WILLIAMSTOWN, Mass. — The Finance Committee on Wednesday decided to send a 5 percent increase in the town's water and sewer rates and discussed possible moves that could trim the tax levy increase generated by the fiscal year 2027 spending plan the committee sends to town meeting later this spring.

 

That water rate increase and another 5 percent hike in FY28, in conjunction with use of reserves from the water department, will enable the town to address two capital projects — the replacement of a well and the replacement of customers' water meters — without needing to borrow for either project.

 

The specter of issuing a small bond for a $1.5-million meter replacement project drew concern from members of the Fin Comm at its March 11 meeting.

 

At the same time, the committee is sensitive to big increases in the fees paid by all residents on town water and sewer in a year when town meeting voters already face the prospect of a major rise in the assessment from the Mount Greylock Regional School District among other rising costs of municipal services.

 

But, as noted on Wednesday night, the town's water and sewer rates — not counting its assessment from the Hoosac Water Quality District — have not seen an increase since FY23.

 

Matheus Carrato Alexandre of utility rate consultant Waterworth made his second appearance before the Fin Comm via teleconference and explained how the 5 percent increases in the water rate could cover the department's capital needs and keep the operation in good fiscal shape.

 

"If you're tracking what's happening with the black line, which represents your cash position, all we're showing here is a stable position until '27," Alexandre said, showing the Fin Comm a series of graphs outlining the recent past and next few years of the town's water operations. "In fiscal '27, you're using those restricted funds to cover a large project, and nothing is changing in your cash. It's pretty much staying the same.

 

"In '28, we have $1.5 million worth of meter replacement. We're depleting a significant amount of your reserves, but then we're stabilizing it in the future. And the amount of money we're keeping in the bank for the water, specifically, is really what we're calling the optimal position for you. … We're making sure to keep a sizable amount of operating expenses on hand at all times, and we're stabilizing for the future.

 

"And the way to get there was using two years of 5 percent increases for the water."

 

The town's sewer department does not have as many anticipated spikes in its capital needs as the water department, Alexandre said. But the consultant did recommend a 5 percent increase there as well after consultation with the town's Department of Public Works director, finance director and the representatives of the Fin Comm.

 

The effective increase for sewer services in town will be around 6 percent because of how charge incorporates both the town and HWQD fees. The district’s assessment to the town for water treatment is up by about 10.7 percent from FY26 to FY27, but the town over-budgeted for that service last spring, when the district was in the process of figuring out how it would deal with higher disposal costs linked to the PFAS controversy.

So, Fin Comm Chair Frederick Puddester explained on Wednesday night, a 10.7 percent hike from HWQD translates to a 6.8 percent increase for Williamstown ratepayers. That rise plus the 5 percent increase in the town sewer department charges (about 45 percent of a ratepayer’s bill for sewer services) combine to produce an overall sewer increase “closer to 6 percent,” Puddester said.

Of course, while the water and sewer fees impact residents on town water and sewer, most of the town’s expenses are shared by all Williamstown residents.

On Wednesday, Puddester noted that if the Mount Greylock Regional School District budget proceeds as drafted and ultimately is passed by town meeting, it along with town expenses (higher health insurance costs, a cost-of-living increase for employees and an additional officer in the Williamstown Police Department) will drive a town budget that is up 10 percent from the current fiscal year that ends on June 30.

 

Puddester praised the efforts of the school district and its committee to go through the education budget with a fine-toothed comb and acknowledged that part of the reason for an anticipated 13.61 percent increase in the FY27 assessment to Williamstown is that the district followed the Finance Committee's recommendation to spend down the district's reserves.

 

In order to mitigate the looming increase in the tax levy, Puddester brought forward a handful of measures he would like to be considered by the committee and Town Manager Robert Menicocci, who was unable to attend Wednesday's meeting.

 

Following up on a point he made to Menicocci and Finance Director David Fierro Jr. earlier in the current budget season, Puddester suggested that the town should revise up its estimates for non-property tax revenue, specifically the rooms and meals tax receipts.

 

"The state recommends we budget our local revenue at 5 percent less than what we took in two years ago," Puddester began.

 

"They say 7 percent, I did 5 [percent]," Fierro interjected.

 

"He was really aggressive," Puddester joked. "If you look at those revenues, it's hard to imagine we'll be 5 percent lower than we were two years ago. We may take a little hit in 2027 with the Williamstown Theatre Festival not being in town and maybe a little bit from Fresh Grass [not happening] because of hotel rooms."

 

But Puddester expressed confidence that the town still could hit its 2025 benchmark. And if it budgeted for that revenue, that is $200,000 that could come off the amount raised from property taxes.

 

One downside, he pointed out, is that the $200,000 — more or less — would not be added to the town's coffers in the FY27 fiscal year and therefore be available in a future year as "free cash" to support capital improvements.

 

Another downside is that if the town overestimates revenues, it could make it hard to get through the fiscal year.

 

"Dave won't like [the suggestion] and neither will Bob [Menicocci]," Puddester said.

 

The upside, of course, is that less money would need to be raised through taxation in fiscal year 2027 to support the budget.

 

Puddester also reiterated another suggestion he made earlier this year: reducing the town's overlay balance which currently has about $600,000 and is in line to receive another $100,000 contribution in the FY27 draft budget. Puddester noted that the town generally uses about $50,000 a year from the account to cover property tax abatements and exemptions.

 

He agreed to wait for further discussion until Menicocci has a chance to weigh in.

 

Puddester also ticked off a few smaller items, including potentially reducing the budget's line item for legal services and ending financial support for the Williamstown Community Preschool, which was cut from $50,000 to $25,000 in the FY26 budget and, "anticipated it would go to zero this year," he said.

 

While on the subject of supporting non-profits, Fin Comm member Melissa Cragg suggested that town meeting needs to take action to either amend or rescind a vote in the 1980s that tied the town's support of the Williamstown Chamber of Commerce to a percentage of the rooms and meals tax revenue.

 

It has been years since the Chamber was funded according to that percentage, and in the last couple of years, the municipal support for the business group was cut even further when the town brought some of the Chamber's communication functions to town hall with the appointment of Williamstown's first communications director.

 

Cragg said town counsel should be consulted about a possible article for the May 19 annual town meeting to address the out-of-date decision on Chamber funding.