Hillsborough NC Equitable Water and Sewer Rate Reform

The Issue

PETITION STATEMENT

We, the undersigned residents and property owners residing outside the corporate limits of the Town of Hillsborough, respectfully petition the Board of Commissioners to review and reform the Town’s current out-of-town water and sewer rate structure.

Under the current rate schedule, out-of-town utility customers pay approximately double (100% higher) the rates charged to inside-town residents. While we recognize the administrative and technical complexities of utility management, we submit that the current tier creates an undue financial hardship on captive consumers who face significant structural inequities.

Absence of Rate Choice or Alternative Utilities: Under local environmental health codes and state regulations, properties connected to public utility lines cannot opt out, drill private wells, or install independent septic systems. Because service is mandatory and no alternative providers exist, out-of-town customers must accept Town rate schedules without market choice.
Lack of Representative Voice: Living outside municipal boundaries, out-of-town utility customers cannot vote for the Mayor or Board of Commissioners who establish utility rates, budgets, and surcharges.
Disproportionate Gap Relative to True Cost-of-Service: Standard industry benchmarks published by the American Water Works Association (AWWA) indicate that extra operational costs for outlying service (pumping, distance, pipe maintenance) typically justify a 15% to 25% differential. A 100% markup exceeds typical cost-of-service allocations and relies heavily on tax-equity justifications for general town amenities (e.g., police, parks, greenways) that water and sewer enterprise funds do not directly finance.

We respectfully request the following actions:

Commission an Independent Cost-of-Service Study: Direct an independent utility rate consultant to evaluate the actual, line-item operational cost differential of serving out-of-town customers.
Adopt a Phased Rate Adjustment: Lower the out-of-town surcharge from the current ~100% rate down to a tier aligned with regional municipal averages (e.g., 25% to 50%).

Saru SalviPetition StarterAn Orange County, NC resident, Saru Salvi serves on the Board of Equalization & Review and various local advisory boards. Beyond civic leadership, she is an active Master Gardener, ceramics practitioner, and community volunteer.

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The Issue

PETITION STATEMENT

Absence of Rate Choice or Alternative Utilities: Under local environmental health codes and state regulations, properties connected to public utility lines cannot opt out, drill private wells, or install independent septic systems. Because service is mandatory and no alternative providers exist, out-of-town customers must accept Town rate schedules without market choice.
Lack of Representative Voice: Living outside municipal boundaries, out-of-town utility customers cannot vote for the Mayor or Board of Commissioners who establish utility rates, budgets, and surcharges.
Disproportionate Gap Relative to True Cost-of-Service: Standard industry benchmarks published by the American Water Works Association (AWWA) indicate that extra operational costs for outlying service (pumping, distance, pipe maintenance) typically justify a 15% to 25% differential. A 100% markup exceeds typical cost-of-service allocations and relies heavily on tax-equity justifications for general town amenities (e.g., police, parks, greenways) that water and sewer enterprise funds do not directly finance.

We respectfully request the following actions:

Commission an Independent Cost-of-Service Study: Direct an independent utility rate consultant to evaluate the actual, line-item operational cost differential of serving out-of-town customers.
Adopt a Phased Rate Adjustment: Lower the out-of-town surcharge from the current ~100% rate down to a tier aligned with regional municipal averages (e.g., 25% to 50%).