strange hole in my parent's yard

My parents have a strange hole growing in their yard. They first noticed it a couple of months ago. It was a few inches deep and perfectly round, about 6 inches across. It is located in their front yard right up against the city sidewalk. We have filled it with chunks of sod several times but the next day it is always back. It has continued to grow and is now over foot wide and at least 3 feet deep (we have given up trying to fill it). The hole is dry.

Today we had a man from the city's public works department look at it and he determined that it is not a problem with the city water line. He said it might be sewer related.

I'm wondering if anyone has had an experience like this. We live in northern Illinois on the Lake Michigan bluff.