Dear

This letter will confirm (individual’s) telephone
conversation with you today concerning an increase in our
billing rate to (amount) per hour, effective (date)
It is necessary that we request this increase due to a rise
in the cost of conducting our business. We are faced with
an increase in payroll taxes and insurance, along with an
increase in our overhead costs. In addition to the above,
we also seek a modest profit.

Attached are copies of our service agreement and we request
that you sign one copy and return it to us indicating your
approval of this new rate.