Category Archives: Districts

Other stuff on the internet.

I loved this slideshow of agriculture around the world, which I looked at long and hard (not least because it loads painfully slowly). I tried to guess the crop and country before I read the caption. I could tell the dairyman was in a first world country because of all the capital in the shot (the nice clean buildings and fences), but wasn’t sure where until I looked at the hills in the background. Oh, home. Absolutely, without question.

Picture 4 blew my mind. Those furrows/beds were machine dug, right? It reminded me of my irrigation professor’s statement that nothing would be more useful to African agriculture then laser leveling.

Looks a fair amount like coastal Central California. Americans should wear more color. Start ’em early.

The picture of the lettuce harvesters reminded me of my perennial internet debates. Sen. McCain once infuriated people by saying that Americans wouldn’t pick lettuce for $50/hour. I don’t agree with Sen. McCain on just about anything, so I should be warned. But I agreed with him here. After spending a summer in fields doing irrigation system evaluations and seeing how hard the laborers worked, I believe that anyone with any alternative (a minimum wage job stocking shelves indoors, for example) wouldn’t do farm labor. I also believe that people who didn’t do manual labor growing up couldn’t pick at a speed that growers would pay for. That picture of lettuce pickers reinforced my take on this stupid, pointless question that I should learn to ignore.

All the pictures are fantastic, but the last one that stuck with me was of the Afghani herders driving their goats. Such beautiful goats! Then, right there, graffiti-ed onto the rock, an American surveying station in ugly orange paint. What did the Americans start there? Can they finish it? Did the Afghani’s want the reminder? What did the locals write in response (coincidence that the response is in green, color of Islam)? In that picture, they’re going along their daily business, not bothering anyone, with the beautiful goats and ugly reminders of imperialism.

Another amazing photo series on the food families around the world eat in a week.

Gene Logsdon has been writing about driving animals, and what a big part of life it used to be.

An interesting take on the Resnicks, from before the drought politicized them in water circles. I stumbled on this by accident as I was looking for beekeeping information, and was surprised to see them in other conflicts. Hard to believe there’s life outside Water, but sometimes it pierces my blinders.

Couple interesting pieces in the SF Chron today. A hay farmer holds out against turning a Delta island to a wetland. My take-away is that we shouldn’t have made contracts to maintain levees in perpetuity for free. Like water rights, it was too much to offer.

Also, an interesting read about a Californian cotton grower who doesn’t want his cotton subsidies. He’d rather compete on quality. Next Farm Bill reauthorization is in 2013? First year of Pres. Obama’s second and final term? Interesting thought.


Alex Breitler pointed us to a new site, put up by South San Joaquin and Oakdale irrigation districts to argue against a Biological Opinion for preserving steelhead on the Stanislaus River.

I like the site. It looks like the authentic work of the people who posted it, not smarmy bullshit by paid-for PR firms. You can tell. This is good, because now I can get a feel for what SSJID and OID actually think. I’m glad they put it out for public analysis.

That said, their argument is wrong on two fronts. First, they say that the Biological Opinion is flawed because it will drain New Melones reservoir 13 times over the next eighty years. But keeping the reservoir full isn’t the goal of the Biological Opinion; just because the reservoir empties doesn’t mean that the Biological Opinion won’t achieve what it is trying to do, which is give the best chance to steelhead. I’d be real interested in seeing that report. I’ve seen similar DWR reports, of state reservoirs going dry about 20 times in the next century. I wonder whether the New Melones/Stanislaus modeling included climate change, which will make the problem much worse (less water, plus you have to release more cold water to cool off warmer rivers). Anyways, the report’s results sound roughly right to me, and point to much more active reservoir operations in the future than we’re used to.

The real problem with their argument is in the last two bullet points. They’re essentially saying that once the reservoir is empty, the river will run dry and it will be terrible for steelhead. That, they claim, is the flaw of the Biological Opinion: “The implementation of the BO could kill the very fish it attempts to save…”. This is true. Once there’s no water left to send down the river, there’s no water left. But holding that water behind the reservoir will also dry up the river, making it terrible for steelhead. Every year the rules laid out in the Biological Opinion draw the reservoir down to almost nothing is another season that the Biological Opinion did exactly what it was written to do, keep water in the river and save the steelhead. I can’t tell from the write-up on their site, but that looks like it might be 22 years in the next 80 years. (Or maybe the 13 years of complete drawdown come out of those 22 years; I can’t tell.)

