San Diego Water Rates Shift in January

San Diego residents will see a new water billing structure on their statements starting in January. The change follows a 6-2 City Council vote on Tuesday to adopt a modified rate plan. This adjustment coincides with a previously approved increase in base water rates. The new system replaces the tiered pricing model that has charged customers based on usage levels since the early 2000s.

The shift stems from a lawsuit filed in 2015 by Daniel Patz and others. The case challenged the city’s method of charging different rates per unit of water depending on total consumption. A court ruled against the city’s tiered system. San Diego appealed the decision but lost the final ruling. The city is now responsible for a $40 million settlement.

Under the old rules, homeowners who used less water paid a lower rate per unit. Those with high usage, such as large lawns or pools, paid a higher rate per unit. The new structure eliminates these tiers. Customers will pay a single rate based solely on the volume of water consumed. City officials estimate the average monthly bill for a low-use single-family home will rise by about $6. High-use customers are expected to see their monthly bills drop by roughly $20.

City staff presented the plan to council members, noting the city’s reluctance to change the system. “The city does not agree with the court's decision in the [Daniel Patz et al. v. City of San Diego] case. However, we are legally required to have a structure the court deems valid,” a staff member said during the presentation. Council members acknowledged the legal mandate while expressing concern over the financial impact on conservers.

District 9 Councilmember Sean Elo-Rivera voiced opposition to the outcome during the Tuesday meeting. “It makes me angry because what is being imposed on us as a city and, therefore imposed, on the people of San Diego is a penalty for doing more to conserve water,” Elo-Rivera said. Other residents offered mixed reactions to the change. Isabel Jordan noted that while equal rates seemed fair at first, the old system provided a necessary incentive for water efficiency in a region prone to drought.

The city expects low-use customers to face the most noticeable price adjustments. A city representative acknowledged that even modest increases could affect households that have invested in water-saving landscaping and appliances. The new billing structure takes effect in January. The separate base rate increase also begins that month. These changes mark the end of the tiered system that lasted for over two decades.

The legal battle that triggered these changes began in 2015. The plaintiffs argued that the tiered system acted as a penalty for high usage rather than a fair pricing mechanism. The court agreed. San Diego is now implementing the flat-rate structure required by the ruling. The $40 million settlement remains a financial obligation for the city. The new bills will reflect the single rate for all usage levels starting next month.