The Kewanee City Council is set to vote on a resolution to purchase the mortgage note for the collective Kewanee Mobile Home Parks from First Secure Community Bank for $150,000 on Monday, July 14th. There are four mobile home parks under the mortgage: Cole Street, Lake Street, West 6th Street, and North Adams Street. With this decision, city officials intend to take over the bank’s current position on the property, proceed with the foreclosure process, and assume management responsibilities for the mobile home parks. The move is aimed at addressing ongoing issues within the parks and ensuring better oversight. If approved, the closing date for the sale is July 31, 2025. The city would become responsible for the foreclosure process against the noteholder, Kewanee Partners LLC.
The resolution in the council packet mentions the unpaid water bills but provides no development plan for the properties. After a few court hearings, a handful of residents have water in the Cole Street properties. The property on West 6th Street was current as of the last council meeting.
City code enforcement staff have posted violation notices due to overgrown grass and notified the appointed receiver, who reports that the bank overseeing property funds will not provide further financial support. The receiver has announced plans to resign because “the bank has placed him in an impossible situation.” Staff estimates seven more mowings may be needed this year, totaling over $21,000—well above the $15,000 currently budgeted for nuisance abatement. Funding shortfalls now threaten continued maintenance. The Kewanee City Council approved the mowing contract Monday night. The initial payment is $8,100, and there will be an estimated seven additional mows for a total of $13,860. This was estimated by city staff and may change depending on weather conditions.
On June 30, 2025, Judge Hathaway approved Ira Lauter’s discharge as Receiver of the properties and officially released his bond. Vanessa Seiler, representing Lauter, has been tasked with notifying all tenants promptly, ensuring each receives the proper documentation with a cover letter. Meanwhile, Attorney Robert Dawidiuk, representing First Secure Community Bank, updated the court on ongoing negotiations with the City of Kewanee. A final hearing regarding Lauter’s discharge is scheduled for July 30, 2025, at 8:30 AM.
On June 10, 2025, multiple attorneys gathered to address motions concerning a high-profile case involving several plaintiffs, the City of Kewanee, Prairie State, and a court-appointed receiver, Ira Lauter. Attorney Zac Lessard sought to consolidate cases, but the plaintiffs’ attorney, Kathryn Liss, requested more time to review the motion. The court agreed and continued that hearing. Focus then shifted to a preliminary injunction affecting all five plaintiffs. After witness testimonies and reviewing admitted exhibits, the judge granted the injunction for Anna Holmberg and Ty Nelsen but denied it for Jack Poole, Teresa Powell, and Tyrone Smego. Orders will follow, with the case set to continue on July 8th for further management. Ms. Liss said that the city offered to have the tenants pay to install a water line that connects to the city’s water main. She said that this still violates their rights regarding payment to run new lines on property they don’t own. The residents own their trailers but not the ground. Ms. Liss said it violates their due process and does not provide an efficient and expeditious resolution for the tenants.
Mr. Lessard said that part of why the city shut off the water was because of the underground infrastructure, on top of the unpaid water bill. He said that “hemorrhaging water into the dirt is not helping anyone.” Mr. Lauter testified that “it was in very bad shape,” regarding the condition of the mobile home parks. He said there was brush and debris all over. Mr. Lauter said the Cole Street property was the main concern because of the many water leaks. He said, “There were frozen geysers of water.” He said there were over 10 leaks when he took over receivership, and the bank said they would support fixing the leaks. After fixing all the known leaks, Mr. Lauter said that there were no major leaks that he knew about. He said there may be some small leaks, but “no substantial leaks.” Mr. Lauter said that he couldn’t pay the $80,000 bill as planned because the bank said they wouldn’t pay anything over $60,000. Mr. Lauter said that he doesn’t believe the tenants can be individually billed because of the way the water lines are run. He said that he isn’t aware of a way for the city to shut off service to individual trailers. On cross-examination by Mr. Lessard, Mr. Lauter said that he is frustrated and feels bad for the tenants who have been paying. He said some non-paying residents threatened him. He said he posted notices on their doors explaining that he needed to money to make repairs. Ira Lauter said that he wants out of the receivership because the bank has made it very clear to him that they will not pay for the water line repairs, the water bill, and the receiver’s pay. He said the bank indicated that the “property no longer has value and hopes to sell the note to the city.”
Mr. Lauter said he didn’t notify tenants about the water termination because he thought the bank would pay the bill, but they stated they would not pay it. He said he hoped the city would work with him. He said he asked City Manager Gary Bradley for a payment plan, but was told the city would not work with him based on his income from the rent roll. He also said that he hasn’t taken any steps to evict any tenants.