So far as I can see from the write-up on their site, the problem isn’t that the Biological Opinion is flawed. The problem is that it is likely the right thing to do for steelhead, and that will direct water into the Stanislaus and away from SSJID and OID’s growers. Also, it looks like there isn’t enough (cold) water in the system even if it all went to steelhead. I do love seeing growers and districts take such an active interest in invasive species, stewards of the land that they are.

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Filed under Agriculture, Climate Change, Districts, Uncategorized

Doubt about making 20% per capita water reduction mandatory.

One big complaint about last week’s water legislation is that it is pricey; a second complaint is that the 20% water use reduction is voluntary. Those are linked. A fair bit of the $11B bond measure goes to grants to districts for conservation and infrastructure improvements. If you don’t meet the 20% by 2020 goal, you can’t get state grants. The legislature is essentially offering bribes that are too good to turn down. This is sortof fine, if you don’t mind that the taxpayers as a whole are supplying the money for those bribes*. But some object to the bribery method at all. Make the conservation target mandatory, they say.

As a bureaucrat, I have an insatiable demand for power and I love to meddle in people’s daily business, so I’m not emotionally opposed to making 20 by 2020 mandatory. But as I think more about it, I can’t figure out how I would make water conservation mandatory in urban California.  Who would I enforce against?  What is the remedy?

What would be the target unit of enforcement?  People?  Households?  Districts?  Cities, in places that aren’t served by a district?  Those all get hairy really fast.  I don’t know of any ways to track the 35 million individual water users, nor how to break them out from within a household, and how would you divvy up the household landscaping water use?  Households?  Every household should have a meter, and I’d like to see multi-unit places have meters too.  So that doesn’t bother me theoretically.  But how would the state receive and track and enforce against individual households, if their water consumption dropped 18% but not 20% by 2020?  What’s the reporting mechanism?  How is it validated?  The state could require that districts or cities do this, or simply that districts show an aggregate water level use that’s down by 20% on a per capita basis.  But that starts pooling crime in a way that we don’t generally do.  Punishing a water district (how?  fines?  And then the district raises rates to recoup funds (which I don’t think it can do under Prop 218)?) for not meeting a goal punishes the people in the district who did meet the goal along with the people who don’t.  Besides, we hold employers responsible for the criminal acts of their employees, but isn’t it a little strange to hold public municipal or administrative body responsible for the acts of its constituents?  I mean, a water district doesn’t have that much power over the people inside it.  If a bad actor inside a water district wanted to use 84% of her 2009 water use, the district can’t do more than levy fines.

If urban water conservation is legally mandatory, choosing the level to prosecute against gets complicated fast.  But assuming we worked that out, there are other stange aspects to it.  Using water isn’t a crime, and it is a little strange to think that it would become one in the next gallon after 80% of your 2009 water use.  Wasting water is currently a(n almost entirely unenforced) crime under the California Constitution, but most people don’t have a strong emotional sense that letting the shower run until the water gets hot, or neglecting a running toilet is a matter that is appropriately prosecuted.  Further, people are extremely attached to however it was when they were kids; we’re going to tell them that what they’ve done their whole lives is suddenly illegal?  I guess we’ve done that with smoking bans, but there you could point to the harms of secondhand smoke.  Any incremental water use, even a wasteful one, seems like a pretty benign thing to criminalize.

Then, what is the remedy?  Throw those wasteful fuckers in jail and throw away the key?  Naw.  I can’t imagine anyone is talking about criminal remedies.  I assume we’re talking about civil prosecutions, and a thought of an administrative system for that (district water courts?  Traffic courts handle water tickets on the side?) is also boggling.  I suppose the water cops could issue tickets and the household could either pay it or make improvements.  Or something.

Yeah.  I’m not emotionally opposed to making water conservation mandatory, but as a practical legal matter, I don’t how to do it.


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Filed under Districts, Water Markets!!!

Please also note that Prop 218 is a real problem for Oceanside.

