Salem sets December hearing on 5% and 5.5% utility-rate proposal

City of Salem Public Works Department, Oregon · Meeting date: November 9, 2026 · Published: November 10, 2026

Salem’s proposed water, wastewater and stormwater increases would lift a typical inside-city residential bill by $5.61 per month in 2027 and a further $6.48 in 2028. The rate path is intended to maintain reserves while the utility confronts major renewal needs, including a leaking 90-year-old water transmission main and ageing sewer infrastructure.

Key points

Council unanimously scheduled a December 14 public hearing on 2027-28 water, wastewater and stormwater rates, fees and charges; it did not adopt the rates on November 9.
The Water/Wastewater Task Force recommended a 5% increase for 2027 and 5.5% for 2028 in a 5-3 vote.
For a typical Salem residential account using 8 ccf of water and 5.3 ccf of wastewater, the combined monthly bill would rise from $112.17 to $117.78 in 2027 and $124.26 in 2028.
Salem said a 36-inch, 90-year-old water main leaks 1-2 million gallons per day and could cost $180 million-$200 million to replace.
The task force also recommended raising leachate acceptance charges from $0.06 to $0.16 per gallon and septage charges from $0.16 to $0.19 per gallon in 2027 and $0.20 in 2028.

Full report

Salem City Council has scheduled a December 14 public hearing on proposed utility charges for 2027 and 2028, beginning a rate-setting process shaped by declining reserve projections and a growing pipeline of major water, wastewater and stormwater renewals.

The council voted unanimously to set the hearing after Public Works presented the Water/Wastewater Task Force’s recommendation for a 5% rate increase in 2027 and a 5.5% increase in 2028. The task force adopted that recommendation by a 5-3 vote. Council was not asked to adopt the rates at the November 9 meeting.

For a typical inside-city residential customer with a 3/4-inch meter, using 8 ccf of water and with a wastewater base of 5.3 ccf, the total monthly bill including franchise fee would increase from $112.17 in 2026 to $117.78 in 2027 and $124.26 in 2028. That equates to increases of $5.61 and $6.48 respectively.

Public Works Director Brian Martin said the utility serves more than 218,000 water customers and collects and treats wastewater for more than 259,000 people. It operates 55 pump stations, 19 reservoirs and more than 2,000 miles of water, wastewater and stormwater pipelines, while adding infrastructure at a rate of 1%-3% each year.

The central pressure behind the proposed revenue slope is the condition of the existing asset base. More than 30% of Salem’s water system is older than 56 years, Martin said. Two transmission mains deliver drinking water from Geren Island to Salem; one, a 36-inch concrete main built in the 1930s, is about 90 years old and is estimated to leak 1m-2m gallons a day through more than 4,500 joints. Replacing one transmission main, sized to sustain Salem’s supply if one or both lines fail, could take at least five years and cost $180m-$200m.

The wastewater collection system has also experienced failures. Martin said two sewer mains more than 56 years old failed in 2024, releasing more than 18m gallons of diluted raw sewage into farm fields and parts of Wallace Marine Park. A recent effort to inspect another pressurised sewer main led to a further break, spilling an estimated 4,000-5,000 gallons.

Other identified needs include replacement of the Upper Bend Dam at Geren Island, expansion of aquifer storage and recovery in south Salem, future treatment upgrades at Willow Lake Water Pollution Control Facility, upgrades to the West Salem pump station and force mains, sanitary sewer inflow and infiltration reduction, and added floodplain detention capacity.

The city’s financial modelling found that continuing the previously modelled 3.5% annual revenue slope would cause unrestricted cash to fall below the policy minimum by FY2029. Council policy calls for at least 150 days of unrestricted cash, with 175 days preferred. Under the task force’s recommended rate path, unrestricted cash is forecast at 180 days in FY2027, 174 days in FY2028 and 166 days in FY2029.

Task force members supporting the recommendation cited ageing infrastructure, capital needs, rising operating costs and the value of gradual adjustments. Those opposed cited inflation and prospective increases in other taxes and fees.

The December hearing will also consider proposed non-rate changes. The task force recommended increasing landfill leachate processing charges to $0.16 per gallon in both 2027 and 2028, from $0.06 per gallon, and lifting septage charges to $0.19 per gallon in 2027 and $0.20 in 2028 from $0.16. It also recommended continuing the Emergency Utility Assistance programme at $500,000 annually, with assistance capped at $400 per account per calendar year.

This summary was generated by AI based on the source document and may contain errors.

Source: City Council , City of Salem Public Works Department