For Clients & Friends of The Gualco Group, Inc.
IN THIS ISSUE – “There are tough choices ahead. It’s not that there’s one water user or state that is the enemy; the enemy is the old way of doing things.”
Becky Mitchell, member, Upper Colorado River Commission, on future water supplies for the West
- Hundreds of Potential New Laws Crowd Legislature’s Final Month
- More Women Candidates Vie to Join Record 50 in Assembly & Senate
- State Water Board Joins Energy Commission in Approving Extension of 4 Coastal Power Plants
- Westlands No Longer the Darth Vader of Water World
- Colorado River Water Users Get More Now, Plan for Far Less Soon
Capital News & Notes (CN&N) harvests California policy, legislative and regulatory insights from dozens of media and official sources for the past week. Please feel free to forward this unique client service.
FOR THE WEEK ENDING AUG. 18, 2023
Hundreds of Potential New Laws Crowd Legislature’s Final Month
CalMatters commentary from Dan Walters
As the Legislature reconvenes this week for the final month of its 2023 session, it will be deciding the fate of hundreds of remaining bills.
It would be fair, if a bit cynical, to say that California could survive quite nicely if 90% of them never made it to Gov. Gavin Newsom’s desk.
It would be equally fair and cynical to say that the session will adjourn in September without effectively dealing with some very serious, even existential, issues that adversely affect the lives of those legislators are sworn to serve.
The housing crisis is one. Another session will end without addressing misuse of the California Environmental Quality Act to stall or kill much-needed housing projects. Newsom persuaded the Legislature to reform CEQA’s effects of public works projects, but is apparently unwilling to take on the heavy lift of reforming its impact on housing.
As the housing crisis persists, it forces ever-more low-income Californians out of homes and apartments and into the streets, thus worsening the nation’s worst – by far – homelessness crisis that the Californians put at the top of their concerns.
Legislators and Newsom, besot with ideological commitments to criminal justice reform, are loath to crack down on the criminals that are terrorizing merchants and residents of the state’s major cities. One of the pending measures, Senate Bill 553, would compel employers to implement plans to mitigate violence against their workers, facing fines and potential lawsuits for failure. Business groups complain that it would wrongly blame employers, rather than criminals, for invasive attacks.
There are many other issues being ignored, and one of the more important is a developing crisis in home insurance coverage as one-by-one, insurers shun the California market, saying that wildfires, construction costs and other factors are creating more financial exposure than they can cover with premiums.
As California homeowners become unable to find coverage from the private market, more are forced into the state’s FAIR program as a last resort, with high premiums and limits on coverage.
Insurers complain that the Department of Insurance doesn’t allow them to include forward-looking catastrophic modeling in their rates, requiring them to base premiums only on past experiences. Nor are they allowed to include the costs of reinsurance, which insurers use to mitigate potential liability.
An Assembly committee conducted a hearing into the crisis and the viability of catastrophe modeling two months ago. A staff report noted that “eight of California’s top 20 wildfires have occurred in the last half-dozen years, burning 8,512 structures,” with “the top three largest fires – the August Complex fire in 2020, the Dixie fire in 2021, and the Mendocino Complex fire in 2018 – burned a collective 2.45 million acres and destroyed 2,526 structures.”
The list of disastrous wildfires didn’t include the 2018 Camp Fire that was relatively small in acreage, but wiped out the town of Paradise, destroyed more than 18,800 structures, caused 85 deaths and resulted in more than $16.5 billion in losses.
Despite the peril posed by wildfires and the ever-worsening insurance availability crisis, the net result of the hearing was that everybody thought something should be done, but nothing concrete emerged.
One factor is a change in the Department of Insurance that voters decreed 35 years ago, making the insurance commissioner an elective office. The ambitious politicians who win the position feel pressure to keep premiums as low as possible, even if they drive insurers out of the state.
Consumer groups oppose forward-looking catastrophic modeling – which is used for earthquake insurance – because it would almost certainly boost fire insurance premiums.
