THOMAS LARSON

(San Diego Reader October 3, 2002)

In recent years, the 855 employees of the San Diego Water Department have faced scandals, alleged mismanagement, media scrutiny, and the rebuke of the City Council. All this began in 1999 when news stories appeared locally about water thieves and industrial hogs who didn’t pay their bills—accusations that proved true and forced changes in how the 100-year-old agency operates. Consequently, the department has new policies to deal with the press. Senior public information officer Kurt Kidman said that "10 years ago we might [have been] a whole lot more accommodating than we are right now." But today, he said, the department is "in a real difficult position. We’re definitely under the gun with Channel 10. When we breathe, they want to know how much it cost us." In 1999 KGTV/Channel 10 reported on how "big water customers are allowed to run up huge bills that go unpaid." In the "hidden meter" scandal, reporter Mark Matthews discovered one million dollars’ worth of unpaid bills, with "dozens of industrial water meters . . . recording only 10 percent of the water going through them."

In 2000, a San Diego County Grand Jury convened to investigate. According to the Union-Tribune, its report cited a water department "riddled with problems ranging from workers who didn’t trust their supervisors to billing policies that left workers largely on their own in deciding how to handle unpaid bills." The grand jury issued 29 findings, two of which concerned the department’s slow response to suspected hazardous materials at a city construction site. The department acknowledged that it knew "of a possible asbestos hazard for seven months before the site in question was examined for hazardous materials," and that it took another six months before determining the charge was "unfounded." The water department maintains that no workers were ever exposed to asbestos.

In 2001, the council brought in Black & Veatch, which describes itself as the "world’s largest provider of engineering and consulting services to the water industry." The council asked Black & Veatch to assess the Water Department’s performance, in part, because the department had asked for a rate hike. The council deferred that hike pending Black & Veatch’s report.

Jake Boomhouwer, the regional manager for the management consulting division of Black & Veatch, said the purpose of its four-month long "management review study" was to assure council and community that the water department "wasn’t totally out of line." During the summer of 2001, Boomhouwer and three teams of consultants evaluated the department’s "organizational performance" and its "planning and information systems." The review’s strongest language labeled the "infrastructure of the water system," in "serious need of improvement." Their report also concluded that the department’s customer service sector was inefficient and had "considerable room for improvement."

A shake-up of city bureaucracy occurred last October when Richard Mendes was hired for the newly created position of utilities general manager. Mendes was installed to oversee the San Diego Water Department and the Metropolitan Wastewater Department, which has had its own set of spills with contaminant results. (It should be noted that the water department only delivers water; the wastewater department is responsible for disposing of that water once it’s been used.)

Then, in spring 2002, two water-safety orders were issued that would require upgrades to the city’s delivery system and would, no doubt, culminate in higher rates for water customers. The first, under the federal Safe Drinking Water Act, mandated that communities adopt stricter water treatment procedures. The second order was sent, as a reminder, by District Engineer Brian Bernados of the California Department of Health Services. Bernados told the water department that if it didn’t comply with a 1997 order from Sacramento, requiring the city to protect its consumers from two cancer-causing pollutants, the public health would be compromised. He issued a not-too-veiled threat. If the city failed to comply, "There are a number of enforcement tools prescribed by law, including public notification, citations, fines, mandatory water conservation, and service-connection moratoriums." In effect, Bernados gave the city no alternative but to comply.

To upgrade pipes or personnel the water department must play ball with the mayor and the city council. Water department spokesman Kidman told me that in the past 13 years, the department has asked the council for water rate increases some 50 times. The council has bestowed two hikes. In neither instance, Kidman noted, has the council taken the water department’s pricing recommendations.

In March 2002, the water department asked the council for more money. The department proposed a 6 percent across-the-board rate hike to collect $508 million for capital improvements. Prior to public comment on the proposal, the city manager and the water department gave the council options from which to choose. These favored the high end user, the low end user, or neither. On April 22, utilities general manager Mendes called for the "neither" option, the one that would apply "equally to all customers," no matter how much water the small or large customer used. This plan would add $1 the first year to the average customer’s bill, rising to $10 a year at the end of 5 years. City manager Michael Uberuaga also urged the council to adopt the equitable proposal, as his department had during the 1997 round of rate hikes. That year, however, councilmembers chose the inequitable increase, something they appeared poised to repeat.

