Coping With Crisis : Shortage: Growth controls are necessary to stop increasing demand for water.

If bumper stickers such as “No Water, No Building Permits” and “Flush Twice, Stop Growth” are accurate barometers of public opinion, two things in California are abundantly clear. Existing residents of our water-starved cities do not want to be forced to conserve water simply to accommodate growth.

As California’s severe drought tightens its grip on the public’s psyche, this “No Water, No Permits” sentiment is putting increasing pressure on city councils and boards of supervisors to cut building permits or adopt building moratoria. This reaction is, in turn, raising cries of protests from the development industry.

Fortunately, there is a way out of the current--and future--water crisis that protects both existing residents and development interests, as well as the economy. The idea was part of the growth management initiative sponsored last year by the group Prevent Los Angelization Now.

Under this proposal, new development could not result in restricted water usage by residents or businesses or to increases in water and sewer rates. The way to achieve these goals is through an “offset policy” similar to the federal policy used successfully to clean up some of the nation’s dirtiest air basins, and through pricing rules that charge developers the actual incremental costs of the water to be used by their projects--rules favored by virtually all economists.

Under the “offset policy,” all commercial, industrial and residential development would have to install maximum feasible water conservation and reclamation devices and technologies. As a practical manner, this would mandate such devices as low-flow shower heads, instant hot water units and ultra-low flush toilets, as well as drip irrigation and drought-tolerant landscaping. It also would require all new development to be equipped with dual pipes to accommodate both potable and reclaimed water.

This idea is merely common sense, and local politicians have moved most of the way towards accepting it. But there is a second part to the offset policy. This would require developers to create “new” water supplies through conservation of existing supplies and to pay the incremental cost of additional water supplies.

This would work in two complementary ways: Developers would pay for the retrofitting of existing homes, businesses and factories. In other words, a developer seeking a building permit would be required to pay for (or directly undertake) the installation of low-flow shower heads, ultra-low flush toilets and other water saving fixtures in existing structures. In exchange, the developer would be issued “water credits” equal to the amount of water the retrofits will save. A building permit will be issued only if the developer conserves enough of existing water to service the new development over its lifetime.

Second, developers could meet the requirement by paying their full and fair share of the incremental or “marginal” costs of new water sources. This “fair share” plan is designed to protect existing residents from the rate shock that is likely to occur when cities like San Diego try to solve their water problems through massive public works projects such as reclamation and desalination plants or by buying substantially more expensive water supplies from neighboring states.

In San Diego, such rate shock is a particularly onerous problem: Under the guise of complying with the Clean Water Act, city and county bureaucrats and politicians have overdesigned a multibillion-dollar water reclamation project. This reclamation project will primarily provide water for new development but will be primarily paid for by existing residents.

If the San Diego City Council and the Board of Supervisors were to adopt these ideas, there would be no net increase in demand for water by new development and therefore no increase in the water and sewer rates of existing residents as a result of new development. Nor would existing residents have to conserve water just to accommodate growth. This is both a fair and politically sensible outcome.

The local Construction Industry Federation has already reacted to PLAN’s water proposals by establishing a voluntary retrofit fund. However, a close examination of the program indicates that it is more of a marketing ploy than an honest attempt to solve the problem. The proposed payments are relatively small and not applicable to commercial and industrial development. The resultant retrofits will save less than 10% of the water that will actually be necessary to quench the thirst of new development.

PLAN hopes that the ideas of “no net increase in water demand,” an offset policy and a retrofit program will set the standard for water policy not only in San Diego, but throughout the state.