Texas City Offers Industry a Choice: Pay an Exemption Fee or Face Higher Water Surcharges

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With water shortages or potential water shortages facing many cities across the US, governments are struggling with how to work with industry to ensure the organizations are not depleting too much of the available water sources. Now, the town of Corpus Christi, Texas, may be implementing what it believes will be a solution: offering large-scale industrial companies a $0.25 drought surcharge exemption fee.

The fee would allow industrial customers to pay an extra $0.25 per 1,000 gallons of water use. The surcharge exemption fee would not be mandatory, but those that choose not to pay would have no guarantee of price stability and could see significant increases in any type of water allocation surcharges that may be assessed, according to the Corpus Christi Caller Times.

If the vote for the surcharge exemption fee passes, it will be an amendment to the city’s Drought Contingency Plan, created earlier this year so that the city can cut dramatically cut water consumption when supplies are low and ensure that residents have enough to make it through a drought. “...[W]ith the variability of weather patterns in South Texas and a continually growing population, it is critical that the city plans for future drought conditions,” the plan states.

The drought surcharge exemption would be put into effect beginning Oct. 1. With money from the surcharge, the city will look at developing alternate water supplies, including seawater desalination, groundwater, and aquifer storage and recovery.

Currently, the city’s water supply system is comprised of four reservoirs: Lake Corpus Christi, Choke Canyon Reservoir, Lake Texana and Colorado River. Since Choke Canyon Reservoir filled in 1987, the combined storage of Choke Canyon Reservoir and Lake Corpus Christi has exceeded 60% capacity only about 62% of the time, according to the drought plan.

Industry in the area has feared water shortages and potential cutbacks, and what they might do to their operations; the optional surcharge should offer them some assurance of a continuing supply of water, says Frank Brogan, a water consultant for the city.

Mayor Joe McComb says the action will not only ensure an uninterruptible supply of water but also the promise of expansion of existing industry and attraction of new industry.

Other cities have experimented with different water-assurance measures. But one recent study indicated that a self-imposed fee on groundwater could work better then government regulations. The study, from the University of Colorado Boulder, was based on an initiative in Colorado’s San Luis Valley, where several hundred farmers voted to self-impose a fee on groundwater - typically free - back in 2011. The decision came after several drier than average years led to water shortages; farmers began to worry that the state might begin shutting down wells, as it had in other areas.

Proceeds from the fee, now at $75 per acre foot of water, are used to help local irrigators buy supplemental surface water or to pay them to let their acreage go fallow, or unused, in dry years.

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