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A Presentation on the Updates to the State and Federal Lead Service Line Regulations and Their Impacts on the Village’s Draft Lead Service Line Replacement Plan
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Introduction
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Village staff will provide an update on the state and federal regulations surrounding lead service lines, including the Lead Service Line Replacement and Notification Act (LSLRNA) and the Lead and Copper Rule Improvements (LCRI), and their impacts on the Village’s Draft Lead Service Line Replacement Plan. Village staff will also explore potential funding options and mechanisms that are available at the local, state, and federal levels for lead service line replacement and water infrastructure improvement projects. Along with this presentation, Village staff will review the current financial status of the Water & Sewer Fund and the potential financial impacts in the near future related to lead service line replacement.
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Recommended Action
Village staff are seeking Village Board feedback to inform future decision making around lead service line replacement planning.
Prior Board Action
On October 22, 2024, staff discussed lead service line replacement with the Village Board to provide an update on state and federal regulations and potential impacts to the Water & Sewer Fund ahead of the 2025 water & sewer rate study (ID 24-497).
Background
In January 2022, the Lead Service Line Replacement and Notification Act (LSLRNA) went into effect in the State of Illinois, requiring community water suppliers to identify, inventory, and facilitate replacement of lead service lines throughout their communities. Not long after, the federal government adopted the Lead and Copper Rule Revisions (LCRR), which was quickly replaced by the Lead and Copper Rule Improvements (LCRI) in 2024 and was codified in late 2025. These new federal regulations, which supersede the LSLRNA, include similar requirements already associated with the LSLRNA, with the addition of public education and notification requirements, new water sampling procedures for lead and copper, and a new timeline for completion of lead service line replacement.
Material Service Line Inventory
Not long after the LSLRNA went into effect in the State of Illinois, the Village of Oak Park began compiling available data associated with both public and private service line materials throughout the Village. The final inventory was due to be submitted to the Illinois Environmental Protection Agency (IEPA) on April 15, 2024, with continued updates expected annually through 2027.
With the Village’s most recent update to this inventory, it has been determined that approximately 8,736 service lines require either partial or full-service line replacement. The Village also has approximately 2,845 service lines that will require further two-point verification to confidently confirm the service line material on either the public or private side. Additionally, as part of the LCRI, all non-lead service lines will need to follow strict guidelines to verify the accuracy of the methods used for identification before December 31, 2034.
While grant funding has been made available to cover costs associated with both identifying service line material and performing two-point verification, the Village of Oak Park is ineligible for this grant funding due to its Median Household Income, as a whole. Recently, the IEPA has suggested applying for this grant funding through the creation of smaller, income-eligible project areas throughout the Village. Public Works staff plan to explore this opportunity further in the coming months.
Lead Service Line Replacement Plan
In late 2023, the Village of Oak Park began working with Baxter & Woodman to compile an initial Draft Lead Service Line Replacement Plan to submit to the IEPA by April 15, 2024. The Village is required to submit updated, draft plans annually through 2026, with a final plan due on April 15, 2027. While the initial draft plan, compiled by Baxter & Woodman, met all of the requirements outlined in the LSLRNA, it simply provided data on what the Village could do as part of its plan, but was not indicative of the Village’s policies/procedures surrounding lead service line replacement.
While revising the plan for submission in April 2025, it became clear to Village staff that additional conversations would need to take place with the Village Board before the plan could be fully developed. Those conversations were further delayed as Public Works staff awaited the codification of the LCRI and further information regarding how those requirements would adjust those currently being met under the LSLRNA. In the meantime, Village staff began internal discussions surrounding such issues as financial burden, timeline, manpower, financing options, and next steps, all of which are discussed below.