It is beneath a good blogger to make fun of comments, right?  Not your comments; your comments have all been fantastic.  But comments to newspaper stories.  There’s no point in selecting one and mocking it.  I mean, they’re likely to be laypeople or be ideologically biased.  I normally read newspaper comments for the gestalt (then huddle in the corner, sobbing for our future).  But this one is SO GREAT.  I can’t resist.  From an article in the Capitol Weekly on increased enforcement in the proposed new water legislation:

The only way that a government that has brought the state to its economic and political knees can think of to fix a problem is by giving that same government more power. This has gone beyond inept insanity to maniacal delusion. We want and we should have more water for less money. We don’t want to continue to pay a collection of incompetents to tell us or try to make us use less. Any 1st grade class could come up with that one.

I am deeply chagrined that the proposed water legislation does not manufacture new cheap sources of water out of thin air.  Why didn’t they think of that?  Where is their problem-solving inventiveness?!  Why are they binding themselves with the iron chains of reality?!!*  That will only hold us back!

The city of Oceanside also thought that water should be cheap, apparently.  Refused to raise rates to cover the increased costs of water from their wholesaler.  I can’t entirely tell what is going on, but it looks like they’re eating their reserves, which may trigger a debt call of $105M.  But I’m only guessing.  I would like to point out, though, that even though a legislative body made a decision that water should stay cheap, that DIDN’T MAKE WATER STAY CHEAP.  Rather, it meant that they had to reach into a different pocket to pay for the more expensive water.   If it doesn’t bankrupt the town first, they seem to have a new plan to look into legislation forbidding rate increases by their wholesaler (over whom they have no jurisdiction).  Yes, well.  How could that go wrong?

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Filed under Districts


There were a handful of articles last week about cities deciding to stop permitting new houses and buildings because of their revised estimates of their water availability.  I think this is fascinating stuff, and one day I hope to write more about it.  If this were the whole post on that, it would have:

A discussion of the Regional Housing Needs Assessment, which is a big part of the reason that cities can’t decide to stop permitting new houses, even if cities or districts don’t have enough water for them.

Speculation about what goes into a Will-Serve Letter, which is a water district’s promise that they’ll provide water to a new service hook-up.

A discussion of whether water availability is used as an excuse to keep (poorer, darker) people out of water district service areas. 

Making explicit the fact that when districts decide on a per capita amount of water (gallons/person-day), they are implicitly choosing a standard of living for their constituents (personal lawns, long showers, thirsty plants).  That standard of living has a strong present-day bias, which I don’t think we were ever able to afford and certainly can’t continue to provide.  (Well, it is possible to provide it, but people are already balking at the increasing costs of providing what we’ve got.  I think they’d go batshit if they saw the costs of getting the next source of water.)

Mention and illustration of the fact that (shortsighted, selfish) people get really pissy about being asked to conserve when they see new houses going up in their city.

Description of two policy holes: that planners take population growth as exogenous, and the gap between land use planners and water planners.


Anyway, that would be a rockin’ post, and I should totally write it.  Not today, though.  I can’t tell whether putting up this stub makes a developed final piece more likely or less likely.  I mean, you get the gist, right?


Filed under Basic stuff, Districts

Youngins, don’t you do what I have done.

The news in water these days is mostly about big bills in the legislature, trying to come up with a big fix for California water.  I can’t get too worked up over it.  I’ll be super pleased if they get the mandatory urban conservation measures passed, and they can start here in Sacramento, which is an utterly shameful water waster.  I’ll be a trifle sad if they pass Sites Reservoir, because I’ve been to that valley and it is beautiful.  I’ll be intrigued if they get the Delta governance structure put in place, because I think that’s a step towards a Peripheral Canal, but doesn’t guarantee anything.  I’ll be guaranteed employment for the next decade if they pass the $10B bond to do all these things.   So that’s what the papers are talking about.  For my money, though, the most important water story I’ve seen in years is this one.

PALMDALE – Residents of one of the city’s newer housing tracts on the east side feel financially drained by the Palmdale Water District’s recent rate hike, which ranged from 65% to more than 140% for some customers.

…”My bill went from $12.80 to $185,” Summerford, a Neighborhood Watch captain, told the water board.

“My water bill went from $139 to $468,” Sanchez said at that meeting. Since then Sanchez received another monthly bill, one for $324. Together that meant she owed the water district $792, plus a prior balance that brought her total to $924.

