NEVADA CITY, Calif., October 15, 2026 – By a unanimous vote, councilmembers accepted the outcome of the Prop. 218 vote on the city’s proposed water and sewer rates. There were 375 protest forms submitted, far below the 50% + 1 threshold of 638 votes needed to overturn the proposed water rates and 757 for sewer rates. The council then approved resolution 2026-33 adopting new water and wastewater service charges.
The new rates will go in effect in 2027, with increases up to 25% possible. However, as City Manager Carrie Wright explained, the city council has the option every year to set increases below that percentage. This could be triggered by grants received, lower cost for materials or an increase in the city’s housing units.
Public comment was largely against the increases, with one exception. Fixed income, the average population age in the city and some suggestions to “look into other options” dominated the comments.
Councilmembers agreed with the public that the increase will be steep, but pointed to the state of the infrastructure and the unwillingness of previous city councils to address the issue.
“I know that our emergency reserve fund, if we break a line, is $20,000. That is no reserve fund at all. I was speaking with some colleagues down in Roseville. A few weeks ago, they broke a six-inch water line in the middle of the street on a Saturday night. Did a lot of damage, but before they even got to the damage, it cost them a million and a half dollars to just do the repair. … We have 100-year-old water lines and 100-year-old sewer lines. That’s what happens in old towns. And over the course of many years, they have not been maintained as they probably should,” Vice-Mayor Gary Petersen said, adding that the money collected via the water and sewer bills “cannot come into the general fund and can only be spent on those items, sewer and water. That is by law. So we’re not raising money to do other things.”
Councilmember Fleming offered the following perspective “One of the things about this council, and it may not be very looked upon favorably right now is we don’t kick things down the road. Kick cans down the road. We deal with the problems. We had to do this with waste management. Nobody had raised the rates on waste management for five, 10 years. And, you know, we got hit with this big increase and all of us felt the impact. We could just pretend like this doesn’t happen, but we can’t stick our heads in the sands about critical infrastructure that may fail. You know, if you’re talking about fire, you have some water problems that are significant in a town when there’s a fire or there’s, you know, a fire is projected to come…”
Councilmember Kline shared his personal situation, “I’m currently working three jobs in order to stay here. And just like you, I’m finding everything in the world is getting more and more expensive. I just filled up my car and it felt like a joke. You’re seeing corporations they’re raising prices on us, and then you’ll see that executives are getting massive bonuses and so forth. It’s incredibly frustrating for people who are paycheck to paycheck or on fixed income. This isn’t that. This is it coming to our attention that we are on the edge of an emergency and needing to do something about that. So our water rates are going to be going up to with yours. We totally understand the frustration. For some of us, it’s going to mean tightening the belts and looking at household budgets. And I absolutely feel that. At the same time, you elected us to be stewards of this city. So our priority has to be the sustainability of this place, and the state of things here 10 or 20 years from now depends on what we do tonight. And that’s heavy, and it’s what you put us here for.”
It’s all connected
Mayor Daniela Fernández agreed with the general sentiment and put the item in perspective to the city as a whole. “Every decision that we make affects another one. Business affects housing, affects short-term rentals, affects water, affects infrastructure. We heard from our city manager tonight that over the last 20 years, this community has grown by 174 people. And one of the things I love about living here the most is that we are unique, that we are not Roseville. I’m not suggesting that we develop and we make this place a place that it’s not. [But] that sort of tight hold on that zero growth, zero change notion also has affected this aspect of our infrastructure. The city manager and I did the math. Had we built 340 units over the last 25 years, and I’m not talking about big huge apartment complexes, I’m talking about infill projects a little bit here, a little bit there that would make up for the cost that the city is subsidizing. And so this is all connected, housing and growth and building and infrastructure, it’s all connected.”
City staff will propose a mechanism for a hardship fund to alleviate the increase for low-income ratepayers. Existing programs like late payment fees will also get a revamp.
Prop. 218 explainer
Proposition 218, approved by California voters in 1996, sets the rules for how local governments can raise money from property owners. For water and sewer service, the city must show that charges don’t exceed the cost of providing the service and that each parcel pays only its share. Before raising rates, it must mail a written notice to every affected property owner at least 45 days ahead and hold a public hearing. If a majority of affected parcels file written protests, the increase can’t go forward. Protests are counted separately for water and wastewater. Rates also can’t be set for more than five years at a time.
The City Council started the Prop. 218 process on July 23, notices went out Aug. 10 with the objection deadline on Oct. 1 at 5 p.m. The protest deadline was Oct. 14 at 5 p.m. and the hearing was held Oct. 14. There are 1,225 parcels receiving water service and 1,512 parcels receiving sewer service, some with multiple meters.