By a 3 to 2 margin, the Oakdale Irrigation District (OID) Board of Directors voted in the third week of March to sell surplus public water outside the boundaries of the district. At the time, nearby urban residents were still under a state order to reduce water use by 36 percent below 2013 usage. Ironically, OID can sell water to outsiders while local residents are still subject to draconian rationing. Supposedly, the Oakdale Irrigation District is a non-profit organization. The sale of the water was justified on the grounds that the funds could be used for unspecified projects within the district.
Exactly how will the money generated from the water sale be spent? Will the money be used to subsidize the infrastructure of preferred customers or be spent to provide service to new customers?
Will the money be used to replace mainline pipes? Will the money be used for salary increases for select employees of the district? Exactly where will the common good result from the money generated in the sale?
Who will benefit from the water? How will the water be used? Will the water use benefit the economy of those living within the Oakdale Irrigation District? Is the real intent to ship more local water to southern California? Water sent south can’t be used for local economic development.
By sending water out of the area, how will local ground water be recharged?
Phony Local Surplus for Southern Buyers?
The longer citizens are required to ration locally, the more water will be available to ship south. The California State Water Board knows that enough rain and snow have fallen to reduce the need for rationing. Is the board deliberately keeping northern counties on water rationing so that a phony “surplus” can be shipped south to Westlands Water District or Southern California?
The State of California telegraphed its intention of taking Northern California water when it suspended historic 1914 water rights in favor of those who benefited from the suspension of the rights. Can the state arbitrarily take anyone’s water and give it to those that it favors by declaring “a state of emergency”?
Is Monetizing Public Water Good Public Policy?
Allowing any public agency to divert water from the customers it is supposed to serve for the purpose of profit is contrary to the spirit of Proposition 218. The proposition stated that public water agencies are only allowed to charge their customers for the actual cost of delivery. Selling water as surplus while local citizens are rationed is bad public policy. Funds from the sale will not necessarily be ongoing and thus difficult to justify for the continued operation of the organization.
Water, Wealth, Contentment, Health
The sign on the Modesto Arch says it all. With water, there is wealth, contentment, and health. Without water, a community shrivels up and dies. We must never forget how the Owens Valley in eastern California died after its water was taken by Southern California.
When the Oakdale Irrigation District decided to sell public water outside its boundaries, it took the first step towards killing the community it is supposed to serve. After four years of drought, the district still did not learn of the need to conserve and preserve. It is not using so-called “surplus” water to recharge badly depleted groundwater.
The decision seems like a crime against the community. Too bad that the citizens don’t realize what is being done to them, or maybe they do and feel powerless to stop it.
The majority of the Board of the Oakdale Irrigation District seems dazzled by the dollar signs of monetized water. Only the minority on the Oakdale Irrigation District, Gail Altieri and Linda Santos, are trying to protect the long term interests of the area. OID is in need of another election.
Steve Knell says
A few facts that you are not aware of;
1. OID’s water is public water to the extent it serves to the benefit of the OID ag constituents who paid for and build the OID dams and canals with their money. No outside state or federal money was used to build OID.
2. OID has no shortages of water this year. There is no rationing in our ag area so i miss your point that says there is. You seem to be confused and mixing two areas of California water management; urban requirements and ag requirements. The State is not curtailing ag this year.
2. In OID’s budgeting process, which you missed, OID has two near term goals with its water transfer revenues; (1) to build a $20 million tunnel to replace 1 mile of canal in Stanislaus River canyon which is slipping to the river. This hazard repair, jeopardizing water delivery to all south of river ag ground, is scheduled for 2020 if the money is there. OID wants to use cash for this. (2) OID then wants to pay off a $28 million bond debt by 2022, Making OID debt free. All this is doable if OID stays on path with its financial plan of using short term water transfers.
If you have another plan to raise this kind of capital to protect the irrigation districts assets, we’d love to hear it.
With no water shortages in OID this year and no place to store this water like MID and TID and MeID, OID has few choices. Lose the water to the federal government, who’ll send it down the river for fish, or attempt to make revenue from those who need it, value it, and are glad to pay what is surplus to our needs. These are one year contracts on a renewable resources with no long term commitments. Seems business smart to do so.
If you want to lean more about OID and how transfers fit into our business plan; keeping water rates low and affordable and building a water district that can meet the challenges of tomorrow, including groundwater protection, please visit our website and hit the Water Resources Plan logo. Read and Learn.
Eric Caine says
Mr. Knell misses the point: all water in California is public water. Subjecting a life-giving resource to the highest bidder is both unwise and unfair. And depleting local groundwater stores so that we can sell surface water down south for unsustainable agriculture isn’t just unwise, it’s worse than unwise.
Bruce Frohman says
The argument that Mr. Knell advances is logical and sound if one accepts the premises put forth within the explanation. My problem with the philosophy is that water use is a regional issue. OID is an independent agency operating within an inter-dependent region. Water exported from the region is no longer available for local economic growth.
Surplus water could be diverted into ground water reservoirs to replenish water reserves depleted during the drought. The wells that went dry need to be recharged. Surplus water could also be shared with neighboring water districts to rebuild their reserves, with OID creating a water bank for sharing between agencies.
If OID truly has surplus water, it could expand its local service area to nearby customers. The Trinitas deal would probably not have received the criticism had it not been done in the middle of the drought.
When water rates are subsidized, doing so creates adverse economic consequences such as inadequate conservation practices, misuse, waste, and greater shortages during drought.
Water releases to the Delta aren’t just for the fish, but are also important to maintain Delta water quality and prevent salt water intrusion.
As a matter of public policy, subsidies are not desirable unless designed to promote certain types of desirable public activity that would not otherwise occur.
If no subsidies existed, the district would have high enough rates for maintenance and upgrades.
At some point in time, OID will not have any water surplus. When that occurs, the economic dislocation will be tremendous as the district may have to suddenly raise rates significantly, as is the case this year in Sacramento.
OID has been blessed with a large supply of water above current levels of use within the district. Monetizing the water may have seemed ok during periods of abundance. But the recent drought should serve as a lesson on how quickly circumstances may change.
I would not presume to tell OID how to run its business. However, the lack of public input in the manner business is conducted is not desirable from a public policy standpoint.
Perhaps OID has operated in an economically optimal manner up to now. However, agreement on the subject is not universal. As well as any public agency is run, improvement is always possible and desirable.