Illinois is stepping in to help Riverside begin its state-mandated replacement of lead water service lines a couple years ahead of schedule.
Trustees approved an ordinance at their Oct. 17 meeting to authorize the village to incur $4 million of debt that it will owe to the Illinois Environmental Protection Agency in exchange for a zero-interest loan in the same amount that Riverside will repay in annual increments of $200,000 over 20 years starting in 2026. The vote was unanimous, and trustees did not discuss the item before approving it.
Finance Director Yvette Zavala emphasized that the board was voting to authorize the village’s incursion of $4 million of debt; Riverside has not yet accepted the loan.
The village will use the loan next year to fund its first round of lead water service line replacements, which must take place in or before 2027 to comply with an Illinois law enacted in 2022. Under the mandate, Illinois municipalities must remove all leaded water lines in town by 2044, replacing at least about 6% of them each year from 2027 onward.
Residents may recall when Riverside raised residents’ water bills in June, in part to collect additional revenue to fund this very project.
“A special portion of residents’ water bill is allocated just for lead service line [replacements]. Those are the monies that we would pledge to repay this loan back,” Zavala told trustees. “We have enough fund balance and revenues from that special portion to cover the debt-service [coverage] ratio required for the loan.”
Zavala said Riverside will collect enough revenue from residents due to its water rate increase over the summer to smooth out and minimize the repayment plan’s financial impact to residents.
An IEPA document included in the meeting’s agenda showed Riverside will use the loan to replace 500 lead service lines next year, with construction estimated to begin Feb. 1, 2025. Zavala said the IEPA notified Riverside at the end of July that it had reserved $4 million for the village, though it will not be disbursed until next year.