Financial Burden
There are high costs associated with lead service line replacement, not only for Village residents required to complete private side service line replacement, but also for the Village, as public side service line replacement often triggers water main replacement and roadway reconstruction. Neither the LSLRNA nor the LCRI explicitly requires the community water system (CWS) to pay for lead service line replacement, but they do require the CWS to make replacement affordable for all residents. The Village has implemented a lead abatement program, which covers the cost of the public side of the service line when the property owner initiates replacement of the private side of the service line. Village staff are also exploring a pilot program to assist property owners with a low-interest loan, financed by the Water and Sewer Fund, needing to replace the private side of the service as part of the annual Water & Sewer Improvement projects. Any Village-financed loan program for private-side replacement would require further review of Water & Sewer Fund liquidity, administrative capacity, repayment security, default risk, legal authority, and potential ratepayer impacts. A pilot program will allow the Village to test this approach on a limited basis before considering whether a broader program is financially or administratively sustainable.
Staff are also aware that other communities, including Skokie, have implemented or explored different program structures to address lead service line replacement. Those models provide useful points of comparison; however, any Oak Park program would need to be evaluated within the Village’s own Water & Sewer Fund capacity, infrastructure needs, rate structure, legal framework, and policy priorities. Because the Village is currently discussing a potential pilot approach, broader program design comparisons may be appropriate as a future phase of analysis.
Timeline
Previous drafts of the Village’s lead service line replacement plan, in compliance with LSLRNA, outlined the facilitated replacement of nearly nine thousand lead service lines within 20 years, with the potential for two additional extensions, bringing the total allowable timeline for replacement to 26 years. Beginning November 1, 2027, the Village’s replacement obligation per the provisions set forth by the LCRI will require a minimum of 3.9% of the total number of service lines to be replaced annually, with a completion timeline of 17.9 years. This includes the only extension available under LCRI and would require the Village to complete replacement by November 1, 2045.
Estimated annual costs associated with each timeline, on average, are outlined in the table below. The figures represented below are not meant to be cumulative year over year, but instead represent costs associated with different policy decisions regarding lead service line replacement. For example, should the Village Board choose to fund private and public lead service line replacement along with the required water main replacement and roadway reconstruction on the 17.9-year timeline allowable under LCRI, it would amount to an additional cost of approximately $24.5 million per year prior to any consideration of grant funding for eligible portions of the Village.
The estimated annual cost scenarios are intended to illustrate the magnitude of potential financial exposure under different policy and compliance assumptions. They should not be interpreted as a staff recommendation to fund all components of lead service line replacement, water main replacement, and roadway restoration through the Water & Sewer Fund. Any future recommendation would require additional financial modeling, rate impact analysis, debt capacity review, and coordination with the ongoing water and sewer rate study.
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LSLRNA |
LCRI |
CURRENT |
|
# of years to complete |
26 |
17.9 |
~50 |
|
Total LSLR* |
$4,659,326 |
$6,767,736 |
N/A |
|
Public Side LSLR* only |
$1,321,692 |
$1,919,776 |
$687,280 |
|
Water Main Replacement & Roadway Restoration |
$12,247,500 |
$17,789,665 |
$6,368,700 |
*Assumes a 1” service line replacement. Costs include average costs for preliminary inspection, non-special waste disposal, trench backfill, and plumbing inspection. Additional restoration costs would need to be considered on a case-by-case basis.
Manpower
Currently, the Village maintains quality control of its drinking water system by having front-line, professional staff perform all of its water main taps for new service lines. Meeting the timeline outlined in the LCRI equates to approximately 325 additional taps per year, nearly tripling the current workload. Engineering Division staff, who already assist by driving down costs associated with design engineering and construction management, would also be tasked with an additional 2-4 projects per year to account for the added water main replacement and roadway reconstruction due to lead service line replacement.
