SAN DIEGO -- Gov. Arnold Schwarzenegger pushed for the overhaul of the state's water system during a speech Thursday in San Diego before the Association of California Water Agencies.

"There are no two ways about it, that it is about time that we rebuild our water system," Schwarzenegger said at the conference at the Town and Country Resort and Convention Center in Mission Valley.

The state Legislature approved a five-bill package last month that would increase water storage in the state by constructing new dams, clean up groundwater, restore ecosystems and ultimately lead to the building of a canal that circumvents the environmentally sensitive Sacramento-San Joaquin River Delta.

The legislation relies on an $11 billion bond, which will likely go before voters next November.

"Let me tell you something, this is the greatest investment," Schwarzenegger said. "It's not spending money or wasting money, it's the greatest investment that we can make in the future of California."

Schwarzenegger said the state's water system was built to serve only 18 million people, but now must handle 38 million people.

California's water supplies are threatened by years of drought and a judge's decision that restricts the amount of water that can be pumped through the Sacramento-San Joaquin River Delta in order to protect endangered fish.