According to City Manager Gary Bradley, water leaks occur every winter and then again in Spring and Summer, due to soil conditions. He said that the material used for the water lines is referred to as “farm plastic” and is not designed for this use. The City of Kewanee applied for a grant to replace the underground infrastructure in the mobile home parks, but the grant application was denied. The grant would have allowed the installation of new water lines on property not owned by the user. Mr. Bradley said the meters on the trailers can not be used by the city’s system, because the city uses wireless water meters. According to Mr. Bradley, approximately $5 million of improvements are necessary for new water, sewer, and streets in the collective mobile home parks. The city sends the non-payment notices to the owner and service address on file. He said the city sent notices to Prairie State Legal and Ira Lauter. Mr. Bradley said that the cost for the city to install a new service line is $5,000 to $8,000 each. Mr. Bradley said that the water bills are smaller since Mr. Lauter took over. Though he has made many repairs, new leaks have developed since. Mr. Bradley said that Mr. Lauter said the bill for the plumber was over $30,000 and that Ira was concerned that the bank wasn’t going to pay the bill.
Attorney Emily Petri said that “although there is some hardship to the city, the harm to the plaintiffs far exceeds that.” She said that “water is essential” for the plaintiffs to remain in their homes. She said that it’s not the responsibility of the tenants to run service lines.
Zac Lessard said that “they have a responsibility to the residents of Kewanee.” He said there will be new leaks when the ground freezes and the city can’t fix what is on private property. He said that this is a failing system that is 60 years old, and there will be no one to make the payments. Attorney Liss said that “the city is not offering anything feasible for my clients.”
Judge Hathaway said that “they do not have a right to water service if they are not paying for the service.” Judge Hathaway found in favor of plaintiffs Holmberg and Nelson and denied the restraining order for the remaining plaintiffs.
An emergency motion for a temporary restraining order was filed on June 13th to add Thomas Christian as a plaintiff and restore his water service. Henry County Judge Colby Hathaway denied the request on June 16th, but the appellate court later reversed it because “The court’s refusal to restore the status quo by granting Christian’s motion for a TRO was an abuse of discretion.” The Appellate Court of Illinois has overturned a previous decision, ordering the City of Kewanee to restore water service. The court determined that Christian satisfied the necessary legal requirements for a temporary restraining order, granting him urgent relief. This reversal comes after a lower court rejected Christian’s initial request. The ruling stresses the importance of access to essential utilities, especially as the court directed the city to act immediately. Reports indicate water service is expected to resume promptly. Read the full briefing here.
Excerpts from the appellate court ruling:
Paragraph 24: Another basis for the trial court’s denial of Christian’s TRO was that Christian had an adequate remedy at law, specifically, section 1 of the Rental Property Utility Service Act (765 ILCS 735/1 (West 2024)), which provides that when a landlord is required by an agreement to pay for a utility service, such as water, for a tenant and fails to do so, the tenant may (1) terminate the lease or (2) pay for their own service. That section further provides that a utility provider must immediately restore and continue service to any tenant who (1) requests that the bill be put in his or her name, (2) establishes satisfactory credit references or provides a security deposit, and (3) agrees to pay future bills. 765 ILCS 735/1 (West 2024).
Paragraph 25: Presumably, the trial court was relying on the provision above allowing tenants to pay for their own utility service by requesting that a bill be put into their own name. However, as Christian alleged in his complaint and stated in his affidavit, individual billing is not possible because in the mobile home park where he lives, water mains are shared by many residents. The City admitted in its responsive pleadings that individual billing was not available but indicated that there was an option for tenants to pay for installation of their own water service lines, which would allow for individual bills to each mobile home owner. However, the City failed to indicate when or how installation would be done or how much it would cost residents to pursue this option. Additionally, Christian averred in his affidavit that he had limited income and did not have the funds to move his mobile home, likely making payment for the installation of a water service line cost-prohibitive. Even if Christian could afford this option, it is hard to understand why it would be an adequate remedy for Christian to have to forgo running water in his home until the installation of a new line is complete.
Paragraph 27: Here, the “adequate remedy” espoused by the trial court was not clear, complete, or as practical and efficient as restoring Christian’s water service while the parties litigate the underlying merits of the case. As explained above, the City provided no information about how and when a new water service line could be installed to Christian’s residence or the costs for doing so; therefore, this remedy is not clear. Additionally, the remedy is not complete because the installation of a water line will require Christian to expend money, which he has asserted he does not have. Furthermore, the remedy is not as practical or efficient as restoring Christian’s water immediately; even if Christian could afford to install a water line, the installation will presumably require time, and until the installation is complete, Christian will not have access to running water in his residence, posing a risk to his health and safety. See Hammer, 2024 IL App (1st) 232464-U,
Paragraph 28: Again, the trial court’s granting of a TRO to Holmgren and Nelson belies its conclusion that Christian had an adequate remedy at law. In granting a TRO to Holmberg and Nelson because they “satisfied the elements for a [TRO],” the court necessarily found that they did not have an adequate remedy at law. However, the court provided no explanation as to why they did not have an adequate remedy but Christian did. Furthermore, nothing in the record suggests that Holmberg, Nelson, and Christian were not similarly situated, as they were all tenants of Kewanee Partners’ mobile home parks, owned their mobile homes, and received water from the City through shared water mains on the property. The only significant difference in Christian’s situation compared to Holmberg’s and Nelson’s was that the City had turned Christian’s water off before he brought his action. However, that has no bearing on the existence of an adequate remedy. Thus, the court abused its discretion in finding that Christian had an “adequate remedy at law.”
