In the water system, major projects include construction of advanced treatment (ozone) at Cater Water Treatment Plant. Debris and runoff resulting from the 2007 Zaca Fire continue to impact the treatment process, causing significant additional costs for removal of high concentrations of dissolved material. The advanced treatment project will help address the fire’s impacts and meet new, more stringent water quality standards. Better tasting water is also anticipated.
Ortega Groundwater Treatment Plant 
Another important project is the rehabilitation of the City’s Ortega Groundwater Treatment Plant, which is now under construction. This facility treats groundwater pumped in the downtown area. The upgraded design will ensure compliance with stricter drinking water regulations and allow the City to continue to use groundwater to replace water supplies lost during drought and other emergencies.
A water rate increase of 3.5% is proposed to pay for these projects.
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The City collects and treats approximately 8 million gallons of wastewater each day. In 2011, there were no sewage spills to creeks or beaches. Never-the-less Channelkeeper, a local environmental group, sued the City claiming violations of the Clean Water Act. To avoid a costly trial, the City settled with Channelkeeper. The City was successful in ensuring that the actions required by the settlement would improve the system, not just pay for studies. As a result, the City is expediting its longstanding program of pipeline rehabilitation. To pay for the replacement of more sewer lines each year, a 6% rate increase is needed. This is in addition to a planned 4% rate increase that is needed to fund capital projects at the 30-year old El Estero Wastewater Treatment Plant.
The Wastewater Treatment Plant operates in a very corrosive environment. City staff are continually maintaining the facility to comply with strict water quality regulations and reduce operating costs. Current projects include replacement of the 30-year old influent pumps, which pump water through the treatment process. Other projects will improve the removal of solid material at the very beginning of the treatment plant and will improve the air handling in the plant to allow better control of the biological treatment.
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