Plan established to help replace lead pipes

This is a follow-up to a post titled, “Municipalities will need to (eventually) invest in aging water lines.” You can read about it here.

The Spring 2021 legislative session is rounding up and lawmakers have addressed the state’s lead pipe issue by passing legislation requiring water utilities to replace lead service lines while also creating a special fund to help finance the project.

The law also requires that water utilities submit a replacement plan draft to the Illinois EPA (ILEPA) by April 24, 2024 and then the final plan by April 15, 2027. The ILEPA will be responsible with establishing rules and regulations.

To help subsidize costs for water utilities, the state will establish a grant program with the money coming from the newly created Lead Service Line Replacement Fund (LSLRF).

Because of the U.S. Treasury’s decision last month prohibiting states from using ARP funds to pay down debt, the revenue needed for such a program is suddenly freed up. Moreover, it has been a priority of the federal government to help replace aging lead service lines as part of a President Biden’s massive infrastructure package.

While the revenue should be there and the program is much needed, questions remain.

The first is how much money will ultimately be allocated to the LSLRF. Lead service line replacement is a state-wide issue. While there are municipalities that are in need of replacement more than others based on their level of ppb (e.g. Oak Park, River Forest, etc.), most (if not all) of municipalities are in need of replacing their pipes due to their depreciation. So expect a lot of grant applicants even if their level of ppb is modest.

And with the state containing hundreds of water utilities and estimating that there are still 680,000 service lines in need of replacement, water utilities will compete for a limited pool of grant funds. If there is not enough money to suffice the demand (because the state will be requiring all utilities to replace their lead based pipes) the program may run into some issues there. For example, if a water utility does not receive adequate state support they will more than likely respond by raising water rates to abide by the replacement mandate.

It should be noted, however, that the legislation does put caps on how the money in the Fund should be spent. For example, no more than 5% of the funds can be used for personnel costs.

Which leads us to the second observation: how the program will be set up and what rules, regulations, process, and grant criteria the ILEPA will establish. The legislation already tells us that an advisory board will be established to help create and oversee best practices for replacement, review performance, and produce reports for the governor and General Assembly. Additionally, the legislation authorizes the board to consider the sufficiency of revenue sources and options.

So the legislation creates an outline, with the new advisory board and ILEPA tasked with working out some of the kinks described above. While easier said than done, a roadmap has been created to (finally) replace lead-based service lines and improve the public health of the citizenry.

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