Illinois American Water has asked state regulators for permission to raise water and wastewater rates, a move that could leave customers across Chicago suburbs and other Illinois communities paying noticeably more every month.
The formal filing landed at the Illinois Commerce Commission (ICC) on Jan. 27 and is framed by the company as a long-term fix for aging systems. Consumer advocates, however, are already warning that the proposed hike would squeeze household budgets that are not exactly flush with spare cash.
In its request, Illinois American says the new rates would support about $577 million in projects from January 2026 through December 2027, aimed at modernizing pipes, treatment plants, and other equipment across a service territory of roughly 1.3 million people. "We carefully and strategically plan and invest in our water and wastewater systems," company president Rebecca Losli said in the filing, calling the work necessary to improve water quality and reliability, according to Illinois American Water.
For a typical residential customer using 3,500 gallons of water a month, the company estimates the change would mean about $14 more per month for water service. Customers on sanitary wastewater systems would see roughly a $28 monthly bump, with the exact hit depending on where they live and what services they receive. Those figures were reported by the Illinois Business Journal.
How the Company Is Selling the Hike
The filing lays out a long shopping list of projects: replacing about 42 miles of aging water and wastewater pipeline; upgrading storage tanks, wells, pumping stations, hydrants, and meters; work at wastewater plants; continuing lead-service-line replacements; and treatment improvements to tackle contaminants such as PFAS.
On the money side, Illinois American is asking for a two-step increase in the revenue it collects from customers: roughly $119 million more starting Jan. 1, 2027, and about $15 million more beginning Jan. 1, 2028. The proposal is built around a requested 10.75% return on equity, according to the company’s Form 8-K.
Consumer Groups Say: Not So Fast
Watchdogs say this is not the first time Illinois American has come in with a hefty ask. They argue customers have already been hit with substantial increases in recent years and that regulators should comb through the latest proposal line by line.
The Citizens Utility Board has contended that earlier rate cases by the company included roughly $50 million in charges that could be challenged and has urged the ICC to pare back what Illinois American can recover. AARP Illinois, in public comments, has warned that higher fixed meter charges could weigh especially heavily on older residents and low‑income households. Those concerns are reflected in testimony from CUB and in written feedback submitted to the ICC docket.
What Residents Can Do Now
The filing kicks off an ICC review process that can run for roughly 11 months. During that stretch, there are opportunities for written public comments and for residents to speak at hearings before the commission issues a final order. Any new rates would not take effect until after the ICC makes that call.
Consumers who want to follow the case can track documents filed in the ICC docket and keep an eye on local reporting for neighborhood-level impacts, including coverage from the Illinois Business Journal and CBS Chicago on early reaction.
