Media Advisory for Monday, June 17, 2013                

Contact: Steve Hopcraft 916/457-5546; steve@hopcraft.com Twitter: @shopcraft

Statewide Coalition of Fishing, Wildlife,

Farming Community Advocates Sues to Halt Delta Plan, Water Export Tunnels

“Arbitrary, Destructive” State Action Violates Delta Reform Act and CEQA; Lawsuit Aims to “Set Aside” State Plan, Require Study of Alternatives  

SAN FRANCISCO, CA – A statewide coalition of fishing, wildlife and farming community groups today announced the filing of a lawsuit against the California Delta Stewardship Council to vacate its Delta Plan, which includes a proposal to build two 35-mile tunnels to siphon water away from the Sacramento River and San Joaquin Bay Delta. The lawsuit asserts that the Delta Plan violates the 2009 Delta Reform Act, and the California Environmental Quality Act (CEQA), and the state Administrative Procedure Act, and seeks to have it set aside. The groups said that the $54.1 billion project would have devastating impacts on California’s farming and fishing, and put several endangered species – including salmon – at increased risk of extinction. The lawsuit was filed in San Francisco Superior Court on behalf of groups from both northern and southern California.

The 2009 Delta Reform Act, which established the council, required it to create the Delta Plan as a framework for its permitting authority over actions affecting the Delta. According to the Act, the council must approve only actions that serve the coequal goals of environmental protection and water-supply reliability. Instead the council approved a plan that excludes most water transfers from permitting requirements and lays the groundwork for Delta water-export tunnels.

The coalition’s lawsuit seeks to have the Delta Plan and its programmatic environmental impact report (PEIR) set aside for failing to disclose and analyze the devastating adverse environmental consequences on Northern California rivers, the Delta, and endangered fish species, resulting from taking enormous quantities of fresh water out of the Sacramento River upstream from the Delta. The lawsuit urges the court to suspend any activity based on the plan that could change the physical environment until the council has met its legal requirements. This would include delaying construction of the Brown Administration’s proposed water-export tunnels.

“The Delta Reform Act gave the Delta Stewardship Council an historic opportunity to remedy 40 years of water policy failures. Instead, the council failed to use the best available science – biological or economic – and adopted a status quo program that fails to fix the Delta or the water supply problem,” said Santa Barbara resident Carolee Krieger, executive director of the California Water Impact Network (C-WIN), a statewide water advocacy organization. “The council failed to honor its own mandate: the adoption of an effective strategy for the distribution of water and the preservation of the Delta.”

Bob Wright, senior counsel for Friends of the River, said: “Seeking relief from the courts is now necessary to protect our rivers and fish from this arbitrary, destructive action. The council’s plan is part of the worst threat to Northern California rivers in history, and continues state agencies’ efforts to take the water regardless of the adverse consequences. The Delta Plan calls for the Delta Water Tunnels with one hand. But, with the other hand, the Delta Stewardship Council violated the California Environmental Quality Act by failing to disclose and analyze the devastating adverse environmental consequences on Northern California rivers, the Delta, and endangered species of fish resulting from taking enormous quantities of fresh water out of the Sacramento River upstream from the Delta.”

Bill Jennings, executive director of the California Sportfishing Protection Alliance, said, “California is in a water crisis and the biological tapestry of the Delta is hemorrhaging. The causes are obvious: we’ve overpromised, wasted and inequitably allocated limited water resources.  We’ve deprived the estuary of more than half its flow, turned its hydrograph on its head and used its waters as sewers. This crisis evolved because state and federal agencies egregiously failed to enforce and comply with the broad suite of laws enacted to prevent it. We implored the council to undertake a series of necessary analyses because the responsible agencies have refused to conduct them. Because the council failed to identify and analyze the root causes of California’s water crisis – over-appropriation, unreasonable use, failure to balance the public trust – the plan and EIR are little more than a ratification of an unsustainable status quo.  It largely recommends that agencies should continue to do the same things that created the crisis in the first place. The Plan and EIR ignore history and are predicated on an artificial reality.  They’re little more than omelets of half-truth and distortion to justify predetermined conclusions.”

