Water-Saving Plan Targets Developers : Drought: The mayor’s proposal would require home builders to pay for conservation equipment at other sites, such as schools, parks and hospitals.

In an effort to keep the City Council from imposing building moratoriums in times of drought, Mayor Tom Bradley has proposed a water conservation measure that would add about $1,300 to the price of an average new home and heap more fees upon developers.

Under the proposal, developers would be required to fund installation of enough water-saving equipment at schools, hospitals, parks and senior-citizen centers, for example, to save half the water that their new projects would use.

The result: the city’s limited water supply would be stretched and job-generating development would continue, albeit at a reduced pace.

“Some elected officials have suggested a city ban on all construction,” Bradley said in a statement, “but such a move would have a disastrous impact on the jobs and economic activity these projects generate during recessions.”

John Stoddard, Bradley’s aide on environmental issues, was more blunt about the proposal expected to go before the City Council in July: “It is this (measure) or moratoriums.”

But developers and city building and safety officials say the proposal would add millions of dollars to the cost of massive high-rise developments, such as Central City West and Union Station, and add at least $1,300 to the cost of new single-family homes.

“Every time you add a thousand dollars to the price of a new home, you knock 2,300 families out of the Los Angeles housing market,” said Edrick Guys, spokesman for the Building Industry Assn. “We are doing one hell of a lot of research to come up with alternatives.”

Beyond that, developers complain that the proposal would burden builders already reeling under a recently enacted real estate transfer tax, which was passed by the City Council to balance the city budget. That tax is expected to add an estimated $1,000 to the cost of a new $230,000 home in Los Angeles.

Nonetheless, caught in a vise-grip of the recession on one side and the threat of a building moratorium on the other, developers have all but given up hope of squelching the Bradley measure.

Instead, they are lobbying hard for concessions such as a sunset clause that would terminate the ordinance when the drought--now in its fifth year--is declared over.

“Why developers should bear the burden of water conservation is questionable,” said Randi Shafton, a spokeswoman for the Central City Assn. “But compared with a moratorium, Bradley’s motion looks like ice cream.”

Bradley’s proposal is loosely modeled on similar emergency ordinances enacted over the last year in drought-stricken San Luis Obispo, Morro Bay and Santa Monica, Stoddard said.

Santa Monica’s water-conservation program requires that developers pay to retrofit enough toilets, showers and irrigation systems to offset 200% of the water their projects would use, said Craig Perkins, manager of environmental services for Santa Monica.

Enacted in April, Santa Monica’s water-conservation program includes a provision that it be dissolved when the drought ends, Perkins said.

“There have been a lot of developers and building owners upset because of the magnitude of the fee,” Perkins said. “But to my knowledge, no projects have left town because of this fee.”

Bradley and his aides, however, envision their proposal as a permanent mechanism with which to deal with the demands of a steadily increasing population in a chronically dry area.

The Southern California Assn. of Governments estimates that the city’s population will increase by 225,000--or 6.5%--over the next 10 years. This will require an increase in annual water supply of about 38,000 acre-feet, or 5.5%.

The Metropolitan Water District is predicting that if current population and weather patterns continue, there could be a 40% shortage of water for Los Angeles customers by the mid-1990s.

The City Council in May enacted a mandatory water rationing program requiring customers to cut consumption by 15%.

Bradley’s proposal, which is moving through the Commerce, Energy and Natural Resources Committee on a fast track, aims to answer the question: How can we go on building when we are asking residents to conserve?

Essentially, the proposal would offer developers of all new structures with the exception of low-income housing two choices: Pay an offset fee to the Department of Water and Power, or retrofit toilets, showers and irrigation systems on their own.

For example, the developer of a 20-unit apartment building would have to offset half of an estimated 3,658 gallons of water a day. This developer could either pay $4 per gallon of water needing to be offset, for a fee of $8,047, or replace inefficient toilets in a senior-citizen housing project that would yield an equivalent savings in water.

The $4-per-gallon fee is based on an assumption that it costs $117 per unit to purchase and install an ultra-low-flush toilet, and that each fixture saves an average of 29 gallons a day.

The fund created by the proposal would be administered by the Board of Water and Power Commissioners. The job of monitoring the installation of water conservation devices would go to the Department of Building and Safety.

“Proving they are saving water would be a burden,” acknowledged Tom Stevens of the Department of Building and Safety.

Still, he argued that the benefits of the motion are worth the trouble.

“What would the value of a home be if they could not build any more homes in Los Angeles?” Stevens asked rhetorically.

Critics argue that the proposal does not include adequate safeguards to ensure that money put into the fund, which could potentially grow into tens of millions of dollars, would be used in a timely manner for its original purpose.

“The biggest bite in the Bradley motion is the contribution to a fund,” said City Councilwoman Ruth Galanter, who has authored a competing motion that would halt construction during a water crisis. “If you create a fund, you create enormous cost and policy questions--and inertia to get the job done.”

Councilman Zev Yaroslavsky is pursuing a similar ban on construction in times of drought.

Bradley described the competing proposals as Draconian and insisted that his plan is innovative, yet fair.

“I believe the cost of this program will be offset by the large amount of water that will be saved during the next few decades,” Bradley said. “This is a small price to pay in order to protect our city’s water supply.”

Developer Fees and the Bradley Plan

Mayor Tom Bradley’s water offset proposal could add thousands of dollars to an array of fees developers are already required to pay the city when taking out a building permit for residential and commercial projects.

Here is a sample of fees currently paid by a developer who takes out a building permit for a first-class 20-unit apartment complex valued at $2 million. A portion of these costs is passed on to consumers. Building permit fee: $10,000

School district fee: $10,000

Fire hydrant fee: $4,400

Parks fee: $4,000

Sewer hook-up fee: $3,000

Seismic fee: $140

TOTAL fees: $31,540*

Bradley’s proposed water offset fee in this case would be $8,000.

* Figures are approximations provided by the Los Angeles Department of Building and Safety.