By: Mark Glennon*
Chicago and other cities around the Great Lakes are envied by most of the world for their abundance of fresh water. It took some doing, therefore, for Chicago to let high water bills drown tens of thousands of homeowners with debt for their water bills.
How did it happen? Chicago turned to water as a revenue source under Mayor Rahm Emanuel, and later added a special water tax to fund part of its struggling pension system.
The details are all in a superb, recent report by WBEZ that didn’t get the attention it deserves. Read the whole thing, but here is some of what WBEZ found:
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- Chicago homeowners have racked up over $421 million dollars in water debt.
- The city’s debt collection system has moved delinquent water bills into the hands of private debt collectors, with little transparency. At least $60 million of the city’s water revenue has gone to pay private debt collectors.
- Chicagoans have had millions of dollars in earnings garnished from their paychecks to help settle water debt and many others have faced judgments and statutory liens in an effort to collect water debt.
- An estimated $775 million in water-sewer tax revenue was allocated to the city’s municipal employees’ pension fund, city budgets show.
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Many homeowners now face impossible bills and penalties, such as one woman described by WBEZ who faces an $8,000 bill that includes more than $1,700 in penalties.
Higher bills were driven up initially, according to WBEZ, when Emanuel turned to water as a revenue source shortly after he took office in 2011. Emanuel added a garbage fee and increased the sewer fee as well. Within four years, Chicago’s water rates nearly doubled, says WBEZ.
Bills were driven up further by a water-sewer tax implemented in 2017 under Emanuel. Proceeds were dedicated specifically to help pay off the city’s huge unfunded employee pension debt, which stood at close to $19 billion when the tax was approved. Emanuel said the tax would protect Chicago taxpayers from “bearing the full burden of growing pension costs in the future.
The cost of water in Chicago tripled in the ten years ending in 2019, according to WBEZ, and more than 150,000 delinquent customers, mostly in minority neighborhoods, had their water shut off, though Mayor Lori Lightfoot has now imposed a moratorium on shutoffs.
WBEZ found an estimated $775 million in water and sewer tax revenue went to MEABF, the city’s Municipal Employees’ Annuity and Benefit Fund, since the tax was implemented in 2017.
To help those struggling with high water bills, the city recently made permanent a pilot program the Lightfoot administration launched last year. Twelve million dollars is dedicated to that.
Think about that. The city drove many residents into delinquency on their bills, then created a special program to bail them out.
Well, you might ask, at least the city stabilized that MEABF pension, which got the proceeds of the tax, right?
Don’t be silly. The net pension liability rose from $11.7 billion in 2017 when the tax was implemented to $13.7 billion at the end of 2020, according to its most recent actuarial report. It’s funded ratio is 23%, which is disastrous by any standard.
*Mark Glennon is founder of Wirepoints.
Audio and summary 
If this bill passes, say goodbye to local control over all Illinois parks and expect to see open drug and alcohol use, needles, no sanitation and fire hazards, but no ordinary park users.
One thing the article fails to mention is what the water cost is in Chicago. According to https://www.chicago.gov/city/en/depts/fin/supp_info/utility-billing/water-and-sewer-rates.html it’s $4.13 per 1,000 gallons. For comparison my village in DuPage county charges me $8.13 per 1,000 gallons. Maybe the pilot program should help people fix a running toilet or dripping faucet and then explain to these people that the bill needs to be paid.
A current Chicago water bill is $8.23 per T-gal for water and sewer. Add $2.51 for Tax and the charges come to $10.74 per T-gal.
My municipality BUYS water from Chicago and resells it to me at cost. I have a large household and we use A LOT of water. My water bill is $120 every two months. That includes watering my lawn. So these people who end up with $6,000 in past due water bills (and the article says only hundreds of dollars in fees) are just not paying their bills, at all, ever, for two or three years, and only then does the city reach out to make a payment plan, which of course, they don’t want to pay. This is just flat… Read more »
Ok so $10.74 for water and sewer. Correction, my current rate is $8.44 for just water plus a fixed monthly charge of $13.72. That same bill also has a stormwater charge of $40.44. In addition I pay a separate sewer charge of $1.95 per 1,000 gallons. No matter how much it is or how you look at it it’s really just a tax.
People don’t pay their bills maybe because they were told water was a right, and the last time I looked rights were god given, free, couldn’t be bought or sold. So Emannual figures Ill jack up the taxes on water, something everyone needs, so I can funnel it to something that has absolutely nothing to do with water or pipes or pumps or treatment… Rather my pension. So the entitled wake up one day and wonder why their “right” to water came to involve a collection agency, shattering their dream in the lie Bernie Sanders and many others told them.… Read more »
Welcome to the suburbs cry baby’s
Leave chicago now or you only have to blame yourself!
