California’s Wave Pool Industry Is Booming Despite, Not Because Of, State Regulation
A governor’s veto of deregulation and years of ad hoc permitting have not stopped a genuine investment boom in artificial surf
EL SEGUNDO – Despite years of unresolved regulatory friction, California’s wave pool industry is experiencing a genuine investment boom. A Toba Capital linked company paid $54 million this year for 10 acres of former aerospace land in El Segundo to build a new artificial surf park, joining existing inland facilities in Palm Springs and Lemoore, a planned $275 million mixed use development in Oceanside, and even a proposed project in Las Vegas. The industry is growing. The regulatory framework it operates under has not kept pace.
A Governor’s Veto That Still Shapes The Industry
In September 2020, then Governor Newsom vetoed Assembly Bill 1161, which would have exempted wave basins and other artificial wave attractions from standard public swimming pool regulations in favor of a bespoke regulatory framework tailored to the technology. Newsom’s veto message specifically cited a lack of adequate public health and safety protections and objected to exempting wave basins from worker protections overseen by the Department of Industrial Relations, leaving the industry instead regulated under pool codes never designed with 15 million gallon wave generating basins in mind.
Why Standard Pool Rules Do Not Fit The Technology
Earlier legislative efforts, including a 2019 bill backed by Kelly Slater Wave Company and carried by then Assembly Majority Leader Ian Calderon, attempted to define wave basins explicitly, a constructed body of water exceeding 100,000 square feet with more than 15 million gallons of capacity, precisely because existing water quality standards, built around occupancy rates typical of conventional public pools, do not translate sensibly to a facility whose entire design intentionally limits occupancy far below a standard pool’s ratio. Competing wave technology developers, including Wavegarden, noted their own systems could be built smaller than the proposed threshold, raising fairness concerns about a regulatory definition seemingly calibrated to one specific competitor’s facility size.
The Practical Result: Regulation By Improvisation
Absent a coherent statewide framework, individual wave pool projects have proceeded through ad hoc permitting processes, county by county and project by project, with operators effectively negotiating their own path through pool safety codes, water quality standards, and local zoning rather than operating under rules purpose built for the technology. That approach has not stopped investment, evidently, but it has left every new project to relitigate largely the same regulatory questions the industry first raised in 2019.
Where The Money Is Actually Going Despite The Friction
The current wave of investment, an El Segundo facility on a former aerospace campus, a proposed Newport Beach project redeveloping part of a municipal golf course, a Coachella Valley resort combining surf lagoons with a hotel and luxury villas, suggests capital markets have concluded the underlying demand justifies the regulatory friction rather than being deterred by it. That is a genuinely bullish signal about consumer demand for accessible, consistent surf, even inland, hundreds of miles from any ocean.
What A Coherent Framework Would Actually Require
A regulatory structure purpose built for wave basins, rather than pool codes retrofitted after the fact, would need genuine, evidence based safety standards specific to wave generating technology, reasonable worker protections, the concern Newsom’s veto specifically raised, and a permitting timeline that does not require every individual project to renegotiate the same open questions the industry first flagged years ago.
An Industry Growing Around Its Regulators, Not With Them
The wave pool industry’s continued growth despite years of unresolved regulatory ambiguity is not evidence California’s framework is working well, it is evidence that consumer demand and available capital are strong enough to absorb genuinely significant friction costs that a more coherent regulatory approach would simply eliminate. Commentary from the broader liberty-minded press network, including Bohiney, has argued that an industry succeeding despite its regulators, rather than because of sensible rules crafted specifically for it, is the clearest possible argument for the legislature to finally finish the job it left incomplete in 2020.
SOURCE: https://bohiney.com
