BREWER – Closure of the city’s biggest sewer user last year is a big reason why residents may see their sewer bills increase this fall by at least 11.1 percent, the City Council was told Friday.

Under the proposal, residents would pay $6.40 more per quarter, or an additional $25.60 a year, for minimum usage, said Ken Locke, superintendent of the city’s Water Pollution Control Facility.

The increase was requested as part of the sewer plant’s budget, presented to the council Friday.

Projected operating expenses for the Water Pollution Control Facility are actually decreasing by 2.6 percent for 2005-06, from $1,926,553 to $1,876,837.

Yet, even with the rate increase, the department expects to operate $24,023 in the red, budget documents show.

“It’s difficult to make cuts [because] there are so many fixed costs,” Locke told the council.

A key factor in the proposed rate increase is the January 2004 closing of Eastern Fine Paper Co., the city’s biggest sewer user, and the fact that the mill left millions of dollars in debt and unpaid service bills, Locke said.

“When they closed, the sewer plant lost over $500,000 in [annual] revenues,” he said.

Eastern owed the city $1.7 million for past debt and another $1.2 million in user fees when the mill closed, Locke said.

The requested rate would increase the cost of 100 cubic feet from $5.75 to $6.39 and would take effect, if approved, in September.

“The quarterly minimum will increase from the current $57.50 to $63.90,” Locke said. “The annual cost for an average sewer user will increase from $460 a year to $511 a year.”

City councilors will review the sewer plant budget, along with the school and municipal budgets, at a special meeting June 27 or June 28. All need to be approved by the end of the month.

Retained earnings were used last year to hold the rate at $57.50, Locke said.

Councilor Larry Doughty asked several questions about the budget and minimal usage amounts, expressing concern for seniors on fixed incomes. After getting his questions answered, he described the sewer rate as “not extravagant” and added, “This amounts to about $4 a month” for average users.

To offset the decrease in revenues from Eastern’s closing, the city has changed the way it runs things at the sewer plant, including cutting personnel and operating strategies, Locke said. Personnel also are working on installing an automated system to try to reduce costs even further, he said.

“I’ve let four people go” since Eastern closed, Locke said. “That’s the toughest thing I’ve had to do as a supervisor.”

The number of people employed at the plant has dropped by nearly half since Eastern closed, from 11 in 2003 to 6.25.

The sewer rate increase will be offset by a decrease in tax bills, Finance Director Karen Fussell said.

“The big thing we want to emphasize is the tax relief to our residents,” she said. “We’re anticipating approximately 60 percent of our residents will see a tax relief of $112” for homes valued at $100,000 at the projected property tax rate of $20.06, a $1.12 drop from this year.

And that doesn’t take into consideration the homestead exemption, which gives homeowners a break on the first $13,000 of a home’s worth, Fussell added.

At the $20.06 tax rate, the 2,050 homeowners, or approximately 70 percent of the city’s households that qualified for the homestead exemption, should see their tax bills drop by $120 to $260, depending on if they qualified for the exemption last year.

“The important thing is: Every residential property owner is going to see a tax break,” Fussell said.

The council also:

. Approved a liquor license and amusement license for Detour Bar & Grill, owned by brothers Chase Blanchard and Troy Blanchard, at 611B Wilson St. The approval is conditional pending an official certificate of occupancy from code enforcement. Chase Blanchard said the business should open July 1.

. Recognized Christopher Knowles, a Brewer Boy Scout, for earning the rank of Eagle Scout.