Carlsbad Council reviews 49% water rate increase amid rising costs and inflation

The City of Carlsbad City Council meeting on April 22, 2025, focused primarily on the rising costs of water and wastewater services, with significant discussions surrounding proposed rate increases and their implications for residents and businesses.

During the meeting, city officials presented a detailed analysis of the cost structure associated with water services, revealing that 35% of costs are internal while 65% are attributed to purchasing water from the San Diego County Water Authority. The council discussed a projected 49% increase in rates over the next three years, which encompasses both water and wastewater services. This increase is largely driven by inflation and rising operational costs, including electricity and chemical expenses.

Council members expressed concerns about the impact of these rate hikes on local businesses, particularly those with high water usage, such as restaurants and golf courses. They emphasized the need for transparency and communication with commercial users to better understand how the rate changes would affect them. The city is also exploring a new rate structure that would allow for more direct pass-through of costs from the water authority to customers, potentially mitigating the financial burden if the authority's rate increases are lower than anticipated.

Additionally, the council highlighted efforts to reduce internal costs, including a reduction in staffing and capital improvement project spending. However, specific figures regarding these reductions were not provided during the meeting.

The discussion also touched on the methodology used to determine the cost of service, with officials assuring that a thorough analysis was conducted to ensure rates remain reasonable and proportional to the services provided. The council is committed to ongoing evaluations of water usage data to inform future rate structures, particularly in light of recent legal rulings affecting rate-setting practices in California.

As the city prepares for these changes, officials are focused on balancing the need for infrastructure investment with the financial realities faced by residents and businesses. The council plans to continue engaging with the community to address concerns and provide updates on the evolving situation regarding water rates.