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Public Works Agency <br />www.santa-ana.org/pw <br />Item # 8 <br />City of Santa Ana <br />20 Civic Center Plaza, Santa Ana, CA 92701 <br />Staff Report <br />January 20, 2026 <br />TOPIC: Water and Sewer Rates <br />AGENDA TITLE <br />Authorize Staff to Prepare Documents for Water and Sewer Rate Adjustments (Non - <br />General Fund) <br />RECOMMENDED ACTION <br />Authorize and direct staff to prepare all required documents necessary to proceed with <br />notification of proposed water and sewer rate adjustments in compliance with Proposition <br />218 requirements, including, but not limited to, the following: <br />a) Prepare and mail proposed rate adjustment notices to all Santa Ana property <br />owners in compliance with Proposition 218 requirements; <br />b) Schedule a public hearing at a future City Council meeting, on or after March 17, <br />2026; <br />c) Prepare all other documents required to proceed with water and sewer rate <br />adjustments. <br />GOVERNMENT CODE 84308 APPLIES: No <br />EXECUTIVE SUMMARY <br />Water and sewer rates have not been adjusted since 2023. California law has evolved <br />with new requirements to ensure equity among rate -payers. Costs have escalated faster <br />than revenue, and the water and sewer enterprise fund balances have decreased to <br />unacceptable levels. To ensure service delivery, compliance with law, and maintain the <br />City's credit rating, staff is recommending rate increases based on a water and sewer rate <br />study. If the recommended rates are approved at a public hearing in the future, the typical <br />single-family residential bill (water and sewer combined) will increase by about $7 per <br />month. Postponing a rate increase will necessitate a larger increase later, and risk a <br />credit rating downgrade. Even with the proposed changes Santa Ana customers will <br />continue to pay a lower amount, on average, for water and sewer services than most <br />other Orange County Cities. <br />