California Drought Springs New Limits on Developers

DEVELOPERS in the nation's fastest growing state are colliding with a faulty water spigot: Since February, builders in Santa Monica must calculate the net water demands for new developments compared with previous usage levels and pay for enough low-flush toilets communitywide to make up twice the difference.

Water districts in the western San Fernando Valley, Ventura County, Riverside County, and the City of Burbank have stopped accepting new customers because of water cutbacks. The Metropolitan Water District (MWD), which supplies 27 member agencies from Ventura to Mexico, has temporarily suspended annexations.

In Lake Elsinore, several major construction sites have been at a standstill since early-February moratoriums prohibited plumbing hookups to local water supplies.

"Up until now, land developers had their own variation on 'Field of Dreams,' - 'If we build it, it will rain,' " says Assemblyman Phillip Isenberg (D) of Sacramento, one of the state Legislature's leading water experts.

Now in its fifth year of drought, California received no fewer than 834,000 newcomers last year. With projected water supplies at 60 percent through the mid-1990s, building projects from San Diego in the south to Shasta County in the north have become increasingly mired in new regulations. A bevy of bills is working its way through the Legislature to shift more responsibility for water planning to developers.

One bill, AB 455, prohibits cities and counties from approving projects unless the building applicant identifies a long-term and reliable supply of water.

"This immediately puts the developer and local planning agency on notice and forces a kind of consultation that has not existed before," says Assemblyman Dominic Cortese (D) of San Jose, the bill's sponsor.

Robert Gottlieb, a professor of urban planning at the University of California at Los Angeles and author of "Thirst for Growth: Water Agencies as Hidden Government in California," says county governments across the state are also considering similar measures.

The Santa Monica law passed last February, and laws being considered in Los Angeles, San Diego, and Marin Counties, are meant to force developers to compensate for their project's drain on the water system by installing new irrigation systems or retrofitting old buildings with water-saving devices.

"In essence, these additional costs are growth taxes with the goal of alleviating stress on the system with new fees," Mr. Gottlieb says.

Ken Willis, executive vice president of the Building Industry Association (BIA) of southern California, sees both moratoriums and legislation as "builder-bashing."

He predicts the current lockout on water hookups to developers will cost $1.8 billion and 60,000 jobs this year.

'No-growth advocates have been looking for every opportunity to seize the public and this is the hot button to push right now," says Mr. Willis. He says the Cortese bill is needless bureaucracy; the California Environmental Quality Act already require local agencies to serve letters of notice to builders that water is available, he says.

AB 455 "proposes that each, individual developer second guess as many as three local, state, and federal agencies on whether such letters of notice are valid," he says.

The BIA has put out its own agenda for water use: legislation requiring the retrofitting of existing houses; master plans of landscape irrigation, reclamation, and recycling; increased capacity for the State Water Project; increased water prices.

Mike McGee, vice president and project manager for Pardee Construction Company, says his firm is losing thousands of dollars each day on its stalled Lake Elsinore development of 4,275 homes. The city, meanwhile, has lost $1.5 million in developer fees.

"These conflicts between home developers and local authorities are going to continue until the state can secure additional water supplies for urban areas," says Christine Reed, a MWD board member and former mayor of Santa Monica.

The drought can be a blessing in disguise, say others, forcing the kind of public will to develop creative solutions. Bruce Lewis, director of development for Whitehawk Partnership, a developer of condominiums, says the 1976 drought paved the way to his company's desalination plant on Catalina Island.

"We demonstrated we could give them drinking water from the sea - at prices they were used to," he says. The new plant provides as much as 30 percent of the island's drinking water.