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Why Your Water Bill Is Going Up

Rivan V. Stinson, Reporter, Kiplinger's Personal Finance
Even though we're using less water, the pipes need fixing, so utilities are charging more.

Water utilities have been hit by a one-two punch that will likely affect your wallet, too. Revenues are down, thanks to consumers' conservation efforts. At the same time, pipes need replacing, and systems are expanding to meet growing demand. "We're playing catch-up," says Tracy Mehan, director of government affairs for the American Water Works Association.

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Water rates rose an average of 5% for U.S. consumers in 30 major cities in 2016, tacking on an extra $2 to $4 or more to monthly water bills, depending on usage. Since 2010, rates have jumped 48%. Expect more increases as utilities try to close the revenue gap.

To raise money, some utilities are reconfiguring rate plans that charge a low initial price for a specified amount of water, with the price scaling up as more water is consumed. In Texas, the Fort Worth Water Department charges $2.12 per 100 cubic feet of water for the first 600 cubic feet, but the first tier used to cover up to 800 cubic feet.

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Other utilities are increasing customers' fixed monthly charges or, in some cases, adding new fees to cover special projects. Bay City, Mich., approved a new $2 monthly fee to fund lead-pipe removal. State and local law determines whether you'll be notified of an increase. Check your bill for a breakdown of your current rate, or go to your utility's website to find out if you'll pay more soon.

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