Early bond payoff would save some Lake County taxpayers $3.56 million
Taxpayers in northern Lake County communities that switched to Lake Michigan water in recent years could be spared about $1,070 in future payments.
That's because bonds issued in 2013 to launch the project in Lake Villa, Lindenhurst and the unincorporated Fox Lake Hills and Grandwood Park areas can be redeemed 15 years ahead of schedule, saving more than $3.56 million in interest, officials said.
All taxpayers in Special Service Area Number 16 will share in the saving. The amount will vary, but owners of a home valued at $250,000 can expect to save $1,070 from tax years 2023 to 2037.
"When we originally set all of this structure up, we were dealing with estimates," said Patrice Sutton, the county's chief financial officer. "We do find ourselves with some money left over that can be utilized to pay of the (original) bond in full with no penalties."
Sutton and others presented the scenario earlier this week to the county board's public works and transportation committee. The full board is expected to authorize the bond payoff Oct. 10.
The two villages and Lake County, which provides water to the two unincorporated neighborhoods, began working together in 2008 to switch from wells to Lake Michigan water, which is regarded as a cleaner and more reliable source.
In 2013, the entities joined to obtain Lake Michigan water from the Central Lake County Joint Action Water Agency. Working groups were established to manage the project and build improvements to bring Lake Michigan water to the four systems.
Two sets of bonds were issued to raise money for the work, with taxpayers in SSA 16 paying the principal and interest.
The original $7 million bond was used for land acquisition, design and related costs to get the project started. About $4.75 million at 5% interest is outstanding and would be paid off.
About $32 million in low-interest revolving loans (about 2%) from the Illinois Department of Natural Resources remain outstanding.
Grandwood Park in 2017 was the first of the four areas to receive Lake Michigan water, and the others followed relatively soon after.
"It was a massive undertaking," said Ann Maine, committee vice chair.
Lake Michigan is a clean and sustainable water source that avoids issues with well water, she added.
Committee member J. Kevin Hunter of Ingleside said much of the area is in his district. He wasn't on the board when the project initially was raised.
"There was a lot of consternation. There was a lot of, 'Do we (or) do we not on this,'" Hunter said.
"There are some communities ... in my district that are remorseful they did not get involved in this because the well water systems with heavy metals are becoming very problematic in western Lake County."