California received some good preliminary news last week following the initial snow surveys for water year 2016. Unlike last spring’s snow survey at which Governor Jerry Brown stood on a bare field, this year’s first survey showed more promise. The survey found 54.7 inches of snow at the Phillips Station plot, about 16 inches more than the average depth measured there since 1965. The snow had 16.3 inches of water content, 136% of the average for that site. However, while the initial snow survey represents a good start, state water officials warned that we are still facing drought conditions, and the precipitation during the remainder of the winter will determine if the drought will break. Frank Gehrke, chief of the California Cooperative Snow Surveys Program said, “Clearly, this is much better that it was last year at this time, but we haven’t had the full effect of the El Niño yet. If we believe the forecasts, then El Niño is supposed to kick in as we move through the rest of the winter. That will be critical when it comes to looking at reservoir storage.”

Despite the encouraging initial snow surveys and forecast for El Niño conditions this winter, California water officials are still proceeding with an abundance of caution. In early December, (before the latest snow survey) the State Water Project announced a 10% initial delivery allocation for the State Water Project. While the allocation could increase if the winter is as wet as some projections, the initial allocation shows that state officials are not yet convinced that this winter’s rains will make a substantial and lasting dent in the drought. The uncertainty about future water supplies have far-reaching impacts for both businesses and public officials tasked with planning for future economic growth. In particular, water supplies will play a key role in the Urban Water Management Plan, (UWMP) a planning document that cities and water districts use to forecast supply and demand scenarios for future water use. Each water district that has over 3,000 connections or provides over 3,000 acre-feet of water annually must create an Urban Water Management Plan, and these plans are due to the Department of Water Resources by July 1, 2016.

The uncertainties surrounding California’s water supplies after a five year drought will have to be addressed in these Urban Water Management Plan updates, and the outcomes of these plans could have far-reaching economic and policy implications. In this post, I will address some of the challenges that cities and businesses will face in planning for an uncertain water future, and the economic and political implications that these challenges may present.

(Note: For reference, in August, 2015 I wrote a post that provides further background on the Urban Water Management Plan update process and what goes into the calculations.)

Economic Implications

As I mentioned in my August post, the UWMP must assess both projected water supply and demand over a 20-year planning horizon to assess whether there are adequate water supplies to accommodate new development for the area. While each UWMP has different assumptions and conclusions, most plans follow the same general outline. First, the district assesses water demands from its current and future user base. The district looks at historical trends to determine per capita water use. To project water demand in the future, the district estimates population growth over the planning horizon as well as the potential regulatory and water use changes that may affect water use habits in the future. The plan then compares the supply and demand projections over 20 years to determine whether the water district will have enough water to meet the projected demands of both current and future customers. These calculations could have far-reaching implications.

We are all aware of the significant cutbacks farmers faced in areas of the Central Valley that the Central Valley Project serves for example. Unfortunately, the drought has started to take its toll on urban water districts as well. Some cities have started to place building moratoriums on new development because of meager water supplies. For example, the City of Pismo Beach issued a building moratorium in December – meaning that the city will issue no new building permits effective immediately. The City cited the fact that it missed its 24% state-mandated water reduction requirement, and it also expects to receive less water this year from the State Water Project. The building moratorium has three tiers and will be reviewed monthly for appropriateness:

• Tier I: Restrictions begin when the City’s water supply drops below 1,337 AF. The city will not issue new building permits for construction on vacant land until new water supplies are accrued. Applications for building permits and projects in the pipeline will move forward in the entitlement process, but will not receive building permits until water is secured.
• Tier II: Restrictions begin when the City’s water supply drops below 1,130 AF. City officials will not grant building permits even if the project has been approved. Redeveloped existing buildings must use 15% less water and outdoor water use will be prohibited.
• Tier III: Restrictions begin when the City’s water supply drops below 850 AF. City officials will not grant building permits even if the project has been approved. Redeveloped existing buildings must use 30% less water and outdoor water use will be prohibited.

So far, building moratoriums of this kind have not been the norm. In October, 2014, the California State Water Resources Control Board issued orders that prohibited 22 water districts (mostly small districts in Northern California) from issuing new service connections without providing new water supplies to support these connections. But if drought conditions continue and water supplies dwindle further, other cities across the state may face similar challenges as Pismo Beach and the cities hit with building moratoriums in 2014.

Implications on Infrastructure Planning

Cities and water districts may be able to avoid building moratoriums due to a lack of water supplies if they plan the proper infrastructure to accommodate new growth. Unfortunately, the state in general has not kept up with needed infrastructure investments to capture storm water in times when significant rains soak the state. The Los Angeles Times published an interesting opinion piece which argued that the El Niño rains this winter will present a missed opportunity rather than a blessing. For example, the author argues that the City of Los Angeles has flood control basins that capture runoff from hundreds of square miles, but the system is designed to move water off of the land as quickly as possible, not to capture it. The areas that can capture storm water such as the Tujunga Wash can capture up to 8,000 AF of water annually – but water from this winter’s storms may be 10-20 times that volume.

In the future, cities and water districts will have to prioritize water infrastructure investments that will provide a reliable water supply in a variety of hydrologic conditions. Karl Seckel, the Assistant General Manager at the Municipal Water District of Orange County argues that future water investments will require a variety of solutions. The Orange County Register says that Karl’s organization will look to invest in a host of infrastructure solutions over the coming years including desalination plants, further water recycling facilities, storm water capture and water banking. They will need to make these investments to accommodate the projected 317,000 new people living in Orange County by 2040.

Takeaways

A building moratorium may not be the only solution to address the lack of water supplies for new development. Cities and water districts in the future will have to balance the need for a reliable water supply with the economic impacts that construction brings to their communities. Our water districts can also be more proactive in building the infrastructure necessary to provide reliable long-term water supplies to existing and future customers. Hopefully the rains this winter will provide enough water to fill back up our deeply depleted reservoirs. However, we cannot rest on our laurels and reverse the water conservation measures that we have put in place during this severe drought. I believe that a combination of water conservation and prudent infrastructure and development planning will go a long way to ensuring that California can accommodate the new growth over the long-term.