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Science tries not to trip on policy

The DSC heard from Dr. Richard Norgaard, the new Delta Independent Science Board Chair.  Dr. Norgaard showed an inclination to be . . . well, independent.  He told the DSC that the charge to the Board is immense and expressed concern with the time frame for reviewing White Papers.  He commented on the conflict with the BDCP process and declined to rank stressors. DSC Chair Isenberg told him that the DSC will push the Science Board, and Norgaard agreed that the DSC could make unreasonable demands but implied that they wouldn’t necessarily be met. The DSC heard presentations on White Papers on the Delta Ecosystem and Delta Flood Risk.  They also received a Preliminary Notice of Preparation (NOP), the first [...]

Land grab in the works

It will come as no surprise to anyone who has been observing the arrogance of the Bay Delta Conservation Plan’s Potentially Regulated Entities (PREs) that they don’t intend to acquire land for habitat restoration using willing sellers. Restore the Delta has learned that the BDCP is looking at eminent domain as the process to achieve habitat goals.

They’d have trouble paying for what they want to take

Back in March of 2009, the San Luis and Delta-Mendota Water Authority issued revenue notes to fund the Delta Habitat Conservation and Conveyance Program (DHCCP) Development Project.  The DHCCP is the entity that is supposed to assess potential habitat restoration and water conveyance options for the BDCP and conduct an environmental review. Fitch Ratings, a global rating agency that evaluates and rates agencies that issue bonds, said this about the March 2009 bond issue:  “Financial strength is derived from the obligor’s, the Westlands Water District (WWD, or the district), credit quality (revenue bonds rated ‘A’ by Fitch Ratings), based on satisfactory historical financial operations and high commodity value.” Fitch Ratings also said, “The value of the WWD’s entitlement to a [...]

Not good for your investment portfolio

Last week, the New York Times reported on a new study warning of the risk of municipal bonds that finance water supply. The study is one of the first to assess the potential impact of water shortages on the municipal bond market. (Read the NY Times report click here) According to the study, credit ratings do not adequately reflect the growing risks of water shortages and legal battles over water supplies. When the risks become apparent, investors may see bond values drop. And water and electric utilities may find it more expensive to raise money. The Times article (“Water Scarcity a Bond Risk, Study Warns”) says, “Among the seven cities and agencies examined in the report, Los Angeles and Atlanta [...]

So here’s where things stand

So export water contractors plan to seize Delta land to create a combination of habitat and infrastructure so complicated that they can’t even figure out how to describe it in a proper public project description. Their plan to pay for this hodgepodge includes issuing bonds based on a degree of water supply availability and stability that no amount of infrastructure can possibly guarantee. And they’re going to try to persuade their ratepayers to pay for the bonds and bond investors to accept the risk. The greater the risk, the higher the returns to investors, and the higher the cost to ratepayers. These are the kinds of fantasies that brought us the savings and loan debacle, Enron, the foreclosure crisis, and [...]

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