BACKGROUND: The issue
In Decatur, only a few service lines have ever been constructed of all-lead material, and all known all-lead service lines have already been removed. However, lead goosenecks and galvanized pipes were commonly used for water service lines installed prior to 1940 and are still present in the system.
To meet Federal and State EPA guidelines, the City is required to remove lead goosenecks and galvanized water service lines which are or were downstream of lead goosenecks. Under US EPA guidelines, these are termed galvanized requiring replacement (GRR) service lines.
In the inventory submitted to the IEPA in 2023, which was primarily based on tap cards and maintenance records, there were 6,883 suspected GRR service lines identified in the City. Another 22 service lines had unknown material, which are considered as suspected lead service lines under Illinois law. The total number of service lines to be replaced is estimated to be 6,900. The attached map shows the general location of the suspected GRR service lines.
Assuming an approximate cost of $10,000 per service line, the potential cost impact is $69 million over a period of 20 years. However, it is likely that many of GRR service lines have already been replaced, either on the city side or the private side of the curb box or both. Many other GRR service lines are on vacant lots where houses have been demolished. The daylighting project approved by Council in January will complete a statistically valid sample of the GRR service lines, which will aid in financial planning.
The unfunded mandate the city of Decatur (and thousands of other cities) face requires that we start replacing GRR service lines by 2027. Illinois state law requires that the replacement program be completed in 20 years. However, a proposed federal rule would require the replacement program to be completed in 10 years. The Illinois State Section of the American Water Works Association is commenting on the proposed federal rule, advocating that the timeline should match that already established in Illinois. As a practical matter, the city has already started replacing these service lines (throughout Johns Hill, as part of major infrastructure projects, and through the city's recently approved cost-share program). But the mandate will mean we have to scale-up our level of activity.
The opportunity
Although the lead service line replacement laws represent an “unfunded mandate”, there appear to be some immediate grant opportunities, especially if the City initiates its replacement program in 2025 or 2026, as opposed to the required start date of 2027.
The Illinois Environmental Protection Agency has been actively encouraging water utilities to seek funding from the State Revolving Fund (SRF) for lead service line replacement. A draft rule for lead service line replacement funding priorities has been published in the Illinois Register, and this rule would heavily prioritize funding for low-income census tracts. As a result, the City may be able to obtain “principal forgiveness loans” (in effect, grant funding) for replacement projects in the most eligible census tracts. The attached five-year galvanized service line replacement project plan would replace the estimated 1,899 water service lines in census tracts which are expected to score highly for principal forgiveness loan funding under the draft rule. This would represent at least 25% of the inventory of suspected galvanized service lines requiring replacement.
By accelerating the program to begin in 2025 or 2026, the City of Decatur may be in a better position to receive federal funds, if other states and agencies are not able to move forward with projects in the fiscal year established to obligate those funds. Lisa Bonnett, the City’s adviser on water finances and government affairs, has highly recommended the approach to get in early and secure as much funding as possible.
As was done in the Johns Hill neighborhood, water service line replacement will be coordinated with the City’s ongoing neighborhood revitalization efforts. Neighborhood meetings will be held to make people aware of the program and how they will be affected including funding opportunities for the replacement of their services.
The resolution
The requested action by the City Council does not authorize any construction, nor does it approve the use of any grant funds. The resolution simply authorizes the City Manager to sign the preparatory loan documents for the project. If the project is selected for funding and terms are acceptable, the final loan documents will be presented to the City Council for approval.
The City of Decatur has successfully completed many projects using funds from the IEPA SRF loan process.