It’s a tradeoff between insurance availability and insurance costs that cannot be, politically, a win-win situation.
https://calmatters.org/commentary/2023/08/legislature-action-fire-insurance-crisis/
More Women Candidates Vie to Join Record 50 in Assembly & Senate
Politico
Fueling historic diversity, the 2022 election resulted in a record 50 women in the Legislature, up from 39.
And if early fundraising is any indication — and campaign cash is often a key factor — the outlook for 2024 is positive for female candidates as well.
In the first half of 2023, of the top 10 fundraisers for open legislative seats, seven are women; of the top 20 fundraisers, 12 are women and 10 are women of color, according to a study by Close the Gap California, an advocacy group that recruits progressive female candidates.
Topping the list are Yvonne Yiu, a Monterey Park City Councilmember who ran unsuccessfully for state controller last year and who reported raising $856,000 in the Senate District 25 race, and Assemblymember Sabrina Cervantes, a Corona Democrat who said she brought in $704,000 in Senate District 31.
Susannah Delano, Close the Gap executive director, in a statement: “The fact that so many diverse women are raising significant amounts of early money is a strong sign that we are leveling the playing field for all women and are on the path to parity.”
The Legislature is now 42% female, and Close the Gap says that women need a net gain of 10 seats in 2024 to reach gender parity for the first time. But that will require winning many open seats: Six women will leave their seats in 2024, either hitting term limits or seeking another office. Also, four female Assemblymembers are running for state Senate, according to Close the Gap.
State Water Board Joins Energy Commission in Approving Extension of 4 Coastal Power Plants
CalMatters
California officials agreed to extend operations at three natural gas plants on the Southern California coast in an effort to shore up California’s straining power grid and avoid rolling blackouts.
The controversial and unanimous vote Wednesday that keeps the plants open came from the State Water Resources Control Board, which oversees the phaseout of natural gas facilities that suck in seawater and kill marine life.
Seawater-cooled units at three power plants in Long Beach, Huntington Beach and Oxnard will be kept in reserve for three more years to feed energy into the state’s grid during power emergencies, such as the 10-day heatwave last August and September that led to statewide power alerts. The plants had been slated to cease operations of those units by the end of 2020, but received a three-year extension amid rolling blackouts that summer.
Now that extension has been extended again — through 2026. A fourth, the Scattergood Generating Station in Playa Del Rey, will receive a five-year extension to fill regional supply gaps though 2029.
The decision about the fossil fuel plants comes despite the state’s mandate for 100% renewable and zero-carbon electricity by 2045.
Natural gas plants are a large source of greenhouse gases, which warm the planet, toxic gases like ammonia and formaldehyde, and nitrogen oxides, which contribute to Southern California’s extreme smog. Nationally, natural gas plants account for about a third of all carbon emissions from energy production.
Gov. Gavin Newsom last year called for state agencies such as the Department of Water Resources (DWR) to prop up the grid — including with fossil fuels, which drew the ire of environmentalists and nearby communities.
The state agreed to pay the plants’ operating companies about $1.2 billion from 2024 through the end of 2026 to stand by during energy events, such as heatwaves.
“These resources would only be turned on to address extreme events or for maintenance runs” at the direction of the state’s grid operator, said Delphine Hou, DWR deputy director, at a meeting of the California Energy Commission last week.
The decision outraged many local residents, especially those in the largely Latino community of Oxnard, where many work outdoors in farm fields. The city supported the previous extension with the understanding that the plant’s owner would pay up to $25 million to demolish it.
After the vote, several angry people yelled at the water board members, “You failed our community.”
During the five-hour session that drew more than 60 people commenting, Kyle De La Torre, an Oxnard resident with the Central Coast Alliance United for a Sustainable Economy, urged the board to reject the extension. He said the smell is so strong that he gets a migraine when he passes the plant and worries about a school and homes nearby.
Water board staff acknowledged that those living near the plants will continue to experience “air, noise, and aesthetic impacts.”