Water bills of hundreds of dollars a month?!  Man alive!  I am generally heartless and unsympathetic to people who complain about water bills.  I know they’ve been artificially cheap for years, as the environment absorbed part of the costs of moving water, and I know people got used to that.   As their bills go up, I am generally glad.  Yes.  You live in Palmdale and I don’t see any rivers near you.  You should expect that it will cost a lot for clean water to come out of your taps.  Still, even for heartless me, an unexpected jump of hundreds of dollars is a blow.

The middle part of the article goes on about a very familiar story, in which the intrepid neighbors decide to take on the unresponsive water district.  I’ve seen this one, so I’ll tell you the ending.  One of the neighbors will get FIRED UP! and empowered and activist.  She’ll run for the board of directors, vowing reform and low water prices forever.  When she gets elected, she’ll be faced with the realities of buying, moving and cleaning water, as well as maintaining the physical insfrastructure.  She will realize the rates are still too low and the district is still eating their reserves; that the previous board made inevitable decisions and did their best to keep the constituents happy.  She’ll end up supporting the next rate hike and be vilified as a traitor by her former activist buddies who got her elected.   Good luck with that, Ms. Sanchez or Ms. Summerford.

But the ending of the article.  This is it.  This is the turning of the California dream.  The rumor I heard was that railroad companies started Sunset magazine, to get people to move west and take their trains back and forth.  The railroads had nurseries full of palm trees, for cities to line their boulevards.  And Sunset magazine sold the dream.  Live here, in the sunshine, in a small bungalow with a yard and two fruit trees.  I don’t know if that is accurate and I don’t know how the dream got supersized into a huge tract home.  But Ms. Sanchez was clearly in the grip of this dream:

Sanchez had been elated to move into her first home but now has second thoughts, especially because she has cut back her outdoor water use significantly to try to lower her monthly bills.

“It’s sad for first-time buyers,” she said. “I feel really disappointed. I came up here working on a home that needed a lawn. You put all our money into it to make it look nice. Now my lawn is going back to where it was. I feel discouraged. I feel like we should have stayed in Santa Clarita and lived in our apartment.”

There it is.  There’s the end.  This is the turning point I’ve been waiting for.  With water costs this high, she’d rather be in a city apartment.  I’ve been wondering for years what would herd people in from the exurbs.  It struck me as a race between costs of water and costs of firefighting.  For a while, the cost of gas and the commute was coming on strong, but that horse fizzled.  Now we need people to know this before they lock themselves into houses.  Ms. Sanchez, don’t become a water district activist!  Spend your energy telling your friends not to do what you did!   Tell them the house and lawn isn’t worth it.  You can still save them.  That’s what we need.


Filed under Basic stuff, Districts

It was better before.

I was all fired up to write a series of posts about this article in the Hanford Sentinel, mostly about this part:

That’s why the Kings County Water Commission spent a good chunk of a Monday night meeting talking about a Westside landowner who plans to sell 14,000 acre-feet of water a year to the Mojave Water Agency in San Bernardino County for $5,500 per acre-foot.

That’s $77 million of the wet stuff headed out of the county for likely urban development (an acre-foot is enough water to supply a typical home for a year, according to Wikipedia).

$5,500 per acrefoot is an outrageous price, so I figured there was an outrageous story behind it.  I figured it was money laundering, and then my friend speculated it was probably connected to intended solar projects in the Mojave.  This was plausible because the sellers are masters of milking the public subsidy.  I figured that like any good corporation, they’d created a shadow entity to be the purchasers, Mojave Water Agency was a pass-through, and Sandridge Partners would now be farming subsidized solar energy (which requires cooling water) instead of subsidized cotton.

It was a good conspiracy fantasy, which is why I’m still telling you, even though the thing that caught my eye was wrong.  Mojave Water Agency isn’t paying $5,500 per af-year (twice the cost of desal).  I couldn’t find a citation for that, so I called the reporter.  MWA is paying a lump sum up front for the water right.  They’ll own all the future flows that water right can command for $77M, which might well be a decent price for water.  I suppose it might actually be water for the stated purpose (subdivisions).

I only have a couple points to make, instead of the scandalous series of muckraking posts I’d hoped to do.

