Developers say Pasco homebuyers will foot bill for proposed rate increase
AI-generated summary reviewed by our newsroom.
- Pasco council delayed rate decision while proposing multi-year water and sewer hikes.
- Connection fees shift to meter-based charges and will increase new-home closing costs.
- Council raised utility tax by 1.5% to generate $900,000 for roads, parks and planning.
The Pasco City Council voted this week to delay its decision on increasing city water and sewer utility rates and connection fees.
Combined monthly water and sewer bills for a typical single-family home would increase by approximately $9-$11 in 2026, $11-$13 in 2027, $9-$13 in 2028 and $9 in 2029.
That’s an annual 8% increase for sewer rates for the next four years, paired with the maximum allowed connection fees, and an annual 20.75% increase for water utilities in the next three years.
Connection fees are one-time charges for new development and expanded water connections.
These fees have been historically unpredictable, but low in Pasco.
The new fee structure bases fees on meter size rather than lot size. The estimated maximum connection fees for a single-family home with a 3/4-inch meter are about $6,150 for water, $4,600 for sewer and $1,500 for irrigation.
A major driver for the increased rates is the replacement of the aging Butterfield Water Treatment Plant. The project is expected to cost between $220-$260 million.
City staff said that if rates and fees are reduced, services will decline and the city would lose out on critical funding for the new water treatment plant.
Real estate developer concerns
About five real estate agents and developer representatives brought their concerns to the recent council meeting.
A few told the council that the increased connection fees will be passed onto homebuyers, causing people to be priced out of Pasco.
“(Connection fees) are an unfair burden. Developers are already putting in all the infrastructure. The developer at their own expense is putting that into the ground so they can sell that to a builder,” said Ken Poletski, a Pasco real estate broker.
“By implementing a connection fee at a higher rate and staggering the fees to increase on a regular annual basis, that’s going to directly impact the affordability in Pasco because that’s passed down to the consumer.”
Poletski and others have noticed a high inventory of housing and the challenges that buyers face purchasing a home.
The council requested community feedback sessions with two groups: residents and developers.
Utility tax rate hike
Pasco has a utility tax rate of 8.5% for electric, irrigation, garbage, gas, sewer, stormwater, cable television and home telephone.
The council voted to increase city-owned utility taxes by 1.5% starting in January. It passed unanimously.
That increase would generate $900,000 in annual revenue for the city’s general fund. It would pay for road improvements, parks, city planning and other projects.
“I’m going to support this small increase. We need to start closing up that delta for our deficit and this being a minor tax increase, it will assist that,” Councilman Leo Perales said.
This story was originally published November 22, 2025 at 5:00 AM.
