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Yorkville’s $170 million federal EPA loan for Lake Michigan water project ‘stuck in limbo’ · Kendall County News - Shaw Local

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  Speaker 1: Yorkville's one hundred seventy million dollars federal EPA loan for
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  Speaker 1: Lake Michigan water projects stuck in limbo. Written by Joey Weslow,
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  Speaker 1: this article is being read by an automated voice brought
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  Speaker 1: to you by Everlett. With Lake Michigan water expected to
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  Speaker 1: be rushing down the pipes to Yorkville residents' homes in
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  Speaker 1: two years, the federal low interest loan the city is
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  Speaker 1: primarily using to cover the project's two hundred twenty four
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  Speaker 1: point four million dollars is stuck in limbo. City officials
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  Speaker 1: said the city's one hundred seventy million dollars loan from
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  Speaker 1: the US Environmental Protection Agency Water Infrastructure Finance and Innovation
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  Speaker 1: Act WIA program has been delayed due to federal staffing
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  Speaker 1: shortages and slowdowns. City administrator bart Olsen said EPA staff
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  Speaker 1: told the city all federal loads nationally have been impacted
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  Speaker 1: by the slowdowns. The city was originally intending to close
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  Speaker 1: on the WIFFIA alone last fall. The Lake Michigan Water
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  Speaker 1: Sourcing Project is a joint venture between Yorkville, Oswego, and Montgomery,
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  Speaker 1: sharing the costs to extend their pipes and connect to
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  Speaker 1: exist water mains near Naperville owned by the DuPage Water Commission.
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  Speaker 1: The total project is currently running around four hundred million dollars.
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  Speaker 1: A groundbreaking ceremony for the project was held at Oswego
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  Speaker 1: East High School on June tenth. Lake Michigan Water is
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  Speaker 1: expected to be online for Yorkville by the summer of
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  Speaker 1: twenty twenty eight. Montgomery should receive water by twenty thirty.
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  Speaker 1: If for some reason the bills come due from the
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  Speaker 1: DuPage Water Commission and the WIFFIA alone is not yet approved,
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  Speaker 1: there is a chance down the road we would have
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  Speaker 1: to issue municipal bonds to pay for the project, Olson
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  Speaker 1: said during the June ninth City Council meeting. Olson said
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  Speaker 1: the city's WIFFI alone has already been signed by the
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  Speaker 1: EPA and is currently being reviewed by different federal agencies.
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  Speaker 1: The EPA has not currently provided the city a closing date.
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  Speaker 1: Olsen said Yorkville's loan is weeks ahead of both Oswego's
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  Speaker 1: and Montgomery's, but all communities are now in the same boat.
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  Speaker 1: The first bills due from the city to the due
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  Speaker 1: Page Water Commission will be after this summer, according to
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  Speaker 1: city documents, Olsen said. EPA's staff indicated they were impacted
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  Speaker 1: by the shutdowns, being short staffed and are behind on
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  Speaker 1: a backlog of work. The EPA told the city it
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  Speaker 1: had to respond to active incidents across the county that
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  Speaker 1: drew staff away. With construction crews making their way across
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  Speaker 1: Kendall County, there are still three bid construction packages to
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  Speaker 1: be opened for different phases of the overall project. While
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  Speaker 1: the first phase bidding came in almost one hundred million
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  Speaker 1: dollars over initial projections, Olsen said recent bids have been favorable.
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  Speaker 1: While the city is still planning on using WIFFIA loans
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  Speaker 1: to pay for the majority of the project, Olsen said
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  Speaker 1: staff wants to remain flexible in funding options in case
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  Speaker 1: the delays continue. The city councils recently approved a reimbursement
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  Speaker 1: resolution that Olsen called a backup plan for the city
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  Speaker 1: should the WIFIA loan delay extend past the first bills due.
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  Speaker 1: The resolution permits a ceiling of two hundred and twenty
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  Speaker 1: five million dollars, those city staffs that any future bond
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  Speaker 1: issuance would likely be substantially less. The resolution enables the
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  Speaker 1: city to reimburse itself for previously incurred project costs within
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  Speaker 1: sixty days of the resolution passage. Olsen said this would
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  Speaker 1: be necessary if the city must pivot in full or
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  Speaker 1: in part from a WIFIA loan to a municipal bond
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  Speaker 1: or line of credit to finance the project. The reimbursements
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  Speaker 1: would include a string of water improvement construction work totaling
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  Speaker 1: around one million dollars that was completed in April. The
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  Speaker 1: resolution allows the city to finance at a later date
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  Speaker 1: if municipal bonds are deemed necessary. This resolution provides us
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  Speaker 1: some flexibility in future bonding if we need to, Olsen said,
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  Speaker 1: and if we decide never to issue a bond, then
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  Speaker 1: this ordinance has done no harm, doesn't cost us anything,
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  Speaker 1: and has no impact whatsoever. The past resolution does not
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  Speaker 1: obligate the city to issue any bonds or to encour
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  Speaker 1: additional debt. Any future bond issuance would be alternative funding source,
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  Speaker 1: not additional debt for the project. According to city documents,
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  Speaker 1: this means whatever bonds would be issued to finance a
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  Speaker 1: portion of the project, the WITHIA loans would be reduced accordingly.
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  Speaker 1: Outside of the original one hundred and seventy million dollars
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  Speaker 1: WITHIA loan, the city was planning on covering its remaining
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  Speaker 1: costs through the city's bond issuance and loan proceeds. To
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  Speaker 1: help cover these costs, the city recently approved twenty percent
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  Speaker 1: annual water rates over each of the next five years.
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  Speaker 1: Average residential water bills are aimed to double by twenty
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  Speaker 1: thirty to help cover the project's costs. In the wake
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  Speaker 1: of some construction bids coming back higher than expected, Olsen
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  Speaker 1: said the city might consider larger water rate increases if
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  Speaker 1: the project's costs balloon. The WIFFI Alone currently has a
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  Speaker 1: thirty five year payback from the time of substantial completion,
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  Speaker 1: which will take it through twenty sixty five. Yorkville must
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  Speaker 1: cover one forty five percent of the WIFFI alone debt
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  Speaker 1: and the three point five percent interest rate to meet
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  Speaker 1: the obligations of the loan. The Lake Michigan Water Project
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  Speaker 1: was deemed necessary to provide the region's growing population a
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  Speaker 1: more reliable source of water because the currently used underground
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  Speaker 1: aquifer is being depleted at an unsustainable rate.