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which funds new water sources. That is separate from the need for water to serve existing customers. Mr. Tarver agreed with that approach, but had grave concerns with the State's ability to provide water as promised. Ms. Mohr asked for further information regarding the groundwater. Mr. Wong indicated that when Zone 7 purchased the additional 10,000 acre feet of water, it believed that the past four years of rainfall would continue another year. It was not foreseen that this would be the third or fourth wettest year. For 1995, Zone 7 does not need the surplus water and probably does not need the water from the State system. There is space to pump more groundwater in, but that will be from local sources at no cost. Ms. Mohr indicated the State Office of Planning is projecting an increase in population to 50 million in the next fifteen years. How does the State intend to deal with that? Mr. Wong stated it is considering similar procedures as Zone 7, such as water transfers from agricultural lands; conservation, including water audits; and water reuse, which is costly but possible. Mr. Lum indicated he is attempting to make arrangements to have a State water official make a presentation to Council in May. There being no further testimony, the public hearing was closed. Ms. Michelotti indicated she had reviewed some of her questions with Steve Cusenza. She believed that large volume water users who can show they are conserving are not rewarded. She urged adopting an audit service for them on a request basis to assist them in cutting costs. Council wants to encourage conservation, but water then costs more. She also believed there should be some kind of disclosure to purchasers of large lots to forewarn them that if they have lavish landscaping, they will pay more ti3r the water. This would give them options to plant water conserving landscaping and though they will pay more because of size, it will still be less than other kinds of plantings. Mr. Tarver felt a complex system had been created to encourage conservation. However, it was still inequitable. He believed there should be a set price for everyone with possible exceptions for seniors or low-income. He felt an audit program would be helpful. He also had concerns about the large lots. At one point, lavish landscaping was encouraged, but after the drought the rules changed and now those lots must still be maintained. He disagreed with the elaborate rate structure. Ms. Michelotti asked if the rate structure addressed conservation issues. 02/21/95 17-