DOVER-FOXROFT, Maine — Customers of the Dover and Fox-croft Water District will be asked next month to increase the district’s debt limit from $1.5 million to $3.5 million.

Approval of the referendum question on the Nov. 4 ballot will allow the district to replace the more than 100-year-old water mains on Route 15 — or West Main Street — next year at the same time the Maine Department of Transportation reconstructs the state road.

A public hearing on the proposal will be held at 7 p.m. Monday, Oct. 13, at the Thompson Free Library meeting room.

For the DOT to reconstruct Route 15, the water district must relocate its aging mains from Monument Square to the Foxcroft Academy tennis courts. Because state law prohibits the district from disturbing the new pavement for any nonemergency water main work for up to five years, the water district’s engineers recommended the district replace and enlarge the lines now.

To help pay for the estimated $11 million project, the district secured a state revolving loan-grant of $795,000. Of that amount, $437,250 represents a loan with no interest. The $357,750 grant requires no payback.

The district also received a USDA Rural Development loan of $147,000 to be paid back at 2.75 percent interest over 40 years and a grant of $153,000 that requires no payback.

Increasing the district’s debt limit to $3.5 million will allow the district to borrow the remaining funds needed for the project, according to Linda Grant, district office manager.

“There’s a lot of streets that need to be redone. We’ve been trying to do some, like one each year, out of our funds that we have available,” but this larger project will require more funds, Grant said Monday.

It was the district’s success at obtaining the grants and loans that revived the DOT project that previously had been shelved. Since the district would lose the funds if they were not used by the 2009 construction season, the state decided to move on its project.

Grant said the district’s current debt is about $1.2 million. That is the remaining balance on past bonds issued to fund a standpipe and pump station in 1999, a vehicle in 2003, and water line replacements and upgrades in 2007. In addition, the district owes a balance of about $1 million to address a giardia problem in 1989. The emergency borrowing was authorized by the Legislature and is not counted against the district’s debt limit.

The district has done its best to keep expenses down for customers, but a small rate increase will be requested in 2010 to help cover increasing operating costs, Grant said.