Board chair Joaquin Esquivel expressed sympathy to those living near the plants and frustration with the position the water board had been put in. “I’ve heard a lot of common agreement around the need to decommission and move on from these plants. But…this board is not established to have the expertise to second guess all of our energy agencies” about the need to keep them open, he said.
DWR’s Hou told the energy commission that because the seawater-cooling plants won’t be operating on “a day-to-day basis like they are today, it’s very likely there’ll be a reduction in air emissions and once-through cooling water use,” which is the process of sucking in large volumes of seawater that kills fish and other marine life. The state policy phasing out the process dates back to 2010.
Newer generating units at the Huntington Beach and Long Beach plants use alternative cooling technologies, instead of seawater, so they are not subject to the phaseout. They would have remained operating regardless of today’s vote, since they are under contract for another 17.5 years — and not just for emergency use, according to AES.
Mark Miller, AES’s general manager for facilities, including the Alamitos and Huntington Beach plants, said the the company “invests significant capital each year to ensure that our facilities are maintained at a state of readiness to safely serve local and system reliability needs” and that the plants’ contributions to pollution in the Los Angeles basin are “overwhelmingly dwarfed” by vehicles and other industries.
But whether the plants are capable of assisting the grid during extreme power events is controversial. During rolling blackouts in 2020, natural gas plants struggled in the heat, “resulting in power loss in combustion turbines, inlet air and cooling system stresses, steam tube leaks, and condenser pump failures,” the California Energy Commission reported.
The plants will be folded into a new state electricity reserve program, created by an energy deal that the Newsom administration and lawmakers cut last summer. Lawmakers called the deal “rushed” and “lousy” at the time, and environmentalists lambasted Newsom for leaning on fossil fuels as the state reels from one greenhouse gas-fueled disaster to another.
State Sen. Henry Stern, a Democrat from Calabasas, said he helped negotiate the deal yet apologized because fossil fuels are supposed to be a last resort.
“We keep head-faking communities and promising them just one more extension, just one more time — but actually, the economic structure we’re building here is designed to be a much more permanent reserve,” he said. “I’m hoping we can find a way to restore that trust.”
Westlands No Longer the Darth Vader of Water World
Politico
Climate change — and changing political winds — are prompting shifts in strategy at California’s largest agricultural water district.
Westlands Water District, which occupies some 1,100 square miles of the arid San Joaquin Valley, is in the midst of an internal power struggle that will determine how water fights unfold across the state.
After years of aggressively fighting for more water, Westlands is making plans to live with less. In 2016, Donald Trump campaigned in the valley, promising to “open up the water” for farmers in the then-drought stricken state. Its leaders are now sounding a more Biden-esque note: They are planning to cover a sixth of the district with solar panels to start “farming the sun” instead of thirsty crops like almonds and pistachios.
A shakeup in water board leadership at the end of last year resulted in the retirement of Westlands’ general manager, Tom Birmingham, whose 22-year tenure saw the district through years of fights with the federal government, steadily declining water deliveries, and the installation of the district’s longtime lobbyist, David Bernhardt, as Interior Department secretary under former President Donald Trump.
Westlands’ new general manager, Allison Febbo, who began in April, is charting a course that’s more in line with projections of how climate change is expected to affect the valley.
Febbo characterized the state’s reckoning with climate change as a journey through the stages of grief.
“You know, denial and then arguing about it. And then bargaining,” Febbo said in an interview. “I think now we’re finally in the stage of acceptance and moving forward, and how are we going to live with this new future.”
Some board members see Febbo, a hydrologist by training who served at the federal Bureau of Reclamation before leading the Mojave Water Agency in Southern California, as a more sympathetic figure than Birmingham, who admitted to being called the “Darth Vader of California water.”
“We didn’t want an engineer and we didn’t want a lawyer being our advocate,” said Jeff Fortune, a third-generation farmer with 3,000 acres of almonds, pistachios and tomatoes who became board president in December. “We wanted a scientist.”
