Creatively Financing Full Lead Service Line Replacement in Green Bay, WI and Spokane, WA

Community Story

Lead service lines (LSLs) are a significant source of lead hazard exposure in the U.S., with an estimated 9 million LSLs still in use across the country.[1] While the federal government has recently made more resources available for LSL replacement, fully financing these projects continues to be difficult for many communities.

One major challenge is that LSLs cross boundaries between public and private property, and many utilities interpret state and local laws to mean they cannot use public funds to replace the portion of service lines on private property. In these cases, full replacement is only an option for property owners who can afford to replace the private portion of their service line, which often costs several thousands of dollars. As a result, many LSLs are either not replaced or are only partially replaced. Partial replacements can increase lead levels in water flowing through the service line for a potentially lengthy period of time following the partial replacement. This dynamic creates and exacerbates environmental injustices.

Officials in Spokane, WA, and Green Bay, WI, understood that full LSL replacement would not be possible or equitable if property owners were responsible for the cost of replacing the privately owned portion of the service line. Instead, officials looked for ways they could use public funding to pay for full replacement without putting a significant financial burden for full LSL replacement on property owners. They identified creative solutions for tapping into public funds to finance full LSL replacement in their jurisdictions.

Prioritizing Complete Replacement in Spokane, WA

The City of Spokane had a longstanding policy to replace any lead components discovered during work on drinking water infrastructure, which reduced the number of LSLs in the city from 1,000 to 486.[2] In 2016, it began a concerted effort to remove the remaining lines. The city used an economic analysis to make the case for using public funds to replace service lines on private property by demonstrating that fully replacing private and public LSLs would save the city from spending the projected capital costs of implementing corrosivity treatment across the system.[3]

The city funded LSL replacement using revenue from ratepayers, spending approximately $3 million in total. While the city did not raise water rates, it did repurpose funds that had been allocated to replacing long service lines. It also sought grant funding to help cover the cost of the work. Dan Kegley, the city's water director, explained the importance of prioritizing LSL replacement: "For us, the replacement program really has been a statement of our values as a drinking water provider to our community. It was the right thing to do."[4]

Supporting Change in Green Bay, Wisconsin

In 2012, water testing across Green Bay revealed elevated levels of lead, and the Green Bay Water Utility determined that LSL replacement was essential to protecting residents' health. State and local laws explicitly prohibited the utility from using public funds to pay for replacements on private property, so officials in addition to the Sierra Club, the Wisconsin League of Municipalities, the Wisconsin Rural Water Association, and the City of Milwaukee, and others[5] provided education to law makers to help efforts to implement policies that would remove this restriction. In 2018, Wisconsin passed SB-48 which allows municipalities and utilities to provide financial assistance to property owners for LSL replacements.[6]

The Green Bay Water Utility was tasked with replacing over 2,000 LSLs at a cost of over $6 million. The utility drew these funds from several sources. Replacement of private segments of LSLs was achieved using $800,000 in funding though the Wisconsin Department of Natural Resources' Private Lead Service Line Replacement Program. Publicly owned portions of the service lines were eligible to be replaced using Safe Drinking Water Loan Program funding. An additional $300,000 was raised via the city's Lambeau Field stadium tax.[7] The remaining funds were raised via two rate increases, each of which raised residents' water bills by about 3% annually. While rate increases can create a financial burden for some and are challenging to justify to the public, officials were fully committed to eliminating this risk to residents' health. According to Nancy Quirk, general manager of Green Bay Water Utility, "We just said, 'Let's get rid of the source of lead...This is the right thing to do.'"[8]

Key steps taken:

• Explored whether existing laws—or alternative interpretations of existing laws—might allow the use of public funds for this purpose.
• Educated legislators about why and how full LSL replacement is helpful and how public funds could help support full LSL replacement.
• Found creative ways to generate and use public funds to finance replacement of the private portions of LSLs.