The economic pressure on water companies is coming in large part from the ongoing drought in Southwestern states, said Back & Veatch's Orth. Many water sources are dry from lack of rainfall. That often means utilities must buy water elsewhere, which drives up the cost to consumers.
Farmers, too, are having to pay higher water prices from the drought, leading to higher food costs.
Perhaps ironically, efforts to encourage water conservation are also contributing to utilities' revenue problem, said Scott Huntley, a spokesman for the Las Vegas Valley Water District.
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"It's having a product to sell and then telling customers not to buy it," he said. "We encourage conservation, but it does mean less money for us."
Huntley explained that his utility, unlike many others, does not have to pay for water, since its water source is allocated from nearby Lake Mead. However, the costs of pumping water, filtering and distribution are fixed, and don't go down when water utilities hit rough economic patches.
Las Vegas Valley Water District has started to feel the effects of fewer consumer dollars, said Huntley. This past April, the utility laid off more than 100 people from its total workforce of 1,300.