Mojave Pistachio, Nugent Farms comment to IWVGA

September 8, 2021

The Indian Wells Valley Groundwater Authority (Authority) has failed the Indian Wells Valley and now wants the ratepayers of the Indian Wells Valley Water District (Water District) to bail them out. The governance structure created by the Authority denies stakeholder involvement while exposing the Authority and its parent boards to significant legal liabilities. The Authority failed to create a legal and effective Groundwater Sustainability Plan (GSP) and instead unlawfully determined water rights and implemented a Replenishment Fee only on select parties through a faulty Proposition 218 process.

The Authority Board of Directors does not provide fiscal oversight and has bankrupted itself with consultants and lawyers. Most egregiously, the Authority now hopes to use the Water District’s ratepayers to finance its way out of overpaid consultants and legal quagmires.

Had the Water District and Tim Parker been allowed to spearhead the Groundwater Authority and act as the General Manager and Water Resources Manager, the Indian Wells Valley would be on the road to a sustainable future. Instead, the Authority’s blundering attempt to seize control has put the Navy front and center in a water fight that did not have to happen.

The Department of Water Resources’ (DWR) facilitation process should focus on real science and implementable actions to undo this acrimonious disaster. It is not too late to wrest control away from the runaway staff and consultants of the Authority and return good governance and responsible long-term planning to the Indian Wells Valley.

The Sustainable Groundwater Management Act (SGMA) expressly calls for local stakeholder input and a collaborative process to achieve sustainability by 2040. Half a decade ago, Dale Schafer provided facilitation services on behalf of the DWR. Through facilitated meetings and outreach programs, an initial plan to have a strongly representative Authority Board of Directors that included all major stakeholders was proposed and widely accepted by residential, agricultural, and industrial water users.

The Authority stepped in and denied seats to agriculture and industry, claiming Policy Advisory Committee (PAC) and Technical Advisory Committee (TAC) boards would be established and do the heavy lifting of planning the Indian Wells Valley’s water future. Again, promises made meant promises broken by the Authority. The PAC and TAC were systematically ignored and sidelined by the Authority. No meaningful input was allowed as all comments were accepted after the fact and then filed without response.

The Authority based all of its decisions on a secret, non-public computer model to drive model runs. These secret model runs came to dubious conclusions that have proven faulty in the first annual reviews which showed pumping was drastically overestimated and recharge was materially underestimated. These faulty, behind-closed-doors models were the basis for picking winners and losers in the Indian Wells Valley. No public review of the model, assumptions, methodologies, or error ranges was allowed.

The PAC and TAC are only window dressing specifically designed to give DWR and the public the appearance of stakeholder input. It is interesting to note that the PAC and TAC have been resurrected just as the DWR has requested to become involved again. The small amount of trust and cooperation Dale Shafer fostered in the early months of the Authority’s founding has been destroyed by Supervisor Gleason and his legacy of secrecy and self-dealing. The new facilitation services offer by the DWR can hopefully restore trust and put the Water District at the head of a reinvigorated and redirected Authority.

The heart of the Authority is the GSP, which is supposed to be the roadmap to sustainability for the Indian Wells Valley. Instead, the Authority relied on a cherrypicked review of prior literature to come to an arbitrary basin recharge amount without conducting any new science or basin tests, and by ignoring the massive amount of water stored in the basin and the lack of adverse impacts on the basin or the environment. They then relied on a secret model to come up with arbitrary, illegal and unsupported water allocations.

The Authority relied on an untested and legally dubious interpretation of the Navy’s Federal Reserve Right to extend the Navy’s claim to water off the China Lake Naval Air Weapons Station base in a move so full of hubris the Navy Commander was forced to disavow the legal maneuvering of the Authority. Using the cover provided by the Navy’s Federal Reserve Right, the Authority then proceeded to declare winners and losers through the implementation of water allocations and imposition of the Replenishment Fee on select parties. This is the largest of such fees in the state and exponentially higher than other fees passed in the Central Valley portion of Kern County.

