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The rate increases include an 8.5% increase for single-family residential customers.

Water customers in Hillsboro will see their water bills increase again starting next year after the city's utilities commission recently approved proposed increases.

The city said the increases were necessary to continue providing safe water to more than 88,000 affected customers, maintain and replace the city's aging water infrastructure and invest in a project to create a new water supply source by building a water pipeline from the Willamette River in Wilsonville.

"Hillsboro Water carefully manages drinking water rates, and strives to ensure equity and affordability for all customers," said Niki Iverson, director of the Hillsboro Water Department. "Water rates are designed so all customers pay their fair share based on how they use Hillsboro's water system and how much water they use."

Starting Jan. 1, water customers will see the rate increase appear on the water portion of their city utility bill, which also includes bills for sanitary sewer, surface water and the transportation utility fee.

Single-family residential customers will see their rates increase by 8.5%.

More than 80% of Hillsboro's single-family residential customers use about 6,000 gallons of water per month and pay about $36.02 per month, city officials said. Those customers with that level of water usage would see their bills increase by $3.06.

Other water customers, including people living in multi-family residential units, commercial entities and industrial entities, will see increases between 10.2% and 10.5%. Customers using water for irrigation will see their rate increase by 15.2%.

The city said the actual percentage increase on a customer's bill may vary based on meter size and individual usage patterns.

The proposed rate changes were adopted after the city provided multiple opportunities for the public to comment on them, including virtual community conversation events and a public hearing. The city received more than 100 comments on the proposed water rate adjustments from community members.

Hillsboro's water supply system is funded solely by water rates and systems development charges, which the city collects when new properties are developed. Tax revenue placed in the city's general fund doesn't contribute to the water system.

Each year, the city's utilities commission establishes and approves new water rates. Last year, rates for single-family residential customers increased on average by nearly 5% while commercial customers saw a nearly 13% increase and industrial customers saw a 10.5% increase (the same as this year), according to the city.

Single-family residential customers, which make up 90% of all city accounts, use 23.4% of the city's total water usage, according to city data. They currently contribute 31.8% of the city's customer revenue for the water system.

Industrial customers use nearly half of the city's total water usage and contribute 39.7% of the city's customer revenue for the water system.

Even with the rate changes, Hillsboro water customers will pay among the lowest rates in the region for water. The average single-family residential customer in Portland pays nearly $64 per month, while such customers in Beaverton pay more than $44.

In addition to typical operating costs and future repairs to water infrastructure, the rate increases will contribute to the city's portion of the new Willamette Water Supply System project.

The $1.3 billion project is a partnership between Hillsboro, Beaverton and the Tualatin Valley Water District. Hillsboro is set to pay for 36% of the project, which will include building more than 30 miles of water pipeline from the Willamette River traveling north from Wilsonville, through Beaverton, and into Hillsboro.

The project will create a new drinking water source as Hillsboro anticipates continued population growth, including an additional 20,000 residents in the south Hillsboro area over the next 20 years.

It is expected to be completed in 2026.

Hillsboro recently refinanced a $251 million federal loan from the U.S. Environmental Protection Agency that will help the city pay for the Willamette Water Supply System. City officials were able to negotiate and reduce interest rates by 30% over the next 35 years, saving ratepayers a total of $175 million in repayment costs over the life of the loan — up $50 million from previously estimated savings.

The city offers multiple utility assistance programs for residents who struggle to pay their utility bills, including programs funded specifically for people impacted by the coronavirus pandemic.

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