The average water and sewer bill in Needham will rise by about $100 next year if the Select Board votes to follow the recommendation made by the Water and Sewer Rate Structure Committee at the June 11 Select Board meeting.

The recommended 5.8% increase will produce an average annual water and sewer bill of $1,930 and was driven by a handful of factors, according to Deputy Town Manager/Director of Finance David Davison.

One contributing factor dates back to 2020, when Coca-Cola fully phased out its once vibrant bottling activities. At its peak, Coca-Cola alone could account for 20%-25% of the town’s total water revenue. Today, it accounts for less than 1% and is on a par with many other commercial users.

The loss of that tremendous amount of consumption — more than 10,000,000 cubic feet per year — did not produce a corresponding reduction in the town’s operating costs, Davison explained. But it did shift the burden of covering the town’s costs to all of the town’s other customers.

“(Coca-Cola) effectively provided a subsidy for other users,” Davison told the Select Board.

Another factor contributing to the need for an increase is added infrastructure costs as the town needs to finance improvements to an aging system. 

“We’re talking tens of millions of dollars,” Davison said. Some of those costs have been funded in recent years by an infusion of federal money from the American Rescue Plan Act (ARPA), but that program is ending.

“Also, there’s been a continual slow decline in the amount of consumption,” said Davison. “That is one of the drivers in increasing the rates to offset the cost.”

The committee provided the Select Board with two additional water rate structures that offer different formulas but would still increase the average bottom line bill by 5.1% and 5.6% respectively.

Needham’s average bill will likely still be lower than most of its peer communities in the MWRA system. In comparison to area communities, Needham ranked 16th out of 19 in terms of annual water and sewer charges for fiscal year 2024.

“The reality is the consumption is going down, our costs are up. We have to figure out how to pay for that,” said John Tallarico, chair of the committee.

“It’s probably going to be a little bit painful, but better to do something now than face a bigger shock a year from now or two years from now.”

The Select Board will vote on the increase at its next meeting on June 25. The new approved rate would go into effect July 1 of this year.

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