Bloomington residents will see their water bills rise by roughly 14%, while businesses can expect a 38% increase on Aug. 1. The Greater Bloomington Chamber of Commerce warns that the cost will trickle down to residents through higher prices.
According to a June 26 Bloomington news release, the Bloomington Utilities Service Board and Bloomington City Council approved the rate proposal in September 2025. The Indiana Utility Regulatory Commission granted final approval in June, clearing the way for implementation.
The increase, which will appear on utility bills starting in September, aims to fund upgrades to the city’s drinking water system. The additional revenue will support upgrades to the Monroe Water Treatment Plant, which aims to replace aging water mains and improvements to pumping, storage and treatment.
From these changes, the City of Bloomington Utilities will receive a 25% increase in revenue. Residential customers will pay 25% of that increase, with Indiana University and other large businesses, including general service, wholesale and IU’s master meter, paying 50%.
Irrigation customers, which include some residential customers with private irrigation systems, will account for 15% of the increase. Public and private fire protection fixed charges make up around 9% of the increase, distributed across all customers.
According to the release, a typical residential customer using 3,000 gallons of water a month will see their monthly water bill rise from $26.06 to $29.78, an increase of $3.72 or 14.3%. The impact may vary depending on water usage and meter size.
In the release, Bloomington Utilities Director Katherine Zaiger said the rate hike is necessary to address long-term infrastructure needs.
“The 2026 water rate increase will allow CBU to address priority projects outlined in our Capital Improvement Plan, including essential improvements at the Monroe Water Treatment Plant and across our distribution system,” Zaiger said. “By investing in this critical infrastructure today, we ensure CBU can continue meeting the community’s water needs now and in the future.”
The rate of adjustment will also help cover increased operational costs, supply expenses and maintenance to reduce water loss and ensure high-quality drinking water for Bloomington residents, according to the release.
In an email to the Indiana Daily Student, Eric Spoonmore, president and CEO of the Greater Bloomington Chamber of Commerce, expressed disappointment with the rate restructuring.
“While we recognize the need to maintain critical infrastructure, this decision effectively shifts costs in a way that places a heavy burden on Bloomington’s working families, both directly and indirectly,” Spoonmore wrote.
The chamber also expressed concern about the timing of the decision, noting that Bloomington residents are already dealing with persistent inflation and a recent 18% increase to the city’s utility rates for sewer and stormwater services.
Spoonmore emphasized that the rate structure could undermine the local economy, adding that the chamber will continue to advocate for the Bloomington community.
“The Chamber believes that maintaining infrastructure should not come at the expense of the local economy,” Spoonmore wrote. “A strong community depends on both reliable utilities and a healthy business environment.”
In an email to the Indiana Daily Student, Daniel Frank, Bloomington Utilities communications manager, said the process leading up to the rate increase included multiple opportunities for customer input.
“That included social media updates, flyers distributed to downtown businesses, participation at a Chamber of Commerce meeting, and opportunities for customers to provide input during Utilities Service Board meetings, City Council discussions, and the IURC field hearing,” Frank wrote.
Bloomington Utilities included notices about the rate change in July and plans to repeat the message in the next billing cycle. In September, customers will receive a bill insert detailing which projects the rate adjustment is meant to fund, according to Frank.
IU spokesperson Mark Bode said in an email to the Indiana Daily Student that any utility rate changes are factored into the university’s budget planning.
Bloomington residents looking for a full breakdown of the new rates can visit the city’s utilities rates website. IU students interested in water usage on campus can find more information through the Office of Sustainability.
