Can California water districts legally use proprietary water budget formulas?
<p>My water district is using EPA's ETo (evapotranspiration) concept to set water budgets for retail billing. When water usage exceeds 2 x ETo x landscape area in a given month, then the HCF unit price jumps from $5.22 to $10.22. This practice in itself <a href="https://law.stackexchange.com/questions/61528/can-california-water-districts-legally-use-epa-water-budgets">might actually be legal</a> because a contract can set forth a formula for determining a price, rather than a particular dollar amount.</p>
<p>My question is whether the practice is still legal if the district chooses to use a proprietary formula for ETo, rather than the accepted CIMIS formula and publicly available data. For example, I was recently charged for 15 extra units at the higher price because the district used ETo=2.06 while CIMIS reported 2.60 for a nearby weather station.</p>
<p>When I provided the CIMIS data to the district, they said it &quot;wasn't accurate&quot; because CIMIS didn't consider factors like &quot;local plant condition&quot;. While that may be the case, at least I showed my work. The district, on the other hand, said that all they could get was daily ETo values per grid cell (and, as it turns out, even those values yielded a higher budget than what was on my bill). They could not provide the &quot;plant condition&quot; data that they bragged about, or even basic temperature/humidity/radiation data that one might use to double-check the results.</p>
<p>Digging a little bit further, they are using a company called Hydropoint that is using patented formulas and interpolation techniques. Woah. If Hydropoint is so secretive with their data that <em>multi-million-dollar water districts</em> can't double-check it, then can this data legally form the basis for a contract, if I am not being told the actual budget value before purchasing the water?</p>
<p>Hydropoint advertises themselves as a water conservation company, and I'm sure that it would be legal to use them as such -- for the purpose of cutting your own water usage. But is it legal to use them in the way that my district is doing, to decide what their customers will pay, after-the-fact?</p>
<p>Furthermore, Hydropoint apparently makes their own irrigation controllers, which are being used by a city within my water district. Does this create a conflict of interest, since they then have an incentive to make unpredictable changes to their data, thereby making their own controllers (which have special advance and insightful access to the Hydropoint data) work better than any competitor's? And if so, doesn't this violate contract law's tenet that you must not interfere with the other party's ability to comply? How can I, the retail customer, comply with a budget that is (as noted in previous paragraphs) unpredictable, and is, furthermore, actually <em>incentivized</em> to be unpredictable?</p>

<p>Any formula which meets the legal muster set forth in the prior Q&amp;A you link to should be valid. If there are multiple reasonable formulas that can be used to allocate revenue to expenses, any reasonable formula available can be used, even if it is not the most accurate one or the &quot;best&quot; formula in some sense.</p>
<p>In the same vein, it isn't uncommon for banks to have contracts or promissory notes that provide for per diem interest in loans where interest is compounded monthly to be computed based upon 30 days months and 360 day years as a matter of contract, even though there are clearly more accurate rules which are available, simply because it provides rough justice and may be easier to apply logistically (e.g. that is what the bank's software could manage most easily back when computing power was expensive and scarce).</p>

contract-law california water