Water rates going up in Lansing after negotiations with Hammond, but it’s still ‘the best deal in town,’ official says

The City of Hammond increased its water rate for Lansing residents and businesses, but Lansing city officials were able to negotiate an incremental increase through January 2024.

Hammond Mayor Thomas McDermott said the city increased the rate to coincide with rates that neighboring cities and villages pay.

“If you look at the wholesale rate for communities around Lansing, the city has enjoyed a lower rate for a while. It is time to bring their rate up along with everyone else,” McDermott said.

On March 8, Lansing officials received a letter from Hammond officials that water rates would increase May 1, said village administrator Dan Podgorski, but village finance director Brian Hanigan was able to negotiate for an incremental water rate increase beginning this summer.

“Lansing for years has enjoyed probably the lowest rates of anybody in the area. I still believe that even after these rates are passed along we will probably still have the lowest rate if not one of the lowest rates in the area,” Podgorski said.

Currently, Lansing residents and businesses pay $5.98 per 1,000 gallons of water, Hanigan said, which means a water bill for 20,000 gallons of water comes out to $119.60. The average use of water per quarter is 18,000 gallons, he said.

By July 1, the water rate will increase to $7.36 per 1,000 gallons of water, and by Oct. 1 that rate will increase to $7.98, he said.

Another rate increase will go into effect Jan. 1, when the water rate will increase to $8.64 per 1,000 gallons, Hanigan said. Under the final increase, a water bill for 20,000 gallons of water will cost $172.80 plus a 3% cost of living adjustment, he said.

Lansing is nearing the end of a 20-year water contract with Hammond that expires in May 2026, Podgorski said. Under the contract, Hammond is allowed to increase the water rate every 3 years, Hanigan said.

“The city of Hammond has been great to work with. We have zero problems with them. They’re great partners with us. We look forward to the rest of this contract and we will see what we can do with them down the road,” Podgorski said.

In other nearby towns, per 1,000 gallons, Flossmoor’s rate is $12.48, Glenwood’s rate is $12, Hazel Crest’s rate is $11.78, Homewood’s rate is $16.74, South Holland’s rate is $9.91 and Thornton’s rate is $11.89, Hanigan said.

“Our rate in Lansing is still extraordinarily competitive,” Hanigan said. “I think this is the best deal in town.”

Hanigan presented the water rate increase to the Board of Trustees Tuesday during its Committee of the Whole meeting. Trustee Jerry Zeldenrust asked about a water cooperative proposed by the City of South Holland.

Podgorski said the cooperative likely won’t be ready for a few more years. When village officials discuss a contract extension with Hammond officials, Podgorski said they will “try to give ourselves the ability to go for whichever agency has the best rate.”

Trustee Saad Abbasy asked if the village will consider moving to monthly billing “to ease the burden of these bills.”

“This is potentially a significant financial impact,” Abbasy said.

Podgorski said the village will consider moving to monthly payments. The board will be presented with an ordinance about the water rate increase at its next meeting, he said.

Along with Lansing, Hammond, according to the city, supplies Lake Michigan water to Griffith, Highland, Whiting and Munster in Indiana. In Illinois, Hammond supplies water to Calumet City, Burnham and Lynwood.

According to South Holland officials, the city receives its water from Lansing and Chicago.

The rate hike for Lansing comes on the heels of water rate increases Hammond imposed on Griffith and Highland.

The Post-Tribune reported in February on a 15% rate hike in Griffith and in Highland water rates went up in January. Both hikes were attributed by town officials at least in part to rising costs from Hammond.

In Calumet City, residents and businesses pay $8.25 per 1,000 gallons within city limits and $9.25 per 1,000 gallons in unincorporated areas, according to the city’s website. In Burrnham, as of May 1, 2020, the water fee is $8.76 per 1,000 gallons, according to the village’s website.

Hammond also provides water to Chicago Heights, which uses it for its own municipal water supply and also sells water to Thornton, Ford Heights, Glenwood and South Chicago Heights.

Messages left Thursday and Friday with Chicago Heights water officials seeking comment on whether their city had received notification of a rate increase from Hammond were not returned.

Homewood last year switched its water supply to Chicago Heights, and Homewood also sells water to Flossmoor. Homewood had previously bought water through Harvey, which supplies Dixmoor, East Hazel Crest, Hazel Crest and Posen.

Glenwood said that at the end of last year it negotiated a new supply contract with Chicago Heights that does not include a rate increase until December 2024.

Oak Lawn buys water from Chicago and in turn sells it to Chicago Ridge, Country Club Hills, Matteson, Mokena, New Lenox, Oak Forest, Olympia Fields, Orland Hills, Orland Park, Palos Hills, Palos Park and Tinley Park.

In approving the village’s new budget last December, Oak Lawn officials included an increase of a bit more than 3% in water bills for this year for village residents and businesses. The village said it would also adjust rates charged to downstream communities that are water customers.

Oak Forest recently said due to operating costs and increases from its water suppliers — Chicago and Oak Lawn — water costs for residents in that city increased as of May 1.

The cost per 1,000 gallons of water used had been $10.33, and that rose to $11.02, according to Oak Forest.

That rate is for the first 25,000 gallons used, and after that the rate per 1,000 gallons, which had been $11.61, increased to $12.38, according to the city.