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Securing and Maintaining Lake Michigan Water Allocation Permits in Illinois

February 27, 2025 | Ravi Jayaraman, Sylwia Kokoszka

Many Illinois communities today still rely on groundwater aquifers as their primary source of drinking water. As the Chicago Metropolitan Area continues to grow, water demand is on the rise, causing water levels within the aquifers to deplete at unsustainable rates. As a result, the Cook and DuPage Counties of Illinois were forced to cease use of groundwater in the 1990’s, switching instead to Lake Michigan water. Other Illinois counties today are starting to experience the effects of groundwater depletion. In 2020, the Illinois State Water Survey published a report which indicated that numerous communities within the southwestern suburbs of Illinois are at risk of being unable to meet their drinking water demands in the upcoming decades. In response, many communities in the region are turning to Lake Michigan water as an alternative drinking water source.

Transitioning from groundwater aquifers to Lake Michigan water can be a huge undertaking. In addition to costly capital improvements, communities must secure and maintain a Lake Michigan Water Allocation permit from the Illinois Department of Natural Resources, Office of Water Resources (IDNR/OWR). To receive an allocation, the respective community must first prepare a detailed application in which they prove that they are able to comply with the IDNR’s stringent water allocation requirements. Once the community successfully secures a permit, they must comply with the IDNR/OWR’s annual reporting requirements to maintain the allocation.

Summary of Lake Michigan Water Allocation Requirements

To secure and maintain a Lake Michigan Water Allocation permit, each community must meet the IDNR/OWR’s Part 3730 Rules. One of the most important requirements for each permittee is to maintain a non-revenue water threshold of no more than 10%. Non-revenue water (NRW) is the percentage of the community’s total water supply which the community is unable to bill due to water system losses, measurement errors, and other limitations. In other words, it is considered a loss in water supply revenue. The IDNR/OWR will only authorize a water allocation if the community is able to maintain a water revenue loss at or below 10% of total water supplied. If permittees exceed the 10% threshold, they must implement a water system improvement plan outlining strategies the community will take to meet the compliance requirements.       

IDNR/OWR’s Part 3730 Rules also require implementation of several water conservation practices, including but not limited to adopting water rate structures that discourage excessive water use and adoption of water conservation ordinances. Permittees are also required to complete an annual water audit form (known as the LMO-2) using the American Water Works Association (AWWA) Free Water Audit Software and following guidelines in AWWA’s M36 Manual for Water Audits. The water audit is used to quantify the community’s annual non-revenue water percentage and must be submitted to the IDNR/OWR each year.

Key Components of a Water Allocation Application

The Lake Michigan Water Allocation Application consists of a detailed report that defends the community’s need for a water allocation and provides a technical assessment that proves the community can meet IDNR/OWR’s criteria for a water allocation. Key components of the application include but are not limited to:

  • A detailed description of the existing water system
  • Water supply and water consumption projections for the community based on anticipated population growth over a time period (typically 20 years). In Northeastern Illinois, the growth projections published by the Chicago Metropolitan Agency for Planning (CMAP) are typically used.
  • Technical data and assumptions supporting the requested water allocation estimate
  • A feasibility analysis and economic evaluation of other water supply source alternatives
  • Historic water supply and water consumption data for the community
  • A water audit using the AWWA’s Free Water Audit Software which meets guidelines in AWWA’s M36 Manual for Water Audits
  • An estimate of the community’s existing non-revenue water percentage
  • A proposed project schedule, including the anticipated timeline for infrastructure design and construction as well as the anticipated startup date for supplying the community with Lake Michigan water.
  • Existing and proposed water conservation measures
  • A Water System Improvement Plan and technical analysis exemplifying how the community will meet the 10% non-revenue requirement before transitioning to Lake Michigan water. The plan must include a non-revenue water percentage reduction schedule showing how the proposed water system improvements will reduce the NRW to 10% or lower. The community must show that the NRW percentage is at or below 10% before they are allowed to use the Lake Michigan water allocation.

Partner With HR Green to Secure Your Lake Michigan Water Allocation Permit

HR Green has staff specialized in preparing applications and water audits that meet the IDNR/OWR’s Lake Michigan Water Allocation requirements. Most recently, in the spring of 2023, HR Green helped a community in the southwestern suburbs of Illinois successfully secure a water allocation permit in preparation for future groundwater supply uncertainty in the region.

HR Green can assist communities with the following services:

  1. Securing a Lake Michigan Water Allocation permit from start to finish, including gathering pertinent data, preparing the application, navigating through the Pre-Hearings with IDNR/OWR staff, and participating in the official Hearing.
  2. Preparing the annual LMO-2 form and water audit using AWWA’s Free Water Audit Software and the AWWA M36 Manual for Water Audits.
  3. Preparing Water System Improvement Plans to help communities reduce their non-revenue water below the 10% threshold.

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If you need help securing or maintaining your Lake Michigan Allocation Permit, please contact:

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