The Fosterburg Water District, which serves roughly 3,150 customers north of Alton, recently obtained a $4.2 million loan from the U.S. Department of Agriculture to help access a new water treatment plant and more than 50 miles of pipeline.
The USDA grant comes via the department’s Water and Waste Disposal Loans, Grants and Loan Guarantees program, meant to help state, local and tribal governments build and improve rural water and wastewater systems.
The loan to the Metro East water utility that serves residents in Madison and Macoupin counties is the largest awarded this year in Illinois.
“Without this money, we would have to seek other funding options, which there are — don't get me wrong — but there are no guarantees,” said Mark Voumard, the district manager for Fosterburg Water District.
The district will use the loan to build infrastructure that will connect to the new plant north of Nutwood, a small community in Jersey County that sits north of Pere Marquette State Park. Construction should be complete by 2027, Voumard said.
Networks of water mains will fan out to various utility providers in the area. They also include Bunker Hill, Carlinville, the Central Macoupin County Water District, Dorchester, Fieldon and Jersey County Rural Water.
Together, the seven communities and water districts will form the Illinois Alluvial Regional Water Company, a nonprofit.
The goal of the bigger project is to pool resources to upgrade aging infrastructure and to give the district more control over costs. Now, Fosterburg buys its water from Illinois American Water’s facility out of Alton.
“We’ve all witnessed in the past years in the private sector and the publicly traded sector: everything’s going up,” Voumard said.
In 2016 and 2022, Illinois American Water persuaded the Illinois Commerce Commission to approve rate hikes. The publicly traded company recently asked for another set of hikes to offset $557 million worth of water and wastewater investments it is making through 2025.
When the treatment plant near Nutwood is complete, Fosterburg and the six others can produce their own water and will have more control over their prices.
“We're trying to be able to have it so those individuals that are on a fixed income, who don't have those means readily available, can still have that life-giving [resource],” Voumard said.
The USDA loan will cover the entirety of the project — and in a much more favorable way than other financing options provided.
The Fosterburg Water District will pay a 3% interest rate over 40 years, Voumard said. Other financiers weren’t thrilled with 40 years and were looking for a 6% to 8% interest rate, he said.
“The investments we’re making today help make a better tomorrow, and it’s always exciting to see the impact these types of projects have across communities,” said Molly Hammond, acting state director for the USDA’s Rural Development Office in Illinois.
