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Executive Summary for December 28th

A stormy Christmas week boosted reservoir levels and brought the crucial Sierra Nevada snowpack above average. Headlines would have us believe our drought fears can be laid to rest. But vital data says otherwise. Plus: efforts to ensure the IRS doesn’t tax your water-conservation rebates.

Published on Dec. 28, 2015 Read time Approx. 3 minutes

Some Perspective on a Stormy Christmas

Headlines are still trumpeting the fact that the Sierra Nevada snowpack is above average for this time of year. It’s actually the first time since 2012 that this is the case. A few reservoirs have seen impressive spikes in storage from storm runoff.

All that is great. But as far as ending the drought goes, this game is only beginning.Today’s exhibit: water storage compared to a year ago.

According to the California Department of Water Resources, which tracks these things by the hour, all of California’s major reservoirs hold less water today than one year ago. In some cases, much less.

Shasta Reservoir – the state’s largest – held 1.4 million acre-feet as of Sunday, compared to 1.8 million a year ago.

Oroville Reservoir – the second-largest – held 1 million acre-feet on Sunday, compared to 1.3 million a year ago.

These numbers illustrate the depth of the drought we’re in. We’re starting from such a deep water deficit, and our collective water demand is so great, that a week of Christmas storms can’t even put our water storage back where it was a year ago.

Granted, that new snow will help when it melts, especially if it remains at or above average depths. And that is the crucial “if”.

At the moment, there is no clear indication it will stay average. The week ahead appears likely to be storm-free. Beyond that, a new long-range forecast released today by the National Weather Service offers hope: it indicates the entire state is likely to see above-average precipitation in the first 10 days of 2016.

Some are already calling for an easing of water conservation rules because of the precipitation we’ve seen so far. The State Water Resources Control Board will weigh up that issue later this month.

It could be rash to cut too deeply into those conservation rules.

“Because the reservoir levels are so extraordinarily low, we’d have to have a lot more rain and snowfall to have an impact on the drought,” Doug Carlson, a DWR spokesman, told the Riverside-Press Enterprise. “One wet winter is probably not going to do it for us. And we can’t make good, solid predictions based on what’s fallen so far.”

Stop Taxing Water Rebates

Earlier this month, Rep. Jared Huffman (D-San Rafael) sent a letter to the Internal Revenue Service urging the agency to stop taxing homeowners for water conservation rebates they receive from local utilities.

This kind of thing has never been an issue before. But this year, thousands of California homeowners received very large rebates for taking out water-hungry lawns. In some cases, individual homeowners received rebates as large as $5,000 or more. The IRS counts this as income, and these amounts may even be large enough to push some families into a higher tax bracket.

Huffman is only asking for water rebates to be treated like energy efficiency rebates, which are not taxed by the IRS. This disparity is yet another example of how water is not treated like other utilities, resulting in hardships for ratepayers.

Several dozen other lawmakers joined Huffman in signing the letter, including members of Congress from Arizona, Wisconsin, Maryland, Pennsylvania and Oregon.

One simple reason these rebates should not be taxed, they note, is that the benefit of the rebate is not held solely by the ratepayer. In fact, the larger purpose is to convey a benefit to the community at large by reducing total water demand.

“The IRS should issue a revenue ruling clarifying that these rebates are not taxable,” Huffman’s letter states. “When water conservation and green infrastructure rebate payments are taxable to the property owners who receive them, it significantly deters participation in these programs.”

Top image: A woman carries an umbrella as she crosses California Street in San Francisco, Tuesday, December. 22, 2015. A fresh round of chilly rain drenched California during Christmas week, but it won’t end the drought. (Jeff Chiu, Associated Press)

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