Formal Complaint Ongoing.

Carrie Jones

Mar 27, 2026

BAR HARBOR—The Maine Public Utilities Commission (PUC) approved Bar Harbor’s new water rates, March 25.

The approval came as a group of ten citizens, led by Charles Sidman, advocated against the increases via a formal complaint.

Under Title 35-A, ten-person complaints under section 1302 are separate matters from requests to approve rate changes under section 6104, according to the PUC.

The town had also officially responded to the Sidman complaint on March 25. The rates will go into affect on April 1, 2026.

Sidman’s three-page letter details that the complaint is based on their belief that the town has a “harmfully preferential and discriminatory” water rate structure that negatively impacts smaller users of water and benefits larger consumers of the resource. He also argues that the town was not transparent as it proposed the changes to the public and PUC.

It was signed by Sidman, Nathan Young, David Rapkievian, James O’Connell, Jeffrey Miller, Rick Seabury, James Schramm, Mary Jane Whitney, Dee Karnofsky, and Norah O’Brien.

Sidman had collected signatures outside of a Bar Harbor business and sent a flyer to residents. Collecting 300 signatures would have triggered a different level of review from the state’s commission. The window to do so was 30 days.

“Regarding rates, in Docket Number 2026-00013, the Commission did not receive any timely and qualifying petition to stop the rates from going into effect, and the Commission approved rates in accordance with section 6104, effective April 1, 2026,” Susan Faloon, APR, the media liaison for the Maine Public Utilities Commission explained, Thursday.

The proposed water rate change comes after a decade of no changes at all.

The rate plan has already been sent as part of the process. The current budget has a shortfall of approximately $1 million.

The past shortfalls have been made up by using the reserves, Public Works Director Bethany Leavitt has previously said. Those reserves have dwindled. The budget shortfall also stems from other planned capital improvement projects. Other causes, according to town staff, are inflation, increases to staff salaries, and an increase in capital investment.

Several residents spoke against the plan during a public hearing at a Town Council meeting in February.

The town has argued that it is fair and necessary.

“The need for a rate adjustment was identified through a formal rate case study conducted with the Town’s consultant in response to a documented structural deficit in the Water Enterprise Fund. That deficit is driven primarily by non-discretionary obligations, including debt service associated with a voter approved infrastructure bond and ongoing system operations. As presented publicly, the majority of system costs are fixed and must be supported regardless of water usage,” Town Manager James Smith wrote in the March 25 response to Sidman’s letter.

“The Town also evaluated several alternative approaches, including a flat rate. Based on its analysis, and in consultation with its rate expert, the Town determined that such an approach could not reliably recover fixed system costs without the necessity to significantly increase the minimum billing, which would disproportionately impact lower-use customers,” Smith continued. “The proposed rate structure incorporates two tiers as part of the Town’s effort to transition away from the historically declining block structure while maintaining a balanced distribution of costs. This approach reduces reliance on minimum charges while still ensuring recovery of fixed costs and limiting disproportionate impacts on lower-use customers.”

Smith has previously said that he understood their worries and sentiments, but that there was misinformation being perpetuated about the rates and water budget, rates that aren’t easily explained in simple terms.

“The Commission will address the ten-person complaint in the normal course. The Commission provided notice to the utility of the complaint and the utility responded on March 25, 2026. Staff will review the response and decide on next steps. All schedules and Commission action will be posted in the Docket Number (2026-00070),” Faloon said.

“We, the undersigned, are customers of the Town of Bar Harbor Water Utility, and hold 10 separate accounts with the utility. (We could also get you 20, 50 or even 100 more if you wanted.),” the citizens’ letter begins. “For many years our town’s residents have experienced discriminatory water rates that have substantially favored larger customers, thus both disrespecting and causing substantial economic hardship to average citizens such as ourselves. We have complained to the Town on several occasions as part of this rate increase process (s/a) and the problems have not been addressed. We therefore request the Public Utilities Commission (PUC) to investigate and intervene. The narrative below provides both a Public Comment asking for disapproval of Bar Harbor’s current rate increase request, and a more general 10-Person Complaint seeking the end of years of inequitable treatment on the part of our municipal authorities. If attention by other state offices might also be appropriate, we would welcome their involvement as well.”

While the rates themselves are a flat 35% increase for usage over the assumed minimum, that is only consumption, Public Works Director Bethany Leavitt explained. There are fixed dollar amounts in meter accounts, which represent a certain amount of the budget revenue.

The assumed minimums vary according to the size of the meters.

The PUC allows 1.5% interest increase annually after the general revaluation, which was what is occurring now. The town councilors have indicated that they’d like to review it again next year and see how it was impacting the water customers.

“This disagreement, as reflected in the complaint, ultimately centers on a question of public policy regarding how to best structure rates to equitably allocate the cost of providing water service. The complaint advances the position that a single per-gallon rate (volumetric rate) is the only approach that can achieve that outcome. The Town does not share that view. Many water systems with very large users utilize the declining tier rate structure. To minimize the impact to the residential customers, Bar Harbor combined the tiers and formed only two tiers. This increases the relative contribution of higher-volume users while limiting impacts on lower-use customers,” Smith wrote.

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LINKS TO LEARN MORE

Public records are available online here.

To find our past stories, about the budget, water increases, and Bar Harbor, you can head over here. There are a few too many to post here. We’re concerned that multiple links may be possibly causing emails to drop and not get to you.

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