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Environmentalist and consumer advocate Paul Robbins compared water usage and cost between 10 cities across Texas. He found that customers in Austin pay almost six dollars per 1,000 gallons of water while San Antonio customers are paying less than four dollars for the same amount.

"San Antonio does a better job at water conservation than Austin," Robbins said.

David Anders, Austin Water Assistant Director, said rates in Austin are tiered, so customers who use the most water pay more per gallon. He also says Austin's hilly terrain makes it more costly to move water.

"Our rate design that we have implemented the last 17 years has focused on affordability," Anders said.

Another big cost the water utility is facing stems from the ongoing construction of Water Treatment Plant 4. That project is slated to cost $508 million with a 2014 completion date.

Robbins’ study also compares the water rates of 13 surrounding communities to Austin’s.

"Austin is 17 percent higher than these suburbs, so there is a disconnect there,” Robbins said. “I don't think the water utility's arguments are valid."

"The downtown area is cheaper, as opposed to where we don't want folks to build – over the drinking water protection zone,” Anders said. “Those are higher."

Austin Water is reviewing its fee for developers this year, but has to keep it within state limits. Robbins suggests making it the same across the city, so developers would pick up the bulk of the cost.

Robbins’ report did find positives. While Austin grew 20 percent in the last decade, overall consumption remained steady.

Anders says mandatory water restrictions and heightened drought awareness have helped—especially since 2007.

Click here to read a copy of the report.