None of the public opposition to the hike before the council targeted the rate hike itself. All speakers supported upgrading the municipal water system, which even the San Diego County Taxpayers Association called "warranted." But voices rose against the city’s equitable plan, mostly from groups representing San Diego’s large water users. These included the San Diego Regional Chamber of Commerce, the San Diego Regional Economic Development Corporation, the San Diego Food and Beverage Association, and the San Diego County Apartment Association. These groups argued that residential customers should bear more of the rate-increase burden since, they claimed, it is less expensive to bring water to one large user than to many small users. Huge spikes in the big users’s bills would be painful, they contended, in a falling manufacturing and tourist economy enervated by fears of terrorism. Steve Zapoticzny of CP Kelco, a plant that makes biopolymer products on San Diego Bay, said that his company uses 1 million gallons of water a day. Reminding the council that there were 300 jobs at stake, Zapoticzny said CP Kelco could not "absorb" the new costs.

In the end, four councilmembers—Scott Peters, Byron Wear, Toni Atkins, and Ralph Inzunza—and Mayor Murphy voted on April 30 for the inequitable proposal backed by the large users, which took effect on July 1. Voting against the proposal were Jim Madaffer, Brian Maienschein, George Stevens, and Donna Frye. Frye objected to the new rate structure since it did nothing to encourage large users to conserve. She also wondered aloud: Shouldn’t the biggest drinkers pay more, if they use more?

According to the Union-Tribune, the average single-family homeowner’s water bill will be 35 percent more over five years while "big companies that are heavy water users" will pay 24 percent more. Locally, the single-family water bill averages 28 HCF (Hundred Cubic Feet), roughly 21,000 gallons every two months. (Customers pay a base fee for water service and a commodity charge for the amount of water used.) The water department’s July newsletter provided two telling examples of how the rates will change for each of the next five years. While the high end user’s bill, which totals 50 HCF, goes up only 5 percent, the low end user’s bill, which totals 4 HCF, increases 9 percent.

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What most San Diegans don’t know about high end-users—defined by the water department as "multi-family, commercial, and industrial customers"—is that they use 67 percent of the freshwater consumed in the city. Because of the high volume of water used by the biggest customers and because they perennially shoulder less of the burden of the rate hikes, does the department monitor their usage to see if they are using water efficiently?

Monitoring San Diego’s water customers, large or small, is something the water department does not do. Nor does the California Public Records Act allow citizens to check on how much water is used by any customer—a neighbor or the United States Navy. The Act protects the privacy of all utility customers and their "utility usage data." But, according to a list of exceptions in the Act, privacy is precluded for "an elected or appointed official with authority to determine the utility usage policies of the local agency." Those elected officials are the mayor and the city council.

Before requesting the council’s water bills, I wanted to know whether other high-level "appointed" managers in city government also had "authority to determine the utility usage policies." If so, were the water bills of utilities general manager Richard Mendes, water department director Larry Gardner, or city manager Uberuaga exceptions to the Public Records Act as well?

In the municipal code, the City Manager’s authority for rationing water in the event of an emergency is clearly established: "He is hereby authorized to determine and declare that a water shortage emergency exists . . . to promulgate such regulations, rules and conditions relative to the time of using water . . . [which] will, in his opinion, relieve the water shortage." Moreover, in the event of a "water supply shortage due to increased demand or limited supply . . . in the City of San Diego, the general welfare requires that the City maximize the beneficial use of its available water resources . . . and that the waste or unreasonable use, or unreasonable method of use of water be prevented and the conservation of such water is to be extended . . . ." In addition, the city manager is "authorized" to implement emergency measures based on the "recommendation of the Director of the Water Department." "Following public notice," water conservation provisions must be set up during a "foreseeable water emergency such as extended drought conditions." The water department "shall monitor the projected supply and demand for water, by its customers, on a daily basis."

