Hillsborough is staring down another round of water and sewer hikes, with town leaders weighing three more years of 7.5% increases as they juggle rising maintenance costs and lingering damage from Tropical Storm Chantal. The proposal would stack on top of a 7.5% bump that hit customer bills last summer, and officials say federal disaster reimbursements will be key if they want to move critical infrastructure out of the floodplain without dumping the full tab on ratepayers.
Consultant: 7.5% over three years
At a Feb. 23 budget work session, utility consulting firm Raftelis walked commissioners through a multi-year rate model and recommended 7.5% water and sewer increases in each of the next three fiscal years to protect the system’s debt coverage and cash reserves, according to WRAL. Maintenance costs are running about 20% higher than last fiscal year, and Raftelis representative Vanessa Bryant told the board that “it’s certainly an industry-wide trend” as inflation and big-ticket capital projects collide.
Storm damage and lost grants worsened the squeeze
Flooding from Tropical Storm Chantal last summer knocked out the river pump station and damaged other parts of Hillsborough’s water system. The town reports that new pumps, motors, and controls were installed and temporary bypass pumps were removed in late December. According to the Town of Hillsborough, preliminary restoration costs topped $1 million, and officials are pursuing grant and reimbursement options so they can upsize and relocate the pump station out of harm’s way. Earlier coverage of the boil-water advisory and short-term conservation push detailed how the storm briefly upended everyday routines across town.
Many customers already saw a recent bump
Commissioners adopted the FY2026 budget in June, locking in a 7.5% water and sewer rate increase that took effect July 1, 2025. The new Raftelis proposal would come on top of that, adding another multi-year lift for customers, WRAL reports. Town leaders have said that even with last summer’s hike, a budget gap remains because water usage is down while operating and repair costs keep climbing.
Next steps and what could change on bills
The town says staff will use the Raftelis-built multi-year rate model to test different options for how people are charged, including tweaking the volume-based structure and potentially adding a flat fee to cover billing and customer-service costs, according to the Town of Hillsborough. The tool will also be used to run scenarios that keep a recommended cash reserve intact while still paying for capital projects. Commissioners are expected to review refined options before taking any formal vote, as they try to strike a balance between shoring up the system and keeping customer bills from rising too fast.
