The Montpelier City Council approved the FY26 water and sewer budgets May 21 and adopted the rate schedule staff recommended under the city’s water and sewer master plan. Rates were set using the plan formula (consumer-price-index plus 1% dedicated to infrastructure); staff applied a 3.5% increase for FY26, reflecting April CPI plus the infrastructure premium.

Public Works Director Kurt Monica reviewed the master plan and a multi-year replacement schedule. Monica said the city’s updated state permit refocused replacement priorities to water mains that experience frequent breaks and boil-water advisories, rather than prioritizing only undersized mains. The sewer program continues to emphasize elimination of combined-sewer overflows and upgrades at the wastewater treatment facility.

Monica presented a 20-year replacement schedule that fits within projected revenues, benefit-charge allocations and planned rate increases. He said the plan does not assume grant funding for all projects but does incorporate existing ARPA and USDA assistance where available. Monica reported the utility has replaced more than 10,000 feet of sewer main and more than 17,000 feet of water main since the master plan’s inception and is pursuing both in-house and contracted work.

Finance Director Sarah LaCroix said the water budget totals roughly $3.8 million for FY26 and that the sewer budget includes capital for current sewer separation projects. Council adopted the budgets and rates by voice vote; the new rates will be effective July 1, 2025, with the first billing impacts for the quarter ending September 30.

Council discussion included questions about emergency repair costs and replacement scheduling; staff said contracted emergency repair expenditures were materially higher in the most recent winter due to a larger number of breaks and aging equipment, and that data on historical emergency repair costs will be provided for future budget deliberations.