Such powers during a water shortage are given primarily to the city manager, with input from the director of the water department, and the regulatory scope of those powers certainly sounds like "authority to determine utility usage policy." When I requested water bills for Mendes, Gardner and Uberuaga, the city attorney’s office responded that those men are not responsible for determining utility usage policy—only the council "sets policy." Accompanying the opinion of the city attorney’s office was an admission that the "language" of the Public Records Act, in this instance, is "ambiguous."

City hall managers and councilmembers wrangled over the rate-hike pricing, and not the scope of the water department’s capital improvements. There was next to nothing said by the city council or the water bosses about adopting water conservation measures. Projects the water department wanted to fund—including projects that had been repeatedly asked for every year by the department and denied by the council—are being funded. Mendes’s detailed presentation to the council on April 22 proved that he had the authority and expertise as utilities manager to persuade his superiors that the projects the department had chosen are worth every penny. In short, the council authorizes only the pricing structure; the water department allocates its budget as it sees fit. The department makes nearly every water-related decision in San Diego except who gets "gouged" (George Stevens used the term) with the rate-hike.

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April’s vote on the rate increase showed that the council’s ear was ultimately pulled by the big consumers of water. Did large consumption of water by councilmembers themselves along with their investment interests in water-using companies effect the vote? The water bills of the mayor and city council, tablulated between summer 2001 and summer 2002, show that most are somewhat below, at, or above the average single-family use of 168 HCF, a bit more than 125,000 gallons per year. Water bills presumably reflect the number of the people who live in each home.

Stevens, Maienschein, and Frye voted against the proposal. Stevens uses 69 percent more than the average and Maienschein, 17 percent, while Frye uses 25 percent less than the average. Murphy, Wear, Atkins, and Inzunza voted for the rate-hike. Murphy uses 68 percent more than the average, and Wear, 56 percent. Ralph Inzunza uses 26 percent less than average, and Atkins, 48 percent less.

The council’s two hydro hogs are Jim Madaffer and Scott Peters.

Like a magnet, District 7 councilman Madaffer continues to draw scrutiny with his water usage. Last year, when Madaffer was in arrears on his bill, the city padlocked his valve—not once but three times, in June, August, and October. Publicity surrounding the third cut-off finally got Madaffer to pay the hundreds of dollars he owed. (The water department declined to say whether Madaffer is now paying his bills on time.) The councilman also happens to chair the council committee that oversees the water department. In the past year, including the time he hadn’t paid his bills, Madaffer used 306,680 gallons, which is 145 percent more than the average residential user. Madaffer may have voted against the hike because of the bad publicity he has received for his water troubles. But, if his water usage remains high, the proposed increase clearly benefits him.

While Madaffer’s water bill shows heavy usage for his home in Tierrasanta, the water bill for District 1 councilman Scott Peters, who voted for the rate-hike, reveals an astounding amount of freshwater used for a single-family residence. Peters was billed for 848,232 gallons from mid-summer 2001 to mid-summer 2002. This was 579 percent more than the average user. Between mid-May and mid-July of this year, the Peters family used 216 HCF, or 161,000 gallons—more water in two months than the average local family uses in a year.

Peters’s single-family home is in La Jolla, not far from Mount Soledad and La Jolla Scenic Drive South. The 1.25 acre lot is dense with trees and bushes, and includes a tennis court, a four-car garage, and a huge home. In this home and on this lot, the Peters family uses on average, 16,300 gallons of water per week. For the same week, the average San Diego home uses 2400 gallons.

Perhaps the most revealing way to show how the water rate-hike benefits large individual users is to compare Toni Atkins’s bill to Scott Peters’s. In the most recent one-year period Toni Atkins paid $511.57 for 88 HCF of water. That worked out to $5.80 per HCF. In roughly the same one-year period, Scott Peters paid $2603.21 for 1134 HCF. Yes, he used more, but he paid less than half of Atkins’s charge—$2.29 per HCF.

Peters describes himself as "an environmental lawyer" and continues to make, according to his statement of economic interest for 2001, $100,000 per year practicing law. He is married to multimillionaire investment banker Lynn Gorguze, who, with her 85-year-old father, owns Cameron Holdings, a private equity investment business. According to its website, Cameron Holdings "acquires small to mid-market manufacturing companies with annual revenues of $5 million to $200 million."

