Hartford – City and Norwich Public Utilities officials today voiced their objection to a proposed bill that would require sewer authorities seeking state grants to obtain prior approval for rate increases from towns served by the system.

The bill, proposed by the General Assembly’s Planning and Development Committee, seeks to enact a regional approach to the expensive necessity to expand sewer services to smaller towns and to upgrade aging systems, supporter and committee member state Sen. Cathy Osten, D-Sprague, said. If passed, the bill would require approval by a majority of towns served if the sewer authority is seeking state grants.

But NPU officials and Mayor Peter Nystrom said the bill would do the opposite, forcing NPU to retract plans to provide service to surrounding towns by in effect giving them a “veto power” over rates required to pay for a proposed $96 million upgrade of the city-owned sewer system.

James Sullivan, chairman of the Norwich Board of Public Utilities Commissioners, told the legislative committee that Norwich customers comprise 90 percent of the system’s usage. The NPU sewer system covers 60 customers in Sprague and a few customers each in Preston, Lisbon and Preston, although NPU is very interested in serving future development at the former Norwich Hospital property in Preston.

“This legislation, if adopted, would effectively give veto power to elected officials who represent customers who comprise only 10 percent of our total flow at the expense of the other 90 percent who do not have similar veto power,” Sullivan said.

According to a cost breakdown provided by NPU, the $96 million project would be funded in part with a $20 million state Clean Water Act grant and with $20 million in revenues through expansions to surrounding towns, including Bozrah, Franklin, Sprague and Preston.

NPU General Manager John Bilda said he hopes to submit the design plans to the state Department of Energy and Environmental Protection by this summer.

Answering questions by state Sen. Len Fasano, D-Wallingford, Sullivan and Bilda said all sewer customers pay the same rates, whether they are in Norwich or another town served by the system.

Mayor Peter Nystrom said Norwich supports the regionalism efforts the committee is promoting and has offered to expand its sewer system to cover surrounding towns that have asked for the service. But he said Norwich has 100 years of investment into the NPU infrastructure and must protect that system by enacting rates to cover the upgrade costs.

“Passage of this proposed bill will eliminate or substantially diminish the ability to pay for said improvements as it will restrict the required use of a reliable rate structure as required by state regulations,” Nystrom said. “If this occurs, this financial burden ultimately would fall solely on the taxpayers of the city of Norwich.”

After hearing the Norwich testimony, Osten said she retains her position that regional input must be allowed on major sewer projects that affect multiple towns. She said the towns where the expansion would extend want a chance to “weigh in” on the costs of the project.

c.bessette@theday.com