A ruling this week by the state Court of Appeal involving a 2,500-home development in Santa Clarita, and a settlement in a separate case the same day, could end the controversial practice of building subdivisions that rely on state water supplies that may not exist.
Both actions gave new hope to slow-growth activists who are afraid that many California developments are being approved by local governments based on the rosiest of water projections, called "paper water," even as the state faces the possibility of diminished supplies from such traditional sources as the Colorado River.
"What the courts are worried about is that we're building projects that might not have the water to supply them," said Antonio Rossmann, an attorney who represented environmental groups in a lawsuit against the state Department of Water Resources. "What we've got to plan for, of course, is the multi-year drought scenario."
That suit, brought by the Sacramento-based Planning and Conservation League in 1996, was settled Thursday, with an agreement by the Department of Water Resources to begin reporting more accurately the amount of state water available to local planning agencies.
Also Thursday, the California 2nd District Court of Appeal rejected the environmental report for a Santa Clarita Valley subdivision.
The court found that Los Angeles County relied on overly optimistic water projections in approving the West Creek project, which was proposed by the powerful Newhall Land & Farming Co.
The environmental report for the subdivision must now be revised to show that it can find enough water.
The unanimous decision by the three-judge panel was not the first to reject an environmental report based on "paper water" projections.
But water experts say the tartly worded ruling -- combined with Thursday's settlement agreement with the Department of Water Resources -- will force developers and local governments to be more specific when it comes to identifying new water sources.
"The dream of water entitlements from the incomplete state water project is no substitute for the reality of actual water the [state] can deliver," the ruling stated.
For years, environmentalists have complained that the department was creating an unrealistic picture of water availability by encouraging government agencies to focus on the estimated amount of water that would be available only during the best possible conditions.
