Westerly council approves enterprise budgets after debate over water, sewer infrastructure and PFAS funding

Westerly Town Council on May 15 approved the town's enterprise budgets for water, sewer and the transfer station after staff outlined capital needs, a proposed infrastructure fee and ongoing work on PFAS mitigation and lead service replacement.

The budgets, as presented by Town Manager Sean, include a proposed $1.5 million annual infrastructure-improvement allocation funded by a flat infrastructure fee the manager described as "$50 per billing cycle on everyone's water bill." The council voted to accept the enterprise budgets as presented.

Why it matters: The enterprise budgets fund operations and capital for the water and sewer systems, including a new multi-year tank maintenance program, set-aside money for PFAS mitigation and continued replacement of lead service lines. Councilors and staff said those projects will affect rates, capital balances and future bond planning.

Town Manager Sean (staff) told the council the proposed infrastructure fee would be added as a separate line item on water bills rather than wrapped into a usage rate increase. He described capital items the fee is intended to support, including a new tank maintenance contract and an annual PFAS mitigation reserve: "We have a proposal of $23,000,000 to take the PFAS out of the water system," Sean said. He also described a new tank program, saying, "On Monday night, there's a water tank company coming in to give a presentation on a service agreement...We currently have 5 water tanks and they're in need of repair...we have not had a maintenance program in place for these tanks." (Sean).

Councilor Dylan raised the scope of the lead-service issue and asked staff to continue seeking outside funding: "The curb stop to the house is still on the homeowners...I'd love to find some money, you know, somewhere out there for that," Dylan said. Town staff confirmed they are researching possible grant sources and federal funding changes but emphasized the town's responsibility ends at the curb stop; work inside private property remains the homeowner's responsibility (Sean).

On PFAS, staff described the regulatory background and litigation: Sean said federal guidance had recently moved lower and that the town is participating in national litigation to recover treatment costs. He cautioned settlement outcomes are uncertain: "We're hoping to prevail on some litigation. We are hoping it's going to cover the cost...I don't know that I see that in here, but it's probably under the capital side somewhere" (Sean).

Capital and program details presented to the council included: - A proposed 10-year tank maintenance and rehabilitation program (presented as roughly a $497,000 annual line item for the program during the contract years). Sean described the program as recurring and as intended to spread major tank work over a decade rather than having a single large one‑time cost. - A PFAS mitigation set‑aside described by staff as an initial $100,000 annual contribution toward future treatment and ongoing operating costs that will remain after a capital solution is installed. - Continued replacement of lead service lines; staff said the town is replacing the portion from main to curb stop and that homeowners remain responsible for the private side. Council discussion included per‑service cost estimates mentioned in the meeting (staff cited a rough in‑house average and subcontract costs) but acknowledged per‑service costs vary with length and complexity. - Ongoing sewer work including sewer lining projects and a planned sewer system evaluation study to be performed by the town's consultant as part of new development review and system planning.

Debt and bonding: Staff explained the sewer treatment plant upgrade is expected to be funded with a bond. While interest/principal projections in the budget are currently modest because borrowing will be drawn over time, councilors were reminded the full debt service will increase when the bond is fully drawn. Sean said an estimated annual debt service when fully drawn could be in the low millions and that the town plans to split debt service between the general fund and the sewer (enterprise) fund.

Council discussion emphasized transparency in how the infrastructure surcharge will be used and the need for annual notes that identify multi‑year or recurring costs (for example, PFAS, tank maintenance and pipeline rehabilitation). Several councilors urged staff to show projected multi‑year costs alongside one‑year budget figures so elected officials can see which items are ongoing.

Direct quotes are limited to speakers recorded in the meeting transcript. The council moved and seconded a motion to accept the enterprise budgets; the motion passed. The ordinances to advertise the proposed fee changes (water improvement fee and sewer ad valorem change) were scheduled for advertisement at the next council meeting.

Looking ahead: The council approved the enterprise budgets and will consider specific fee and ordinance language at upcoming meetings; staff said they will bring the tank maintenance contract and the fee ordinances back for formal council action.