The first 10 minutes on Tucker Carlson last night was about Chicago,Lori Lightfoot,Kim Foxx and the out of control crime.Then i constantly read articles on WP about every other problem in Chicago and Illinois.For a brief second last night I was really feeling bad for the citizens that live in Chi-town,then I caughty myself and remembered that you people re-elected Kim Foxx recently,and continually elect the likes of Lightfoot,Emanuel,and Pritzker so,here ya go people,wallow in your own misery,no one to blame but yourselves.
My kind of town, to get the hell out of. Once a wonderful toddling town. Daley is rolling over in his grave. No more complicit, deluded, complacent population than that of Illinois. How many govs have served prison time? No, how many haven’t. Hopeless. Let it drown in water debt.
Fantastic. I tried to make comment on wp guest piece with McQuerry that I thought it was important for WP, IPI. etc going forward to try and do more stories/studies that DIRECTLY link the astronomical debt for the pay-to-play/ gaurenteed upper income public sec union ill machine lifestyles falling disproportionately on poor folks/ on poor folk of color. That in fact by a couple light years, the progressive lefts “systemic disinvestment” term in communities of color is the public sec pension debt that’s extracted disproportionately from low income communities to the benefit of well to do public sec union members… Read more »
I have more than a passing familiarity with water bills in Chicago. WBEZ’s faux sob story glosses over pertinent facts and naively misunderstands how the administrative system works. Is Chicago water expensive? Yes, yes it is. Just as everything in Chicago is expensive. But that’s no excuse to not pay your water bill. So many families in Chicago view water bills as optional. So what is Chicago to do when people refuse to pay? Chicago stopped shutting off water for non-payment in 2019 (and rarely do so before that because it’s not an easy task to do). They only tool… Read more »
““Our lives changed completely,” the 59-year-old Pilsen resident said in Spanish. “He got sick, and I got sick, too. And we couldn’t pay all of our bills.” So you can’t be bothered to learn English or pay your water bill. And it’s the second time you’ve stopped paying your water bill in 10 years…hmm….. Taylor said that she spoke with the city’s water department and finance departments in hopes that they would clear the error. She was advised to register the two-flat house with the city as a vacant property — which comes with an initial fee up to $600 plus… Read more »
Totally agree. Sure, the high cost and the tax contributed to the delinquencies, but many of these people just aren’t paying. WBEZ ignored that.
99.9% of them are not paying. The water call at 400 W Superior is on Saturdays IIRC. Go there and listen. It’s one fake sob story after another of people who own real estate but are unwilling to pay their water bill. They know the water bill will never but shut off; and they know they will have to pay it if and when the property is sold (the infamous water bill cert!). They just don’t want to pay.
You are correct that the article neglects the significant problem of non payment. A sizable number of people not paying utility bills undermines a civil society. But take the story of a woman paying water bills in a south side bungalow of 2600 dollars a year. If I received a bill like that, I would pay it, but I would unhappy at being ripped off. Importantly, I would interpret such a bill as a hallmark that I was living in a corrupt and inefficient and hopeless political environment, and would do whatever I could to leave. I would look at… Read more »
The $2,600 bill likely included late fees after non-payment for a full year.
To save money, she could have put in a meter instead and saved money. These are simple things every homeowner should know.
If it was metered, she has a leaky something or other. She should have fixed that by calling a plumber.
Do the lien and/or penalties also encumber fire insurance proceeds?
I don’t think so.
If you are correct, and I have no doubt you are, then this is poor reporting. Neglecting to mention that the 2600 a year are the charges resulting from non payment is a major omission. The narrative of citizens as victims eclipses all.
It’s probably $2,600 including the late charges for non-payment and sewer fees.
WBEZ is all about poor reporting. They are not journalism. They are activism that tells one side of a story to achieve a goal.
The real non-story here is: chicago water department is bureaucratic; city refuses to shut off water to vacant building until it is registered as vacant.
One of Chicago’s advantages is an unlimited source of fresh water. If it was a well run city, water should be both relatively cheap and of high quality. How unfortunate for the South Side woman described in the WBEZ article. 2600 dollars a year? So an everyday diligent office worker has to pay 2600 dollars a year for water? I have a sizable house in Northern Virginia – frankly more than I need, and water bills run about 600 dollars a year, and without the same kind of access to fresh water as in Chicago. My property taxes are just… Read more »
One can literally retire on what it costs to live in IL
$2,600 a year annualized, years later, if you flat out refuse to pay any portion of the bills, and let the fines and penalties accrue. I can’t pay my bills, how am I supposed to pay for water! Put a large bucket on your roof and connect it to a hose……just like your ancestors did 100 years ago before they buried the water lines…water falls from the sky for free in the form of rain, nothing is stopping you from collecting it and drinking it, or hike your butt down to bubbly creek, or the lake, and grab buckets of… Read more »