Peters reports five investments of his own, seven investments in trusts for his children, and, under his "spouse’s separate holdings," more than 100 large-cap growth stocks, each with a worth of at least $10,001 to $100,000 with several holdings worth $100,001 to $1,000,000. These stocks are in oil and gas, energy, telecommunications, electronics, software, and the copper and fiberoptic cable industries. Gorguze is the director of several cable companies. She is the sole general partner of Gorguze Investments LP and specializes in buying portions of or acquiring high-tech manufacturing businesses.

One example of Gorguze’s deal-making is her purchase with her father in 1990 of Aldila, a Poway company that produces carbon fiber golf club shafts. Gorguze also oversaw the opening of another Aldila plant, a maquiladora, in Tijuana. Today, according to the Aldila’s website, there are four manufacturing plants worldwide, including one in Poway, with a total of 950 employees. As of 2001, Gorguze owned options on nearly 300,000 shares of stock in Aldila. Gorguze’s stock holdings in large companies with local operations include Aldila, Sony, Qualcomm, and Coca Cola, which has a sizable San Diego facility.

Did Peters’s vote on the inequitable water-rate increase benefit his and his wife’s stock holdings as it obviously did their residential water bill? Whether here or elsewhere, tourism, manufacturing, development, and technology are driven by water consumption. This is particularly true in the fiberoptic business where large amounts of super-cooled water are used as part of the manufacturing process. The interests of the Gorguze and Peters families have much to gain (and much to lose, had the vote gone the other way) by passing the business-friendly rate-hike.

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Since the lion’s share of the water rate increase goes for capital improvements, one finds scant spending allocation in the department’s budget that targets conservation or inefficiency among San Diego’s big water consumers. True, efficiency will be increased when the department replaces thousands of feet of cast-iron pipe, which is 60 years old and breaks more often than the newer pipes, subjecting the system "to catastrophic failure."

The water department says in its January 2002 Annual Water Conservation Report that its programs "reduce water demand through promoting or providing incentives" to bring about "permanent water savings." Such programs include water surveys, landscape-watering calculators, graywater usage, and low-flow fixtures. Last year when San Diegans used 232,000 acre-feet of water, the department claims to have "saved" 13,000 acre-feet because San Diegans installed hardware or participated in the city’s programs. These programs have also brought about a decline in "per capita water use," even as San Diego’s population has grown in the past decade. But for a region facing supply reductions and rising demand—the water department estimate that it will need 255,485 acre-feet by 2015, roughly a 10 percent rise—the only way to keep lowering per capita use is to conserve more. The city has few plans that will lower the amount of water its customers are currently using perhaps because it allocates only $3.2 million, less than 1 percent of its annual revenues, for its conservation budget.

Some question whether conservation hasn’t, over the past decade, realized its major savings. The key technological advances of the 1990s—ultra-low flush toilets, low-pressure shower heads, and the like—have been widely installed. If most public bathrooms have been outfitted with low-flow toilets and motion-sensor technology already, how much more savings is possible? The new front-loading High-Efficiency Clothes Washers help conserve water. But at $1000 to $1300—nowhere near the price of a low-flow fixture—the washers are too expensive (despite the $125 voucher from the city) for most San Diegans.

An obvious way for the water department to conserve water is to not buy it in the first place. But is this efficient? The city stores water in reservoirs—Miramar, Lower Otay, and Lake Murray—adjacent to the three water treatment plants. According to Kurt Kidman, the department keeps the reservoirs low in the summer because it’s more efficient to "draw down" the reservoirs in advance of winter rains and because water is more expensive during the hottest months. But, as one senior water department engineer told me, the department did not fill its reservoirs last winter, when the water was cheaper and the supply more abundant. There was, the engineer said, nothing budgeted for such a purchase.

The water department has, in the last decade, made significant strides in using reclaimed water. The department maintains two water recycling plants (North City and South Bay), which provide non-potable water for irrigation, cooling towers, dust abatement, golf courses, and more. Many big users like reclaimed water because it’s half the price of freshwater. However, the city and its water customers face limitations in developing this resource. It costs a lot of money to build a separate infrastructure through which recycled water is pumped; strict regulations forbid recycled and freshwater from ever making contact. The city has few areas where recycled water is distributed—only 250 sites in the northern half of the city. And, while a recycled water system does represent a savings once it’s installed, the water can only be reused after it has been bought, delivered, and flushed first as freshwater.