Adam Lazar, a staff attorney at the Center for Biological Diversity, said: “No matter how you slice it, this plan is bad news for endangered fish, wildlife and the long-term health of the Delta. Unfortunately the Delta Stewardship Council seems more interested in catering to special interests than the communities it was supposed to protect.”

Barbara Vlamis, of Chico, executive director of AquAlliance, said, “We join this lawsuit because we are the heart of the area of origin for the Sacramento River watershed. The Tuscan Aquifer in Butte, Glenn and Tehama counties is the groundwater foundation that supports the streams and rivers that are vital for farms, fish, and communities throughout California. The Delta Plan’s goal to expand groundwater storage north of the Delta is a fool’s errand. The State of California has failed to protect its groundwater, and has acknowledged serious overdraft in 11 basins. The only reason we don’t know of more overdraft conditions is because the State Department of Water Resources hasn’t studied this since 1980! If water transfers increase in scope and duration, particularly when groundwater is substituted for surface water, it will escalate the losses already underway in the Sacramento River watershed’s creeks and rivers and will jeopardize what remains of the hydrologic system that supports the majority of California’s economy, the Central Valley’s fish and flyway, and the largest estuary in North America: the Sacramento/San Joaquin Bay Delta.”

Barbara Barrigan-Parrilla, executive director of Restore the Delta, said, “This lawsuit challenges the foundation that is being laid to build the water export tunnels. Without the Delta Plan in place, the tunnels cannot win approval for the needed permits. This is the opening salvo in what will be an epic legal battle over California’s water future. The Delta Stewardship Council failed their legislative mandate to address the protection and enhancement of Delta agriculture, and the Delta as a place, including failing to analyze the plan’s regional and statewide economic impacts. The council failed to conduct a comprehensive benefit/cost analysis indispensable for maximizing the use of limited resources for the greatest good for all Californians.  And by not conducting this essential piece of work, they have forgotten the impacts of water diversions on the $5.2 billion annual Delta agriculture economy, the $750 million per year Delta recreation economy, and the $1.5 billion per year California coastal salmon economy. We believe the reason the council refused to perform all the above analyses is that they expect the science would not support the construction of the Peripheral Tunnels. There is a better solution that includes upgrading Delta levees, reducing exported water to a sustainable level that restores fisheries and investing in regional water projects.”

Mike Jackson, attorney for C-WIN, Restore the Delta, California Sportfishing Protection Alliance, and AquAlliance, said: “The Delta Plan violates CEQA in ten different ways. It fails to achieve the co-equal goals of Delta ecosystem restoration and water supply reliability established by the Act. The Delta Plan may be the most incomplete environmental document I’ve even seen. The council ignored three critical documents they were obligated to use: a State Water Resources Control Board water flow recommendation; a Department of Fish and Wildlife report on biological objectives, and the Delta Protection Commission’s economic sustainability report. In all three cases, the documents were inconvenient to the approval of the tunnels.”

Media Advisory for Monday, June 17, 2013

Contact: Steve Hopcraft 916/457-5546; steve@hopcraft.com Twitter: @shopcraft

Fishing, Environmental, Farming Advocates to Sue

to Halt Delta Plan, Water Export Tunnels

San Francisco, CA – A statewide group of fishing, environmental and farming groups will announce the filing of a lawsuit to stop the Delta Plan, which lays the groundwork for Delta water export tunnels.

“The Delta Reform Act gave the Delta Stewardship Council a historic opportunity to remedy 40 years of water policy failures. The council instead failed to use the best available science – biological or economic – and adopted a status quo program that fails to fix the Delta or the water supply problem,” said Santa Barbara resident Carolee Krieger, executive director of the California Water Impact Network (C-WIN), a statewide water advocacy organization. “The Council failed to honor its own mandate: the adoption of an effective strategy for the distribution of water and the preservation of the Delta.”

