Michael Smolens: Changing water reality upends huge project, pushes rates higher

We're all in hot water.

Sometimes there's not enough water, sometimes too much. Either way, water costs for San Diegans will increase to sticker-shock level and maybe beyond, if that's possible. And using less won't help much.

This comes after a string of some hefty rate hikes in recent years.

The San Diego region's effort launched a couple of decades ago to insulate the county during times of extended drought, and from decisions elsewhere to reduce water headed this way, has long been deemed laudable. That was always going to be costly, but nobody likely anticipated just how much. If they did, they weren't advertising it.

For now, the San Diego County Water Authority is awash in too much water it can't sell.

The convergence of these factors has put tremendous pressure on the agency's budget — leading to proposals to raise rates up to 22 percent next year and as much as 39 percent over three years.

In a water world turned upside down, stocking up for expected droughts, better than expected conservation and back-to-back very wet years — usually good things — are part of the problem.

The building of dams, reservoirs, the Carlsbad desalination plant and other infrastructure as well as long-term contracts for imported water have reached the point of no return. They can't be undone and must be paid for even if all are now not needed.

The city of San Diego may try to put at least part of the genie back in the bottle by looking at scaling back , or doing away with, the second phase of its multibillion-dollar Pure Water program that will turn sewer water into drinkable water.

“The population, wastewater flow, water demand projections and regulations have all changed significantly since the original plan was completed in 2011,” Amy Dorman, the city’s assistant director of public utilities, told David Garrick of The San Diego Union-Tribune.

The old water wisdom was to plan for extreme dry years ahead.

The new wisdom requires also preparing for shorter periods of heavy rain. Such events can be both welcomed and feared. They bolster water supplies but can cause catastrophic flooding.

Remember, only in recent years has the term " atmospheric river " — kind of the old Pineapple Express on steroids — become part of common weather lexicon.

"I think the world's changing and it's not going back," said Dan Denham, general manager of the water authority. "... Climate change whiplash is at the center of all this."

The wet, relatively cool weather has depressed demand among the authority's two dozen member agencies, which includes the city of San Diego. Despite low revenues from lagging water sales, the authority has actually buffered recent rate increases by dipping into its water stabilization fund and reserves over the past couple of years.

Those have largely been depleted, according to Denham.

"We're at the point where we can't dampen rate increases as we have in the past," he said.

The authority is on the hook for paying off its infrastructure build-up for years to come, along with financing ongoing maintenance. With sales on the wane, the agency is looking to lean on rates to keep its budget from sinking. A downgrade in its credit rating would increase future costs.

Praying for drought — and thus increased water sales — is hardly something any water agency wants to do.

One potential result of cutting back on the Pure Water program is the city could continue buying a substantial amount of water from the authority, possibly at a lower cost than through recycling. The project was expensive to begin with, but costs have escalated.

It's uncertain exactly how much city residents would pay for water if the full project is completed, but there's no question it was going to be more than from most other sources.

Evolving water-use calculations have also changed the equation. For example, not long ago, Pure Water was expected to provide up to a third of the city's water needs. More recently, that estimate was increased to half.

The water authority points out that residents of San Diego County reduced water consumption by more than 40 percent per person over the past 30 years. Years ago, water officials in San Diego and across California underestimated the public's willingness to conserve.

San Diego County residents have the lowest per capita water usage in Southern California, according to the water authority, but they may face the highest costs. Yet water bills are projected to rise across the state.

With the county water authority in budgetary triage mode, Denham and the board are attempting creative solutions to give the agency more flexibility in wet and dry years — and lessen its financial strain. The sometimes byzantine, century-old water laws make it difficult to move water around. Even if you have water to sell, doing so isn't always easy.

San Diego water officials are seeking to expand their market, initially with relatively modest, temporary water deals . One is a three-way transfer among San Diego, the Los Angeles-based Metropolitan Water District and the Imperial Irrigation District. (Under a separate landmark agreement hatched two decades ago, San Diego receives a substantial amount of Colorado River water from the Imperial district.)

Another potential pact is being negotiated with the small Moulton Niguel Water District in Orange County, which essentially would purchase expensive water from the Carlsbad desalination plant.

The hope is this will lead to a more free-flowing system of water transfers across the state.

"We look to have more flexibility, to move water where it's needed," Denham said.

That could be crucial as the federal government is overseeing negotiations that could revamp allocations from the Colorado River.

But at least in the near future, San Diego agencies and ratepayers will be struggling to keep their heads above water.

What they said

The Washington Post

"Juneteenth or Jefferson Davis? Alabama is considering a bill that would make Juneteenth a state holiday. Workers could choose to celebrate Juneteenth or the birthday of the president of the Confederacy, Jefferson Davis."

CORRECTION: This column has been revised to correct the spelling of Dan Denham's last name.

This story originally appeared in San Diego Union-Tribune .