1.  This tells me that farming corporations are pulling out of the west side of the San Joaquin Valley.  Assuming corporations are making cold, hard business decisions and not emotional decisions about “being a farmer”, they think the era is over.  They are cashing out.  I don’t know what factors they weight (Subsidy reform? Climate change predictions about less precip? Maybe they don’t think Obama will build them the West Side Drain? ) but they’ll trade their future on the west side for $77M.   Can’t come a day too soon, says I, except for the cashing out part.

2.  I enjoyed reading the Negative Declaration quite a bit, for a rare look at a shy water district.  Dudley Ridge Water District covers 37,000 acres completely owned by eight farming corporations.  There are no towns, and the district has no staff.  There is no public for this water district.  Perhaps the district directors fly in  for the annual meeting on the several private airstrips the Neg Dec mentions.  Or maybe they just meet at home in San Jose.  The article says:

Dudley Ridge Water District, where Sandridge’s land is located, has adopted a policy divvying its water among member property owners. That gives each the right to sell their share.

No representatives from Sandridge Partners or Dudley Ridge Water District spoke at Monday’s meeting.

Yeah, I bet they didn’t. They aren’t answerable to the likes of some county water commission.

3.  I despise the injustice behind permanently vesting water rights in whomever filed for them two generations ago, and making those rights marketable.  Mojave Water Agency serves a relatively poor community.  It infuriates me that they had to give some of the richest people in the world $77M for unreliable water.  They made the trade, so maybe they think it was worth it.  But it is incredibly unjust and as a society, we could choose fairer ways to make sure towns get the water they need.

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Filed under Agriculture, Districts, Water Markets!!!

As it happens, I have the Inland Empire climate change assessment right here.

 Buried in a report released Wednesday are two words increasingly becoming an issue in the topic of economic recovery for the Inland Empire: “water supply.”

While the Inland Empire forecast by the Los Angeles County Economic Development Corp., a research group, pushes recovery prospects to 2011 or 2012, the region’s water supply could play a bigger role in shaping that recovery than people realize.

“Water costs are going to be very important,” said Jack Kyser, the agency’s lead economist. “Water is obviously going to become more expensive.”

If job growth goes hand in hand with attracting new companies, water issues might keep the area’s job base from reaching its full potential.

If you are at the limit of your binding constraint, you have reached your full potential. This is true even if you have more of other stuff left over (like people wanting to work or already built warehouses). There must be lots of work on matching development to capacity, but I don’t know it. Instead of real research and analysis, I have two thoughts on the matter. I think a lot about an offhand remark a professor once made, which is that if you design for peak capacity, you have over-designed for all the time you don’t operate at peak capacity, which is most of the time. The second thing I think is that people very readily adopt peak capacity as their baseline. California water projects over-delivered ag water in the early 2000’s because of politicking at CALFED, and now agriculture shrieks that it is being viciously cut back. It has been cut back to historic delivery levels up through the 90’s. Fifteen years ago that was standard, but a few generous years have apparently upped the baseline in their minds. California’s hydrology has and will be extremely variable. Regions would do well to base projections for available water on something they think they can get half or two thirds of the time. Even though that may feel like they are wasting high flows in some years, it is dangerous to let people rely on having more than average.

I am also guessing that some local politics are playing out in that article:

Lee Harrington, executive director of the Southern California Leadership Council, a Los Angeles-based group of business and community leaders that works with the county agency, agreed.

“The Inland Empire … needs to overcome the perception that somehow water availability is more challenged there than other places,” Harrington said. “It isn’t necessarily true.”

No need to remind you guys, but Inland Empire is famous in water district circles, rivaling only Santa Rosa and Santa Clara Valley for taking progressive stands on resource management (obviously!). Those three are the first few to have done climate change studies for themselves and set strong internal policies on climate change. I wonder if I’m hearing some frustration from this business-y, Chamber of Commerce-type guy at hearing “no” from a water district. He may be right that water availability is no more challenged at Inland Empire than elsewhere, but when I hear that, I figure that Inland Empire has the right assessment of their inventory and likely future and that other water districts are agreeing to take on more water service out of ignorance and unfounded optimism.


I’ll be away until August 4th at the earliest. Have a great week or so!

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Filed under Districts

Why districts are slow to charge market rates for water.

Why don’t districts pass the marginal costs of water on to their constituents?

HAH! Do you see what I did there? Constituents? Not customers, constituents. That’s the first reason districts don’t want to raise rates and pass the marginal costs of supplying water to users.

