Water Costs Go Up in Pasadena on July 1

Pasadena Water and Power customers will pay more for water starting July 1, when the third year of a five-year rate plan the City Council approved in 2024 takes effect.

The adjustment, an increase of about 9% under the approved schedule, is the latest in a series of annual July 1 increases running from 2024 through 2028. The council adopted the plan June 3, 2024, on a 7-1 vote after a cost-of-service study found the municipal utility’s existing rate structure did not adequately recover costs.

For a customer with a three-quarter-inch or five-eighths-inch meter — the most common residential size — the fixed monthly service charge rises from $43.25 to $47.15. Usage-based charges go up as well: for single-family residential customers, the first-tier rate increases from $2.51796 to $2.74458 per 100 cubic feet. The new charges apply across customer classes, including multi-family residential and commercial accounts.

PWP’s current rate card, effective June 1, still lists the July 1, 2025 water rates, confirming the new schedule has not yet taken effect.

The 2024 plan also changed how PWP designs its rates, shifting from a meter-size-based block system to a customer-classification-based tiered system — single-family residential, multi-family residential and commercial — with tier breakpoints tied to customer class.

Because the plan changed how costs are allocated among customer classes, not all customers see the same change. The utility’s rate consultant, Steve Gagnon of Raftelis, told the council that some commercial accounts would see lower bills under the new capacity-based allocation even as residential bills rose. “That created a shift in what a two-inch meter pays, and that’s the majority of the reason why this commercial customer is going down,” Gagnon said.

PWP has attributed the increases to rising costs, including higher purchased-water costs from the Metropolitan Water District, increased pumping and treatment costs for local groundwater, growing capital-investment needs and reduced sales tied to the city’s conservation goals. Over its five years, the plan is projected to generate approximately $42 million in additional revenue.

The June 3, 2024 vote was not unanimous. Councilmember Tyron Hampton cast the sole dissenting vote, saying he supported pursuing a federal loan. “I would be supportive of staff going after the loan. I’m not just supportive of the increase,” Hampton said. PWP told the council it was pursuing a low-interest federal Water Infrastructure Finance and Innovation Act loan through the U.S. Environmental Protection Agency and said that, if awarded, the loan could reduce a planned increase by 3%; the council asked the utility to return with updates on its status. Twenty-three individuals sent the council a letter opposing the increase, saying it would disproportionately impact low- and middle-income households.

PWP Assistant General Manager Lynne Chaimowitz told the council the increases were needed to bring in sufficient revenue. “We do need the rate increase of 13% in the 2025 and that is to make sure that we have sufficient revenues coming in to 2027,” Chaimowitz said. She added that the utility would keep seeking outside funding: “A penny increase in the bill is uncomfortable so we’re not going to stop trying to find grants for funding, trying to find other sources to supplement this.”

The 2024 increases were noticed under Proposition 218, the California constitutional provision requiring mailed notice to all property owners and a protest process before a local water rate change can be adopted.

Under the approved schedule, year-over-year increases were about 13% in 2024 and 12% in 2025, with the July 1 increase representing roughly 9%; increases of about 8% and 7% are scheduled for 2027 and 2028.

The July 1 change affects water only. Electric rates are rising under a separate, three-phase plan the council approved in March; the next electric increase is scheduled for October 1, not July 1.

PWP offers bill assistance for income-qualified households, along with residential energy rebates and home-efficiency programs, which remain available regardless of rate changes. The utility posts current rates on its website. Two annual water increases remain under the current plan after this year’s adjustment.