Lake County considering $24 million bond issue for septic elimination project

Lake County Commissioners are looking to embark on a nearly $24 million bond issue for the final financing component of the planned $90-plus million Calumet Township Septic Tank Elimination Project.

During its workshop, the body asked the Lake County Council Thursday to add the request to Tuesday’s regular council agenda for a first reading.

Doug Baldessari, an accountant with Baker Tilly, said the project is on schedule and is almost done with the design process. Construction will start this summer once financing is in place.

The majority of the $90-million-plus cost is funded with American Rescue Plan Act funds, Baldessari said. Commissioners dedicated the bulk of the about $84 million in ARPA funds they received — $60 million — to the Calumet Township sewer replacement project. An additional $10 million in funds were directed to the council to spend at its discretion.

Baldessari said another $5 million in grant funding for the project also has been secured.

The $24 million bond issue will come from the state revolving loan fund and have a fixed interest rate of about 2.49% over a 35-year term. The debt will be serviced with county economic development income tax funds, he said. He said they would like to see the sale finalized in May.

Baldessari said 820 customers will be connected to the service at a rate of about $85 per month. Once the sewer plant is completed, it could create the opportunity for additional growth.

The Calumet Township STEP project area is bordered, in general, by Ridge Road to the north, 53rd Avenue to the south, Colfax Street to the west and Cleveland Street to the east, according to the STEP website. The project area covers about 4,500 acres and has the potential to serve 2,500 sanitary sewer customers once it is completed.

“It’s sort of a moving target,” Commissioner Micheal Repay, D-Hammond, said of the number of customers who may sign up in the first phase. Until everything is near completion, it will be difficult to tell, he said. At this time, it is up to property owners to decide if they need to tie in.

Between 1991 and 2021 there were 324 complaints about septic systems in this area of Calumet Township, officials from Baker Tilly have previously said. In 2017-2018, the company conducted a study for Cady Marsh Ditch, which runs through the project area, which found elevated levels of E. coli and other contaminants. Officials said the findings were indicative of failing septic systems creating runoff into the surface waters.

“There’s not an obligation at this point for any resident to tie in. I’d say there’s an opportunity, a great opportunity…,” Repay said.