The Replenishment Fee was adopted through a Proposition 218 process that was conducted behind closed doors and without oversight. An appeal by the voters was casually rejected by Kern County Counsel and the Replenishment Fee became another in a long string of misdeeds by the Authority. Most of the members of the Authority felt very little impact from the Replenishment Fee, except the Water District and its ratepayers. The ratepayers saw their bills skyrocket with only more consultant reports to show for their hard-earned dollars.

In addition to hitting the residents of Ridgecrest hard, the agricultural and industrial users were left to pay the full replenishment fee. This outrageous fee was assessed with the full knowledge of the Authority that the supposed benefits of the Replenishment Fee—purchase of State Water Project (SWP) supplies—would never be realized. Without environmental review, firm supplies, or a conveyance plan, this is a literal pipedream. Searles Valley Minerals, along with the pistachio and alfalfa producers, would be put out of businesses by the Authority. This disregard for the role of agriculture and industry within SGMA, and indeed the economy of the Indian Wells Valley, shows the callous disregard for the deleterious effects on severely disadvantaged communities and the environment that come from bankrupting major portions of a region’s economy. Small farmers were also targeted by the Authority. They were left with a small pool of water that, once agreed to and entered into contract for, would strip them of future water rights and leave their land worthless for agriculture.

The unfortunate and unavoidable result of the arbitrary and capricious nature of the Authority’s unauthorized determination of water rights and implementation of the Replenishment Fee has been litigation filed to protect the very constitutional water rights SGMA was not supposed to alter. From the Authority’s actions has sprung a GSP that is challenged in court for its unconstitutionality, and DWR’s offer for facilitation services. It is time to establish a path forward that leads to a cooperative and collaborative GSP and that needs to be done now.

The Authority has become a financial behemoth that will consume the economic growth of the Indian Wells Valley if left unchecked. The Authority has been reported to be pressuring the Water District to obtain long-term financing to pay the Water District’s portion of the Replenishment Fee now. This is unwise on many levels and reflects the poor oversight of the Authority Board of Directors and their overreliance on consultants.

Had the Authority owned SWP entitlement in 2021, there would not have been any water available. The costs of the proposed project to bring SWP water into the Indian Wells Valley are highly speculative. The cost and long timeline to complete studies, obtain easements, fight legal challenges, and engineer such projects would be borne by the Water District ratepayers as well, despite the Authority claims that federal and state monies will be forthcoming. The Water District has no assurances it will not be the sole agency on the hook for building the massive infrastructure necessary to realize the benefit of the SWP entitlement.

A future Water District Board of Directors could be left with the agonizing decision between abandoning the SWP entitlement or going further into massive debt to underwrite a massive water importation project into a basin that has hundreds of years of available water in storage and a sound plan to clean up in-basin brackish water supplies. These challenges are in addition to the Delta Conveyance Project, or the tunnel project, and its potential to increase operational costs on water delivered through the Delta.

Most importantly, the Water District should be the primary driver for the efforts to obtain water for the basin. It is their ratepayers, after all, who will bear the cost. The Authority’s consultants have not been forthcoming with the true, current cost of SWP entitlement and the accompanying risks in the post-SGMA water world. Also, consultants should be held accountable and operate on a success fee, not paid on an hourly basis with little oversight. It is much more common to pay water brokers a portion of the successful transaction instead of padding their consultant fees for years with little to show for their efforts.

This is just one of many examples of how the cost of running the Authority are not being controlled by the Board of Directors. A review of monthly expenses leads to the conclusion that cost-to-benefit is a foreign concept and not a filter being used by the Authority. The Board of Directors, with the important exception of the Water District, is composed of members that are not doing the heavy lifting of paying for the Authority. A finance committee should have been formed years ago, but Supervisor Gleason openly stated that public input would slow down the process. The only way to rectify the situation is to get effective leadership for the Authority with a meaningful role for the Water District and to have representation for all the stakeholders in the basin, as SGMA demands.

- Mojave Pistachios

Story First Published: 2021-09-10