(Monterey Bay Economic Partnership)
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Improving housing progress through clearer insight into housing-water linkages

Monterey Bay Economic Partnership’s (MBEP) Blue Paper makes recommendations to address water-related barriers to housing.

Our local watersheds are affected by climate changes that are altering the quantity, quality, timing, and distribution of water. MBEP co-hosted the Central Coast Climate Action Summit, which recently took place on March 31st, hosted in conjunction with Greenpower, California State University Monterey Bay, Central Coast Climate Collaborative, Ecology Action, and San Luis Obispo Climate Coalition.

“Planning for a Sustainable Central Coast: Climate, Resilience, Sustainability & Adaptation,” will be the third installment of the overall Climate Summit Series that will showcase success stories from around the region, provide updates on real-time climate action planning happening now, and share resources and next steps for public agencies and community stakeholders to help create a more sustainable, resilient region. See here for more information.

Water defines the Monterey Peninsula, but to what degree does water define its housing progress? That’s the focus of a study commissioned by the Monterey Bay Economic Partnership (MBEP) that examines the complex role water allocations play in meeting the Monterey Peninsula’s housing needs, particularly for affordable and workforce housing.

The report, “A Study on the Impact of Water on Housing Development on the Monterey Peninsula,” aggregates and assesses existing data and stakeholder input on the extent to which water limits housing development, and recommends feasible water policies and/or activities to strengthen the ability of the Monterey Peninsula to achieve its housing production goals, particularly with respect to housing that is affordable to lower-income households and the broader workforce.

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(Monterey Bay Economic Partnership)

During housing presentations and in separate conversations with individual stakeholders and entities, MBEP’s housing team frequently heard the issue of water broached as a barrier to housing development. So in its 2018 State of the Region event, MBEP facilitated a breakout session on housing and water, consisting of housing and water professionals and advocates, which resulted in a need to further investigate and create more common understanding of the underlying issues.

Limited sources of readily available freshwater and a state-issued cease-and-desist order (CDO) on pumping from the Carmel River aquifer are elements of a more complex housing-water connection also influenced by economic feasibility, local history, legal challenges, regulation, and political will. These are further complicated by repeated legal challenges to large-scale desalination or recycled water expansion efforts. It’s in that context that Monterey Bay Economic Partnership saw the need for a deeper analysis of housing and water.

The resulting Blue Paper, prepared for MBEP by independent water resource policy expert, Abby Ostovar, Ph.D., was introduced at MBEP’s 2019 State of the Region. The full study, written with the guidance and expertise of several stakeholders, including a housing and water advisory committee convened by MBEP, was released in March 2020. The report identifies seven key recommendations to help strengthen the Monterey Peninsula’s ability to achieve its housing production goals, particularly with respect to housing affordability for lower-income households and the broader workforce.

The study makes several recommendations that local jurisdictions can implement to alleviate water-related barriers to housing development, including increasing conservation, pursuing innovative water allocations, and incentivizing water-efficient housing. It also finds that increasing housing stock, particularly equitable and affordable options, cannot be addressed through water fixes alone – it needs to be part of an integrated vision of urban planning that includes appropriate density developments, transportation, and conservation.

The report also highlights strategies other cities have taken to successfully balance water demands. The City of Santa Cruz’s “Laundry-to-Landscape” Rebate Program offers $150 to customers who install greywater systems, and the Soquel Creek Water District offers its customers greywater rebates ranging from $400 to $1,000. According to Ecology Action, those greywater systems can result in an average savings of 62 gallons per household per day.

Santa Cruz has seen a concerted effort to increase density in certain areas through infill with multi-family dwellings. A recent water use survey showed that multi-family units, on average, have lower water usage (0.12 acre-feet per year, or AFY) than single-family units (0.21 AFY), so that while landscaping and other factors produce variation, on average more units can be supported with the same amount of water if they are multi-family dwellings.


Taking a collaborative approach by bringing together diverse perspectives on the environmental sustainability of water supply options can help reduce the threat of lawsuits, such as have occurred in Santa Cruz and Soquel Creek, which have had recent success in identifying and agreeing upon new water supply projects with both government and non-government stakeholders working together on a Political Advisory Committee.

Growing support for housing that is affordable to the local workforce shows that it may be a productive space for incorporating water-related challenges. Encouraging more public/private partnerships, room rental services, and home-sharing programs are other ways to find common ground and increase collaboration for more affordable housing opportunities. See the full report here.

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