CALAIS – Water users were not happy Tuesday night when they learned that a possible 38 percent hike in their water rate was needed to help pay back a $1.9 million federal loan that was used to build the city’s water system.

The new rate increase is expected to cover the debt incurred as a result of upgrades to the treatment plant and replacement of water mains on Pleasant, Lincoln, Downes and Carver streets. The costs were covered by a Rural Development Loan that is required to be repaid starting in July 2006.

A household that uses about 1,200 cubic feet of water will see their bill increase by $15.81 per billing quarter, or $5.27 a month.

Private fire protection rates will increase by 38 percent, while public fire protection rates will increase by about 35 percent.

The meeting was held at Washington County Community College. Only a handful of people attended.

Several residents objected to the meeting because they said it had not been properly advertised. But PUC utility analyst Lucretia Smith said that public notices had been published in at least one of the local newspapers. And an advance notice of the meeting was published in the Bangor Daily News.

“This meeting was scheduled on the first day of school when all parents were home getting their kids ready,” said Mary Anne O’Brien. She said the rate increase would adversely affect area residents. “You’re driving people out,” she told city officials.

For years, the city bought its water from neighboring St. Stephen, New Brunswick, but a change in federal laws forced the city to look elsewhere.

Three years ago the city drilled wells to supply the water. Unfortunately, the water that came out smelled like rotten eggs or swamp water. People at the time complained. The city took action, flushing the system and upgrading underground pipes. The changes have improved the water quality. Although complaints citywide have declined, for many who attended the meeting water quality was still an issue.

It is up to senior process engineer Annaleis Hafford of Oliver and Associates of Winterport to respond to water concerns. In the spring of 2004, the city contracted with the company to manage the city’s water system. She said she took all complaints very seriously.

Hafford explained that the city had an antiquated cast iron and galvanized steel pipe system that has been in the ground for more than 100 years. When the city turned on the tap, the new system churned up the loose flakes in the pipes and that is what has been flowing through the system.

The city has repaired pipelines and regularly flushes the system.

When it was clear that an increase was necessary, Cindy O’Brien asked that the huge increase be done incrementally.

But Smith said that the large increase was needed to cover the cost of the first loan payment.

Mary Anne O’Brien then asked the PUC to delay the rate hike until next year. She said that many people faced with huge home heating oil price hikes might not be able to afford a similar increase in their water bill. The new rates are expected to go into effect on Oct. 1, unless PUC officials are convinced otherwise.

Smith said the PUC would consider that request.

After several more minutes of discussion, Smith said that a telephone conference would be held between the city and the PUC. She said the press could be a part of that conference and that concerns raised by area residents would be addressed at that time.