January 31, 2025
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How federal funding fiasco could impact Yorkville’s share of Lake Michigan water project

Other local projects, funded by state, local dollars, should not be impacted

By Joey Weslo
Yorkville City Administrator Bart Olson delivers a report to the Yorkville City Council on Nov. 22, 2022.

Yorkville City Administrator Bart Olson said there is ambiguity regarding the federal WIFIA and IEPA loans the city is using to help fund the Lake Michigan water sourcing project. Pictured, Olson addresses the city council at a meeting in 2022. (Mark Foster)

With construction expected to begin later this year on its Lake Michigan water project, Yorkville is depending on federal funds to help cover it share of the costs for the colossal infrastructure project. The project is a joint one between Yorkville, Montgomery, and Oswego, and the DuPage County Water Commission to bring Lake Michigan utility water to their residents.

However, after a memo from the Office of Budget and Management paused – then unpaused – the dispersal of federal grants and loans, that funding is less certain. Before the Trump Administration rescinded the memo on Jan. 29, Yorkville city officials discussed the ambiguity surrounding the water project’s future.

City Administrator Bart Olson said on Jan. 28, that both the city’s federal WIFIA loans and their IEPA low interest loans for the project were at potential risk. The loans are distributed from the Environmental Protection Agency.

WIFIA loans are expected to cover up to $126.732 million of the $158.165 million phase I and II of the infrastructure project. Low interest IEPA loans will contribute another $18 million to the project. The city is responsible for the rest of the tab, including an $8 million connection fee.

“We were able to confirm mid-morning that both our WIFIA loans and our IEPA low interest loans that are federally backed are in jeopardy, at least according to the executive order,” Olson said at the Jan. 28 city council meeting. “A lot of things are in flux. EPA staff weren’t able to confirm the actual impact.”

While the memo has been rescinded the office still wants by Feb. 10 detailed information from programs and projects that were subject to the initial funding freeze.

With the ambiguity regarding federal funding expected to continue, Olson said it’s important to have a game plan in place.

“We’ve already been awarded the loans, and so there’s checklists and things that have to be done that are going to occur weeks or months into the future,” Olson said after the meeting. “We will continue to work on both documents and interface with staff from both agencies.”

The project is currently scheduled to be completed with Yorkville residents first sipping on Lake Michigan water in 2028. It was deemed necessary because the region’s underground aquifer was being mined at an unsustainable rate, especially with the area’s booming population.

Olson said he does not believe any of the extra steps will impact the project’s lengthy timeline, and the city is not even expected to close on the WIFIA loan until September.

“The implication would be that at some point they would do their checklist, compare it against the executive orders, and then say this program is good or this program needs to be fixed,” Olson said. “But right now, there are a lot of unknowns.”

Olson said the city expects more guidance on the status of their federal loans by mid-March, and it will continue notifying the public as it receives updates.

He said the city’s other large infrastructure projects are not affected because they are mostly city and state funded. This includes things like road reconstructions, water main projects, and the revitalization project on Yorkville’s downtown district.