When the drought hit, we were told we had to conserve water, that there simply wasn’t enough for everybody to keep watering their lawns. We all complied, reducing residential use by over 20%. Like a lot of Venturans, I let my water-hungry ornamentals and lawn wither and die. So it’s difficult to swallow when a new development comes along and is given the greenlight, with the understanding that there’s enough water for new homes or a new business, but not enough for me to water my hibiscus.
So the city introduced a Net Zero fee in 2016. The idea is, if you’re building a home and it requires a brand new water meter, they’ll calculate how much water your house is likely to use, and you can buy either buy water rights on the market to cover the use, or pay a fee to offset the cost of developing a new water source. If you’re building a new business, the fee was originally based on square footage. The Net Zero fee for commercial users is currently being revamped to estimate water use based on the category of business. Dozens of categories have been identified, from medical offices to breweries.
Basing the commercial Net Zero fee on square footage never made sense; if anything, it encourages the development of water-hungry uses. The new approach sounds appealing but the law requires every utility rate be justified with reams of data. It has required hundreds of hours of staff time, and an outside consultant. It will still be discouraging business start-ups.
We are in a housing crisis, with low vacancy rates and sky high rents and mortgages, and the Net Zero fee makes it more expensive to build a new home or duplex or apartment building.
As appealing as it is to say that new developments will pay for 60% of their share of developing new water sources, that’s just not how it works. Our upcoming water projects — the State Water Interconnect and Ventura WaterPure — are currently budgeted at about $25 million and $250 million, respectively. Meanwhile, the city has collected only a couple million dollars total in Net Zero fees in the four years since it was adopted. A couple million dollars is nice, but not much of an offset.
The fact is, we’re not building those two expensive projects to meet new demand. We will build them, regardless of whether demand for water goes up or or down. The State Water Interconnect will improve the water quality on the East End, and reduce the need to pump from our overdrawn aquifers. We are building Ventura WaterPure because we settled a case in court in 2012 over our wastewater discharge. We can’t now decide not to build it. It will ultimately provide up to 4000 acrefeet of drinking water, a 25% increase over what we have now.
Council must review whether the Net Zero fee is providing enough revenue to to outweigh the broader economic costs that come with discouraging housing starts during a housing crisis, and discouraging new businesses in a recession. Council must hold a workshop:
- How does NetZero revenue compare to original estimates?
- How many projects drop out when they find out what their NetZero bill will be?
- How many jobs and how much tax revenue has the city missed out on because of Net Zero?
- What is the cost to administer the program? How many hundreds of thousands of dollars does it cost to administer a program which is only getting more and more complicated?
Economic Development and addressing the housing crisis are some of my top priorities. The NetZero fee is likely holding us back. If the Net Zero fee isn’t working, Council must fix it, or suspend it for a year, or scrap it altogether.