By Hanspeter Walter, Kronick, Moskovitz, Tiedemann & Girard.

The drought California is suffering – the worst in modern times – is profoundly affecting special districts whose missions and operations are intertwined with water. These districts face the acute challenges and hardships of this drought on a daily basis. The drought is an immediate crisis, but it also presents important opportunities for special districts to ensure that they, their constituents, and California are prepared to thrive in a future of increased water scarcity.

The New Era of Sustainable Groundwater Management

The drought has predictably caused many areas to rely heavily on groundwater. Record high levels of groundwater pumping and falling groundwater levels, which were occurring in some areas even before the drought, did not go unnoticed by the Legislature. So last year, for the first time in California’s history, it enacted a statutory scheme to regulate groundwater.

The Sustainable Groundwater Management Act, Water Code § 10720 et seq., (“SGMA”) has significant implications for any special district using groundwater. SGMA’s requirements apply to about 127 high- and medium-priority groundwater basins throughout the state. It requires special districts, cities, or counties to achieve groundwater sustainability, which generally means that no more groundwater is pumped than is recharged to the aquifer. Local agencies may also voluntarily choose to implement provisions of SGMA in lower priority basins.

SGMA’s first major requirement is designation of groundwater sustainability agencies (“GSA”). Any local public agency that has water supply, water management, or land use responsibilities within a groundwater basin is eligible to become a GSA. A patchwork of local agencies may separately choose to be GSAs to regulate portions of a basin in coordination, or such agencies may form a joint powers authority to serve as GSA. Counties are the default if no other local agencies within a basin elect to be GSAs, but counties may refuse. If no local agencies elect to become the GSAs for a basin by June 30, 2017, the State Water Resources Control Board (“Water Board”) may step in to regulate the basin.

SGMA’s other key requirement is that GSAs adopt detailed groundwater sustainability plans by 2020, for some critically overdrafted basins, or by 2022 for other medium- and high-priority basins. Plans must include detailed water budgets for basins and chart a path to sustainability within 20 years. The Water Board will review plans and may step in to impose its own “interim” sustainability plan if local plans: (1) are not timely prepared, (2) are insufficient, or (3) are not implemented to achieve sustainability. Local agencies that become GSAs will have sweeping powers to implement plans, including: (1) requiring measuring and reporting pumping, (2) restricting pumping, (3) imposing well-spacing requirements, (4) prohibiting new wells, and (5) imposing fees to fund their monitoring and management activities, which may include constructing new facilities and acquiring alternative water supplies.

For many groundwater basins, achieving sustainability may require pumping restrictions or the development of alternative water supplies. Thus, difficult choices and conflicts seem unavoidable. In addition to protecting their own interests, SGMA presents a prime opportunity for special districts to exercise leadership in the management and stewardship of their local groundwater resources.

Because special districts operate under so many different enabling statutes, each impacted district must carefully consider its existing policies and authorities when determining how to implement water reduction mandates.

The Increasing Focus on Efficient Water Use

State and local agencies have taken a multitude of actions in response to the drought. One of the most significant is the Water Board’s adoption on May 5, 2015 of emergency regulations mandating reductions in potable urban water use ranging from eight percent to 36 percent depending on district. (23 Cal. Code Regs. § 863 et seq.) The regulations raise a host of specific legal and practical issues, including:

  • What water conservation measures can and should districts implement?
  • How can districts enforce water conservation measures?
  • How can districts address the potential loss of revenue from reduced water use?
  • Can and will the Water Board penalize districts that fail to meet the water reduction targets?

Because special districts operate under so many different enabling statutes, each impacted district must carefully consider its existing policies and authorities when determining how to implement water reduction mandates. Furthermore, a recent 4th District Court of Appeal opinion in Capistrano Taxpayers Ass. v. City of San Juan Capistrano may have dealt a significant setback to water conservation efforts by finding a fairly routine tiered water rate structure (i.e., the more you use the more you pay) unconstitutional under Proposition 218. Unless depublished or reversed, the opinion will cast a cloud over one of the most effective ways to reduce water use.

The State is also spearheading a host of other regulatory changes and programs to further reduce water use and demand. The Energy Commission will implement a multi-million dollar high-efficiency appliance rebate program. The Department of Water Resources (“DWR”) will oversee similar programs to install low-flow toilet and remove lawns. Special districts should look to partner with these agencies to create or augment their own parallel programs, or assess whether they can avail themselves of some of these incentives to reduce their own water use and operating costs. The Building Standards Commission and DWR will also amend the Building Code and Model Water Efficient Landscape Ordinance to impose leaner outdoor watering budgets on residential, commercial, school, and hospital projects. These and other state and local programs will enable Californians to do more with less water.

Special Districts Must Lead the Charge to Safeguard California’s Water Future

California’s continued economic and demographic growth is in part a testament to the stellar, but often unnoticed, performance of various special districts to capture, supply, treat, deliver, and dispose of water supplies. This drought, however, appears to have triggered a new social and political consciousness regarding the importance and scarcity of water in California, which will not fade when the rain and snows return. Indeed, the administration and key officials have stated their intent that this water ethos be the new normal. This seems prudent considering that climate change will likely alter California’s hydrology and precipitation patterns for the worse.

A vast array of special districts must adapt and prepare California for its new water future. They will carry out the laws, regulations, and programs established during the drought long after this crisis passes, but they must also work to implement new programs and projects involving, for instance, stormwater capture, water recycling, groundwater recharge, and water quality. Urban and agricultural water districts, community services districts, stormwater and flood control districts, and park, recreation, and cemetery districts, among others, figure to have prominent roles. There are literally hundreds of millions of dollars available to kick start water projects and programs through the recently passed Proposition 1, other bond measures, and other local and state programs. Special districts must seize this public, political, and financial momentum to ensure California’s water use remains among the most dynamic, efficient, and innovative in the world.

Originally published by the California Special Districts Association.

Hanspeter Walter is a shareholder at Kronick Moskovitz Tiedemann & Girard in Sacramento. He specializes in water, environmental, and administrative law. Walter is also an adjunct faculty member at the University of the Pacific McGeorge School of Law, where he teaches a class on representing local public agencies.