Baltimore will pay an additional $38.5 million over the next three years as a result of a breakdown in its sewage sludge processing.

The increased costs, which were approved by the city’s spending board Wednesday, will be paid to Synagro Technologies, a company that dries sludge from the city’s two wastewater treatment plants and turns it into fertilizer.

Synagro, which has been a city contractor since the 1990s, stopped processing sludge at the Back River Wastewater Treatment Plant in August. The Middle River-based company has said contamination of flammable hydrocarbons in Back River’s waste — a result of city digesters not working properly — has endangered its industrial dryers.

Synagro’s facility at Back River, in Baltimore County, experienced an explosion and fire in March 2023 and another fire last September.

As a result of the shutdown, Synagro has been shipping Baltimore’s sewage out of state at a cost of millions of dollars a month to the city. The wet sewage weighs three times as much, officials explained, increasing the cost of transport.

Sludge processing has continued at the Patapsco Wastewater Treatment Plant.

On Wednesday, the spending board approved two increases to the city’s contracts with Synagro — $21 million more for Back River and an additional $17.5 million for Patapsco. Both contracts extend until 2029.

Mike Hallmen, deputy bureau head for wastewater, said the drying process can be restarted after Back River’s digesters come back online. Work on two of the plant’s six in-ground digesters, designed to remove harmful nutrients from waste after it enters Back River, is expected to be complete in the next couple of weeks, he said. Officials hope to have all six online by the summer.

“Once those are in service, we can handle the normal flow coming into the plant,” Hallmen told the board.

Hallmen said he was optimistic that Synagro would be willing to put its dryers back in service with just two digesters online.

Synagro did not respond to a request for comment.

The increases approved Wednesday came just a year into the city’s four-year agreement with Synagro. When the Board of Estimates extended the agreement last year, Hallmen said his agency would explore longer-term alternatives to Synagro, which has come under national scrutiny over allegations its product laces cropland with dangerous forever chemicals.

Hallmen said Wednesday he was confident the additional $38.5 million would be enough to carry the city through 2029 without additional amendments.

“We should see much better stabilization for costs,” he said. “It’s been a difficult year for us.”

Mounting expenses at the city’s wastewater treatment plants, including drying problems and pricey contractors, have necessitated rate increases for city customers. Ratepayers faced a rare midyear 15% increase in 2025, and rates are set to go up 9% in July.

Top officials with Mayor Brandon Scott’s administration said they hope to avoid increases beyond 9% next fiscal year. Plans call for trimming vacant positions across city utilities and strengthening collections from delinquent customers.