Is There an Emerging Consensus on How to Fix California Water Problems?

Over the past couple of months, I have attended and participated in a number of water conferences and broader meetings where common themes have emerged. There is a universal belief that California’s water situation is not good and there are two things we need to do to change that. One is euphemistically named “regulatory reform” and the other is “funding.” 

Let me unpack that a bit. By regulatory reform, folks mean a couple of things. First, current regulations governing the operations of our many and varied water delivery systems are layered with many constraints creating bottlenecks and barriers to using water when it is available. For example, the regulations governing the movement of water through the delta during the winter and spring when wet year water is most prevalent are very restrictive. Many of these regulations were put in place decades ago to protect endangered species with very dubious benefits, and yet they remain in place, costing in some cases millions of acre-feet of water over time to run to the ocean. 

The other group of regulations that prevent progress are the overlapping, conflicting and time consuming rules that govern building water projects. A very obvious example of this is the Sites Reservoir Project in Northern California. Sites is a dry valley located in the foothills on the West side of the Sacramento Valley that would be a great location to enclose with a few dams and fill up with wet year water for use in the dry years. It seems most everyone is for it. It has attracted major investment from the state, federal and local government as well as many water agencies. But it has been decades in the making constantly delayed by regulations. 

The consensus I see emerging is driven by the recent mood change in the public that is now finally focused on affordability. The insane cost of all this overregulation is finally hitting the public, and affordability is becoming a political issue. Somehow, we need to connect the dots that it is the massive overregulation of California that contributes to making the cost of everything so high. 

But there is a second issue with water that I see an emerging consensus and that is on how to finance the water infrastructure that is needed to actually sustain California for the long term. We do need to build some stuff. California is a creation of water projects that move water from where it is abundant and when it is abundant to where it is short and where it is needed. Our historical policy has been that “user pays.” That worked for decades, although the federal and state governments played a big role in financing major infrastructure with loans that have to be paid back. In recent decades, there have been water bonds which produced grants, but bonds and grants are episodal. That is, each bond and grant program has its own rules and priorities and often requires expensive, time consuming competitive processes which all delay projects and add massive costs to delivering them. 

Last week at the Urban Water Institute conference in San Diego we heard from a panel of Texas water officials explaining their Texas Water Fund.  Texas has adopted a funding mechanism that allocated $1 billion per year for 20 years from state sales tax revenue to investing in water supply projects. This is the type of approach California should employ if we are serious about securing our water future. I heard lots of support for this type of approach in the meetings I have attended recently. 

Will we get there? Is there time? Is there the political will? I always take comfort from what Winston Churchill observed. He said you can always count on Americans to do the right thing, but not until they have exhausted all the alternatives. 

Geoff Vanden Heuvel

Director of Regulatory and Economic Affairs