Conservation and water-efficiency programs, while necessary, do not prevent urban citizens from questioning whether our water supply is secure. Are the city and the region growing so fast that we will face significant shortages, perhaps mandatory cutbacks in the next 20 years? Does the city, in times of a true shortage, have an equitable allocation plan? And, with less water, how might the department determine who uses how much and how might that "how much" be regulated?

Surely, regulating heavy usage is on the water department’s radar. According to Mike Bresnahan, assistant deputy director of the water department, it’s not. "We don’t produce a report of individual [water users] from highest to lowest and then start looking at them. We don’t regulate water usage." If an individual or business customer, he said, uses a large volume of water, even a significant amount more one month than another, the water department has few means with its "cumbersome, old technology" to identify the problem. Instead, the department set up its water billing system to show percentage usage from one year to the next. If our bill spikes, we must ask the department for information on how the problem can be corrected. The system is set up for its users to police themselves voluntarily.

Recalling last year’s review of the water department by Black & Veatch, Jake Boomhouwer said that his firm was not asked to look at how the department monitored its users. Why not? One reason, he noted, was that such an examination of billing and usage problems had occurred several years ago, when the department "fixed the metering difficulties they were having." Boomhouwer also said that concerns over how the water department polices itself and its users is a "matter of perception. Water utilities don’t typically" police their users, he said. "A water utility is basically in the business of maintaining its own system and selling water. The only time that something unusual might pop up is when the meter reader comes by on a monthly or bi-monthly basis and punches in the read on the meter. If it’s out of line, typically, it will pop up an exception. If you’re using 10 gallons every read, and now it says 100, usually [the device] will flag that. Maybe it was a misread. Or they might send somebody by to double check." Boomhouwer said the department may investigate. "But, even then, a leak on the other side of the meter is a customer’s responsibility. It’s up to the customer to figure that out and fix it."

When any municipal water utility faces a drought, Boomhouwer went on, the agency will offer water audits and tips on conserving. But, as far as how the department can improve its service or regulate its customers usage, there is little incentive to do so. Why? Because the municipal water delivery business is a monopoly. If the water department was subject to "competition, as we’re having with electric de-regulation, at that point the utility might say, ‘Well, maybe I ought to identify my ten largest customers and go out there and see if I can’t help these guys because I don’t want them to leave,’" which would change "the whole dynamic."

I suggested the giant municipal utility is a curse and a blessing. Boomhouwer responded with, "right. He [the customer] can’t go anywhere else so you don’t necessarily have to do all the kind of customer service things you would have to do to keep him."

On the question of big residential users, Kidman said that he doubts whether his department’s computer system, maintained by Data Processing Corporation, could look through 270,000 accounts for the top 15. The system is "not set up for that. I won’t be real surprised if they can’t run a report based on amount of usage. When we installed it, that was never a consideration." As far as commercial and industrial users, Kidman said, "Anyone who uses lots of water has multiple meters. The U. S. Navy"—easily the area’s largest user—"may have thousands of meters, I don’t know." It would be near impossible, Kidman emphasized, to evaluate whether the Navy was using its share responsibly or not.

Does the water department have any means to target inefficiency? Kidman described the department’s "alert" system that measures "overs and unders," that is, significantly more or less water use based on the user’s average. The department has a program that compares a current bill with the 12 previous bills, bi-monthly for residential users (two years) and monthly for commercial (one year). An average is figured, which is then multiplied by one and a half. If the current bill is 33 percent more than one and a half times the average, the bill is red-flagged and given to a field investigation crew. That crew either calls or visits, making some 1500 calls a month. Kidman said the majority of the calls are for low bills; typically, there’s a For Sale sign on the property. With most high bills the customer usually says, "‘We don’t have a leak. We filled a swimming pool, we had guests, we had a toilet that got stuck and ran.’"

But, despite the value of an alert-system, 1500 calls or visits a month for 270,000 customers seems minuscule. Kidman said efficiency occurs when the department asks rather than tells its customers what to do. I wondered whether the department was in the business of asking big users to conserve, so I queried a dozen of the thirstiest about how much water they use and whether the city helps them with conservation or has monitored them with alerts.

