Buffalo Grove may loan residents money for water, sewer and drainage upgrades

Buffalo Grove is considering a revolving low-interest loan program to help homeowners make utility improvements on their properties.

Deputy Village Manager Chris Stilling said the loans would help residents address water and sewer line repairs and upgrades, sewer service lining, and stormwater and drainage improvements, in particular backyard drainage issues.

"(Village) staff has seen an increased interest from homeowners wishing to make these types of improvements," Stilling said during a village board meeting Monday. "Unfortunately, many homeowners do not have the financial capacity to complete these projects."

The village previously had a program that allowed homeowners to borrow money for utility projects and repay it over three years, but it was cumbersome to administer and phased out in the early 2000s for lack of interest, Stilling said.

As proposed, the new program would provide a loan to cover half a project's costs, up to $10,000. Residents would repay the loan at 3% interest over three years, with payments due every two months at the same time as their water bill. Collateral would be in the form of a lien and a personal guarantee.

The village would pay the loan amount directly to the project's contractor, upon completion of the work.

Stilling said $150,000 will be needed in 2024 to start the program, with $75,000 coming from the water and sewer fund and the balance from the village's general operating fund.

Trustees Lester Ottenheimer III and Joanne Johnson, who called herself one of the "lucky residents in Buffalo Grove who had to once replace a cracked sewer line," voiced support for the proposal.

"I don't think it will significantly have any impact on our budget," Ottenheimer said.

However, Trustee Andrew Stein said there are several questions to be answered before he could vote for the proposal, including how much staff time and expense it would take to administer it.

A final decision is expected in the fall, when the village board approves next year's budget.