SAN DIEGO (CBS 8/ CNS) - The city of San Diego's turf replacement rebate program resumed Wednesday with the beginning of the new fiscal year, with $1.2 million available for residents who remove their lawn and install native or drought-tolerant landscaping.

From midnight to 9 a.m., on Wednesday, 350 applications were submitted for the rebate program. By 5 p.m., on Wednesday, over 500 applications had been received, and the program had been shut-off. 

"The best way to conserve is to reduce watering outdoors or take advantage of rebates to replace your lawn with drought-tolerant landscaping," Mayor Kevin Faulconer said. "We're all in this together. It's time to change the way we think about water. Let's conserve today for a better tomorrow."

Instead of letting grass just die, the rebate program would allow homeowners replace it with artificial turf or drought tolerant landscape. The rebate includes $1.50 per-square-foot. 

The city of San Diego is operating under a state mandate to reduce water consumption by 16 percent over 2013 levels because of the ongoing drought. On Monday, the City Council tightened water use regulations by cutting the number of days of outdoor irrigation from three per week to two per week, at five minutes per station. The new rules also prohibit watering within 48 hours of measurable rain.

"San Diegans have stepped up to the plate and decided to commit to changing their turf and putting money into it as well," said Luis Generoso, San Diego Water Resource Manager. 

The new restrictions brought San Diego's regulations in line with state and San Diego County Water Authority rules.

According to the city, outdoor irrigation accounts for half of residential water use.

Information about the rebate program is available at