The United States Navy uses 2.5 billion gallons per year. The Municipal Code guarantees that, because of "extensive services which the Navy provides the City," the Naval Air Station and the Amphibious Base, both in Coronado, pay the city only for the water they use and do not pay base fees, that is, for meter service. Sea World uses 1.1 billion gallons, of which 20 percent or 230 million gallons is from the water department; the rest is taken from and returned to Mission Bay. A spokesman for the San Diego Unified School District said that during the fiscal year 2001-2002, 429 million gallons of water were used at 211 sites. The Port of San Diego, which is responsible for streets, parking, landscaping, buildings, terminals and piers as well as Lindbergh Field, uses 289 million gallons per year. UCSD Medical Center in Hillcrest reported using 58 to 61 million gallons annually. A spokeswoman for Kaiser Permanente said their facilities use millions of gallons of water inside and outside, maintaining "park-like settings" for the "well-being of patients."

Qualcomm Stadium uses 29 million gallons per year, watering the field and hosing down the seats. A spokeswoman at Qualcomm, the cell phone chip-maker, said that their operation in San Diego, which consists of 25 buildings, is "fab-less," that is, the company doesn’t fabricate chips locally. (Where are they fabbed? "We don’t disclose that information.") The company "designs and develops chips here" and uses 15 million gallons per year. At Scripps Hospitals, a spokeswoman had "no idea" about water usage and amount: "These kinds of facilities’ things must go by the wayside." A Zoo spokeswoman said the Zoo has not cut back on watering this year because "our water is for the survival of our plant and animal species." The hotter and drier it is, the more water the Zoo will use.

All these large users conserve water and each one spoke, in glowing detail, of its on-site program. The most astonishing tale came from San Diego State’s administrative operations analyst Bill Lekas. Lekas recounted the many new devices like infrared hand-activated faucets and toilets and computerized irrigation systems that have radically altered water management at the campus. Lekas said the school has cut freshwater usage dramatically. In three years, from 1999 to 2002, the number of gallons fell from 107.7 million to 20.9 million—an almost 81 percent drop! Covering such a vast amount of landscaped ground was the culprit. Lekas said, "The old-style sprinkler systems would go on at night, and, if we had a broken head, it would spout like a fountain and no one would know. We had hundreds of thousands of gallons of water that went into the drainage system."

And yet, when asked how much the water department helped in making changes, many—the city schools, the zoo, Sea World, UCSD Medical Center, among others—agreed that the department has done little to advise them on conservation. A spokesman at the city schools said the department did not help, except for "administrative billing" procedures. No one I spoke with was able to point to a person or a program that helped with conservation. San Diego State’s Bill Lekas confided, "To tell you the absolute truth," the water department "did not help" his conservation efforts at all. Most large users have established water-savings plans on their own—because it saves money, it helps the community, and it burnishes the image. And, whether they know it or not (none interviewed spoke before the council), these users were saved, by virtue of their heavy consumption, even more money by the council vote on April 30. This hidden relationship between water guzzlers and the council’s policy is perhaps not so hidden after all.

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Finally, what of the current drought that San Diego and much of the West is facing? How will another year or two of too little rain affect us? City water engineer Tibor Varga told me that drought is not an aberrant condition; it is part of a weather pattern. "Drought is a certain thing. Every 20 years you’re going to have some very dry years. To balance out water demand with supply, you need to have some water stashed away in your bank account. Whether it’s groundwater or surface water, it should be there, for the lean years." Today, San Diego is in its lean years. Without much water stashed, will we face water shortages and, thus, city-manager imposed rationing? Or is it possible to find new sources that will supply our needs before El Niño returns?

High on the water department’s agenda, as stated in its conservation report, is "water supply reliability through an aggressive capital improvements program, and investigating new alternative sources of water." Water department deputy director Marsi Steirer admitted that while her agency is "investigating" new water sources, much depends on the definition of "sources." If it’s reclamation, the department has targeted $25 million to expand that program. If it’s the "drilling of new wells or having staff aggressively pursue water transfers," nothing’s been budgeted. A new Strategic Water Plan (which remains in draft form) must be approved first by the council before the city can explore alternative sources.

