Portland agencies to remove returned payment fees after investigation dinged water bureau
PORTLAND, Ore. () — Months after a report determined the Portland Water Bureau was overcharging customers, multiple city agencies have decided they will stop charging returned payment fees.
On Wednesday, the that PWB, Portland Fire & Rescue and the transportation department will no longer impose these fees in the upcoming fiscal year. The Revenue Division has already removed them.
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The announcement follows the , which was prompted by a water bureau customer who claimed they were wrongly charged a $35 fee when their bank merged with another company.
'Normally, I would accept a small fee because I could not stay on top of my bills or accounts,' Kerry Rasmussen, the original complainant, said in a statement. 'But $35 seems absolutely criminal from a public entity where customers have no choice in provider.'cSeveral city agencies impose the fee when customers have insufficient funds in their account as a payment processes. However, investigators found that PWB loses nearly three times the amount of money it gains from the fees.
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According to the report, banks charge the water bureau about $16 for each returned payment — which added up to a total of $112,496.25 in 2023. The agency recovered just $40,075 through the fees.
Investigators also found that PWB increased this fee from $25 to $35 in July 2008, although Oregon law didn't permit that amount until July 2012. The bureau has since been advised to notify the impacted customers that they're entitled to a $10 refund.
But the recent update from the ombudsman focuses on the 'inequitable impact' of the fees. Investigators that the extra costs are 'ineffective deterrents' for customers who may be struggling financially.
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Additionally, about 86% of the households that were repeatedly hit with the fees reported difficulty paying at least one of their bills throughout the year. The report also cited data from the Consumer Financial Protection Bureau, which determined that lower-income, Black and Latino communities are more likely to see these fees.
'The practice of charging returned payment fees was out of step with the City's equity goals and an ineffective use of public resources,' Deputy Ombudsman Andy Stevens said in a statement. 'Removing them across the board is a step in the right direction and aligns with City values of anti-racism, equity and fiscal responsibility.'
Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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