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Water and Sewer Rate Adjustment Authorization <br />January 20, 2026 <br />Page 7 <br />The table below shows the water and sewer revenue adjustments proposed in the <br />Study to achieve the Capital Improvement, Operations and Maintenance, and Financial <br />Plan objectives. <br />May 1, <br />July 1, <br />July 1, <br />July 1, <br />July 1, <br />2026 <br />2027 <br />2028 <br />2029 <br />2030 <br />9.0% <br />9.0% <br />9.0% <br />9.0% <br />8.0% <br />13.5% <br />13.5% <br />10.0% <br />10.0% <br />10.0% <br />Typical Bill Impact <br />The financial impact of the proposed revenue adjustments and rate structure changes <br />on the typical customer was carefully evaluated. The overall increase in the combined <br />typical bill of a single-family residential customer will be $7.12 per month (based on the <br />average of 8,975 gallons of water used per month by typical residential customer). <br />In addition to the proposed rate adjustments, the City is planning to transition from the <br />current bi-monthly billing cycle to monthly billing following implementation of the Smart <br />Water Meter Program. Monthly billing is intended to provide customers with more timely <br />and manageable billing information and offers several benefits compared to bi-monthly <br />billing, including: <br />Improved ability for households to budget for and anticipate utility expenses <br />Lower individual bill amounts (though billed more frequently), which may <br />make bills easier to manage and pay on time <br />Earlier notification of leaks or unusual water use, allowing customers to take <br />corrective action within approximately 30 days rather than waiting up to 60 <br />days under the current billing cycle <br />When compared to neighboring cities, the typical Santa Ana customer will continue to <br />pay a lower amount, on average, for water services as compared to other Orange <br />County cities such as Garden Grove, La Habra, Fullerton, Tustin, Newport Beach, and <br />San Clemente (Exhibit 4). Similarly, customers will continue to pay a lower amount, on <br />average, for sewer service as compared to other Orange County cities such as <br />Huntington Beach, Orange, Newport Beach, Fullerton, and San Clemente (Exhibit 5). <br />Staff recommends City Council authorize and direct staff to prepare all required <br />documents necessary to proceed with the notification of proposed water and sewer rate <br />