Controversial state rules could cost $13 billion – Press Enterprise

Saying the targets to cut water use in cities and towns will be costly and difficult to achieve, water agencies throughout California have raised concerns about an ambitious state proposal that would require more water conservation statewide beginning in 2025.

The State Water Resources Control Board’s proposed regulations would mandate conservation measures by more than 400 cities and water agencies that serve about 95% of Californians. The measure could save about 413,000 acre-feet a year by 2030, enough to serve about 1.2 million households per year.

During the last three-year severe drought, which ended this year, the Newsom administration set voluntary conservation goals that were largely ineffective. Californians used only about 6% less water from July 2021 through the end of last year compared to 2020, far less than Gov. Gavin Newsom’s 15% goal.

The new rules are mandated by a package of laws — enacted in 2018 by the Legislature and former Gov. Jerry Brown — that aim to make “water conservation a California way of life,” not simply an emergency drought measure.

Water providers from the Mojave Desert to Sonoma County and beyond warned at a board workshop on Wednesday that the regulations would be a challenge, particularly because many would have to make steep cuts to outdoor water use. About 80 people, mostly representing water agencies, spoke during the meeting, which lasted longer than eight hours.

The regulation would cost water suppliers about $13.5 billion from 2025 to 2040 — more than 40% of which would fund rebate programs and other efforts to cut residential water use, according to the water board. But the benefits are anticipated to reach about $15.6 billion between 2025 and 2040, largely from reduced water purchases by both suppliers and customers.

“It’s awkward, because we are committed to water use efficiency,” said Ryan Ojakian, government relations manager for the Regional Water Authority, which represents Sacramento-area providers. “It really comes down to, are the regulations feasible? Are the costs worth the benefits? And what are the consequences in achieving the regulations?”

The water board is expected to vote by next summer on the rules, which could go into effect next fall.

Water suppliers, not individual customers, would have to meet the targets — and each supplier would need to figure out its own strategy. These could include rebates that encourage customers to swap out thirsty lawns for more drought-proof landscapes or rate structures that penalize heavy water users.

Water providers said it will be difficult to squeeze more conservation out of their customers.

“They want us to save water at such an accelerated rate, that even if we had all the money, we would not be able to convince our customer base to participate at the rates we need them to,” said Joe Berg, director of water use efficiency at the Municipal Water District of Orange County. “We can build it, but they don’t necessarily come.”

The state agency’s formula sets targets for each water agency based on goals for indoor and outdoor residential water use, business landscapes with dedicated irrigation meters, losses like leaks and other variables, such as the presence of livestock in a region.

In the rules, the state’s targets for indoor and outdoor water use in residential areas ratchet down, beginning in 2030 and then again in 2035.

Suppliers that fail to live within their prescribed water budget could face escalating consequences that could eventually lead to fines of $1,000 a day starting in 2027 or $10,000 a day during droughts.

Tracy Quinn, CEO of the environmental group Heal the Bay, told the board that water conservation measures are critical as California stares down a water-scarce future.

Between the declining snowpack, ongoing haggling over Colorado River water, groundwater regulations and projections that climate change could dry up 10% of the state’s water supply, “there is an incredible need for us to do a rulemaking that’s going to require the efficient use of water,” she said.

About 231 agencies serving nearly 27 million Californians are already on track to meet the 2025 objectives without reducing their water use, mostly in the San Francisco Bay Area and Southern California. And 71 agencies serving 8.5 million Californians are expected to meet the 2035 standards as well, including the city of San Diego, the San Jose Water Company, the San Francisco Public Utilities Commission, the Irvine Ranch Water District and city of Santa Ana.

Cumulatively, the rules are expected to save about 6.3 million acre-feet between 2025 and 2040, mostly from residential measures.

Berg said the regulations could cost Orange County water agencies more than $707 million over 11 years to implement. But more than that, he said, he’s concerned that the standards for outdoor water conservation accelerate too quickly.

“If an agency were to look at the cost to comply and compare that to the cost of the fines, it wouldn’t surprise me if an agency just says, ‘Okay, we’ll just take fines,’” Berg said.

Claire Nordlie, water use efficiency supervisor for the city of Santa Rosa in Sonoma County, echoed those concerns during the workshop.

“I really want to emphasize that sustained water savings are difficult to achieve. It takes decades of time, and a significant investment of resources, as well as a population and a culture within your service area that want to participate,” she said.

Nordlie said fewer and fewer people are participating in the city’s rebate program for removing lawns, which offers $1 for every square foot of grass removed. Customers surveyed say that it costs about $7 a square foot to tear out their lawns. That cost, Nordlie said, is a major barrier.

“If customers don’t want to participate, we can’t force them to,” she said.

Jay Lund, director of the Center for Watershed Sciences at the University of California, Davis, told the board he’s concerned that the regulations could affect public trust.

“Certainly some aspects of our society are really upset every time you come in there with a new regulation, and so I think we have to bear that in mind,” Lund said. “Because that blowback can be very bad for a lot of more important things than this.”

Smaller water agencies, especially in inland regions, will be the hardest hit. Ten suppliers serving about 200,000 Californians are expected to face cuts upwards of 30% in 2025, but the number increases to 84 suppliers serving 3.7 million Californians in 2035. Included are the cities of Atwater and Kingsburg, the Oildale Mutual Water Company and the West Kern Water District, according to state data.

Jennifer Cusack, director of public and government affairs with the Hi-Desert Water District in Yucca Valley on the edge of Joshua Tree National Park, said the water agency has long struggled with its water supply and there’s little room for additional conservation. Many ornamental lawns are already gone and indoor water fixtures have been improved.

“There’s not a lot of opportunities for savings in our community, because we’ve done so much already,” she said. “A lot of folks don’t even irrigate their homes. They have dirt lots or maybe some trees.”

Even so, the desert water supplier is expected to be out of compliance with the 2030 and 2035 targets, which, she said, “just raises a red flag.”

In response to earlier calls for increased flexibility, state regulators offered an alternative pathway that would give some providers, such as those serving disadvantaged communities, extra time to meet a 2035 outdoor water-use target, provided they meet certain criteria.

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