Photo by From Rainbow water district website
Will those left behind pay more as others tap new supplies?
Valley Center farmers aren't alone when it comes to the high cost of water. But it could get lonelier and costlier if two neighboring water districts unyoke from the Water Authority to get a fresh start in Riverside.
In December, the boards of the Fallbrook Public Utility District and the Rainbow Municipal Water District voted to begin detachment from the San Diego County Water Authority in order to join Riverside's Eastern Municipal Water District.
Will those left behind pay more as others tap new supplies? Questions are flying in Valley Center, where farms are the main customers, even as avocado turf keeps shrinking.
"Yes, we are concerned," says Valley Center Municipal Water District general manager, Gary Arant. But even bigger trouble is brewing. San Diego Water Authority member agencies, such as the city of San Diego and East County agencies, are developing new supplies like Pure Water (recycled water) which means they'll be buying less water from the Water Authority, leading to higher rates.
It's the first time in the Water Authority's 75-year history that any of its member agencies have tried to secede, and San Diego Water Authority estimated a revenue loss of $13,367,100.
The analysis indicates the Water Authority will lose about 1.5 to 2 percent of its revenue which Arant says "could reasonably translate into a 1.5 to 2 percent rate increase to Valley Center." The amount could be lower, depending on Rainbow and Fallbrook's debt obligations once they leave.
But that amount pales beside the increase that could come when member agencies start buying from local water projects. "This will raise rates as well, but three or four orders of magnitude higher than the Fallbrook and Rainbow issue," he says.
"Like 100,000 acre-foot or more in lost sales for the city of San Diego Pure Water compared to 24,000 for Fallbrook and Rainbow combined." (An acre-foot is equal to 325,851 U.S. gallons).
The local projects could reduce Water Authority deliveries over 10 to 15 years by 20-25 percent, with a commensurate increase in cost to the other member agencies, like Valley Center, he says.
While the Fallbrook and Rainbow detachment could have an incremental impact, the local projects "could have a devastating impact if the Water Authority's rate structure is not adjusted."
Why not join the exit party? That's what agricultural customers will be asking when they learn that Fallbrook and Rainbow expect to save millions of dollars annually by jumping ship, Arant told the water board in October.
It will be a question, but it's not an option. All of their seven connections are on aqueducts owned by the Water Authority, while most or many of Rainbow and Fallbrook's connections are on aqueducts owned by the Metropolitan Water District.
And detachment would still leave them paying for certain services from the Water Authority "or building pipelines paralleling the aqueducts northward to tie in on the sections owned by Metropolitan Water District."
One perk for farmers is a recent change made to the Special Agricultural Water Rate, a temporary drought program the Water Authority has in place to provide growers cheaper rates in exchange for less reliable supplies. It was set to expire at the end of this year, but will become permanent.
Through 2020, participants will pay $1,231 per acre-foot for treated water, while municipal and industrial users pay $1,686 per acre-foot.
"Even though they are accepting a lower level of reliability during droughts and disasters, the pricing is critical to agriculture's continued existence in the San Diego region," Arant says.
It was the formation of Valley Center's water district in 1954 that created the area's "unique cross-blending of agricultural and residential development," notes a report by San Diego Local Area Formation Commission, the agency that will oversee the proposed detachment.
But the mix of farms and housing is changing substantially, according to the commission, which is now reviewing Valley Center's municipal services, a state requirement for sphere of influence updates, for the first time since 2003.
Being near Escondido and right next to Interstate 15, one of the busiest commute corridors, has also drawn developers. The county has already approved Meadowood (824 units), Orchard Run (300 units), and Park Circle, with 332 units, which will break ground this year. Lilac Hills Ranch, now under review by the county, would add 1,746 units.
The commission attributes an ongoing transition to more residential uses to higher water rates for farmers and demand for housing.
Arant partly disagrees. Even with the agricultural land that has turned residential, farming dropped long before the housing pressures started, he says. Most of Valley Center's farming was for avocados. "Avocado land is very steep and rocky and was recently downzoned by the county to one dwelling per 8, 10, 20 or 40 acres, making it unsuitable, physically or economically, for residential development.
One reason agriculture has diminished so rapidly and deeply, is foreign competition from Mexico, Central and South America, he says.
That, "and the cost of water which has more than doubled in the last 10 years."