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No Increase In Water And Sewer Rates, As Selectmen Shift Debt To Property Tax Levy

Apr 04, 2016 08:59PM ● By Bill Gilman

Tewksbury Board of Selectmen

For the first time in several years, Tewksbury residents will not see an increase in their water and sewer rates with the new Fiscal Year.
Acting on a recommendation from Town Manager Richard Montuori at its March 29 meeting, the Board of Selectmen used an exemption to Proposition 2 1/2 that allows cities and towns to shift debt from water and sewer capital improvements to the property tax levy, to keep water and sewer rates unchanged for Fiscal Year 2017.
Selectmen unanimously voted to shift $344,109 of water debt and $198,956 of sewer debt to the tax levy. 
According to Montuori, the one-time water debt shift should put the town in an excellent position in regard to water rates for the next decade.
"With this debt shift, it could really stabilize the water rates over the next 10 years," said Montuori, adding that he expects annual rate increases to be limited to 0-3 percent.
On the other hand, said Montuori, the board would need to repeat the sewer debt shift annually to keep sewer rates under control while the town pays off its $100 million sewer project. This year marks the third time a portion of that debt has been shifted to the property tax levy to help keep sewer rates under control.
The property tax rates for Fiscal Year 2016 are $16.35 per $1,000 valuation for residential properties and $27.46 per $1,000 valuation for commercial and industrial properties. The rates for Fiscal Tear 2017 (Starting July 1) will be $17.00 per $1,000 for residential and $28.50 per $1,000 for commercial and industrial properties.
According to figures provided by Montuori, the actual cash impact of the debt shifts on Tewksbury property owners will be as follows:
Property Value                       Annual Property Tax Increase
$250,000                                              $27.50
$350,000                                              $38.50
$400,000                                              $44.00
$500,000                                              $55.00

According to Montuori, had the debt shifts not taken place, water rates would have increased 6 percent and sewer rates would have increased 3.5 percent in FY '17.
"We all hear, every year, about our water and sewer rates, in comparison (to other towns)," said Selectman Bruce Panilaitis. "This (shift) would be a way of smoothing it out, moving forward."

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