La Jolla homeowners who conserve water will pay more starting Jan. 1, 2027, after the San Diego City Council voted 6-2 to replace the city's tiered water pricing with a single flat rate.

The Oct. 27 vote eliminates the three-tier price system for single-family homes and charges every water customer $11.09 per hundred cubic feet (HCF), about 748 gallons, according to San Diego Newsline. Under the old system, customers who used less water paid less per unit, while those with large yards or pools paid more.

The change hits low-use households hardest. A city Public Utilities Department presentation estimates a low-use single-family customer will pay $5.62 more per month, a 7.1% increase, Newsline reported. An average-use customer will pay $7.82 more, up 5.9%. High-use single-family customers will save $19.52 a month, according to the same presentation.

The new rate also applies to apartments and irrigation accounts. A 10-unit apartment property would save about $15.17 a month, and irrigation customers would save roughly $48, according to Newsline.

Why the city says it had no choice

The overhaul traces to a 2015 class-action lawsuit, Patz v. City of San Diego, filed on behalf of single-family water customers. The plaintiffs argued the city's tiered rates violated Proposition 218, which requires water agencies to charge customers no more than their proportional cost of service, KPBS reported.

Courts sided with the plaintiffs. A San Diego Superior Court ruled the city failed to justify its tiered rates. The Fourth District Court of Appeal affirmed that ruling on July 30, 2025, and the California Supreme Court declined review in October 2025, according to the city's Public Utilities presentation.

San Diego also owes a $40 million settlement. The council approved that deal on Aug. 25, 2026, directing payment from the city's Water Fund, the account supported by ratepayers, Newsline reported. Class members have until Nov. 12 to opt out or object, and a judge must still give final approval.

Council frustration

Councilmember Sean Elo-Rivera, who represents District 9, voiced frustration at the Oct. 27 meeting despite voting to approve the new structure.

"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, according to NBC San Diego.

Councilmembers Kent Lee and Henry Foster III voted against the new structure, while Councilmember Marni von Wilpert was absent, Hoodline reported, citing the San Diego Union-Tribune.

What's ahead

The flat-rate billing takes effect alongside a previously approved 14.5% across-the-board water rate increase on Jan. 1, 2027. The city says the restructuring does not change total revenue collected. It redistributes costs among customer types.

The city does not plan to revive tiered rates before 2030, Hoodline reported, citing San Diego Public Utilities Director Lisa Celaya. A pending California Supreme Court case, Dreher v. Los Angeles Department of Water and Power, could clarify whether cities can legally use tiered pricing under a new state law, Assembly Bill 2180.

San Diego is also conducting a comprehensive rate analysis covering 2028 and 2029, expected to be completed in February, according to Hoodline. The rate changes affect roughly 286,000 customers across San Diego, Coronado, Imperial Beach and Del Mar.