San Diego water rates to rise more steeply than expected — but single-family homeowners will get a reprieve
An updated proposal would raise the monthly rate for a typical single-family home to $93.55 instead of $103.06. Those customers now pay $81.07 per month.
San Diego city officials say they must raise water rates more than previously announced — 19.8 percent instead of 17.6 percent — but a smaller portion of the increases would fall on typical single-family homeowners.
Water officials told the City Council this week that the bump in the proposed increases is being driven primarily by costs for imported water, which makes up 85 percent to 90 percent of the city’s supply.
The relief for single-family homeowners in the rate hike proposal is the result of a consultant’s analysis last winter that said not enough of the burden would fall on businesses and condominium and apartment complexes.
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The updated proposal, if approved by the council as scheduled Sept. 19, would raise the monthly rate for a typical single-family homeowner to $93.55 instead of $103.06. Those customers now pay $81.07 per month.
City officials didn’t provide estimates of the impact on average monthly bills for businesses and customers in apartments and condominiums.
They said rate increases are needed to pay for upgrades to customer service, maintenance of more than 3,300 miles of aging pipes and capital projects like ongoing construction of the city’s Pure Water sewage recycling system.
The annual revenue generated by the city’s water system must increase from $566 million to more than $600 million to cover rising expenses, they said.
“We don’t take lightly the impact that increased water rates have on San Diegans, and we pursued all possible measures to lessen the impact,” said Juan Guerreiro, director of the city’s Public Utilities Department.
The increases will come in two parts: a 10.2 percent increase Dec. 1 and an 8.75 percent increase in January 2025. When compounded, the two increases become a 19.8 percent jump.
The 10.2 percent increase is composed of 6.6 percent for the city’s water system and a pass-through of an expected 3.6 percent increase next year in what the San Diego County Water Authority charges local agencies for imported water.
The 8.75 percent increase consists of 4.3 percent for the city’s water system and a pass-through of an expected 4.4 percent increase from the water authority in 2025.
The increases will leave San Diego roughly in the middle of the pack in what local agencies charge for water — far above the $60 per month charged by Lakeside and far below the nearly $180 charged by Del Mar. The county average is about $90 per month.
The city’s water system serves 270,000 customer accounts and roughly 1.4 million people.
Before raising sewer or water rates, the city orders two separate studies of costs and revenue by different consultants to determine how large the increases should be.
The first study, completed last fall by a consultant hired by Public Utilities, proposed 17.6 percent increases that would have fallen more heavily on single-family homeowners.
A new analysis says more money is needed from ratepayers for the Pure Water sewage recycling system and other projects
The second study, completed in the winter by a consultant the city’s independent budget analyst hired, agreed with the overall size of the increases but suggested changes that would help single-family homeowners.
The legally required second opinion raises questions about fixed costs, firefighting fees and analysis of water use during the COVID-19 pandemic.
The first change proposed by the second consultant would reverse a city plan to begin charging all water customers fixed “distribution system” costs regardless of how much water they use.
The goal of that proposed charge is to spread the cost of maintaining the entire water system more evenly among all the customers connected to it.
City officials hail conservation programs for reducing the use of water, but those programs don’t lower the fixed costs of maintaining the city’s pipes, 49 pump stations, nine reservoirs and three treatment plants.
That causes the city to raise rates when people conserve water, which can seem unfair to customers who have done so.
The proposed fixed charge to cover maintenance of the city’s distribution system aims to account for that unintended consequence of conservation, but the second consultant said a fixed charge would be unfair to customers who use relatively little water and that it could be legally challenged.
City officials said this week that the latest proposal shrinks, but doesn’t eliminate, the proposed fixed distribution costs.
The rate hikes would be the first since 2015, but the city has passed on some increases in costs for imported water to its customers since then.
City imposing second consecutive 3 percent annual rate increase to cover rising imported water costs
An overall city rate increase has been delayed partly by ongoing litigation challenging tiers in the city’s rate structure that reward customers who use less water and penalize customers who use more.
