I live in CA. My state senator is Scott Wiener. We are making some progress.
Your argument might be plausible if it weren't for the fact that this issue is happening -- predictably -- in every major sprawling city in America. Strong Towns has literally built a tool to effectively convert cities' cash-accounting budgets into accrual-accounting budgets. You can see it happening over time... you just need to account for the future liabilities in the way you look at your budget instead of ignoring them until it's time to replace the infrastructure.
Indeed, the problem is the same in Texas which is about as opposite California as you can get. Sprawling suburbs over old farm fields. Installing infrastructure is vastly cheaper when you are doing so in an unoccupied empty field.
None of those cities are saving money or even _planning_ for the inevitable repaving, pipe re-lining, etc. Worse: many of them were built up in waves so much of the city's infrastructure will "come due" around the same time.
I never imagined we would see San Francisco (of all places) overhaul its permit process. I can now build a deck in my backyard, add a story to my house, or build an ADU without having to pay DBI to send certified letters to all my neighbors asking if they'd like to object, then being forced in front of the planning commission when they do so. That's a direct result of the pro-housing legislation at the state level, something Wiener has been heavily involved in.