Portland water rates could double within a decade due to Bull Run Filtration site

PORTLAND, Ore. (KATU) — For the first time, a Portland City Councilor is publicly urging city leaders to rethink a multi-billion-dollar water treatment facility and consider an alternative.

KATU has reported extensively on the ballooning cost of the Bull Run Filtration Site and the impact on ratepayers.

The project had an estimated cost of $500 million when it was approved in 2017. That grew to $1.5 billion in 2019 and then $1.8 billion in June 2023. That jumped again to $2.1 billion in 2024 and then finally to $2.5 billion this past February.

The city blames the increases on inflation, legal challenges, and better cost certainty as the project moves forward. However, recently retired city administrator Mike Jordan told a crowd at a City Club event that the cost could go even higher.

“It will be $4+ billion before they’re done; I guarantee you,” Jordan told the crowd. “They’ll be raising rates at a rate that will drive you all nuts, and they will be constraining the operational budget at the same time. I mean, you should be talking to city council about this issue.”

RELATED | Controversy swirls around Portland water treatment facility, as cost balloons over $2B

Those comments came up at a recent city council committee hearing tied to the project. The public works committee was debating authorizing $525 million in debt for the project.

Sam Diaz, with 1,000 Friends of Oregon, encouraged councilors to pump the brakes.

“It is not too late to adapt. There are viable, affordable options to proactively plan to treat the water we drink in case of emergencies. We do not need to price out and force working Portlanders out of this city,” Diaz said.

Ultimately, the public works committee did not pump the brakes. Councilor Mitch Green was the only councilor on the committee who voted against authorizing the debt to cover part of the project.

His main concern is the project’s impact on your water bill.

“I see that to pay for these water bonds and then the overall Water Bureau’s portfolio and normal work, you’re going to require 9.8% per year to sustain our level of service, and if you do that math on a 9.8% rate increase year by year by year and hold that over the next seven years, you’ve doubled the rate,” Green said.

RELATED | Portland Water Bureau defends cost, necessity of $2B filtration facility

That likely won’t go over well with ratepayers at a time when affordability is top of mind for most Americans.

“Who’s looking out for the rate payer?” KATU asked Green.

“Certainly not the past council. I’m looking out for the rate payer, because when we look at the consequences of issuing these bonds and saying nothing about it, then I’ve got to live with the fact that I knew that this was going to double the water bill inside of a decade and said nothing, so I have to say something,” Green said.

Green is now pushing for an alternative. He wants the city to ask the Oregon Health Authority (OHA) if there’s another way, a cheaper way, to get into compliance with federal drinking water rules.

The city’s Water Bureau has insisted its hands are tied, and that the facility is required in order to get in compliance with federal drinking water rules. Portland must treat water from the Bull Run Watershed for cryptosporidium by September 2027. An agreement with OHA mandates filtration, but the agreement says it can be amended with approval from both parties.

RELATED | Portland seeks 2-year deadline extension as Bull Run filtration cost jumps to $2.56B

“Maybe I’m wrong; maybe there is no other alternative, but if there is, and we have an opportunity to lower the long-term rates for our rate payers, we should try,” Green said. “I would love to have a world-class filtration system that has some seismic resiliency built into it. It has all these other ancillary benefits beyond cryptosporidium filtration, but if your regional ratepayer base is not sufficient to pay for that, then you’re going to create a cost pressure that might potentially drive people out of the city of Portland and they’re no longer a rate payer.”

Bureau leaders said their confidence in the current estimate is high despite what Mike Jordan said about it ballooning to $4 billion. The city’s finance team projected a nearly 10-percent annual increase in water rates through the early part of the next decade to pay for the project.

Green said now is the time to discuss an alternative.

“If there’s a less expensive alternative, even though you’ve already spent all this money, then you should always be thinking about that alternative.”