cents per 100 gallons. Between 10,000 and 20,000 gallons,

cents per 100 gallons. Between 10,000 and 20,000 gallons, the charge increases to 40 cents per 100 gallons, and that charge continues for usage above 20,000 gallons.

"That will be OK for this year, '

until we get the water project un- \ derway," Mr. Fisher said. “Then I'd like to review it.”

He added that, according to federal Housing and Urban Development guidelines, the water rates are well within the accepted limits for small towns. “The HUD guidelines say the base rate should not be more than $34 — we’ve got a ways to go.”

After announcing that the town’s application for the CDBG had been rejected, Mr. Morehouse promised that the town intends to pursue the overhaul of its water system, even if it must be done in stages.

In other business, the council:

• approved an $84,300 budget for fiscal year 1989-90. It is exactly balanced by income, the bulk of which ($55,000) is expected to be generated by the town’s 2 1/2 percent meals and lodging tax.

• heard a report from Mr. Reynolds that the county has filed an appeal of the ARB’s decision to deny a Certificate of Appropriateness to the county for its addition to the jail. The appeal, he said, will be heard bythe council during its July meeting. The process allows the ARB and the county to present both sides of the case from the beginning, known legally as a de novo hearing.

• directed that a letter be written to the State Corporation Commission urging the denial of a request from the state association of telephone companies for a decrease in the number of free directory assistance calls from eight to two per month.

• heard a report from Mayor Morehouse that the fireworks for the Fourth of July celebration have been received. Plans for the evening slate of entertainment is progressing slowly, the mayor added, and volunteer coordinators are still needed. Anyone willing to help should contact Mayor Morehouse (675-3658) or Brad Fisher (675-3428).