Financing Options
Village staff have been working closely with the IEPA financial assistance section to strategize a means by which to receive federal grant funding for lead service line replacement through its PWSLP loan program. These funds are not guaranteed as they are becoming increasingly competitive, and, as a whole, the Village does not qualify for this federal grant funding due to its Median Household Income (MHI). Village staff have been encouraged to develop smaller project areas in low-income census tracts, where federal grant funding could cover the entire cost of lead service line replacement and present them for consideration. Following a brief review of the most up-to-date available information, there are three small areas at the center of Oak Park that it would be advantageous for Village staff to analyze further for potential grant funding opportunities. If successful, the Village would only be financially responsible for water main replacement and roadway restoration in these project areas.
In addition to grant funding, as of 2024, the IEPA has isolated funds from the Public Water Supply Loan Program (PWSLP) to be used for lead service line replacement projects and associated activities directly linked to the identification, planning, and replacement of lead service lines. All lead service line replacement loans have an interest rate of 0% and a loan term of 30 years. Funding is not guaranteed and has also become highly competitive in recent years as lead service line replacement activities have ramped up. Projects receive a priority score based on demographic data for the census tract(s) where the lead service line replacements will occur. While the IEPA 0% loan program is financially attractive compared to traditional borrowing, it does not eliminate the need for a dedicated repayment source. Any loan-funded lead service line replacement program would require the Village to demonstrate sufficient Water & Sewer Fund capacity to repay the debt, which would likely need to be supported through future water and sewer rate adjustments.
While reviewing grant funding opportunities and available financing mechanisms, Public Works staff have also been strategizing on a means by which to make private side lead service line affordable for Oak Park property owners. A few mechanisms that have been reviewed are a low interest, installment loan specifically offered to property owners impacted by annual Water & Sewer Improvement projects, a cost share model mirroring those offered by other municipalities, an income-based hybrid model similar to that of the CDBG assistance program offered in recent years, and a Village-funded model by which the Village funds the cost of both public and private lead service line replacement. Grant funding should be viewed as a potential offset, not as the primary funding strategy. Because eligibility is limited and awards are competitive, the Village should model scenarios both with and without grant assistance. Securing grant funding and/or IEPA financing would be imperative to subsidizing private side lead service line replacement.
Next Steps
The Village has successfully increased its service line replacement activities to 165 per year over the last few years through assistance from the Village’s lead abatement and CDBG lead service line replacement programs. With household lead abatement requirements under CDBG becoming more stringent and reducing cost benefit, there is some concern amongst staff that lead replacement will start to decrease once eligibility for Village-financed incentives, such as free public-side replacement under the lead abatement program, dwindle throughout the community.
On April 15, 2026, Village staff submitted a 50-year draft service line replacement plan. While Village staff recognize that this plan is not compliant with the LSLRNA or the LCRI, this plan would maintain the existing replacement frequency and allow the Village Board ample time to review potential financing options and additional pathways forward. Once all financing options have been explored, presented to the Village Board, and direction has been provided on a plan that the Village is confident it can complete successfully and affordably, Village staff will share the updated plan with IEPA representatives and convey the desire to maintain the Village’s commitment to transparency with its residents.
Timing Considerations
In accordance with the Lead Service Line Replacement and Notification Act, the Village is required to finalize its plan for lead service line replacement prior to April 15, 2027. Discussions regarding lead service line replacement policy and water and sewer rate structures are anticipated to occur concurrently over the course of the next year.
Village staff are scheduled to meet with the Finance Committee on July 16, 2026 to review both items, most notably the anticipated impacts on the water and sewer rate of feedback provided at this meeting.
Village staff would then return to the Village Board in October with recommendations surrounding lead service line replacement policy and their anticipated impacts on water and sewer rates for 2027-2030.
Financial Impact
Village Board policy direction on lead service line replacement will have significant implications for the Water & Sewer Fund, future capital planning, potential debt issuance or IEPA loan repayment, and residential and commercial water and sewer rates. While this item is intended to receive policy feedback and does not request approval of a specific funding model, the financial exposure associated with lead service line replacement varies materially depending on the timeline, level of Village participation, private-side assistance approach, grant eligibility, and whether related water main replacement and roadway restoration are incorporated into the program.
