Village Trustees Debate Giving Breaks to Developers on Water-Tapping Fees

Collect more money from developers to pay for the impact they might have, or charge based on what their development is actually using. The Village Board is debating the fairness and philosophy of how to calculate fees when a new water connection is turned on.

At its Monday meeting, the board discussed an ordinance that would change the way such fees are calculated specifically for age-restricted, multiple-family developments. The discussion has come up before, but a has brought it back to the village's focus; if passed it could mean about $375,000 in savings for developers that would otherwise go to the village. Here's a step-by-step explanation of the issue:

• Everyone in a single-family unit pays a connection fee to the village for sewer and water.
• Connections larger than the standard single-family residential unit fee are the product of the single-family fee times the rate factor, which depends on the size of the water meter required to meet the building's demand.
• The Lodge at Bristol Meadows plans for 50 age-restricted units. Thus, it would pay 50 times the rate of a single-family dwelling.
• A single-family unit would pay about $11,400 in water and sewer connection fees. 50 x 11,400 = About $570,000.
• The village researched, and such housing will use about 50 gallons of water per unit per day, or the equivalent to about 16 single-family homes. 
• Thus, the new calculation would require such developers to pay 16 times the rate of a single-family home. 16 x 11,400 = About $183,000.
• So the village would lose nearly $400,000 in connection fees, which troubled some board members. But others were OK with it because they said it was a fairer way to calculate the fees based on usage.

For Trustee Dave Smith, that's too much for the village to lose in a time when holding onto money could be key because the future is unknown. Smith said Oak Lawn, which provides water to New Lenox, is changing its water system and will likely charge costs downstream. Additionally, new environmental regulations require the removal of phosphates and nitrates from the water, and that will also lead to more costs.

"The reason you have a fee is to pay for the next development," he said. "Say we all of a sudden have a 500-unit place coming in and we need to expand the plant. How do we do that? Impact fees. Right now we are going into a time that we just don’t know what to expect. We could be dumping a lot of money."

Although Smith dissented, other village board members disagreed with his philosophy and said new rate calculations were a matter of fairness to developers and that they should pay for what they use.

"I want to make sure New Lenox is competitive for future developers," Trustee Ray Tuminello said, adding that he's seen developers drop plans in New Lenox to avoid high fees. "To me, ($570,000 is) just an astronomical amount of money."

Because this calculation would change just for age-restricted, multiple-family housing, Mayor Tim Baldermann said it would be worth it to the community to change the calculations, which would help allow the development come to New Lenox.

"There is a need for here, and since this is age-restricted, I don’t think many of these will come along," he said. "We are not here to help the developer make money."

Trustee Annette Bowden asked for more information, and said she didn't approve of the adjustment until a full-fledged study could be conducted. The board has a couple weeks before its next meeting to gather more information, and could bring back the issue for a second read in April.