EARLIER THIS YEAR, Washoe County decided to auction off some water rights it owned in the North Valleys area. The water was freed up when the county-owned Sierra Sage Golf Course switched from using potable drinking water for irrigation to using highly treated wastewater. That left the county parks department with 174 acre-feet of water for which it had no use.

An acre-foot is enough water to cover an acre of land with a 1-foot-deep pond, and 174 acre-feet is enough to supply 174 families of four people with water for a year. So, by modern Northern Nevada growth standards, it wasn’t a lot of water.

But it was, in many ways, very special water, for it represented the last available chunk of water rights for the Stead and Lemmon Valley areas. It’s an area where developers want to build — and build a lot — but many of the projects planned for that area were stalled when state officials realized they overestimated the amount of water available there and took back water rights they had already approved.

So developers came armed with their checkbooks that night in March. With demand for housing high and Northern Nevada housing prices soaring into California’s stratosphere, paying a little extra for the fundamental element that makes houses grow in the Truckee Meadows — a clear, unquestionable water source — seemed to make good economic sense.

But even the most optimistic water watchers could not have anticipated just how valuable that water would prove to be by evening’s end.

All told, the county made $7 million. That’s more than $40,000 per acre-foot and nearly three times the water’s appraised value. Government officials who came to the auction thinking they would easily pluck up a few acre-feet to keep on hand to sell to small-time builders simply watched, their jaws going slack as bidders from such big-time operators as Centex Homes pushed prices higher and higher.

“We bid at the whole lot, but not at the prices they ended up at,” says Lori Williams, executive director of the Truckee Meadows Water Authority, the water purveyor for 85,000 customers in Washoe County. “That was not a game we wanted to be in.” While the North Valleys water auction was, in some ways, an anomaly — an unexpected gusher that erupted at just the right time and just the right place to make the water unusually valuable — in other ways, it is a reflection of what’s happening all over the Truckee Meadows. Our water supply is limited, and the supply of available water is quickly shrinking at a time when the demand for new homes is skyrocketing. You don’t have to be Alan Greenspan to know the price of water is going up.

Just four years ago, rights to an acre-foot of water sold for about $3,200 in the Truckee Meadows. Today, the price is at least twice that and often higher.

Williams has experts in the field talking to people who own water rights, but lately every deal she puts on the table gets topped by somebody else. One offer of $7,200 per acre-foot was trumped by a bid of $9,000. Another time, developers came in with an offer of $11,000 per acre-foot. And no one is expecting those prices to level off any time soon.

“Water has always been a valuable commodity in the Truckee Meadows, but with so many people wanting to move here, its importance has taken on new dimensions,” Williams says.

Water lesson

The Truckee Meadows water picture is at once labyrinthine and simple. It’s easy to get lost in talk about Orr Ditch decrees, negotiated settlements, and the complex history and politics of the matter. Some of it just doesn’t make sense. Such as how a Nevada water company can control water in California lakes and reservoirs, or why Nevada farmers maintain a dam that holds back water in a reservoir built by the federal Bureau of Reclamation on land in California.

So don’t go there.

What you need to know is this: The Truckee River supplies about 85 percent of our domestic needs and the rest comes out of carefully regulated wells tapping underground aquifers. The amount of water available and, thus, the amount to which people are allowed rights each year was established by the courts and state engineers who have studied the matter tirelessly for decades. When there is a drought, there is not enough water to serve everyone’s rights, so some people have to go without. Those poor folks include ranchers and farmers or

landowners who irrigate with water drained from the Truckee because their rights have a lower priority than other users, including the municipal water companies that deliver water to our homes. So rest assured your tap will never go dry. Unless, of course, there is a nuclear holocaust or catastrophic global warming or some other kind of colossal ecological disaster.

In years when water is plentiful — when our frozen vault of snow in the Sierra is deep and mountain streams are surging with enthusiasm — extra water is siphoned off and stored in a variety of places. The top six feet of Lake Tahoe, for instance, is actually a reservoir. So is Independence Lake north of Truckee and the top layer of Donner Lake. Boca, Prosser, and Stampede reservoirs also hold water held back from the spring run-off. TMWA even stores extra water underground by “recharging” wells.

Most of the water serving new developments will come from developers buying up farmers’ water rights to Truckee Riverwater. The developers turn the rights over to TMWA and, in return, TMWA issues a “will-serve letter” for water equal to the rights surrendered by the farmer.

Houses in the fields

It’s no secret that irrigated fields are disappearing in the Truckee Meadows as those sparkling new subdivisions spring to life. But it might surprise you how fast those fields are being lost.

A few years ago, water experts determined there were about 51,000 acre-feet of “mainstem” Truckee River water rights being used for agriculture or tied up on land already covered in asphalt or concrete in the Truckee Meadows. They figured that was enough water to handle all the growth we could envision for the next 20 years.

