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The Winchester Select Board signaled support March 16 for a 7% increase in water and sewer rates for fiscal year 2027, with a formal vote expected at a public hearing scheduled for March 30.
Consultant Mark Abrahams of the Abrahams Group presented three rate options to the board during a presentation that covered the Water and Sewer Enterprise Fund’s financial outlook through fiscal year 2031. All three options were designed to bring the fund’s retained earnings balance into the town’s longstanding target range of 8% to 10% of total expenditures within five years.
The board’s preferred option would apply a flat 7% annual increase across all five years of the rate plan. For the average residential user, that translates to an increase of roughly $16 per quarterly bill in fiscal year 2027, rising from $267.61 to $283.89, according to the rate study.
No formal vote was taken, as the board must first hold a public hearing.
Abrahams told the board that without any rate action, the fund faces a projected deficit of approximately $863,000 in fiscal year 2027, growing to nearly $2.9 million by fiscal year 2031. He said the current retained earnings balance could absorb a single year’s deficit but nothing beyond that.
“Even in FY27, we think it’s going somewhere in the $800,000 range,” Abrahams said of the no-action scenario.
The presentation noted the fund had a strong revenue year in fiscal year 2026, with user charges projected at $8.57 million, driven largely by dry summer conditions that increased water consumption. That figure was well above the $7.57 million collected in fiscal year 2025 and the $6.12 million in fiscal year 2024, which Abrahams described as a wet year.
Even so, he cautioned that after subtracting the $760,000 in retained earnings appropriated to balance the current budget, the fund’s surplus without that funding source was only $235,000.
“[The] $235,000 in your strongest revenue year means that revenues generally are not really keeping up with expenses,” Abrahams said.
On the assessment side, the Massachusetts Water Resources Authority’s preliminary fiscal year 2027 water assessment rose 8.8% compared to fiscal year 2026 — a figure Abrahams attributed to increased water usage in 2025.
The 8.8% represents the combined increase in the authority’s operations-and-maintenance and capital charges to Winchester for water service. The sewer assessment, by contrast, increased just 1%, which Abrahams said reflected stabilization after a three-year spike caused by the installation of new sewer meters.
Select Board member Bill McGonigle said he favored a level approach.
“I always prefer the plans that just kind of keep things level,” he said.
Member Paras Bhayani asked whether the board could take a one-year rate holiday, given that retained earnings could cover the fiscal year 2027 deficit.
Abrahams ran the numbers during the meeting and said skipping a year would require increases of roughly 10.5% annually in subsequent years to reach the retained earnings target.
Several board members noted the timing alongside a Proposition 2½ override ballot question scheduled for March 21.
“If that passes, people are going to see their tax rates go up,” member Anthea Brady said. “And then, if we come to Town Meeting and say, and also, you know, it’s another $65 to $100 on your water bill a year, it does add up.”
Brady also raised the possibility of adding a fourth pricing tier to the rate structure as a way to generate additional revenue from high-volume users while encouraging conservation.
Robert LaBossiere, director of public works, said such a change would require a study and could not be implemented for the coming fiscal year.
The board is expected to take a formal vote on the rate increase at its March 30 meeting, with the approved rate then going before the April 27 Town Meeting for final action.
Will Dowd is a Massachusetts journalist who covers municipal government and community life for Winchester News. He runs The Marblehead Independent, a reader-funded digital newsroom.
