Fairfax builders and developers "will have no choice" but to pass on to home buyers the Fairfax County Water Authority's proposed $875 increase in fees charged to hook up the county water system, the president of the Northern Virginia Builders Association said yesterday.

Association president David Miller said the connection fees, which will increase from $1,125 to 2,000 under the proposal of the authority, are "much too hig." Speaking at a hearing on higher water rates the authority proposes to charge startling Aug. 1, Miller said the agency's 10-year plan means new homeowners will be paying for a huge surplus of wate treatment capacity that will be left over at the end of the plan, in 1986.

Fairfax builders have complained that fees charged by the county and agencies like the water authority are one of the prime reasons for the sky-rocketing price of housing in the county. The median price of a house in Fairfax rose to $64,600 this year.Houses costing $50,000 or less are rapidly disappearing from the market.

In addition to the big increase in connection fees, the water authority is proposing an average 29 per cent increase in service charges for residential and commercial users.

The authority has proposed the increase only three years after it raised rates 26 per cent. The 1974 increase was supposed to take care of expenses for 10 years, but the authority says inflation, construction delays and the higher cost of financing construction with bonds have added $71 million to its projected expenditures for the next 10 years.

At yesterday's hearing, the authority was compared to an executioner asking an innocent man "whether he wants to be shot, hanged or electrocuted."

The comparison was made by George D. Gray Jr., administrator of the water authority's big wholesale customers, the Occoquan-Woodbridge and the Dumfries-Triangle sanitary districts, which serves populous northereastern Prince William County.

"Since . . . there is no requirement that . . . your rates be fair or just, we find it to be an exercise in total futility to hold these public hearings," Gary told the assembled water commissioners. "In the past you have imposed rates with everyone opposed. Why pretend this hearing will be any different?

"We will do anything and everything in our power to see that the citizens of the sanitary districts are not compelled to pay for a system which they were forced to become part of," Gray said at the hearing.

In an interview later, Gray said the sanitary districts would ask the Prince Williams Board of Supervisors to condemn all the authority's properties in the county so Prince William would have complete control over its water system. These include treatment and transmission facilities.

Grey also said the supervisors would be asked to move ahead with impoundment of Cedar Run, a project he estimated would cost Prince William residents $32 million. Such an impoundment would guarantee Prince William's long-term water needs but choke off some of the water that now goes to Fairfax County and Alexandria, which are also served by the regional authority.

But members of the authority, time and again during the hearing, disputed claims by Prince William representatives that the country was being overcharged for water.

"There are a number of people in Prince William who don't understand the rate structure," William Evans, the commissioner from Mount Vernon, said.

"Prince William doesn't have connection fees - that's why they are charged more for usage," David Edwards, the Annandale commissioenr, said.

"We keep explaining this," Chairman Fred C. Morin said with exasperation, "but it doesn't seem to make any impression."

The Prince William dispute tended to obscure other issues surrounding the proposed rate increase. Last year lawyers retained to advise the authority on sales of bonds told the authority it would have to impose its second increase in four years - seven years ahead of schedule.

Without a big rate increase, the authority was told, it plans to sell $54 million in revenue bonds to finance expansion and improvements would be jeopardized because buyers would not purchase bonds unless they were assured that the authority had enough income to pay them off.

Under a trust agreement with purchasers of old bonds, the authority must have rates tha will automatically cover all principal and interest payments on bonds already sold and those it plans to sell over the next year. On top of these requirements, the trust agreement stipulates, a 10 per cent margin of safety. Even stiffer requirements on revenue are set once construction is finished.