There are several factors that affect water rates, including the cost of buying water; the cost of electricity to move water from place to place; the cost to fund water improvement projects for the City’s 50-year-old aging water system; and the cost to enhance emergency preparedness. Water costs alone have increased by 17% for imported water and 66% for groundwater in recent years. Costs for electricity, labor and construction have increased, too.
Since the City had not examined its overall costs since 2010, it was time to evaluate them and recalibrate rates to accurately account for the service delivery. Furthermore, the City is legally required to divide the cost of delivering water evenly across all users, which is why it changed from a tiered-rate model to a flat-fee model.
The recent water study also found the City’s current revenue would not meet financial needs in the future. As a result, the water rates were changed to reflect the cost of delivering water to our customers and to ensure the City can continue to invest in a secure water future.
While it is not uncommon for water agencies in California to increase rates each year, the City of Tustin has not increased its rates since 2014.