The best proposals around the county—aside from towing icebergs from Alaska to San Diego Bay—are projects to ramp up a plant in Carlsbad, for desalinating brackish bay water, and to explore the San Diego Formation, an aquiferous strata of fossilized fish bones, sea shells, and other material beneath much of the city. Although there’s been little research into the water’s quality, preliminary reports suggest that the formation may contain as much as 1 million acre-feet of water.

But San Diego is years from integrating any new water source into its supply. Perhaps, in 1991, when rationing was adopted throughout Southern California, such alternatives should have been developed. But they weren’t, and now we are on the cusp of a water crisis that may be worse than the one in 1991. Nature has bore the first bad news. The region’s yearly rainfall averages 10.77 inches; this past year rainfall was barely three inches. That is the lowest level since yearly tallies began in 1851. Our nine county reservoirs are near or at their lowest collective level ever, with five lakes nearly 80 percent empty. (The most strategically located reservoirs—Lower Otay, El Capitan, Lake Murray, Miramar, San Vicente—are dwindling, though not rapidly. City council policy #400-04 states that those five reservoirs, along with 60 percent of Lake Skinner in Riverside County, must contain enough water, in case of a catastrophe, for the next seven months. Currently there’s 150,000 acre-feet, roughly 18 percent above the required 127,000 acre-feet.)

The city gets its water—90 percent of it—from the Colorado River and the Sierra Nevada snow-pack. (Elsewhere in the United States, 90 percent of the water supply is rainfall, costing nothing to transport.) Despite last year’s healthy snowfall in the Rocky Mountains, water activists are wondering how much supply will be available and how costly San Diego’s water bill will be should the drought persist this coming winter.

New curbs on the city’s (and the county’s) imported allotment are coming. Under a U.S. Interior Department mandate for the seven Colorado River basin states, California has been directed to reduce its reliance on the river by 800,000 acre-feet by the end of 2015. Apparently California has just been buying more than its share. (California uses 5.2 million acre-feet per year from the Colorado; its allotment, which is the 2015 target, is 4.4 million acre-feet. The reduction is known as the 4.4 Plan.) Now there’s a new threat. Unless programs are put in place to show "progress in saving water by the end of this year," Interior Department Secretary Gale Norton may, following federal guidelines, order that the entire 800,000 acre-feet of Colorado River water be cut from California’s supply on January 1, 2003.

The volume of water under discussion is enormous. Each year, the San Diego County Water Authority, the local wholesaler that brings water to 23 water agencies in the county including the City of San Diego, buys 591,000 acre-feet from the regional wholesaler, the Metropolitan Water District. (An acre-foot is about 326,000 gallons, enough water for two families of four per year.) The county will need to buy more water over the next two decades to keep pace with the county’s development. According to a San Diego County Board of Supervisors policy statement, "Demand within the Water Authority’s service area is expected to grow from about 695,000 acre-feet [in 2002] to 813,000 acre-feet by 2020." That’s 17 percent more over 18 years. Anticipating a surge in new accounts, the Board has begun "to regulate water-using activities of private development projects in unincorporated areas."

A problem as grave as the limited water a growing San Diego depends on is the supply battle that continues between the San Diego County Water Authority and the wholesaler, the Metropolitan Water District of Southern California. The Met, as its called, is the second largest agency in California behind the state government itself. Many experts agree that the Met, because of its size, its location in Los Angeles, and its clout, has been gouging the water authority and its customers for years. To illustrate, the authority has rights to only 14 percent of the Met’s supply but has historically paid for 22 percent of the Met’s capital and operating costs. Additionally, because of a 1927 law, Los Angeles has the right during times of drought to take half of the authority’s allotment. So outrageous are these controls that the water authority is suing the Met. According to the authority’s media relations officer John Liarakos, the Met allocates its reserves in a scheme that is neither "a fair nor accurate way to calculate water rights." The first bad news is in—the Met’s position was recently upheld in a San Francisco Superior Court ruling; that judgment is under appeal.

