WORCESTER—A decades-long sewage fee dispute between Worcester and Holden has reached a critical juncture, with Worcester residents facing the possibility of sharp rate increases while Holden waits for payment on a multi-million-dollar judgment.
According to city spokesperson Tom Matthews, the impact on local households could be staggering. “With the judgment of $27M and $2.4M revenue loss included in the FY26 rate calculation, the average combined water and sewer single family bill would increase to $984.68, an increase of $295, or 42.9% from FY25,” Matthews told the Worcester Guardian. “The sewer specific portion of that would be increasing $293.63 to $745.98, a 64.9% increase from FY25.”
The dispute stems from a 1999 agreement involving Worcester, Holden and the state’s Department of Conservation and Recreation (DCR), then the Metropolitan District Commission. State Sen. Michael Moore (D-Second Worcester) emphasized the state’s responsibility, saying, “The agreement that the city of Worcester signed with the Metropolitan District Commission assigned them the responsibility to enforce the terms of the contract. The City of Worcester did not have a contract with any of the other municipalities – the contract was with the state agency.”
Worcester has long maintained that it did nothing wrong. “The municipality maintains its position that it has not been unjustly enriched,” Matthews continued, “as the payments were mutually agreed upon between the municipality and the Commonwealth. Worcester and Holden never had a contract. Still, he acknowledged that “the only way to move forward is to negotiate a new agreement that protects the interests of all parties involved while preserving the Wachusett watershed drinking supply.”
Holden officials point to a very different reality. Town Manager Peter Lukes noted that the judgment—now exceeding $34 million—remains unpaid. “When payment is received, I will consult with the select board and the DPW director,” he said, “and expect that Holden will dedicate the funds toward a combination of capital projects and rate relief to partially compensate Holden residents for the millions of dollars of overcharges Worcester imposed upon them between 2007 and 2022.”
Lukes said the legal process has been exhaustive. “The courts gave all parties—Holden, Worcester and the state—full due process and the opportunity to present the case and all defenses,” he said. “After reviewing all of the facts and evidence, a unanimous jury and six judges, including three different Superior Court justices and most recently a unanimous three judge Appeals Court panel, determined that Holden had proven that Worcester had received $14.6M in excessive payments from Holden for wastewater transport, which in equity and good conscience should be returned to Holden.”
With Worcester appealing the case to the state’s Supreme Judicial Court, frustration is mounting locally. Council Vice Chair Khrystian King, who is also running for mayor, recently pressed Gov. Maura Healey to intervene. In a letter, King argued that Worcester taxpayers are being unfairly asked to shoulder a burden created by the state. “The Commonwealth made the decision to end the contract and not uphold its agreement—and now it is passing the cost of its breach onto Worcester families. That is unacceptable,” King wrote.
King warned that without action, the numbers could spiral quickly. “If this matter is not resolved, Worcester households could face annual increases of $281 to $1,000, with interest accruing at nearly $270,000 per month to $65,000 each week,” he wrote, calling that “an unsustainable and unjust burden.”
For King, the focus should shift away from courtroom battles. “Litigation may ultimately determine liability, but it is neither the most efficient nor the most equitable path forward,” he said, urging a “commitment to shared responsibility and a shared resolution” that spares Worcester families from footing the bill.
Moore also cautioned that failure to settle could hurt both communities. “Residents of Worcester and Holden should understand that failing to resolve these issues and negotiating a new contract will result in higher costs for everyone involved,” he said.
Local lawmakers have echoed that message, arguing DCR must play a key role in bringing the dispute to an end. Matthews said Worcester remains open to negotiating but added, “The Commonwealth must honor its financial obligations to Holden, so the residents of Worcester do not bear the financial burden.”
As the SJC weighs the case, Worcester and Holden remain in limbo. For Worcester, the threat of spiking water and sewer bills looms large; for Holden, compensation for years of overpayments remains out of reach. Both sides are waiting for a resolution that could reshape their municipal service relationship for years to come.
Matt Olszewski is a freelance content and news writer based in Boston, MA. In his free time, Matt enjoys running, hiking or skiing. Matt recently graduated with his MPH from Tufts University. He can be reached at mattoskier@gmail.com
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