But in just three years, some 10,000 acre-feet was swallowed up by development. For years the amount of agricultural water converted to domestic use remained steady at about 1,500 acre-feet a year. Then it jumped to 2,250 acre-feet and then two years ago it went to 3,000 acre-feet. Last year TMWA issued will-serve letters for 5,000 acre-feet.

TMWA wasn’t the only operation seeing surprising growth. The Washoe County Department of Water Resources almost doubled its number of customers to more than 16,000 between 1997 to 2003. It’s number of sewer connections tripled.

So now water planners are rethinking that 20-year estimate. If water is going to continue coming on line at the rate it’s going now, those 51,000 acre-feet will be all used up well before 2025. But the experts say we are more likely to run out of buildable land before those Truckee River water rights are depleted.

Disappearing ranches

Don Casazza, a longtime rancher in the south Truckee Meadows and regional water planning commissioner, has watched the growth from his front porch. His ranch used to be 220 acres. He’s sold most of it but still has 30 acres left.

“When they first brought that freeway (I-580) through, I thought, ‘Holy cow! Who all do they think needs a highway like that?’” he says. “But now it’s all developed and people need a road like that.” It wasn’t as hard as some might think to give up the ranching life. As more houses crowd up to your fields and the neighbors’ dogs find out how much fun it is to run with your cows, selling the land and the water rights starts to make more sense.

If there’s one thing ranchers like Don Casazza sound wistful about it’s the irrigation ditches that still deliver water to their fields. There are eight major ditches that funnel water out of the Truckee and carry it all over the Truckee Meadows to water treatment plants and hundreds of small ranches that still use them for flood irrigation. Cassaza is vice president of one of the longest ditches — the 32-mile Steamboat Ditch that runs from the state line down to the south Truckee Meadows.

Although the number of people relying on ditches for irrigation water has remained the same, the amount of water running through many of the ditches has decreased over the years as more water is sold off for domestic uses. There’s talk now of narrowing some of the ditches or combining them so less water is lost to absorption, but a lot of people would miss the ditches if any were to be abandoned. Some date back to the 1850s. The biggest one — the Highland Ditch, which delivers river water to TMWA’s Chalk Bluff water treatment plant near West McCarran Boulevard — was built in 1880.

“I grew up in this valley and the ditches are a big part of the history and development of this area,” says Norm Dianda, president of Q&D Construction and, for the past 20 years, president of the Last Chance Ditch company.

Dianda and Casazza admit they endure some headaches running those two ditches. Downstream users complain about the guy above him taking too much water. It’s hard to find workers to patrol the water ways through the summer. And every year, it seems, there are more houses creeping up along the ditches and homeowners objecting to how the ditches are cleaned out.

But at the same time, you sense they love it every spring when they see that first head of water pushing through those old trenches.

“The southwest (Truckee Meadows) wouldn’t be what it is without that irrigation,” says Dianda, who irrigates his own 2.5 acres in the southwest with ditch water.

Future sources

Although water planners have estimated that we will run out of buildable land before we run out of water to serve projects on that land, planners already have started looking at future water options.

Steve Bradhurst, executive director of the Washoe County Department of Water Resources, expects a couple of thousand acre-feet of water rights will be freed up over the next decade as more projects or developments switch from using potable water for irrigation to using treated effluent. The county’s water reclamation plant near Rattlesnake Mountain treats the effluent, stores it through the winter in a reservoir and then treats it a second time before it’s piped to places like ArrowCreek and Wolf Run golf courses for irrigation. Bradhurst calls it “first-class reclaimed water” and it sells for about a third the price of potable water.

“What we’re doing is stretching our resources,” says Bradhurst. “You have to be smart about it.” So where will we grow when the Truckee Meadows is full and Truckee River water is all allocated? Well, follow the water. Right now the most likely source of additional water is from Fish Springs Ranch in northern Washoe County, where Vidler Water Company officials have been granted rights to 13,000 acre-feet of water. Company leaders have proposed delivering 8,000 acre-feet to the North Valleys from the ranch. The county also has 3,000 acre-feet in Dry Valley that they aren’t sure what to do with at this point.

Water planners also have scouted out locations for future reservoirs and have found eight possibilities, including two in Verdi, one in the Virginia range east of Hidden Valley, and sites along Thomas, Whites and Galena creeks in the south Truckee Meadows.

Water meters for all

In June of this year, TMWA finally finished installing water meters at every single family home it serves in the Truckee Meadows. TMWA officials still have some small apartment complexes and duplexes to meter, but 90 percent of their customers now have them. But, they aren’t being turned on yet.

This is because TMWA still is determining how everyone will pay his or her water bill. Most customers still can choose to pay a flat rate or pay a metered rate —at least until the authority’s board members decide to “flip the switch” and put everyone on metered rates. Although board members have shown an eagerness to do that — if you charge by volume for milk and gas, it reasons, why not a valuable, limited resource like water? — the authority isn’t rushing into it.

Initially, water officials wanted to make sure TMWA wasn’t going to lose a lot of money switching from flat rates to metered rates and wind up in a deficit and be forced to raise rates. But after analyzing the issue, TMWA officials decided a budget shortfall wouldn’t be created from the move.

