Water Sale Is ‘Wild Card’ in Evanston’s Economic Future

As the city of Chicago raises its water rate over the next five years, Evanston is moving forward with a plan to turn local lake water into dollars for Evanston’s civic coffers. 

Water was among the possible growth sectors for Evanston that were up for discussion at the city’s Economic Development Summit Friday, along with more traditional areas such as retail, the arts, technology, nonprofits, education and health.

“One of our greatest assets is access to water,” said Evanston’s economic development manager Nancy Radzevich, who described Lake Michigan water as the city’s economic “wild card.”

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City officials are currently reviewing proposals from engineers for a study on supplying Evanston water to more municipalities. The city’s existing customers include the municipalities of Skokie, Arlington Heights, Buffalo Grove, Palatine and Wheeling. 

Evanston started pursuing the option to sell its water to more communities two or three years ago, when Chicago hit the suburban municipalities it supplies with back to back water rate hikes, according to Dave Stoneback, utilities director for the city of Evanston.

But when Mayor Rahm Emmanuel came into office and announced four rate hikes over the next four years, “those communities started calling us,” Stoneback says. 

With a capacity of 108 million gallons per day in its current system and an average use of 40 million gallons per day, city officials believe Evanston is poised to profit—although adding more customers would require some capital outlay.

Evanston has entered into a memorandum of understanding with four municipalities and two water agencies that supply multiple communities, in order to study the size, cost and route for a new transmission main.  Those communities include Lincolnwood, Des Plaines, Niles and Park Ridge, as well as the members of the Northwest Suburban Municipal Joint Action Water agency, which includes the suburbs of Elk Grove Village, Mount Prospect, Rolling Meadow and Schaumburg, among others. 

Within the month, Evanston will choose an engineer to complete the study, according to Stoneback. Each community that has signed on to the memorandum will share the cost of the study, he added. 

If all the communities in the study decide to buy water from Evanston, Stoneback said that the city would have to build a new transmission main and increase its capacity to 215 million gallons per day. Evanston would likely shoulder the majority of the cost to build the new main, according to Stoneback, but, he said, city officials assume the revenue from increased sales would more than make up for that cost.

Based on federal decree, each lakefront community is given an allocation for the amount of water it can drain from Lake Michigan. Because Evanston is nowhere near maxing out its allocation, the city can legally increase the capacity it pumps, Stoneback said. But it faces possible competition from other lakefront communities, including Wilmette, Highland Park and Waukegan, all of which already sell water to their neighbors to the west.

At $2.34 per gallon, Evanston’s water rate is the second lowest of the north suburban communities, with only Highland Park coming in lower, at $2.31 per gallon. Evanston, however has the third largest treatment facility in the state of Illinois—with the two largest located in Chicago, according to Stoneback.