Rusty water coming out of the hot water.

I've got a friend who say's he's getting rusty water out his hot side. He called the water department and they flushed out his lines, but he still has the problem. Anyone have a idea what might be causing this, any help is much appreciated. Thanks, Jerry

Water heater on its last legs...galvanized supply pipes, or a steel nipple (short threaded length of pipe) somewhere?

rusty water

Actually, he's getting rusty water from all the faucets in his house. Brass nipples on both hot and cold, could this be the anode rod or is something inside rusting.