General Rate Information

Lusted Water District bills customers once every two months for water service connections.  Water bills are comprised of two separate charges:  a "Base Charge" and a "Usage Charge".  At this time, all water service sizes have the same Base Charge per two-month bill period.

The billing unit of the Usage Charge is the "CCF" (100 cubic feet of water), which is the equivalent of 748 US gallons.   

For customer usage of 29 CCF of water or less per bill period, the District charges the Tier 1 Usage Rate.  For the units of water consumed above 29 CCF per bill period, the District charges the Tier 2 Usage Rate for these units. 

The Board of Commissioners of Lusted Water District has developed a rate structure to collect approximately half of the District's overall revenue from the Base Charge and half from the Usage Charge.   (Approximately 75% of the District's annual costs are not related to the amount of water sold to customers.)

Rate Increase Discussion

Water rates for the Lusted Water District, and for many other local water agencies, are increasing significantly.  The factors driving Lusted Water District cost increases in 2026 are mostly related to the surging cost of wholesale water from neighboring cities.  However, the general trend for rate increases includes cost drivers such as the high capital costs to install replacement pipelines (>$1,500,000 per mile), the high maintenance costs of managing aged infrastructure, and the additional staffing required to manage capital projects and the higher level of maintenance.

In particular, Lusted Water District is facing major cost increases for the water it purchases from neighboring cities.  From 2025 to 2031 these costs are projected to increase from $1.70 per CCF to over $5.50 per CCF, based on purchasing water from the City of Gresham starting in 2027.  If the District were to remain a customer of the City of Portland, our fiscal year 2031-2032 wholesale water rate would exceed $10.50 per CCF.

In addition, Lusted Water District has been active with capital improvement projects in the last several years, including pipeline replacement and pump station refurbishment.  These projects include the purchase and refurbishment of facilities that allow us to change our water supplier from the City of Portland to the City of Gresham.  

The sum of these costs are driving higher water rates for our customers.

Water Rates Over the Decades

When public water systems are first developed or expanded, a significant share of the initial infrastructure is funded through developer-installed improvements, connection fees, system development charges, or other capital contributions associated with new development. Those costs are ultimately embedded in the price of new homes, lots, or development projects, rather than appearing as a separate monthly utility charge to the future homeowner.

For the first several decades after construction, a relatively new water system requires less major replacement spending, and customer rates primarily reflect operations and general maintenance. But as communities and water systems age, pipes, pumps, reservoirs, meters, and treatment facilities must be repaired, upgraded, and eventually replaced. Replacement infrastructure in an existing community is financed differently than the original buildout: much of it is paid for by the existing customer base through higher utility rates or property tax assessments.

This is an important and often underappreciated part of public infrastructure finance. The first generation of infrastructure may be paid for indirectly through development and home prices, while later generations must be funded more visibly through higher utility rates or assessments. As a result, mature communities can face rising utility bills not simply because the water itself is more expensive, but because the community is now paying to rebuild and sustain the system that earlier growth created.