BETHLEHEM, Pa. — Bethlehem plans to ask state regulators next year to raise water rates for the first time since 2021, with higher bills likely to start in early 2028, the city’s water director told City Council on Tuesday.
Edward Boscola, director of water and sewer resources, laid out the plan at council’s first hearing on Mayor J. William Reynolds’ proposed 2027 budget. He did not say how much rates would rise. The city’s water system bills about 37,000 customers, in Bethlehem and all or parts of 11 other municipalities.
The budget itself, which Reynolds presented Friday, would raise two household costs next year, with a 2.9% property tax increase and $1.67 a month more on the recycling fee. Business Administrator Eric Evans told council the city’s median home is assessed at $57,000. In the Northampton County part of the city, the owner of that home would pay about $52.50 more a year: $32.49 in property tax and $20.04 in recycling fees.
Boscola said the city expects to file with the Pennsylvania Public Utility Commission around June. The commission takes seven to nine months to review a filing, he said, which puts new rates in early 2028.
Council is reviewing the budget department by department over three hearings. Tuesday’s covered the city’s revenue and its water and sewer systems, which are paid for by customers’ bills, not taxes.
The utility commission regulates what Bethlehem charges customers outside city limits, and City Council sets rates inside the city. When the city last asked for an increase, in 2020, it said the approved rates would apply to both groups. The commission approved an 8.4% increase in April 2021.
Revenue from the city’s water and sewer customers has grown about 1% a year for more than 20 years, because water-saving fixtures cancel out the added use from new customers, while expenses rise about 3% a year, Boscola said in his presentation.
The proposed budget takes $6.5 million from the water fund’s cash reserves. About $3 million of that goes to the Bethlehem Authority, the agency that borrows money for the water system, and will come back later to pay for water projects, Boscola said. He projected about $13 million in reserve at the end of this year.
The tax increase, the city’s first since a 2.6% increase in 2024, would bring in more than $1 million, Evans said. He gave the new rate as 20.21 mills, or $20.21 for every $1,000 of a property’s assessed value.
That rate applies in the Northampton County part of the city, where it is now 19.64 mills. Homes in the Lehigh County part are taxed at a separate rate, 6.21 mills this year, because the two counties value property differently. Evans did not give a new figure for it.
The recycling fee, billed with water and sewer, pays for curbside pickup, the Theis/Cornfeld Recycling Center, the yard waste site and leaf collection, Evans said. Selling recycled material brought the city $855,000 in 2011 and brings in about $65,000 now, he said.
About $9 million of the water budget, or 30%, goes to paying off debt, Boscola said. He tied that debt to the rebuilding of Penn Forest Dam, at one of the city’s two reservoirs in the Poconos, in the 1990s.
No one spoke when council opened public comment midway through the hearing, before the water presentation. The next budget hearing is Tuesday, Nov. 24, at 6 p.m. at City Hall, 10 E. Church St., with a third on Monday, Nov. 30. Council is scheduled to vote on the budget Tuesday, Dec. 15.