Who:         Carolee Krieger, C-WIN; Bill Jennings, California Sportfishing Protection Alliance; Barbara Vlamis, AquAlliance; Barbara Barrigan-Parrilla, Restore the Delta; Michael Jackson, Attorney for several groups; Bob Wright, Attorney for Friends of the River; Adam Lazar, Center for Biological Diversity

When:        Monday, June 17, 201310:30am,  

Where:       404-920-6442; Conf. Code: 631349#

In case you missed it…

Valley Economy

Changing the Baseline: The Biggest Problem in the New BDCP Economic Rationalization of the Tunnels

By Dr. Jeffrey Michael

Originally published Tuesday, June 11th

Both environmental assessments and economic assessments of proposed major infrastructure critically depend on a baseline or no-action scenario.  This scenario defines the conditions that are expected if the project is not built and is used as the basis of comparison for the projects impacts.  The same no-action scenario should be used for environmental, economic and financial feasibility assessments.  However, the latest BDCP documents use a different baseline for the economic analysis than the environmental impact report (EIR).  When analytical consistency gets in the way of rationalizing the tunnels, BDCP just switches the baseline.

The BDCP EIR no-tunnel (i.e. no-action) scenario makes the reasonable assumption that through-Delta operations would continue under the current pumping constraints imposed by the Endangered Species Act through ”biological opinions.”  The EIR no-action scenario estimates average water exports at initial operations of about 4.7 million acre feet (MAF) per year at initial operations declining to 4.4 MAF towards the end of the 50 year permit.  The EIR estimates that with the tunnels, water exports would be 4.4MAF to 5.3 MAF in the “late long term,” a change of between 0 MAF and 0.7 MAF per year.

In contrast, the economic analysis assumes that without BDCP, additional ESA regulations would bring even tougher restrictions on water exports between now and 2025 such that average water exports at initial operations would be 3.4 MAF to 3.9 MAF.  Thus, building the tunnels would increase water exports by between 1.3 MAF and 1.7 MAF per year compared to no action.  In other words, the economic analysis assumes that without the BDCP tunnel plan, ESA regulations would add another 20-25% cut to water supplies on top of current limits.  Never mind that no such plan has been proposed, and that the California Department of Water Resources (DWR) and the water contractors are trying to weaken the current restrictions in court.  Clearly, DWR has no sincere intention of implementing this more restrictive scenario, they are just conveniently adopting it for the economic analysis to rationalize building the tunnels.

This switch of the no-tunnel baseline is probably the most serious of several problems with the BDCP economic analysis, and it will create some very practical headaches for the BDCP.  The fish and wildlife agencies that have to approve BDCP will certainly ask why the financial feasibility analysis depends on assumptions that are inconsistent with the EIR, and if DWR is actually proposing such restrictive operations on exports in the absence of BDCP.  The inconsistency also gives BDCP opponents another issue to use in lawsuits, and it could even undermine the water contractors case in their existing litigation over the biological opinions.

Considering all the problems the state is creating for itself with this shift in baseline, why would they do it?  Because they can’t demonstrate financial feasibility without it.  Using the BDCP’s own estimates of costs and benefits, I demonstrated a year ago that the tunnels can not be financially or economically justified by comparing them to the no-action scenarios of the draft EIR.  The sleight of hand with the shifting baseline is simply a clever, hidden way to bring back the “value of regulatory certainty” argument the state attempted last summer (see this blog post from last July, and this  one from January where I worried that they might try this baseline shifting stunt).

The shifting baseline creates problems for the BDCP environmental approval.  Why?  If this more restrictive baseline were used for the EIR, the tunnels would almost certainly fail the EIR analysis.  The tunnels could not be justified as a Habitat Conservation Plan (HCP) under the ESA since the no-tunnel scenario would be more protective of endangered and threatened species than the proposed tunnel project.  [See Matt Weiser's article in Sunday's Sac Bee for a discussion of how the EIR finds the tunnels are not even anticipated to benefit endangered fish species compared to current conditions (i.e. the EIR baseline).]

In addition to the EIR, the tougher baseline assumption would create problems for a true statewide benefit-cost analysis.  The recently released economic analysis only considers the benefits and costs of the tunnels to the water contractors.  In contrast, a statewide benefit-cost analysis would include benefits and costs to the environment and to other effected parties in-Delta, upstream, and fishing.  While the baseline shift creates water supply benefits from the tunnels for the contractors, the increase in water supplies raises the tunnels’ costs to the environment and these other parties.  Thus, the change in assumption that increases the tunnel’s water supply benefits helps financial feasibility to the contractors, but would hurt the tunnels comprehensive benefit-cost justification.