In summary, a recent appellate court decision has ordered the immediate restoration of water service for a mobile home resident, Christian, after the trial court’s denial of a temporary restraining order was overturned. The records indicated Christian consistently paid $300 per month, including water, matching payments made by other residents who were granted relief. The court found no justification for the distinction between Christian and others, noting that the loss of water service made his home uninhabitable and caused irreparable harm. The court directed the lower court to enter a restraining order in Christian’s favor while further hearings are conducted on the matter.
The June 25, 2025, hearing was continued because Attorney Robert Dawidiuk was not available. Mr. Lessard told the court he was concerned about bills getting paid without a receiver. Mr. Lauter informed the court that there was a new active leak on Cole Street and that he didn’t have any money to fix the leak. He said that ” the city isn’t stopping it.” he said the leak is under a trailer, and an excavator would be needed to fix it. The tenant in the trailer has water service but is very concerned about the leak. Mr. Lauter said that there is very little left in the receiver’s account and that most tenants have stopped paying. Attorney Seiler requested that the city fix and leak and “help the receiver.” The leak is on one of the properties under the injunction. Judge Hathaway said the court would entertain a lien for the receiver to fix the issue. Judge Hathaway said that Ms. Seiler and Mr. Lessard need to communicate and find a solution to the problem. Mr. Lessard said, “This is the kind of thing I’m concerned about.” Mr. Lauter permitted the city to make the repairs.
On July 2nd, a hearing on a motion to reconsider filed by the plaintiffs was heard by Judge Hathaway. City of Kewanee Attorney Zac Lessard expressed concerns for the future of the properties should the receiver, Ira Lauter, be allowed to be discharged as receiver. Mr. Lauter filed a motion to be discharged as the receiver, citing the bank’s refusal to pay. Mr. Lessard said the tenants’ electricity is included in their lot rents and is concerned that electricity will be disconnected from the properties for non-payment. Ira Lauter said that many tenants have stopped paying for lot rent, water, and trash after the City of Kewanee threatened to disconnect water service to the mobile home parks. Mr. Lessard said there will be no one to pay the bills if the current receiver is discharged from the receivership. Judge Hathaway ruled in favor of the motion and ordered that water service be restored to Jack Poole, Teresa Powell, and Tyrone Smego.
On July 8th, the motion to consolidate filed by Kewanee City Attorney Zac Lessard was denied. Mr. Lessard said the city has found a fourth leak in the mobile home parks. At the June 10th hearing, Judge Hathaway instructed the city to correct any leaks on the properties or allow them to leak. There were three known leaks at the time.
There are many questions regarding the situation at the mobile home parks, including who is ultimately responsible for the properties. The city said they are unable to individually bill tenants since the properties share one main line and meter. Gary Bradley said the meters on the individual trailers are sub-meters, and before the court case, he didn’t know there were meters on each trailer. The city bills from the main meter at the four properties. The receiver, Ira Lauter, said there is not enough money in the receivership account to fix any of the leaks, and the bank will not provide any additional funds. Mr. Lauter said he filed a motion to be discharged from the receivership because the bank will not provide any additional funds, and the city’s threat to terminate water service has “placed the Receiver in a position where the Receiver can no longer perform his duties.”
When Mr. Lauter filed his motion for discharge, Mr. Lauter said that expenses for June 2025 were $1,300 for Waste Management, $400 to Ameren, $5,000 in Receiver’s fees, and $7,000 in attorney fees. At the time of the filing, there is an outstanding water bill under Mr. Lauter of $82,669.27. As of May 31, 2025, the total amount of rent collected was $4,932. At the time of the filing, there was approximately $4,421.97 in the Receiver’s account. Ira Lauter requested that he be released from the receivership on June 30, 2025, and his bond be released on the same date.
According to court documents, on June 17, 2025, notices were to be sent terminating month-to-month leases, and the Kewanee Police Department was to accompany whomever served the notices. The motion to discharge would be entered upon completion of the notices.
On June 30, 2025, Judge Hathaway approved Ira Lauter’s discharge as Receiver of the properties and officially released his bond. Vanessa Seiler, representing Lauter, has been tasked with notifying all tenants promptly, ensuring each receives the proper documentation with a cover letter. Meanwhile, Attorney Robert Dawidiuk, representing First Secure Community Bank, updated the court on ongoing negotiations with the City of Kewanee. A final hearing regarding Lauter’s discharge is scheduled for July 30, 2025, at 8:30 AM.
