BAR HARBOR — No rate increase is planned for water and sewer service in fiscal year 2017, according to budgets proposed June 21 by Finance Director Stan Harmon and Public Works Director Chip Reeves.
Public hearings on both budgets are set for the July 19 Town Council meeting at 7 p.m.
Town Council Chair Paul Paradis thanked Harmon and Reeves for the flat budgets at the June council meeting. Councilors also were pleased to see these budgets presented earlier in the year than they were before.
“Money the town has borrowed or generated has improved the financial and infrastructure position” of the water division dramatically, Harmon said. The sale of old buildings paid off old pension liabilities and debt to the general fund. “That takes pressure off rates. The taxpayers aren’t owed a nickel from the water division.”
For the first time in more than 20 years, he said, the water department’s insurance rates will go down thanks to a more modern infrastructure.
“We used to have very low water rates, but [the system] was falling apart,” he said.
The total debt for the town’s water users stands at $6.7 million, or 36 percent of all the debt obligations of the town. The $1.7 million that was borrowed at the 2015 town meeting is still on hand and will be paid to the state DOT’s contractors as the Route 3 rebuild project progresses.
The sewer budget also proposes to keep the rate at the current $7.80 per cubic feet. This is the second year of a new rate structure, where the operations rate (based on current usage) and capital charge (based on prior year’s summer usage) were merged.
Sewer rates have risen an average of 1.9 percent per year for the last eight years, including a 4.7 percent increase approved in 2014.
Harmon said the council will need to decide on whether to make changes to the sewer connection fee. Town Manager Cornell Knight said a recommendation for an ordinance change on that issue will come this fall and a public hearing will be held.