San Simeon residents and businesses will face sharp increases in water and wastewater bills after the San Simeon Community Services District (SSCSD) approved a new rate ordinance on Jan. 7, a decision the district said is necessary to keep the system operating while it undergoes a potential dissolution.
Under the ordinance, water rates will rise by 32 percent and wastewater rates by 36 percent, starting Feb. 7.
San Luis Obispo County Public Works Division Manager Suzy Watkins, who currently serves as the primary lead for SSCSD operations, said the increases are meant to provide short-term financial stability.
“The purpose is solely to generate cash flow in the near term to support the district through the dissolution study,” Watkins said during a Nov. 13 meeting.
The district last raised rates in 2022, Watkins said. Although a five-year rate plan adopted in 2019 allowed annual increases tied to inflation, the final increase authorized for the 2023-24 fiscal year was ultimately not implemented, and draft rate studies prepared in 2022 were never adopted. As a result, revenues for the district remained flat while costs increased.
The rate study identified a 32 percent funding shortfall in the water fund and an 88 percent shortfall in the wastewater fund. A staff report noted that fully closing the wastewater gap would have required an 88 percent increase, but the district opted for a lower increase to reduce immediate impacts.
“Without additional revenue, SSCSD is projected to have insufficient funding to operate within the next year. The proposed rate increases are intended to fund the costs of providing water and wastewater service within the specified area,” Watkins told New Times in an email.
District board Vice Chair Karina Tiwana said the board struggled with the decision but felt it was unavoidable.
“It is incumbent upon us as residents of the community, as all of us are, to ensure that the appropriate funding is there to keep the water and wastewater going and the water coming out of the tap,” she said at the Jan. 7 meeting.
Public commenters acknowledged the district’s financial problems but criticized the size of the increases. Resident Mary Margaret Maguire said she agreed that some increase was necessary but described the approved rates as “draconian” during the Nov. 13 meeting.
“These amounts of increase could serve to bankrupt several businesses here,” Maguire said. “People are not making any money these days. They’re hanging on by a thread.”
She added that many residents are on low or fixed incomes and said the increases “are going to cause a lot of harm to a lot of people,” attributing the situation to years of district mismanagement.
In a Nov. 24 letter, resident Wendy Ball described how she was struggling to afford basic water use.
“For over two years, I have been unable to take a shower—not because of plumbing issues, but because I simply cannot afford the cost of water service,” she wrote.
She said an increase could lead to a complete loss of service and asked the district to consider hardship accommodations and low-income assistance programs that can help residents like her maintain access to essential services.
A separate protest letter submitted on Sept. 21 by property owners William and Erin Gibson criticized the district’s past leadership.
“This district has historically had ample opportunities to address rate increases but evidently lacked either the political will or the business acumen to do so,” they wrote. “This lack is the direct cause of this outrageous rate increase. And thereby dumping this decision and action on the county, which we feel does not have a real grasp on the population dynamics of San Simeon.”
The letter also noted that permanent residents will be disproportionately affected while part-time property owners face fewer impacts.
The rate increase comes after San Luis Obispo County temporarily assumed day-to-day operations of the district under the California Water/Wastewater Agency Response Network (CalWARN). The county’s involvement is expected to last about one year during which a state-required dissolution study will be completed. The district is required to reimburse the county for all costs incurred. ∆
Correction, January 27, 2026 1:54 pm: This story was updated to correct the proper title of San Luis Obispo County Public Works Division Manager Suzy Watkins.
This article appears in Jan 15-22, 2026.