Districts are public institutions.
Districts are not companies. They have no profit function. They do not, for themselves, want to capture the full willingness to pay for water. That is not what they are for. In fact, their mission is some variant on “cheaply and reliably deliver water”. Because that is why local citizens organized and incorporated a district. Charging any more for water than it costs to get, treat and deliver is failing their mission. It is often also violating their bylaws, charter or the state laws that give them authority.

From the district side of things, they don’t want to make water expensive. Once O&M is covered, they have no incentive. What would they do with the money? Gold plate their pumps? They don’t have shareholders to distribute it to.

This neglects the ‘price signal’ aspect to charging lots for water (show the public it is valuable! no wasting!). There’s a lot to be said for that, so why don’t districts raise rates for that purpose and, um, give any revenues above operations and maintenance to an orphanage?

Board members are publicly elected
The people who set rates for a district are the board members, who are publicly elected by people in the district. They are not strongly motivated to increase rates for abstract considerations like “send a price signal”. First, they’d be increasing rates on their very own water. Second, they are answerable to the people in the district at the very next election. If you go back to those stories on raising rates, did you notice the part about how people are pissed? And organizing? Those are the friends and neighbors of board members, and also the people who will yank them out of office at the next election if rates go up (long digression on the opposition to rate increases in a post below).

But maybe a district really does need to raise rates, to pass along higher costs of getting new water or in this drought year, to encourage conservation. A standard technique is to charge very little for some small amount of health and safety water, and then high prices for frivolous extra water like elaborate water fountains in your tropical rainforest garden, Richy Rich. Economists are all, this is SO OBVIOUS. Do this already. Yeah, well, until last October, it was illegal. This is why economists need to pay closer attention to the law side of things.

Motherfucking Howard Jarvis.
There is an elaborate legal backstory, but basically, one side effect of Proposition 218, put forth by the Howard Jarvis Taxpayers Association, was that it became illegal to charge any household more than the costs of conveyance to that parcel. It was illegal to charge punitive rates to send a price signal to wasteful users. The last year of drought made this such a problem that the legislature corrected it.

So you have all these economists telling districts they could solve their shortages by charging more for excessive use, and districts saying, we’ll get sued. It was illegal until six months ago. I went to a number of different agency meetings, where everyone talked about how conservation pricing was such a great tool, and I kept saying, it is illegal. I think we should stop recommending illegal measures to the public. (Or, if we don’t care about legality, I think we should get far more imaginative.) People didn’t believe me because it evolved over three court cases, but then I’d explain Prop 218 and the court cases, and they’d realize that was a huge problem. Fortunately, Assemblymember Wolk solved it.

So when people say, ‘why haven’t districts instituted conservation pricing already when it is the obvious solution’, one answer is, ‘because there have only been three board meetings since it became legal to do that?’ Then my question is, did you know that? Did you realize that there are legal and institutional barriers that slow districts down? Do you know what they are? It isn’t necessarily ignorance or backwardness on the part of the district. The world that districts operate in is far more complex than the world of economic theory.


Filed under Districts, Drought

Long digression on the opposition to rate increases.

It is fairly common, if you follow a story for a few years to see a cycle of necessary rate increases followed by recall or ousting at the next election. Diehards get elected, swearing on their newborns that they’ll never raise rates like the last assholes. Then, the realities of the district beat them down. Two or three years later, they’re reluctantly admitting the need for rate increases. You would think that people would remember that they used to oppose rate increases and that would give their calls for higher rates some credibility. But I’ve seen vicious cycles where their previous supporters turn on them and yank them out next. The aversion to higher rates starts anew. I always wonder if anyone in the process gains self-awareness or enlightenment.

The story for opposing rate increases is always the same. People storm district meetings, afraid and angry and dogged, saying they can’t afford the increases. I never know what to make of that. In the first place, there are efficiency gains and cutting back. After that, though, what should I make of stories about forcing little old ladies on fixed incomes to eat cat food? Do I believe that increasing water rates are the last straw? Maybe that’s plausible, and I certainly believe that we’re in the beginning of a period when most environmental fees will go up. Gas prices, food prices, firefighting costs, development fees, water, sewage, waste collection. I fully believe those are all about to go up. I suppose any one of them could be perceived as the last straw.

