One of the largest utility bill hikes in the state this year came to residents in a small, rural community not far from the New Hampshire border. After years of stagnation, the local water company increased its rates by 75% this summer.

“People were not happy,” said David Walton, chair of the board that oversees the West Paris Water District. But he said the change was unavoidable.

Expenses have been rising rapidly for the utility, which serves about 220 customers in Oxford County.

Last year, tears in the reservoir cover allowed contaminants like E. coli into the water system, forcing residents to boil water and requiring the state to intervene. This August, an intake pump failed, prompting another boil-water order. And the district still needs to install a new water tank, which will cost more than $2 million, Walton said.

“We were in the red. … Our infrastructure was aged and failing,” Walton said in a phone interview earlier this month. “With that rate increase, we knew that we would be barely breaking even.”

Walton and his team upped the minimum quarterly fee from $87.47 to $153.07 — or from about $29.16 to $51.02 each month — according to filings with state regulators. It was the first substantial change in about six years, the utility said.

A similar story is playing out at other small water districts throughout the state, where rates have failed to keep pace with rising expenses and maintenance needs for decades in some cases, according to industry experts and a Portland Press Herald/Maine Sunday Telegram analysis of rate cases filed with the Public Utilities Commission.

Since the start of this year, about 40 of the 152 water utilities regulated by the commission have filed proposals to raise their rates. Most reflect smaller increases that are part of a yearslong pattern of incremental change.

But in at least half a dozen districts, rates have risen or are slated to rise by 20% or more by Jan. 1. That’s a greater increase than most Mainers saw on their electricity bills between last year and this year.

The changes come as Mainers, especially older residents on fixed incomes, contend with high living costs across the board. At the same time, the state says there is a pressing need for heightened investment in Maine’s drinking water infrastructure, including to safeguard it from the effects of climate change, according to a report released in May. That could force more budgetary dilemmas.

Kirsten Hebert, executive director of the Maine Rural Water Association, said keeping rates as low as possible is a “very well-meaning” approach, but it ignores the practical realities associated with operating a complex infrastructure system and often leads to a backlog of necessary work.

Beyond West Paris, the biggest increases have been proposed or implemented for customers of water districts in South Berwick, Anson and Madison, Shapleigh, Corinna and Fort Kent.

In Fort Kent, residents are also facing a 75% increase — the first in more than two decades. That would raise the minimum cost from about $15.15 to about $26.52 a month starting in January, though actual rates are billed bimonthly.

That revenue is intended to upgrade aging infrastructure, like several water mains that need to be replaced.

Fort Kent resident Joey Ouellette, 49, called the roughly $10 per month increase manageable but questioned whether such a sudden change could have been mitigated.

“I think a more gradual increase to kind of keep up with inflation would have probably been a better idea,” Ouellette said. He said there have been a few changes to the town’s staffing and leadership over the last few years, so “maybe some of that got lost in translation.”

SMALL UTILITIES, BIG INCREASES

About half of Mainers get their water from shared systems, rather than from private wells. Most of those systems are consumer-owned, including municipal water departments and quasi-governmental water districts, according to spokesperson Susan Faloon.

The largest rate hikes have been centered in those consumer-owned utilities, said Public Advocate Heather Sanborn, whose office represents Maine’s ratepayers. Sanborn said these types of utilities have no profit-motive to overinvest in new infrastructure.

“Instead, their management may take a cautious approach and under-invest in aging infrastructure,” Sanborn said in an email. “This can keep rates artificially low for a time, but then the under-investment will need to be addressed.”

At the same time, small water utilities have felt expenses rise for years — from electric bills, salaries and supplies — and they have fewer customers through which costs can be spread. These smaller utilities are especially common in rural corners of the state, where residents generally have lower incomes and tighter budgets.

“So, relatively small changes in costs can have a big rate impact,” Sanborn said.

Faloon also pointed to small customer bases as a contributing factor. She said the state’s smallest utilities, which often serve fewer than 1,000 customers, are seeing some of the largest increases because of aging infrastructure and long-overdue rate changes.

“A good portion of Maine’s water infrastructure is aging and in need of replacement,” she said in an email.

Hebert said there have been more large increases this year than has been typical in her more than two decades with the group, as years of deferred cost increases finally hit.

“As a result of maintaining a low rate, preventative maintenance wasn’t necessarily addressed. They’re not putting aside monies for depreciation, they’re not putting aside monies for capital projects,” Hebert said. “And then that day comes that now they have to do something.”

AIMING FOR CONSISTENCY

Water utilities can pursue several types of rate changes, each with its own set of rules. While some set a cap on potential increases, others don’t, meaning there is no absolute limit on how big an increase utilities can pursue each year.

Over the last couple of years, regulators have pursued “an aggressive education and information campaign” to ensure smaller utilities know how to approach rate changes and encourage them to pursue more frequent and incremental changes, Faloon said.

“It appears the commission is starting to see the fruits of those efforts in both more frequent rate cases and rate cases from utilities the commission has not heard from in a while,” Faloon said. “Generally, the commission is seeing an increase in rate cases, and this is a good thing for the long-term viability of Maine’s water utilities.”

Part of that work has been highlighting a relatively new mechanism, known as a 6104-B rate increase, which allows consumer-owned utilities to raise their rates by 1.5% every 11 months. That process was approved by the Legislature in 2023 as a means of softening rate hikes and encouraging steady investment in infrastructure, and its adoption by utilities has outpaced what the commission anticipated, Faloon said.

In some cases, regulators can open investigations and compel utilities to adjust rates if they are not found to be reasonable based on expenses, projected investments and the state of the system. But the commission “does not typically force a (customer-owned utility) to raise rates,” Faloon said.

Chairman Philip L. Bartlett II said the commission intervenes in cases of mismanagement or safety issues, but is “not roaming the streets” evaluating small water utilities’ finances. He noted that smaller utilities often have fewer resources than their larger counterparts, so the commission aims to position itself as an approachable resource — not just an enforcer.

“We’re not going out district by district, although we are trying to increase outreach,” Bartlett said in an interview Monday. “We don’t want them to see us as the enemy. We want to try to be helpful.”

Sanborn, the public advocate, noted that water utilities are regulated by the utilities commission, which focuses on finances, and the state’s Drinking Water Commission, which focuses on water quality and safety but does not oversee customer rates.

“Consumer-owned water is a little bit of a hybrid in terms of who it is accountable to,” Sanborn said.

Hebert, with the rural water association, recommends water utilities review their rates at least once a year and pursue the newly available 1.5% increase whenever possible. Several water utility and town leaders, including Walton in West Paris, told the Press Herald they planned on doing so.

Suzie Paradis, Fort Kent’s town manager, said the town had no choice but to pursue the massive hike this year, but plans to pursue smaller increases “on a regular basis.”

“We don’t want to see this happen again,” she said. “It’s not fair to our citizens. It’s not fair to our department.”