Bloomington’s water utility is proposing significant rate increases to cover rising operational costs and fund infrastructure improvements.
If approved by the Indiana Utility Regulatory Commission (IURC), residential customers would see bills rise about 20 percent. Indiana University, local businesses, and wholesale utilities could face increases of around 50 percent. Irrigation meter customers would see their rates more than double.
Eric Spoonmore, president of the Greater Bloomington Chamber of Commerce, said the proposed hike is substantial.
"This is a rather dramatic increase that I think will come as a surprise to a lot of people," Spoonmore said. "People in business typically don’t like to be surprised with costs. We feel it would be more business-friendly to have a gradual, incremental, and predictable rate schedule going forward."
IU, the city’s largest customer, would pay $4.76 per 1,000 gallons — up nearly 48 percent. Businesses would see rates climb 46 percent to $5.83, while wholesale utilities like Southern Monroe Water would see a 48 percent increase to $4.49 per 1,000 gallons. The new rates could begin appearing on bills by mid- to late 2026.
CBU Director Katherine Zaiger told Utilities Services Board members the utility plans infrastructure investments to create a “redundant and reliable system.” The utility’s $84 million capital improvement plan includes upgrades to electrical and instrumentation systems, chemical lines, tanks, and pumps, many of which are reaching the end of their life.
Spoonmore also noted that some costs could be passed to customers, particularly large facilities such as IU dorms.
"Indiana University dorms are seeing a nearly 50 percent increase," he said. "I view the residence halls more as citizens and residents of Bloomington. It's interesting that they would be subject to such a high increase when we're talking about citizens in Bloomington."
He emphasized that the Chamber values its working relationship with CBU.
"I think CBU does a great job,” Spoonmore said. “They're obviously good advocates for the community. The Utility Board is doing really good work, and we hope to continue having good partnerships where we can provide input. The spirit is to make Bloomington the best possible place to do business."
The last time Bloomington Utilities sought a rate hike, Indiana University and Washington Township Water objected, and state regulators reduced the city’s request. It’s unclear whether similar opposition will emerge this time.