But then, I think two things. I suspect that for lots of people, the reason they can’t pay those fees are that they transformed their income into illiquid extra square feet on their house. That is a huge bind, but I never respected their choice of a big house, so it leaves me a little unsympathetic that their mortgage puts them so close to the edge. Second, the truth is, most of those new fees are different forms of internalizing environmental costs. Someone who can’t afford to pay those cannot afford their standard of living. They’ve grown used to that standard of living under artificially low prices subsidized by the environment, but that is a false expectation.

So, on the one hand, I really do feel bad for any particular nice old lady eating cat food. When those stories get personalized, they really hurt. On the other hand, their fight is to impose the costs of their lifestyle, of which water is just one example, on anything else. The environment, most likely, or the collective as a second choice. Then I am not so sure that that lifestyle is such a valuable one that I care if they get to continue it. I am even less sure that I care enough to spend money supporting their lifestyles.

(Please note that I would make the decision to support some forms of farming, because it can have positive externalities that I want. So it isn’t like I’m absolutist on this stuff.)

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Filed under Basic stuff, Districts, Water Markets!!!

Why it isn’t simple to charge market rates for water. Background.

I see this stuff all the time (sometimes, I see double!): an oversimplistic assessment that raising rates for water would end shortages. I am, actually, in favor of charging by unit of water (so you pay more when you buy more, a concept so straightforward that it is embarrassing to have to say it explicitly, but not always the norm for water pricing). I am also in favor of charging a rough marginal rate for water. These days the cheap chunks of water are thoroughly exploited and the next source costs more to collect, treat and deliver. I’m fine with water users seeing that cost for what it is. So it isn’t that I’m opposed to the concept of raising rates on water. But I do get frustrated when people act as if that is straightforward and obvious and the full solution. Districts aren’t dumb. There are reasons they have the pricing structures they do.

Some things to get out of the way:
1. No utility sells water. Water is free. What they sell is capacity and distribution. You are renting a length of pipe as water moves through it. The way to tell how much you bought is by measuring the amount of water, and that’s how they charge you. For your billing and behavior, this is just like charging you for water, so this is a minor technicality that makes no difference. It just bugs me to hear people saying to charge more for water, because I am hopelessly pedantic and literal minded.

2. It isn’t coincidence that the people you hear saying that pricing water is the bulk of the solution are all economists. A lot of the reasons pricing structures change slowly are over on the legal and institutional side; economists dismiss those as trivial, malleable impediments, but lawyers understand that they give districts a different set of incentives.

3. Rates ARE going up. Fast and hard this year.

4. The word “shortage” is doing some work that gets skipped over a lot. When everyone says “drought” and “shortage”, what we basically mean is “less then we’re used to”. We don’t mean, and won’t in the foreseeable future, “not enough to drink and bathe”. So far we’re not even close to that range. What we do mean is “not enough to use it like we’ve always been able to”, on lawns and embedded in our meat supply and on wasteful appliances and by deferring maintenance on leaky pipes.

Now here’s the thing. When laypeople hear No More Shortages, they think, ‘there’s plenty, I can continue hosing down my driveway just like I always have.’ When economists say No More Shortages, they mean charging so much for water that people cut out the uses they don’t want to pay for. Then supply curve intersects demand curve, and the economic definition of No Shortage is met! Yay! In real life, high price signals that cut out less-intensely-wanted uses means no lawns, fewer burgers, switching out appliances and replacing leaky pipes. That is what laypeople thought was a shortage! It is not the careless plenty they grew up with.

I am personally fine with this. I don’t have any emotional attachment to careless water management or lawns. I do want to point out, however, that when economists say No More Shortage, they are talking about what the broad public considers a shortage (less than I’m used to and I have to pay attention).

5. One of the standard critiques of markets is that since wealth is distributed unevenly, the marginal value of a dollar is different between rich and poor people. The rich will be able to afford their swampy lawns while the poor scrimp to drink. You can create pricing structures to alleviate this (a very low rate for the initial chunk of water, or refunds to low-income users), if environmental and social justice are important to you. Those are worth explicit consideration and decision.

All that out of the way, lets get to the good part. Why don’t districts pass the marginal costs of water on to their constituents?

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Filed under Districts, Drought, Water Markets!!!