Public Works and Finance staff will evaluate Board feedback in coordination with NewGen Strategies and Solutions as part of the ongoing water and sewer rate study. This analysis will allow the Village to assess lead service line replacement alongside existing Water & Sewer Fund operating needs, capital infrastructure requirements, reserve targets, debt service obligations, and rate impacts.
Potential funding mechanisms, including IEPA 0% loans, targeted grant opportunities, cost-sharing models, income-based assistance, and a possible limited pilot loan program, will require further review before staff return with a recommendation. Even where low- or no-interest financing is available, the Village would still need to identify a reliable repayment source, which may require future water and sewer rate adjustments. Future recommendations will include specific scenario analysis showing projected impacts to the Water & Sewer Fund and estimated impacts to average residential and commercial water and sewer bills.
Operations Impact
Public Works administrative staff (deputy public works director, village engineer, and assistant village engineer) have spent approximately 8 hours per week over the last few years reviewing, planning, and strategizing on potential solutions for lead service line replacement. Additionally, Public Works frontline staff (water & sewer superintendent, water & sewer workers, and civil engineers) have spent an average of 20 hours per week implementing the lead abatement program by assisting property owners with water service upgrade forms and permit information, visiting properties to lay out specific site plans, and replacing public side lead service lines. This time commitment easily fluctuates between clerical and operational work based on the time of year. With that being said, Village staff anticipate that time commitment to increase exponentially, likely requiring additional consultants and/or manpower, should the Village be required to meet the LCRI timeline requirement of 490 lead service line replacements per year.
In addition to Public Works staff time, this item will require considerable Finance staff time as the Village works to determine which financial strategies are both necessary and beneficial to implement in order to fund this endeavor. Those financial strategies will be heavily centered on their direct impacts to the water and sewer fund and rates.
DEI Impact
The DEI impact of lead service line replacement is multifaceted and can significantly contribute to health equity, economic opportunities, and community empowerment. Lead pipes are often found in older neighborhoods, which may disproportionately affect low-income communities. Replacing lead service lines can help reduce lead exposure, leading to improved health outcomes, particularly for vulnerable populations, including children and pregnant women.
Lead service line replacement projects can create jobs and economic opportunities in underserved communities. As part of the ILSLRNA, the Village is to make a good faith effort to use contractors and vendors owned by minority persons, women, and persons with a disability for not less than 20% of the total contracts.
Lead exposure is often a concern that communities may not fully understand. Replacement initiatives can include educational components that inform residents about the risks of lead, preventative measures, and the importance of clean drinking water. This knowledge is crucial for fostering informed communities and promoting health literacy.
While considering the benefits of lead service line replacement, it’s essential to consider potential barriers that might exist in the implementation of service line replacements. These challenges can include financial constraints for homeowners or a lack of access to information regarding financing options and grant programs. Ensuring that replacement programs are accessible to everyone, regardless of socioeconomic status, is crucial for achieving equity.
Community Input
There has been no community input given in relation to this item.
Staff Recommendation
There are no Village staff recommendations, at this time, as this is a presentation meant to elicit feedback from the Village Board on the Draft Lead Service Line Replacement Plan.
Alternatives
There are no alternatives, at this time, as this is a presentation meant to elicit feedback from the Village Board on the Lead Service Line Replacement Plan.
Anticipated Future Actions
Village staff will return to the Village Board in the near future to finalize policy decisions surrounding lead service line replacement, which are heavily seeded in their anticipated impacts to water and sewer rates.
Prepared By: Erin V. Duffy, Deputy Public Works Director
Reviewed By: Jack Malec, Assistant to the Village Manager
Approved By: Kevin J. Jackson, Village Manager
Attachment(s):
1. Draft Lead Service Line Replacement Plan
2. Presentation- LSLRNA, LCRI, and Financing Options
3. Lead Service Line Replacement Comparison Table- Neighboring Communities