The Privatization of the Kern Water Bank and the State Water Project AquAlliance Water Conference, Nov. 2012

Transcription

1 The Privatization of the Kern Water Bank and the State Water Project AquAlliance Water Conference, Nov Adam Keats, Center for Biological Diversity

2 Largest state-built water storage and conveyance system in the United States Separate from, but parallel to, the U.S. Bureau of Reclamation s Central Valley Project

3 1959: Legislature approved Burns-Porter Act 1960: Voters approved Burns-Porter through initiative 1960: Construction starts 1962: First water delivered

4 Construction funded through state general obligation bonds. 29 State Water Contractors all public water agencies are contractually obligated to repay the bond debt in exchange for being able to obtain water from the system.

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6 SWP Contracting Principles The users of the system (i.e., SWP Contractors) will pay for it. Payment collected irrespective of the amount of water furnished. Payment is proportional to each contractor s maximum allotment. Allotments = Table A Amounts Allotments used to be called entitlements but this is a misnomer.

7 Only about half of the SWP was ever built. Dams on the Eel, Mad, Van Duzen, Klamath, and most of Trinity were never built (protected as Wild and Scenic Rivers). Peripheral Canal and other facilities were never built (lack of funding).

8 Today, SWP only delivers (on average) half of its Table A Amounts. The difference between the total Table A Amounts and the amount actually delivered or deliverable is known as paper water. Different treatment for AG and Urban in the original long-term contracts.

9 SWP Long-Term Contracts ARTICLE 18(a): Urban Preference In times of temporary shortages in SWP deliveries (due to drought, for instance), Ag contractors would have their deliveries cut before Urban contractors. ARTICLE 18(b): Long-term shortages, caused by the failure to build out the entire system, would cause all Table A Amounts to be reduced proportionally

10 SWP Long-Term Contracts ARTICLE 21: Surplus Water Water that is available above and beyond Table A Amounts in any given year Cannot be used if it would tend to encourage the development of an economy which would be dependent on the sustained delivery of surplus water. Sort of an Ag preference for seasonally available, less-reliable water

11 The paper water problems, combined with the severe drought of , exposed a rift between the urban water contractors and the agriculture water contractors.

12 SWP Ag / Urban Conflict Ag contractors: resented Article 18(a) s Urban Preference wanted enforcement of Article 18(b) (proportional reduction of Table A amounts) wanted more ability to transfer / sell water Urban contractors: argued that Article 18(b) could not be imposed until after completion of the SWP wanted more dependable year-to-year deliveries, wanted more storage and usage options for surplus water (Art. 21) wanted more ability to transfer / sell water

13 SWP Ag / Urban Conflict Environmentalists perspective: Article 18(b) should be exercised due to failure to build-out SWP; Article 18(a) should be more routinely and strictly enforced; Article 21 should be more strictly enforced as to both Urban and Ag Reality is that nobody really wanted full enforcement: getting rid of these restrictions was actually more preferable to all parties than any enforcement.

14 Monterey Agreement Deleted Article 18(a) s urban preference Deleted Article 18(b) s proportional reduction Deleted permanent economy restrictions for surplus water (Article 21) Water transfers allowed between contractors; made all transfers easier Storage of water outside of districts Transport of non-swp water in SWP system Transfer of Kern Water Bank

15 Kern Water Bank

16 Kern Water Bank Water Code 11258: The project shall include facilities south of the Sacramento- San Joaquin Delta for utilizing groundwater storage space for the purpose of providing yield for the State Water Resources Development System. A facility shall not be constructed or operated within the boundaries of an agency that has contracted for a supply of water from the State Water Resources Development System unless the department enters into a contract with that agency concerning the facility.

17 Kern Water Bank 1980 s and 90 s: DWR developed KWB purchased Kern Fan Element land built water bank facilities tested feasibility of water bank acquired and stored water in bank DWR unable to operate KWB KCWA unwilling to enter contract as required by Water Code KCWA and others wanted local control of local storage facility

18 Kern Water Bank Transfer DWR gave to KCWA: Kern Water Bank land and facilities $3 million (indemnity for future environmental liability) Half of water already stored in KWB (43,000 acre feet, valued at $28 million)

19 Kern Water Bank Transfer DWR got in return: 45,000 acre feet of Table A Amounts from KCWA and Dudley Ridge Water District. Value of 45,000 acre feet: $30 million? $0? < $0?

20 PCL v. DWR EIR Prepared by Central Coast Water Auth. Certified in 1995 DWR responsible agency, not lead agency PCL v. Department of Water Resources CEQA and validation action Appellate court strikes down EIR Wrong lead agency Inadequate analysis of alternatives 83 Cal. App. 4th 892 (2000)

21 2003 Settlement Agreement EIR decertified; decision revoked DWR to prepare new EIR Interim authorization for the operation of the SWP and KWB pursuant to the Monterey Amendments

22 Monterey Plus EIR Certified by DWR in 2010 Includes original Monterey Amendments, plus additional elements as required by 2003 settlement NOD: Monterey Plus proposed project is to continue operation under the existing Monterey Amendment and the existing settlement agreement

23 Central Delta I lawsuit Central Delta Water Agency, et al. v. DWR Sacramento Case No CEQA action: Improper project description Improper baseline Failure to analyze impacts Alternatives Is the project the continuation of the Monterey Amendments or is it a new project?

24 Central Delta I lawsuit Central Delta Water Agency, et al. v. DWR Sacramento Case No Reverse validation action: Statutory prohibition on transfer of SWP facilities (Water Code Sec ) Unconstitutional gift of public funds Illusory consideration Abrogation of statutory and contractual duties Impairment of bond agreements

25 Demurrers overruled (2010) Plaintiffs sufficiently allege questions of fact as to when validation action could commence Mot. Judgment on Pleadings denied (2011) CEQA action not barred by res judicata (no privity between plaintiffs in PCL and Central Delta; return to writ in PCL case did not determine CEQA validity of 2010 EIR) Statute of Limitations trial (2012) Determination of factual issues from demurrers Waiting decision Central Delta I lawsuit

26 SWP was built by the state, funded by state bonds Contractors promised to pay off the bonds by paying for the use and delivery of water, but they would never own the water nor own the SWP.

27 For more info: /monterey_plus_amendments or just search for Monterey Plus on