Under Febbo, the district is pursuing a plan to gradually convert 100,000 of its 600,000 acres of farmland to solar panels. It’s a huge chunk of the valley, but only half as much as the district had to fallow last year due to drought and inadequate water deliveries.
The changes are worrying some of the longest-serving board members.
“You’ve basically turned into a solar board, is that what we are?” Frank Coelho, Jr., asked during a meeting in July. “I thought we were a farming board.”
Other board members are embracing the rebrand. Westlands recently joined TikTok and a board meeting last month featured a discussion of hiring competitive hot dog eater Joey Chestnut to advertise ketchup made with locally grown tomatoes.
Fortune argues that solar panels will enable the district to make money from fallowed land while using its water more productively — and extracting itself from decades-long, politically divisive campaigns to secure more supplies.
A sign of the shift came earlier this month when Febbo, in an op-ed in the Fresno Bee, pledged to work “collaboratively with communities and agencies at all levels” and deal with “changing hydrology, climate, politics and renewed priorities.” She emphasized the district’s land retirements, solar installations, groundwater recharge program and conservation efforts.
Two days later, the Sacramento Bee ran an op-ed from Birmingham devoted to arguing for one of the district’s past priorities: raising Shasta Dam, a perennially discussed, controversial proposal that would capture more Sacramento River water but also flood an upstream tributary that’s protected under state law.
Birmingham, who is now director of water policy at the environmental consulting firm Hallmark Group, said in an interview that the district was “discussing in detail” solar energy and “working diligently” on groundwater recharge under the prior board of directors, during his tenure.
The recharge program that the district is doing in conjunction with farmers is an attempt to stash floodwater underground for drought years to come by injecting or letting extra water sink into the ground where it can be retrieved in the future. The program is largely a response to a groundwater management law signed by former Gov. Jerry Brown that limits pumping — the second major source of water for Westlands farmers.
Behind the rhetorical differences, there are still substantial similarities in the district’s tactics.
One board member went to a congressional field hearing in April to support a bill that environmentals argue would lock in controversial victories the district won in the Trump years and provide money to enlarge Shasta Dam.
In early August, the district lost a fight to keep what critics called a “sweetheart deal” from the Trump era that gave the district a permanent contract for federal water, though it doesn’t guarantee the district will always get that water.
And Westlands is again working with Bernhardt, who returned to K Street law firm Brownstein Hyatt Farber Schreck in 2021. Bernhardt didn’t respond to a request for comment.
Febbo is making her own inroads in Washington, Fortune said. She recently had dinner with Bureau of Reclamation Commissioner Camille Calimlim Touton, he said, and is making more contacts through advisers with Brownstein Hyatt.
Scott Artis, the executive director of Golden State Salmon Association, which advocates for reserving more water in Shasta Dam for migrating salmon, said he worries the district is taking “a lipstick on a pig approach.”
“We’d love to see, obviously, an effort by Westlands to move in this more productive direction and have a more meaningful makeover,” he said. “But we’re just not sure that is actually happening at this stage.”
Even if the changes at the district are largely rhetorical, looking inward and talking about living with less could sap political momentum from major supply-side projects that depend on support from multiple backers, like Newsom’s tunnel to bring water from the northern part of the state to central and southern California.
“Nothing can happen for Westlands without it happening for everybody in California,” Febbo said.
Fortune said he’s seen the district’s water deliveries declining since the 1970s, when his father first drilled a well to tap groundwater during a drought. Now, he said, the district is going to play with the cards it’s been dealt.
“We’ll never get enough water,” he said. “It doesn’t matter who the president is.”
Colorado River Water Users Get More Now, Plan for Far Less Soon
CNN
Fresh from a phenomenal winter snowpack, water levels on the Colorado River are going up for the first time in years.
As a result, federal officials will announce this week that they are easing water restrictions in the Southwest starting next year, three sources familiar with the plan told CNN, lifting the region from a Tier 2 water shortage to a Tier 1. It’s a remarkable turnaround that will give back billions of gallons of Colorado River water to millions of people in the Southwest, primarily in Arizona and Nevada.