In making the switch, TMWA officials are aiming at helping people understand why meters are important and what will happen to the water saved by meters and other conservation measures. For instance, they say, water being saved isn’t going to new development — it’s being stored in reservoirs or sent down river to help endangered fish in Pyramid Lake.

“The water only gets saved for drought or is turned over to the environment,” Williams says. “It doesn’t go to future growth.” Meters have been a touchy issue for years. Users worried if they hooked up to meters somebody would finally realize how much water they use and their bills would go through the roof. Or they worried rates would be increased and their bills would go through the roof. But many customers have found they save money by switching to a metered rate.

It’s true flat rates have climbed much faster in recent years than meter rates, but that wasn’t an effort to push

people into meters, Williams says. The goal was to get flat-rate users to cover the cost of the water they are using.

“We have two types of people still on flat rates — those who are using way more than they are paying for and those who are using way less than they are paying for,” Williams says. “The guy who is paying $70 a month and irrigating four acres is being subsidized by the other guy who has just a small garden.” The switch to meters isn’t inevitable, but feel free to bet it will happen. For one thing, TMWA decision makers are strongly in favor of meters. But another factor is something called the Truckee River Negotiated Agreement, a proposed pact between all the water users of the Truckee River, from the Pyramid Lake Paiutes to farmers in Fallon to the Truckee Meadows Water Authority.

That proposal, which still is three to five years away from being finalized, includes a deal in which TMWA gets a boatload of upstream storage in exchange for putting their customers on water meters. Downstream users believed that was the best way to ensure the growing metropolitan area does not squander water that should be going to fish and lakes.

“The spirit of the deal was we meter and get storage,” says Williams, who worked with Sierra Pacific Power Company before it sold its water operation to the water authority in 2001.

But how much would meters save? Although studies show people’s domestic consumption of water is “non-elastic” —they’ll use a certain amount no matter how much it costs them — other studies show when water officials “flip the switch” to meters, they will save 4,000 acre-feet of water a year.

But that water won’t be going to new homes, either; it will be stored in Stampede Reservoir for drought years when we really need it.

Understanding rates

There’s been a fair amount of squawking in the four years since TMWA was formed and acquired the water system from Sierra Pacific. Some say the authority paid too much for the system, that it acquired a distribution network that needed a lot of repairs. Flat and metered rates were increased in November 2003 and again in March this year, and more than one customer will say they are worried about unchecked rate hikes in the future.

While it’s true the authority can raise rates without going to the state Public Utilities Commission, as Sierra Pacific did, Williams says the authority will only charge what it has to.

“We’re not profit-motivated,” she says. “Everything we collect goes to serving the customer.” And keeping the system running. Williams doesn’t sugarcoat her description of the system she inherited from her former employer, Sierra Pacific.

“It’s a 1960s Chevy. It was never a Cadillac and it certainly wasn’t a Yugo,” she says. “Some maintenance and rehabilitation on it was deferred, but not unjustifiably so.” State and federal water quality regulations that emerged in the late 1990s forced Sierra Pacific to invest a lot of money in water treatment facilities and other operations that siphoned money away from routine upkeep.

“It’s like if they had to put a new engine in, so work on the muffler and the brakes had to be deferred,” Williams explained.

But, still, it’s a reliable system. Service is rarely interrupted and water delivered is good quality.

Drought reserves

Although we had a pretty good winter in 2004-05, with the snowpack measuring 150 percent of normal in many watersheds, water experts like federal water master Garry Stone aren’t saying we’re out of a five-year drought yet. In fact, anybody who knows anything about the water picture won’t say that until they are sure Lake Tahoe will fill to its artificial brim and all upstream reservoirs can be filled.

Stone is predicting Tahoe still will be about four feet below the dam at Tahoe City this summer and he doesn’t expect the 226,500 acre-foot Stampede Reservoir to fill up either. Most of the other reservoirs will fill, however, and he doesn’t expect to have any trouble maintaining river flows on the Truckee this summer.

Since the severe drought of 1986-1994, water officials say they’ve taken several steps to improve our storage to handle dry periods. In 1999, the state engineer granted TMWA a permit to store treated river water underground and that aquifer under southwest Reno now contains 32,000 acre-feet of water, about a third of the annual demand by

But even with these preparations, it remains a challenge convincing the public all these efforts — including the twice-a-week watering rules — are not just so we can provide water for more houses.

“Getting people to practice conservation is one of our biggest challenges,” Bradhurst says. “They want to think it’s all going to new houses, but it’s not. We don’t have any more water now than we did 10 years ago; it’s just being used differently.

“But people need to realize that if they use half as much water, the half they save just stays in the creeks or in the rivers or in the ground or goes to Pyramid Lake. It just makes sense for them to conserve.”

Jim Sloan, 49, is a senior editor/projects at the Reno Gazette-Journal. He has written extensively about health, fitness, and environmental issues. He also is the author of several books.