Customers could soon see 18.4% sewer rate hike in Winthrop

The rate increase, which would be spread out over two years, is intended to cover a sewer project that came in well over its initial estimate.

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WINTHROP — A proposal in front of the Winthrop Utilities District would increase sewer rates by an average of 18.4% over the next two years, driven by a project that is expected to go over budget.

The board of trustees discussed the proposal Tuesday but delayed approving it to present to the public until later this month so they could receive more details from the district’s accountant.

The proposal calls for a 9% increase on the district’s customers Jan. 1, 2025, and an additional 9% increase Jan. 1, 2026 — all based on a sewer pump replacement project that will cost substantially more than its original budget.

The $4.3 million project would replace the district’s eight sewer pumps, which help move sewage to a wastewater plant in Augusta. Almost three-quarters of the funding for the project comes through grants and a reserve fund, but the district will need to take out a $1.25 million bond to fully fund the replacement.

Daniel Wells, the district superintendent, said the oldest of the eight sewer pumps was installed in 1959. Many of the pumps, Roger Hanson, trustee treasurer, said, are at constant risk of failure, which could end up being a bigger cost to the ratepayers than replacing the pumps preemptively.

“We really want to emphasize to the customers we’re doing this because we’re pinned into a corner,” Hanson said. “We’ve got to replace these pumps, and we had an engineering study verify that.”

Hanson said the engineering study, which the district commissioned about three years ago, determined there were significant risks to keeping the pumps in place and helped the district develop an initial cost estimate.

“We have estimated costs from three years ago, but when the bids came in, they were quite a bit higher,” he said. “You know what’s happened in the last three years — there’s been a lot of price increases.”

The district charges each customer based on a minimum of 2,100 cubic feet of sewer usage every three months, which Wells said is the average usage across the district’s approximately 1,000 customers in Winthrop and Monmouth.

Those minimum quarterly charges would go up from $224.70 this year to $245 next year and $266 in 2026. Each additional 100 cubic feet would cost $11.67 in 2025 and $12.67 starting in 2026.

In all, over the next two years, ratepayers would see an average 18.4% increase in their sewer bills, since the second year’s 9% increase would be applied on top of the first year’s. A notice posted on Facebook by the town of Winthrop on Oct. 9 incorrectly stated the proposed increase was 8% each year, which would add up to a 16.6% total increase.

Wells said the board of trustees will likely hold its next meeting Oct. 29 to further discuss the rate increase and finalize a plan to present to the public.

Hanson said during Tuesday’s meeting that he wanted to discuss a longer term for the bond to reduce the immediate impact to ratepayers. In a memo reviewed in the meeting, the district’s accountant, Nick Henry, proposed a 15-year loan payback schedule and urged the board to consider an even shorter term, but Hanson said Tuesday he wanted to extend the term to 20 years.

Henry estimated the district would need to pay $97,000 per year to pay back the loan under the 15-year term, an expense the district would pass down to customers. With a longer loan term, the costs passed down to customers each year would be lower and rates may not need to increase as much, but the total interest costs would be higher in the longer term.

The board tabled further discussion until they could discuss those loan details with Henry over the next several days.

The board plans to hold a public hearing on the increase during its meeting Nov. 19, after which they would approve an official rate increase and begin the implementation process. That hearing will take place at 6 p.m. at the Winthrop Utilities District Equipment Garage at 1771 U.S. Route 202 in Winthrop.

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