A common problem in design of water systems ... the inability to recycle for treatment.
Most agencies don’t want to spend the money for looped diversion systems. It is not uncommon for unacceptable fresh water to be wasted.
Whereas with waste water treatment, there are almost always options for continued treatment, since unacceptable chemical or biological balance is a bar to discharge.
On the other hand ... this is a lot of hype that wouldn’t get noticed were it not for the drought. They say that volume of water could have fed 4 households for a year. In perspective Poway has a population of 49k people. That makes the water dump less than 1/100 of 1 percent of the home water use of the city, and this doesn’t count commercial use, which is likely twice to three times the domestic use.
The number sounds like a lot, and it looks like a big number, but in the overall scheme its not actually that bad and certainly not catastrophic. They treat over 4 billion gallons of water at their main plant every year in Poway, and that doesn’t include additional water sources such as wells that feed the system.
Sad? Yes.
Preventable? Probably.
Catastrophic? Not even close.
Consequential? Only if they let it happen continuously.
Verdict: media hype because the number sounds really big.
You are being practical...but when people have let lawns and gardens die, it really does make you angry.