OID to consider $4 million water sale

OID General Manager Steve Knell attends an Oakdale Irrigation District board meeting in Oakdale, Calif., on Wednesday, Sept. 21, 2016.
OID General Manager Steve Knell attends an Oakdale Irrigation District board meeting in Oakdale, Calif., on Wednesday, Sept. 21, 2016. aalfaro@modbee.com

At a special meeting Monday, irrigation leaders will consider selling more river water to buyers south of the Sacramento-San Joaquin Delta, a tradition that has brought in millions of dollars but also controversy to the Oakdale Irrigation District.

OID and its sister agency on the Stanislaus River, the South San Joaquin Irrigation District, would split $4 million for sending 16,000 acre-feet of water to the San Luis & Delta-Mendota Water Authority. The water would flow in October and November, timed to help fish migrating between the ocean and rivers.

The proposal is similar to previous transactions in recent times that have set OID and SSJID apart as water-rich and willing to deal. OID alone has reaped some $60 million in recent years from shopping water to outsiders, drawing praise for bringing cash to the district and funding upgrades, but also scorn from regional leaders who would rather see the water benefit less-fortunate agencies in this area.

OID is fighting a lawsuit brought by two of its customers who fear that shipping water elsewhere could harm the groundwater table here. They have questioned the unique method used by OID and SSJID to move water in recent sales: abandoning water upstream to be picked up in the Delta and rerouted to buyers.

No other water agency whose water flows to the Delta is using abandonment to move water, said the California Department of Water Resources, which plays a role in this and many other contracts because buyers and sellers use state canals and aqueducts to move the water.

Environmental review? Don’t bother ...

And none of OID’s recent abandonments for fish flows – in fall of 2015, in spring of this year, and the current proposal – have been subject to the usual review under the California Environmental Quality Act. Such studies would be expected to predict the impact on local aquifers.

No irrigation district has ever been so reckless or mismanaged their water by abandoning it while it was still in storage prior to reaching its own landowners.

Robert Frobose, in OID Watchdogs Facebook post

OID and SSJID have skirted CEQA review by citing an exemption afforded in times of drought. The exemption is tied to the U.S. Bureau of Reclamation’s responsibility to provide spring and fall pulse flows for fish.

And each time, state and federal water officials have signed off on the exemptions – sometimes, however, after expressing angst over the proposals.

“This feels like a concerted effort to transfer water without our knowledge/approval, similar to their (fall 2015 deal) – or perhaps I am mistaken and they just do this all the time,” Bureau of Reclamation water rights specialist Lisa Holm wrote to another bureau employee, in a January email obtained by The Modesto Bee.

In dozens of other emails and letters, bureau workers debated the legitimacy of OID’s proposed deals because of questions regarding water rights and environmental review. In an exchange with Holm, also in January, water operations division chief Elizabeth Kiteck mused of a then-new OID proposal: “It will probably be some shady deal again.”

It will probably be some shady deal again.

Elizabeth Kiteck, U.S. Bureau of Reclamation, in January email on OID proposal

Pre-1914 senior water rights enjoyed by OID and SSJID don’t appear to be vulnerable, experts say. That’s because the districts are not abandoning their water rights – just a portion of their stored water. And providing it to a thirsty buyer is considered good water policy, many say.

‘It’s their water’

“(Releases) are considered a beneficial use,” said Ellen Hanak, director of the Public Policy Institute of California’s Water Policy Center.

However, state and federal water agencies – asked if abandonment is a clever, innovative solution to shopping water – did not rush to praise OID and SSJID.

“It’s their water. What they do with their water is a conversation to have with Oakdale,” said Louis Moore, spokesman for the Bureau of Reclamation.

Water rights experts with California’s State Water Resources Control Board declined to speak about the value of OID’s unique solution for moving water without environmental review.

$5.75 million OID’s profit in fall 2015 water sale

$13.75 million OID’s profit in spring sale

$2 million OID’s share, if board members approve deal Monday

“We know there are ways to game the system,” said Nancy Quan, water supply chief with the state Department of Water Resources, about her agency’s regulatory responsibility in general.

The National Marine Fisheries Service signed off on the deals, all structured to give fish maximum benefit – even though the water is routed south in the Delta and doesn’t flow to the ocean, where the fish are supposed to go. That’s partly because swelling the Stanislaus does help some fish in that river, the agency says, while improving water quality and oxygen levels.

“We reviewed it and concluded that (more water) would create better habitat conditions,” said Maria Rea, assistant regional administrator for the fisheries service.

The districts’ release will improve instream flow conditions for migratory fish in the Stanislaus and San Joaquin rivers and will have an incidental effect of improving water quality and water supply conditions in the Delta.

Proposed OID resolution

Because the water doesn’t flow to the ocean, her agency worried that some fish would get confused and swim the wrong way, or be killed in huge water pumps, but concluded in the end that the benefits would outweigh the risks.

However, the proposal going before the OID board Monday notes that because the water technically is abandoned upstream, no one can guarantee that the same amount will show up downstream to be grabbed by buyers. Other transfers, subject to normal environmental review and approved by the state, are saddled with no such uncertainty.

More locals benefit this time

An OID report notes that of the 28 agencies included in the San Luis & Delta-Mendota Water Authority, which buys a portion of the water, five are within this county. “These transactions carry significant benefit for Stanislaus County, which to date has had little to no exposure of that benefit,” the report says.

Buyers this time will pay $250 per acre-foot – half the price from last fall, and down from $300 in the spring.

OID General Manager Steve Knell did not respond to requests for comment. But he has defended the practice of abandoning water in social media, sparring with Robert Frobose, one of those suing the district.

I find it fruitless to discuss speculation on what might happen (if OID continues abandoning water). Crying wolf on this subject serves no purpose but to misinform the reader.

Steve Knell, OID general manager, in posting on the OID Watchdogs Facebook page

Forfeiture concerns might be valid, Knell said in a posting, “if OID were doing nothing with its water, but it’s not. OID and SSJID put water into defensible contracts to move water to agencies in the state who desperately need water. OID’s ability to work with federal and state and environmental groups helps secure and protect those resources under the law, not diminish them.”

OID’s past two water sales brought a combined $19.5 million to the district, but also have been linked to problems.

A year ago, news that OID leaders had sealed a deal with no public vote or discussion in Oakdale helped propel board challengers Gail Altieri and Linda Santos, who campaigned on promises of transparency, to victories over longtime incumbents a few weeks later.

They joined the three other board members in approving the spring pulse flow. But Altieri and Santos balked at another proposal that would have some farmers fallowing land in exchange for money from selling freed-up water to the same buyers. The fallowing deal would not enjoy the same environmental exemption, but Knell’s staff recommended getting around the requirement by declaring that fallowing land would have no environmental impact.

The board majority outvoted the newcomers, and Frobose and former board member Louis Brichetto sued. Altieri and Santos got entangled in the lawsuit when the suing attorney used sworn statements from the women, who complained that Knell was hiding secrets from them, the public and farmers hoping to fallow land.

The board majority then sued Altieri and Santos and persuaded a judge to bar them from closed-door strategy and voting in the fallowing matter. Altieri and Santos hope to have that order reversed in a court proceeding Thursday.

Monday’s meeting of the OID board will start at 9 a.m. in the chamber at 1205 E. F St., Oakdale.

Garth Stapley: 209-578-2390