But they can’t breathe a sigh of relief. Officials, farmers and tribes are bracing for more difficult negotiations on how to divvy up the river when the current interstate agreement expires in 2026.
The big, unanswered question: Exactly how much water is there to divvy, and how long can the Southwest expect to rely on it?
“We have a smaller river; we need to learn to live with a smaller river,” Brenda Burman, general manager of the Central Arizona Project and former Bureau of Reclamation commissioner, said. “We all need to be looking ahead to the ways we can live with less water.”
Scientists have recently focused on how hotter temperatures are changing snowpack in the Rocky Mountains. Each winter, that snow melts and trickles down through streams and tributaries into the Colorado River – a source of water and electricity for 40 million people in seven states.
Yet scientists have watched in recent winters as blockbuster snow seemingly disappeared before it reached the Colorado River’s headwaters, University of Washington environmental engineering professor Jessica Lundquist said.
“The temperature is definitely going up” in the Rockies due to global warming, “(and) the amount of snow you have is controlled by precipitation, which is very uncertain,” Lundquist said.
Her team is trying to figure out how much snow is evaporating straight into the atmosphere without melting into water, a process called sublimation. Other scientists are looking at how much is being sucked into the ground or being absorbed by trees and plants – but it’s too early to tell where exactly all the snow’s water is going, or whether we’re losing more because of climate change.
The one certainty is there is less water in the Colorado River than there used to be, said climate scientist Jonathan Overpeck, dean of the University of Michigan’s School for Environment and Sustainability.
“If we want to keep the reservoirs functioning – which is a very wise thing to do – you need to reduce consumption by 15 to 20%,” Overpeck said. “You’ve got to acknowledge that climate change is going to make the situation worse, and in the future, we’re going to have to reduce consumption even more.”
This winter’s excellent snowfall and recent water conservation is giving the feds the ability to retain more water in Lake Mead this year, a Biden administration official said. They expect the water release from the reservoir will “be the lowest in 30 years, approximately one and half million acre-feet lower than an average normal year,” the official said.
But it’s a drop in the bucket. Scientists estimate that Colorado River flows have decreased by about 20% compared to the early 20th century. A recent UCLA study found that in just the last two decades, rising temperatures from climate change sucked more than 10 trillion gallons of water out of the river basin – a volume about the size of Lake Mead.
The worst-case scenario is another 20% decline by mid-century, according to Brad Udall, a senior water and climate research scientist at Colorado State University. Scientists aren’t sure that’s going to happen, Udall said, but he stressed water managers should prepare for the possibility.
“We need to plan for a river that’s significantly less than what we’ve seen over the last 24 years,” Udall said. “I’m more than a bit frustrated by the hope-springs-eternal mode of thinking – that with any kind of wetness people want to think climate change doesn’t exist. We’ve had one good year.”
Udall noted that as good as the 2023 winter was, there haven’t been multiple good winters in a row for over two decades.
Some water managers on the river are calling for permanent reductions of water use by ripping out grass and recycling more water. But big cuts would have to come from agriculture – which uses the vast majority of the river’s water to grow thirsty crops like alfalfa.
That’s a tall order; farmers and Native farming tribes have some of the more senior water priorities on the river.
“There are tough choices ahead,” Becky Mitchell, the Colorado commissioner for the Upper Colorado River Commission, said. “It’s not that there’s one user, state or entity that is the enemy; the enemy is the old way of doing things.”
Balancing agriculture’s water needs with explosive suburban growth in cities like Phoenix has turned contentious in recent years. Phoenix, a metro area of 5 million people, is the first to get hit with water cuts when the Colorado is running low, something Arizona leaders want to change with the 2026 negotiations.
Officials and scientists often mention the need to be flexible in future years; taking advantage of wet years and banking water to use in dry years.
“You have to build in a plan that is adaptive and is really more robust than we’ve had in the past with a full range of futures,” said Bill Hasencamp, the manager of Colorado River Resources for the Metropolitan Water District of Southern California, which provides water to Los Angeles.