Fair deal or government giveaway? Farmers’ toxic drainage agreement nears completion

By Alex Breitler
Record Staff Writer

Posted Sep. 2, 2016 at 6:48 PM

The federal government and farmers on the west side of the San Joaquin Valley may be close to signing off on another controversial deal to clean up toxic runoff which, if left unabated, could threaten the downstream Delta.

But the terms of the latest agreement are not as aggressive as the U.S. Bureau of Reclamation itself has proposed in the past under both the Bush and Obama administrations.

Most notably, to some critics, the agreement contains no specific plan for how the farmers will clean up the runoff, which is tainted with selenium that occurs naturally in the soils on the west side of the Valley.

“What does the government get in return for this, without some sort of performance standard?” said U.S. Rep. Jerry McNerney, D-Stockton. “If you make this agreement and they don’t clean up their water, there’s going to be poisonous runoff, it’s going to influence drinking water, and we’ll be creating another version of the same problem.”

Reclamation officials are defending the deal, which could be approved by the end of this month but would still need to be authorized by Congress.

It is roughly similar to a higher-profile deal proposed last year that involved Reclamation and the Westlands Water District, which at 1,000 square miles is the largest agricultural water district in the U.S. This latest agreement involves three much smaller water districts north of Westlands.

The bureau is required by law to fix the drainage problem caused by its delivery of Delta water to these impaired lands, but at an estimated cost of $3.1 billion, officials say fulfilling that task would siphon money away from much-needed water projects elsewhere. So they propose shifting responsibility for cleanup — and any potential liability — away from taxpayers and onto the water districts themselves.

In exchange, the water districts would receive permanent contracts and would be forgiven the debt they still owe for the construction of the infrastructure that delivers water from Northern California to their fields. They would also receive millions of dollars in assistance to find ways to clean up the runoff.

The drainage issue has lingered for decades. In the 1970s federal officials began building a drain that would have dumped the runoff into the Delta, but that project ended when deformities were discovered in birds that had been exposed to high levels of selenium at Kesterson Reservoir.

Nearly 30 years of litigation followed, though some on-the-ground progress has been made in recent years.

Alicia Forsythe, a program manager with Reclamation, said Friday that the pending agreements are “most definitely a good deal.”

“It will be a tremendous savings to the American taxpayer if Reclamation can get out of the drainage obligation,” she said. “We’re putting that obligation back on the folks that are creating the drainage in the first place.”

But Delta counties, environmental groups and some congressional representatives still have doubts. The pending deals are an “incredible giveaway” of “new, permanent water contracts for a massive amount of Delta water at super cheap prices,” said Hal Candee, an attorney representing some of the environmentalists.

Among their criticisms:

• Neither agreement spells out exactly how the runoff should be dealt with, or how to gauge success, despite the bureau’s own call for “measurable performance standards” in 2008 under the Bush administration, and a similar statement made in 2010 under President Barack Obama. The Environmental Protection Agency has strongly recommended such standards, as has U.S. Sen. Dianne Feinstein.

“You’re left with these promises, but there doesn’t seem to be any kind of check-in or enforcement or ramifications if they don’t do it,” said Jerry Brown, general manager of the Contra Costa Water District, which relies heavily upon the Delta for drinking water for 500,000 people.

Forsythe said about $70 million from the bureau would be given to the northern districts to help them tackle the drainage. The technology to treat tainted runoff is evolving quickly, she said, making it difficult to predict exactly what might need to be done.

“We felt like enforcement standards would constrain the districts,” Forsythe said. “We want them to have flexibility over time.”

State regulators would have a say over any plan proposed by the farmers, she said.

• The Westlands agreement calls for 100,000 acres of farmland to be taken out of production, which would reduce the amount of toxic runoff. But that total is considerably less than previous proposals. The new agreement with the northern districts calls for no land retirement at all.

Because those districts are so much smaller than Westlands, their ability to retire farmland is more limited, Forsythe said.

• The agreements also do not expressly prohibit building a drain to send the runoff to the Delta.

“(The districts) have been very successful over the years at in-Valley solutions,” Forsythe said, such as using the tainted runoff for dust control, or blending it with fresher water to irrigate wheatgrass.

Any plan to send the polluted water to the San Joaquin River and therefore the Delta would require permits that may be difficult to obtain, she said.

• The districts would get permanent water rights. Like most water districts that are part of the federal Central Valley Project, until now they’ve had to periodically negotiate new contracts. That requirement would normally remain until they’ve repaid the cost to construct the canals and aqueducts that deliver the water. But the agreements call for that debt — nearly $53 million for the smaller water districts alone — to be forgiven.

A permanent water right doesn’t mean the farmers will get full water allocations. Farmers on the west side rarely do.

A permanent right does provide stability as water districts seek funding from financial institutions, Forsythe said. It allows them to demonstrate that on paper, at least, they have long-term security.

Critics counter that demand for Delta water has contributed to the overall decline of the estuary. The U.S. Environmental Protection Agency in a 2008 letter called the Delta watershed “oversubscribed.”

“We believe it is unwise for the government to continue creating unreasonable expectations by executing long-term contracts for water that does not appear to be available,” Karen Schwinn, the EPA’s associate director for water, wrote at the time.

Both deals must be approved by Congress.

Adding a twist to that process, a U.S. Department of the Interior official said during a congressional hearing in May that the Office of Inspector General is investigating the agreement involving the northern districts, consisting of the Pacheco, Panoche and San Luis districts.

An Interior official confirmed Friday that the investigation is still ongoing but declined to provide any details.

Westlands, too, has recently been investigated, having been fined earlier this year by the Securities and Exchange Commission for allegedly misleading investors about its finances. Westlands has called its drainage agreement with the U.S. government “fair and equitable.”