I think this maneuver is a major reason why the BDCP cancelled the benefit-cost analysis and postponed the planned release of chapters 8 and 9 by a month.  It is also a sign of how the BDCP is going to increasingly desperate measures to keep their sinking project afloat.

Dr. Jeffrey Michael is Director ofEberhardt School of Business, University of the Pacific.

If you didn’t know anything about BDCP, you wouldn’t get the real story from the plan’s website.  The page “About the BDCP” will tell you that “The Bay Delta Conservation Plan (BDCP) is being prepared by a group of local water agencies, environmental and conservation organizations, state and federal agencies, and other interest groups.” What do they mean by “local”?  The South and Central Delta water agencies are not part of the BDCP working groups, and North Delta Water Agency, while in the process, has been virtually ignored at the table.

The main agencies behind this process don’t meet our definition of “local”: Westlands Water District, Kern County Water Agency, and Metropolitan Water District of Southern California.

More misrepresentations: “The BDCP is being developed in compliance with the Federal Endangered Species Act (ESA) and the California Natural Communities Conservation Planning Act (NCCPA). When complete, the BDCP will provide the basis for the issuance of endangered species permits for the operation of the state and federal water projects. The plan would be implemented over the next 50 years. The heart of the BDCP is a long-term conservation strategy that sets forth actions needed for a healthy Delta.”

Baloney.  Here’s why.

Friends of the River (FOR) has sent a comment letter to officers and staff of federal agencies – the Bureau of Reclamation, the National Marine Fisheries Service (NMFS) and the U.S. Fish and Wildlife Service (USFWS) – alerting them to “foundational violations of law and fundamental analytical deficiencies in the Bay Delta Conservation Plan (BDCP) process being carried out by the federal Bureau of Reclamation and California Department of Water Resources (DWR).”

NMFS and USFWS have already “red flagged” ways the Peripheral Tunnels would threaten endangered fish species.  FOR’s letter details the reasons why BDCP is an illegitimate basis for fisheries agencies to issues incidental take permits under the Endangered Species Act.

“The BDCP is not a legitimate Habitat Conservation Plan (HCP) because it does not actually ensure the continued existence of the relevant endangered species.”  In fact, BDCP has been designed to free contractors from any obligation to provide adequate water for fish even if the plan fails to achieve recovery goals.

FOR’s letter reminds the fisheries agencies that “Removing freshwater deliveries from critical habitat areas and replacing it with dubious mitigation measures elsewhere will surely not satisfy ESA’s mandates to refrain from adversely modifying critical habitat and avoiding jeopardy to the continued existence of endangered species.” 

Asserting that “the cart has unlawfully been placed before the horse,” FOR’s letter points out that the agencies cannot rely on BDCP documents to fulfill their obligations to conduct a biological assessment, an ESA consultation, and a biological opinion that includes analyzing a Reasonable Prudent Alternative.  (That would include no conveyance at all, as proposed by the Environmental Water Caucus “Responsible Exports Plan.”)

FOR’s letter also refers to the Delta Reform Act requirement that flow criteria developed by the State Water Resources Control Board (SWRCB) inform planning decisions for the Delta Plan and BDCP.  “The BDCP process is simply a DWR effort to make a premature and unlawful decision to develop the massive Delta Water Tunnels before rather than after determining whether updated flow objectives would even allow such quantities of water to be diverted upstream away from the Delta.”

And in the absence of a public trust doctrine analysis and setting of new, stricter flow objectives, with EPA review, there is no water supply availability analysis, quantification, and analysis of environmental impacts required under the California  Environmental Quality Act (CEQA).

