The Waukesha Water Utility has to spend millions drawing fresh water from a new source.
Whether ratepayers bear the brunt of that cost depends, at least partially, on how successful the utility is drawing federal grant money for pipe construction.
The utility is writing an application for a $100 million U.S. Army Corps of Engineers grant. If the corps approves the application, the money would be available for water utility projects in Milwaukee and Waukesha counties.
But the Waukesha utility still could get between $25 million and $50 million, said Dan Duchniak, water utility general manager.
“I think we’re looking for all opportunities for funding,” he said, “and that might not mean only for city of Waukesha. It could be for the region.”
The Waukesha utility faces a 2018 deadline to lower radium levels in its drinking water supply. The utility’s wells are contaminated with radium, and on days of heavy water demand, the utility distributes water that exceeds U.S. Environmental Protection Agency limits.
The utility’s cheapest option for a new supply is to spend $164 million to build a pipeline, pump stations and other infrastructure to buy Lake Michigan water and pump it to Waukesha.
Without state or federal grants, the project is estimated to increase the average Waukesha household’s annual water payments from $268 to $568. If the utility gets $50 million from the Army Corps, the bills are estimated to rise to $492.
The potential rate increases emerged last week during a water plan hearing as the main point of concern for Waukesha residents.
“Given that the radium is a federal mandate,” Waukesha Mayor Larry Nelson said after the hearing, “it makes sense that federal funds should help us meet the mandate.”
The utility is working with the offices of U.S. Sen. Herb Kohl, D-Wis., and U.S. Rep. James Sensenbrenner, R-Wis., to draft the application, Duchniak said. If the money is awarded to the region, local governments in Waukesha and Milwaukee counties would decide how to split the grant, he said.
The federal money is useless to some utilities in Milwaukee County because the grant only can be spent on new pipes, not on line replacement. Milwaukee County found that none of its projects are eligible, said Jack Takerian, county interim director of transportation and public works.
“From my understanding, it excludes water towers,” Takerian said. “The only thing we’re putting in new that way is a new water tower.”
But Michael Sullivan, Oak Creek Water Utility engineer, said the utility could use the money for its plan to spend $30 million on new pipes during the next 20 years.
Sullivan, who said he has not heard of the planned grant application, said federal grants could lower bill increases for ratepayers and free up more money for pipe-replacement projects.
“It’s something our water systems need,” he said of maintenance money, “that’s for sure.”
Duchniak said the Waukesha utility has no choice but to swallow the cost of new construction for a new water source. Without outside grants, he said, the cost will fall on people who buy water from the utility.
“We need to do something,” he said. “We can’t do nothing.”