In terms of increasing supply, the water authority is negotiating to buy 200,000 acre-feet a year from the Imperial Irrigation District in the Imperial Valley, in a new water transfer agreement. (The district already transfers 106,000 acre-feet per year to the Met.) Sue Giller of the Imperial Irrigation District told me that "if urban California is going thirsty, there’s political pressure on us and our farmers." Giller said the strongest lobbying has come from state officials on behalf of the federal government’s 4.4 Plan. The Met and the San Diego County Water Authority are also pressuring the district. She said that because of the year-end deadline for 4.4, water decisions are being made "in a crisis environment. We have attorneys and negotiators working around the clock, trying to make" an agreement.

Last week, the state Water Resources Control Board gave its tentative approval to the transfer. The board wrote that "the public interest in the transfer outweighs the adverse impacts." But this approval is not final; there are several socioeconomic and environmental issues to be resolved. Beginning this week, under the leadership of assemblyman Bob Hertzberg, all parties have convened in Sacramento and set an October 15 deadline to reach an agreement.

The delivery of new valley water to the San Diego county, if implemented, would be incremental. The transfer would begin with 20,000 acre-feet next year and adds 20,000 acre-feet each year until 2012. Hence, valley water will not bail out the water authority in one fell swoop. Moreover, the transfer is contingent on as-yet unsigned agreements between landowners and the Imperial Irrigation District, and what Giller called valley farmers’ "heroic means" of conserving more water because "[our] farms already use extremely efficient means of saving water." The district has an "elastic right" to use as much of the Colorado as it needs, so mandates under the 4.4 Plan to use less will not affect it.

Valley growers are opposed to a program being pushed by Governor Gray Davis’s office and environmentalists, who want farmers to fallow some 25 percent of valley fields. Davis and the environmentalists claim that more water will be saved by this tactic than by conservation methods. But it will not save the fast-expiring Salton Sea. The sea is hyper-saline and needs freshwater in-flows. Besides, Giller said, farmers want to farm, not fallow. Not to farm would "deteriorate the farmland" and put people in the irrigation business out of work. Giller said the Imperial Irrigation District board has offered to fallow roughly "100,000 acres of farmland over a 10-year period"; the San Diego County Water Authority wants farmers to fallow more than twice that amount. This would have a "severe economic impact" on valley agriculture, Giller said.

Imperial Valley citizens this summer made a list of economic "mitigations" they would exchange for the lost water. The community wants $200 million in aid to pay for building costs associated with the transfer; a new Department of Motor Vehicles office and an expanded San Diego State University campus in the valley; $50 million in environmental mitigation; and more. The valley community also wants San Diego water bosses to guarantee some $130 million in incremental payments to valley farmers once the transfer begins.

The transfer agreement must stipulate, Giller said, that, in any given year, if there is less Colorado River water available, the Imperial Irrigation District will send less water to the water authority. In short, even if the transfer is negotiated in time, it is not clear that this will hold off the federally-mandated 15 percent drop, which is ordered to begin in 3 months. Some people have even raised the probability that each year’s newly arriving 20,000 acre-feet will be siphoned off by new development instead of supplying existing accounts.

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Water Resources Specialist Vicki Driver of the San Diego County Water Authority described to me a concept called evapotranspiration with which commercial irrigation customers have experimented. Evapotranspiration means "the amount of water a plant loses from its leaf material and its surrounding soil—the amount of water that has to be replaced to maintain the health of the plant." One water-district program had several large commercial landscapers and growers tied to a water budget—voluntary, of course—which would supply them with only the amount of water their plants needed. The object was for these water customers to calculate the evapotranspiration of their plants and to budget their irrigation costs accordingly. In the economies of abundance, that have ruled our water usage in the past, "it’s been easier and cheaper," Driver noted, "to over-water than it is to [use water] efficiently." But that may be changing, as smart technologies and falling supplies become the wave of the future.

Southern California’s many water bureaucracies and delivery systems are in trouble. The possibility exists, however, to re-think and re-fashion an alternative system, covering single-family, multi-family, commercial, industrial, and agricultural users, that is plentiful and efficient if it were tied to the amount needed rather than the amount used. As it stands, the water bosses will keep negotiating the supply, supplying the resource, and taking little or no charge of how that water is used. From Sacramento to San Diego, the faucet appears to be stuck open.