements.

Muenz said while she understands the necessity for the improvements, she doesn’t want the increases “entirely on the backs of our rate payers.”

She suggested looking into current city-provided services and determining if they could be “pared back, utilize those funds in a different way to ease that burden.”

Muenz requested that the council explore those options going forward and potentially alter the rate increases for future years if alternative funding sources are preferred by the community.

Alderperson Vicki Spellman echoed those sentiments, saying she prefers to see the rate increases spread out over other revenue sources besides utility bills.

“It would be helpful to our residents to have some visitors sharing in some of that burden and to reduce (it) for residents,” Spellman said.

During public comments, resident Rita Payleitner said a $100 increase on monthly bills is a big deal for many residents, especially seniors on fixed incomes. She said the city is in crisis.

“This crisis is wrongly set to be managed on the backs of the rate payers alone,” Payleitner said. “The city needs a crisis mindset. A crisis of this magnitude needs to be met head-on by all departments, all budgets, all citizens, all visitors, partners in pain and in solution.”

Following the vote, the mayor said the search for alternative revenue sources “starts tonight.” He said the city will continue to provide transparency as the staff “keeps digging” to find more options and ensure every dollar of taxpayer money gets used responsibly.

Hull said the unfunded mandate was something the city couldn’t plan for. He said the city applied for grants to help reduce the costs. However, the city was told it does not qualify for the grants because of its higher income levels. He said the city will continue searching for potential grants to mitigate costs.

City Finance Director Bill Hannah previously said the rate jumps will likely be readjusted in the future.

“A portion of this water rate increase is temporary,” Hannah said. “Once the city is finished with the lead service line unfunded mandate project, we will be able to roll back some of that increase.”