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Farmland council warned of $284,000 revenue loss starting 2028; sewage rate study proposed
Summary
Council members were told a state Senate bill will eliminate certain local income tax (LIT) rates by 2028, creating an estimated $284,000 annual revenue shortfall for Farmland; the town asked to authorize a $4,000–$6,000 sewage rate study to assess future sewer rates and fund stability.
Chair opened the May 6 meeting by alerting the council that a recently circulated Senate bill would eliminate some LIT rates beginning in 2028, and that the town faces an estimated $284,000 loss in revenue tied to the change. He said he did not yet know what replacement funds, if any, would arrive and called the prospect “frustrating.”
The warning framed a broader discussion about utility fund health. Chair said the town had paid off a 2025 sewage loan rather than raising rates, leaving sewage reserves below the level an outside consultant had recommended in 2023. He recommended commissioning a follow‑up sewage rate study from Jared with Cone and Associates at an estimated cost between $4,000 and $6,000 to determine whether and how to adjust sewer rates in coming years.
Supporters of the study said it would provide the documentation needed to justify rate adjustments to customers and to regulators; others urged establishing a fee cap before engaging the consultant. Chair suggested asking for an hourly or capped engagement so the town would not exceed budgeted amounts. The council discussed that water funds are in better shape but sewage reserves are low, and one member noted the town had borrowed from a sewage improvement fund and should set a plan to repay it.
No numeric vote tally was recorded in the transcript for the motion to pursue the study; the motion was discussed with an instruction to request a not‑to‑exceed cap and then follow up at the next meeting. The council also discussed longer‑range budget impacts tied to the anticipated $284,000 revenue reduction from the state bill set to take effect in 2028.
Next steps: council asked staff to request a scope and not‑to‑exceed price from Cone and Associates, compare options, and return with a recommendation and any proposed cap for execution.
