The recession hasn't stalled construction plans at the Metropolitan Water Reclamation District of Greater Chicago, which is rolling out a $1.5 billion budget for next year that includes improvements at its three largest treatment plants.

A public hearing on the district’s proposed 2009 budget is scheduled for 10 a.m. Wednesday, at 100 E. Erie St.

Though the district's total spending will increase by 9.6 percent under the plan, the tax rate paid by property owners will drop 3.3 percent.

Under the current budget, property owners pay 27.34 cents for each $100 of assessed value. The proposed budget sets the rate at 26.45 cents per $100.

"We have a triple A bond rating and a decrease in the tax levy of 3.3 percent," says district spokeswoman Jill Horist. "We are adding a very modest amount of staff and we are continuously providing improvements in our infrastructure. The taxpayers have every reason to be proud of the work of the district."

Much of the increased spending in the proposed budget will come from bond sales. The new budget calls for the district to raise $1.2 billion from bond sales, compared to bond revenue of $638 million in the current budget. That's an increase of 88 percent.

The budget calls for a 14 percent jump in capital improvement expenditures, including $791 million in construction work.

The district recently completed master plans for its Calumet, Stickney and North Side plants, which date back to the 1920s and 1930s.

The master plans call for $2.1 billion in construction over 10 years.

The upgrades will produce significant savings in energy, staffing and maintenance, according to district officials.

Dollars will also flow toward continued construction of the McCook and Thornton reservoirs, phase two of the district’s Tunnel and Reservoir Plan.

Three major contracts worth over $307 million are proposed for the Thornton Reservoir, slated to go on line in 2015.

Increased construction and slightly higher appropriations for maintenance and operations in 2009 are balanced out by decreases in the budgets for general administration, human resources, information technology and stormwater management.

The district’s five-year financial forecast includes an estimated 7.8 percent average increase in tax rates annually. Primary financial challenges are rising energy and healthcare costs, says district Superintendent Richard Lanyon.

Other challenges for the district’s financial planning include new water quality standards in the pipeline.

The Illinois Pollution Control Board is expected to rule next year on whether the district should disinfect its effluent to reduce bacteria in the Chicago River. Preliminary district estimates of the price tag for disinfection range into the billions, according to budget documents.

And the Illinois Environmental Protection Agency is considering new water quality regulations that would require removal of excess nutrients like nitrates and phosphorous.

The district is increasingly looking at wetlands as a way of removing harmful nutrients from waterways. It’s budgeted $5.3 million for a one-acre wetland creation and sediment clean-up demonstration project on a stretch of the Sanitary and Ship Canal near Kedzie Avenue.

Officials say wetland-based nutrient removal could save taxpayers over 50 percent over  conventional wastewater treatment methods.

Commissioners are scheduled to adopt the budget at a meeting Thursday.