Colorado River drought makes region's water costs overflow.

The 11 percent water rate increase approved by the Los Angeles City Council earlier this month is merely a taste of things to come, and not just within city limits.

Water rates are heading up all over L.A. County, thanks to a combination of a severe drought in the Southwestern U.S., an aging infrastructure, tougher water quality standards and increased security concerns.

"All of these pressures are converging to drive prices up," said Steven Erie, director of the urban studies and planning program at the University of California San Diego, who is now writing a book on Southern California's long water wars.

In March, the Metropolitan Water District of Southern California, the region's major water wholesaler, voted to raise its rates 4.4 percent starting next Jan. 1. The $30 million increase will be passed onto local water districts throughout the region and is expected to cost the average home about $7 a year.

"We're looking at an inflationary trend of anywhere from 3 percent to 5 percent each year for the foreseeable future," said Brian Thomas, the MWD's chief financial officer.

Drought impacts The major reason for the increases is the loss of cheap water from the Colorado River--the result of California being forced to reach an agreement with states along the river for a reduced share of surplus water. After years of negotiations centering on a transfer of water from the water-rich Imperial Valley to water-poor San Diego, that agreement was completed last year.

But a seven-year drought in the Colorado River, which has led to water rationing in Arizona and Las Vegas, has those and other communities dependent on the river clamoring for a larger share of water.

The drought has prompted the Department of the Interior to demand that the six states along the Colorado to agree to further reductions in their water supply; otherwise, restrictions will be unilaterally imposed.

The DOI did that 17 months ago for California when the state failed to reach the agreement to wean itself from surplus Colorado River water.

To ensure adequate water supplies, the MWD has been trying to cut water transfer and storage deals with farmers and rural water districts throughout the state.

Last year, the agency agreed to purchase 120,000 acre-feet of water from rice farmers in the Sacramento Valley area. (An acre-foot is enough to supply two homes for a year.)

Earlier this month, the MWD board came to terms with the Palo Verde Irrigation District in eastern Riverside and Imperial counties for the transfer of 25,000 to 111,000 acre-feet of water annually for the next 35 years. In exchange, the MWD has agreed to pay farmers in the area to fallow some of their croplands on a rotating basis.

MWD spokesman Adan Ortega said other farmers and water districts have approached the agency with similar deals.

While these agreements go a long way toward ensuring water supplies, they come at a price: the replacement water costs much more than the Colorado River water. In addition, more treatment is required to bring the water up to current environmental standards.

Bay-Delta deal

Another source of water for Southern California is on tenuous ground.

For nearly a decade, efforts have been made to upgrade the Sacramento River Delta-San Francisco Bay region, which serves as the vital transfer area for water from snowmelt in the north to the cities in the south. The deal would involve increased protection for endangered species in the Bay-Delta area while increasing by about 5 percent the amount of water transferred to Southern California.

After promised federal funds for the upgrade tell through, U.S. Sen. Dianne Feinstein, D-Calif., and Rep. Richard Pombo, R-Tracy, have agreed on a package of $390 million they hope to steer through Congress by the end of the session this October.

Meanwhile, local water agencies have had to come to grips with other forces driving up costs.

Two years ago, strict new federal regulations for water treatment took effect, forcing water agencies to spend millions of dollars to upgrade their water treatment costs. At the same time, the Sept. 11 terrorist attacks forced the agencies to increase security with measures such as increased patrols and covering reservoirs.

All this comes at a time when much of the basic water conveyance infrastructure needs to be replaced. Many water mains and pipes are at least 50 years old and are increasingly prone to rupture.

"Just maintaining our system costs $40 million to $60 million a year," said Jerry Gewe, chief operating officer for the L.A. DWP's water system. "You add in doubling of annual security expenditures, plus more water quality testing and it's much more expensive now."

These increased security and water treatment costs were the major justifications the DWP used in proposing an 18 percent increase in water rates over two years. However, that increase met with stiff resistance from neighborhood councils. It also came against a backdrop of audits of the agency that revealed high levels of spending on public relations, travel and entertainment.

In the end, the L.A. City Council only approved an 11 percent increase, postponing consideration of the remaining 7 percent.