Finance Director Glenys Salas noted that higher than expected revenue in the sewer enterprise fund interest line item could help pay back a shortfall to the town “faster than expected” at a Board of Finance meeting on April 24.

With a line item of zero for sewer assessment interest budgeted, the $72,106 received was described by Salas as a windfall during her financial report.

The water enterprise interest line also had a surplus, with $32,000 budgeted for and $89,000 received.

The Water & Sewer Authority currently owes the town general fund after a $271,000 shortfall was discovered in its last year’s budget.

A public hearing to consider a 9% increase to Sewer usage rates will be conducted at 7 pm Thursday, May 8, at Newtown Public Works, 4 Turkey Hill Road. The usage rates are projected to increase from $9.64 to $10.51 per gallon on July 1.

Salas says the greater than expected interest revenue could “mitigate” potential sewer use increases in fiscal years 2027 and 2028.

Many other line items were doing well in the 2025 budget, with most line items showing more than 20% of funding left with 20% of the fiscal year left. The one area of possible shortage is energy costs, but Salas was confident that other line items could cover that with end of year transfers.

The projected budget for 2024 budgeted an operational cost of $1,226,000, but the estimated revenue before the rate increase is $955,000. The usage increase not only prevents future shortfalls but covers a multi-year payback of the money the authority borrowed from the general fund to cover the shortfall.

Last year, Public Works Director Fred Hurley told the authority that, “What’s happening is we’re seeing the residual from the COVID years where there were a lot of increases that were not necessarily passed along at that time.” Hurley explained, “Sooner or later, if you’re running a business, whether it’s a utility or a private business, you got to have enough revenue to pay your bills, and that’s basically the situation we’re in. We got to pay our bills.”

When asked how the shortfall occurred, Hurley stated that a financial modeling company was hired 19 months ago to develop a cash flow model to be used to justify sewer use rate increases, but the work was ended in March because they “could not resolve many of our questions except to support a substantial sewer use rate increase for at least the next three years.” Part of the problem, according to Hurley, was the fact that the WSA had been asking the Finance Department if there were enough funds and were told “everything looks OK.” Hurley also states that expenses and revenues were “lumped into single accounts,” making it “difficult to monitor a current budget or project an operational budget.”

Finance Board Chairman Jim Gaston at the time said it looked like “sloppy accounting.”

The sewer usage rates also increased in 2024 due to the shortfall, and are projected to increase the next few years to pay it down.

In other Board of Finance news, the board accepted a $25,000 grant from the estate of Betsy Ann Godfrey to the Newtown Senior Center with the hope it could be used towards senior transportation.

The request included that it be used as additional funding following a $100,000 grant received previously for a transport van, a driver, and to defray cost of a coordinator.

Finance Board member Barney Molloy expressed concern about the amount of items the previous grant was applying to, saying, “it’s doing a lot for $100,000.” Molloy wanted the $25,000 to be applied with the previous $100,000, so that there was no expectation of any of these costs carrying forth into the town’s budget in future years.

“It seems there are a lot of aspirational things rolled in,” said Molloy.

Editor Jim Taylor can be reached at jim@thebee.com.