Higher utility rates in East Dundee to fund operations, infrastructure

East Dundee is raising its water and sewer rates by 33 percent to fund costs of operation and infrastructure improvements.

Village officials last week approved increasing water rates from $4.49 to $5.97 per 1,000 gallons and sewer rates from $4.20 to $7.62 per 1,000 gallons.

The new rates are expected to generate an additional $396,167 per year, according to village documents.

Residents have not seen a sewer rate increase since 2010, nor have they been charged more for water since 2007, Village Administrator Bob Skurla said. Instead, the village has been subsidizing water and sewer costs with other revenue sources, such as sales taxes and tax increment financing funds, he said.

"We have been trying to hold the line on all fees and taxes at the village's control during this major recession we are finally coming out of," Skurla said in a memo to trustees, noting the village's four-year property tax levy freeze. "We realistically need to examine if our (six- and nine-year-old) rates are still adequate to serve the cost of operating both systems. In short, the answer is a resounding 'no.' "

With the new rates, residents using an average 3,000 gallons per month would see a $20.24 increase every two-month cycle, bringing their bills up to $91.56, according to village documents.

During the 2015-16 fiscal year, $326,131 in home rule sales tax revenue was going toward water and sewer costs, according to village documents. The higher utility rates will cover that amount, Skurla said, and will leave $70,000 left over for capital projects.

That frees up the sales tax revenue, which could now be used for other expenses such as fixing roads, Village President Lael Miller said.

By not raising prices for several years, Miller said, East Dundee officials have been "running ourselves into a deeper hole" and are now playing catch-up. In addition to keeping up with operating costs, he said, the village needs to maintain and replace its aging infrastructure.

"We are not charging more money to our residents for water and sewer than we need to," he said.