Water-rich OID debates method for selling surplus

OID General Manager Steve Knell
OID General Manager Steve Knell aalfaro@modbee.com

Selling extra river water clearly will continue as an important income source for the Oakdale Irrigation District. How it’s sold, however, remains a subject for debate.

Board member Linda Santos on Tuesday questioned the wisdom of abandoning water at New Melones Dam for buyers to pick up downstream, a tactic used in recent years by OID and its partner on the Stanislaus River, the South San Joaquin Irrigation District. Abandoning water may enable the agencies to skirt environmental review, Santos said, but weakens the districts’ moral argument for retaining water rights coveted by others.

“Abandoning is jeopardizing our long-term water rights,” Santos said. “When we abandon, there is no record to protect us. Why take a chance with abandonment rather than a transfer?”

Why not use the recognized safeguard? I’m not saying don’t do the transfer, but do so in a way that we’re protected.

Linda Santos, OID board

OID General Manager Steve Knell said transfers – a method more acceptable to state water officials – requires another party willing to buy water and to go through a lengthy regulatory process, and such buyers have been harder to find.

An environmental impact report accompanying a common transfer can cost as much as $250,000 and take up to 18 months, Knell said, while a “negative declaration” – or simply declaring that shipping water elsewhere will have no negative impact – might take only a few weeks and cost as little as $2,500.

OID would not have enough time this year for the more costly but less risky option, Knell suggested.

Also, several potential local buyers aren’t interested this year, including the Modesto and Turlock irrigation districts and the cities of Modesto and Riverbank. Oakdale City Hall has reserved the right to buy 10,000 acre-feet of water but is not yet prepared to take it, a report says.

We always review local demands first before selling (water) outside the district.

Steve Knell, OID general manager

Thirstier water agencies such as the Del Puerto Irrigation District and the Eastside Water District might buy water but can’t take it without cooperation from the Modesto Irrigation District, whose canals – between OID and such buyers – are required to move the water. Frosty relations between OID and MID have nixed such deals.

OID growers have fared better than most elsewhere in recent drought years, getting all the water they could use last year with the same expectation this season. They probably will need about 235,000 acre-feet this year, says the district, which has rights to 300,000 acre-feet, leaving about 65,000 acre-feet – 22 percent of OID’s allotment – available to sell.

22 Percentage of OID water available to shop to outsiders this year

Last year, OID offered 5,000 acre-feet of water to growers just outside its boundary, but they bought only 400 acre-feet. The same amount will be offered this year, a report says.

OID has reaped $48 million by selling water to outsiders in the past decade. The money has helped improve pipelines and canals and boosted reserves; in other action Tuesday, the board unanimously agreed to move $19 million in surplus money from OID’s general fund to an account designated for boring a tunnel, for paying down debt and for stabilizing water rates.

“We sell our surplus supplies to generate revenues to do the things we do,” Knell said. “Without it, we don’t move forward.”

Knell said the abandonment method could weaken OID’s water rights if done in five consecutive years, but that hasn’t happened.

Disputes over past sales have led to two ongoing lawsuits and a recall drive that could cost Santos her seat if a majority of voters in District 4, southeast of Oakdale, turn her out of office in an April 25 special election. The period for people to declare themselves candidates, to succeed Santos in case she is recalled, closes at 5 p.m. Thursday.

We’ve pretty much outgrown this facility.

Steve Knell, OID general manager

In other action, the OID board unanimously agreed to pay a firm $2,800 to start the design process on a new headquarters. Then-board members in 2012 bought 10 acres at the southwest corner of Kaufman Road and Greger Street, but nothing has been accomplished since. Selling OID’s office on prime F Street frontage coveted by commercial developers, and selling about a third of the new property to a storage rental company next door, could cover the cost of a new headquarters with a more efficient layout, Knell said.

Garth Stapley: 209-578-2390