On August 9, Santa Barbara City Council voted unanimously to increase water rates, effective immediately, by as much as 57 percent for certain users. This increase came on the heels of a similarly high rate increase the previous year. The new rates were required to offset higher supply costs and reduced consumption during the drought. Although property owners lowered use from about 15,000 acre-feet to less than 10,000 acre-feet per year, it was costing more to supply less water. At the old rates, the city was losing approximately half a million dollars per month. Hence the rate increase.
But the way in which the new rates are structured may be out of compliance with Proposition 218, which requires that property-related fees are proportional to the actual costs of supplying service to that parcel or class of parcels. For example, if it costs more to supply water to a mountainous area, then those parcels may be charged more. However, Proposition 218, which amended the California Constitution in 1996, does not allow governments to set water rates to promote conservation.
How are Santa Barbara’s water rates structured?