Hammond Water Department borrows $500,000 from city

2012-08-09T20:15:00Z 2012-08-09T22:43:05Z Hammond Water Department borrows $500,000 from cityChelsea Schneider Kirk chelsea.schneider@nwi.com, (219) 933-3241 nwitimes.com

HAMMOND | The Water Department is taking out a $500,000 loan from the city to meet its short-term financial obligations.

The loan was necessary because of "cash flow" as the Water Department works to negotiate new contracts with Illinois communities, Water Department Chief Executive Operator Ed Krusa said.

“Our planning centered around negotiations of these new contracts,” Krusa said.

Krusa said the Water Department is hoping to pay back the loan, borrowed from the city's gaming revenue, by the end of the year. The Hammond City Council agreed to the loan at its July 23 meeting.

Krusa said these types of loans are typical, explaining the city had to borrow from the Water Department when tax collections were delayed because of the new property tax assessment process.

In late June, Calumet City approved a new contract with the Water Department, agreeing to an increased rate of $2.20 per 1,000 gallons of water.

However, negotiations with Chicago Heights have been slow, Krusa said.

Chicago Height's 30-year contract expires in November and as in Calumet City the Water Department is requesting city officials agree to a rate increase.

Both communities had paid less than a $1 per 1,000 gallons for Hammond water. Hammond's case for higher rates has been helped along by the city of Chicago, which is also charging more for its water.

“They're moving slowly,” Krusa said of negotiations. “We've been talking to them for over a year.”

Sharon Daniels, president of the Water Department's Board of Directors, said negotiations are on track.

“We're just waiting to get all the new contracts the Water Department is working on in place,” Daniels said.

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