Restore the Delta has been saying since last summer that the total cost of the Peripheral Tunnels/BDCP would be close to $55 billion, not the $14 billion BDCP kept talking about. Here, from the BDCP’s own documents, are supporting details of projected costs for the 50 years of the permit period:

Construction – $14.5 billion
Operations and maintenance – $1.5 billion
Interest on Tunnel Revenue bonds – $26.3 billion
Habitat and Conservation – $7 billion
Interest on General Obligation Bonds – $3.2 billion
Administration and Research – $1.6 billion

TOTAL – $54.1 billion

DWR has been holding Contract Extension Negotiation Sessions with the State Water Project Contractors.  Meeting summaries are posted for May 1 and May 15, but by May 29 things seem to have been breaking down. 

Now the session scheduled for June 12 has been cancelled.  Another is tentatively scheduled for June 26.

DWR and the SWP contractors entered into water supply contracts in the 1960s to provide water service in exchange for payments to finance, build, improve, operate, and maintain SWP facilities.  The first contract was with Metropolitan Water District, and it extends to 2035.  Other contracts signed later have terms that extend to 2035 or beyond.  According to an April memo from DWR, “Several SWP Contractors have expressed interest in extending their contracts beyond the current termination date and amending certain financial provisions.”

One issue: Contractors need to be able to sell bonds and keep the debt service as low as possible.  Bonds typically sold with a 30-year repayment period can now be sold with only 22-year repayment periods due to the 2035 maturity date limitation.  They’ll have to sell bonds to help finance the Peripheral Tunnels.

Another issue is reserves.  The SWP is the largest state-built utility in the U.S. and costs $1 billion annually.  (So should BDCP maybe adjust that $1.5 billion estimate for operating and maintaining the Tunnels for 50 years?)  Current reserves are only $27 million (less than 3 percent).  DWR would like to get that reserve up to $200 million, which represents 120 days of operational reserves and power purchases.

As we’ve seen lately with collapsing bridges, it’s one thing to build “visionary” infrastructure. It’s another thing to operate and maintain it for all the decades of its planned life.

Compromised SWP operations could be a really BIG elephant in a room already full of pachyderms.

In January of 2011, the California Water Commission (CWC) got a briefing from Ralph Torres, Deputy Director for the State Water Project on “State Water Project Current Issues and Challenges.” (We reported on this meeting on 1/27/11.)

Torres reported that that for the first time in 2010, the SWP actually missed making water deliveries. There were breakdowns and forced outages because the SWP couldn’t find and retain qualified water and power dispatchers – people who knew things like how to properly schedule energy to turn on a pump.

That year, the SWP paid $57,000 in fines for not meeting North American Electric Reliability Corporation (NERC) and Western Electricity Coordinating Council (WECC) regulations for activities such as relay testing.

At the time, the SWP couldn’t offer competitive wages to qualified electricians, mechanics, and operators. Torres reported that SWP salaries lagged 32% below the industry median in 2010.

One result of these staffing problems was that the SWP faced a significant backlog of deferred maintenance. Deferred maintenance leads to increased energy costs, reduced equipment service life, and possibly decreased safety, for both employees and the public. Torres told the commissioners, “We won’t give up safety to deliver water.”

With SWP reserves as low as DWR is reporting, it’s doubtful that this situation has improved much in the last three years.

While researching the January 2011 CWC meeting, we turned up this juicy tidbit from Jerry Meral, who never misses a chance to tell a listener what the listener wants to hear. (This can make it hard to know what Meral himself actually thinks.)

During a presentation that day on the BDCP, then-commissioner Dave Cogdill asked about the science behind a 15,000 cfs conveyance. Karla Nemeth said that BDCP had tried to match the capacity of the existing State and federal water project system. Cogdill thought that wasn’t big enough for wet year management, sending water south for above ground storage and for recharge of aquifers.

Said Jerry Meral, “You’re absolutely right.”

In other words, Meral agreed with Cogdill in 2011 that a facility with a 15,000 cfs capacity was TOO SMALL.

By contrast, we ALWAYS know what Jason Peltier of Westlands Water District really thinks.  Here’s a link to a YouTube clip of him telling Senator Fran Pavley.

And here is Westlands doing something we approve of: proposing to generate power with solar facilities on San Joaquin Valley land that has salty soil and poor drainage.  That means more water for growing food on prime farmland elsewhere, like the Delta.