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The Price of Water: Part I

California's drought has put a new emphasis on water distribution and cost.

| BY Kent McDill



How much is water worth? 

We may be close to finding out.

The dire situation in California, where years of drought have combined with global warming to reduce the amount of available water for human use to a seeming dribble, puts a spotlight on the problems with water usage in the United States. At the same time, the world is running out of potable water, while the sea levels rise with water that requires thousands dollars’ worth of treatment to make worthy of consumption.

It is estimated at current levels of population growth and water usage, the global demand for water will outstrip supply by 40 percent in just 15 years. Governments throughout the world will be pressured to make never-before-considered choices about water usage and distribution.

In most communities in the United States, water is delivered to homes and is paid for through a system of monitors determining usage. However, the cost of the usage is not related to the value of the water; it is instead related to the value of the delivery.

“It’s ridiculous how (little) we pay for water,’’ said Robert Glennon, an expert in water usage at The University of Arizona in an interview with The Atlantic. “None of us are paying for the water itself. Economists talk about the marginal cost of water, and in very few places in the country are people even paying for the marginal cost.”

Here are some water statistics that can be used in a discussion about pricing water. It is estimated that American consumers drink only about 1 percent of the water delivered to their homes. The other 99 percent of the water, which is suitable for drinking, is instead used for toilets, showers, laundry facilities, or to water lawns and gardens. Such usage does not require the same quality of water as drinking.

The history of water pricing in the United States goes back to when municipalities first began regulating its use and purifying water for consumption. Utilities were created and water prices set in order to prevent cities or controlling bodies to use water delivery as a profit-producing vehicle.

Those laws prevent cities from raising the price of water in order to reduce demand.

But there are arguments that while the amount of water humans need to survive should be subsided my governments, there should be increasing rates for water use outside of human or family consumption.

The water situation in California is unique. While water supply dwindles, arguments over how much city dwellers should pay versus what rural and farming communities should pay begin. It is estimated that farming uses 80 percent of California’s water usage annually, and that water is delivered at far less cost than water delivered to municipalities.

The water in California is administered by water districts, and recently a water district in the area of the state’s capital, Sacramento, offered to buy a portion of the water supply from a northern district for 50 percent more than ever offered before.

California governor Jerry Brown has proven to be forward-thinking in regards to his state’s water problems. He has introduced a plan calling for $1 billion to be earmarked for water considerations. While some of the funding would go to immediate short-term help for the areas of the state hardest hit by the drought, most of it will go to funding long-term projects aimed at water recycling, flood control infrastructure and the building of desalination plants.

If the Colorado River had a negotiating body, it would be making billions on its resources. Instead, the seven states that draw water from the Colorado River Basin argue over concerns that too much water is being drawn too far north, keeping a plentiful supply from getting to New Mexico and beyond at its base. The Colorado River is estimated to provide 41.4 trillion in economic benefits and 16 million jobs along its shores through the states of the Colorado River Basin.

About the Author

Kent McDill

Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.

In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.

McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.

McDill is the father of four children, and an active fan of soccer, Jimmy  Buffett and all things Disney.