Waking Up to the Water Crisis

By Kim Herman

Executive Director

Washington State Housing Finance Commission

By early May 2015, drought emergency declarations had covered a total of 44 percent of Washington State. Parts of Western and Central Washington are particularly hard-hit; runoff is predicted to be the lowest on record in the past 64 years.

This year’s drought conditions are a wake-up call in a state where water has always been presumed to be plentiful. But even in years of plenty, water doesn’t come cheap. In my conversations with multifamily developers, managers, and consultants, I heard over and over that water efficiency is just as important as other sustainable practices. In many cases, water conservation efforts are yielding the biggest paybacks for building managers.

Graced as we are with a temperate climate and affordable hydroelectric power, our fuel costs are relatively low. But Washington State’s water costs are not only high by national standards, they are rising more rapidly than energy costs. Seattle Public Utilities, for example, announced last year that it was raising water rates by 30% over a six-year period.

“I think people are waking up to the fact that their water and sewer bills are significantly higher than their energy bills,” Alistair says.

Just as critical to this bottom-line calculation is the fact that most affordable housing operators face a split incentive: Residents in tax credit-funded (LIHTC) housing may pay their own energy bills, while the building’s management covers water and sewer costs. Fuel efficiencies save residents money on their utility bills, which is a good thing. But this doesn’t ease the operating-cost pressures on subsidized housing. Affordable owners and managers in our state are increasingly implementing audit processes to make residents’ utility allowances more accurate—a process I’ll discuss further on.

Read the full article on the Washington State Housing Finance Commission website.