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IN THIS ISSUE – “Christmas, New Years & the Easter Bunny”
RECALL & POLITICS
- Recall Election Set for Sept. 14; Newsom in Strong Position
- Governor Claims California is “Roaring Back” – Not Exactly
- As Recall & 2022 Elections Begin, Democrats Fight with Key Union
- Building Trades Union Leader Abruptly Retires
ECONOMY
- Jobs Recovering Slowly
- California Remained World’s 5th Largest Economy in 2020
DROUGHT
- Drought in the West: “Unlike Anything We Have Seen”
- Hard Times in America’s Fruit & Nut Basket – Farmers Struggle With Drought
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 service.
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FOR THE WEEK ENDING JULY 2, 2021
Recall Election Set for Sept. 14; Newsom in Strong Position
Politico & CalMatters
Just hours after the state Dept. of Finance released its final estimate for the 2021 recall election — a whopping $276 million — Lt. Gov. Eleni Kounalakis put the historic election on the calendar for Sept. 14. And that is nothing less than “Christmas, New Years and the Easter Bunny” all wrapped up for Gov. Gavin Newsom, says longtime state political analyst David McCuan. “It could not be a better date for him.”
NO WONDER Team Newsom is popping the champagne today; the governor is now firmly in the driver’s seat on three key fronts, McCuan notes:
— STATE RECOVERY: California is bouncing back from Covid, the state is rolling in a $76 billion surplus, Newsom’s polls are looking good, and he’s happily “played Oprah” around the state. His September recall date will be after the dog days of summer and the traditional Labor Day campaign kickoff — but before the height of the wildfire season in October and November, where planned power outages could hit millions. Kids should be heading back to school, and the election may be early enough (Dems crossing their fingers here) to beat any resurgence of Covid with the increasingly worrisome Delta variant. Plus it will be just days after the end of the legislative session, shielding Newsom from blowback for controversial bill signings or vetoes.
— MONEY: Newsom has more resources in the bank than all of his opponents combined — $17 million in the bank, and more stashed away for his 2022 race. And it’s still pouring in: The California Building Industry Thursday kicked in $1.1 million to his cause. The ramped up schedule cuts GOP chances to raise money — both candidates and the party — by months. “The fundraising alone is huge … you need to have a team up now,’’ says one GOP key operative. “People were assuming this was going to be in November,’’ and coming anywhere close to Newsom’s war chest “is going to be tough.”
— CAMPAIGN STRATEGY: The short turnaround means deprives the California Republican Party of ramping up months of voter registration drives aimed to pump up numbers heading toward the 2022 election — the next regular gubernatorial and statewide contests. Which means it dramatically shortens the party’s opportunities to get out its message and energize voters by amplifying the shortcomings of Newsom on issues like homelessness and crime.
The early election throws a serious wrench into the plans of any candidates who may have been mulling the idea of still getting in — like talk show host Larry Elder, Assemblyman Kevin Kiley and former Trump Administration insider Ric Grenell, who just launched a new independent expenditure committee called Fix California. They have until July 16 to make up their minds, California’s Secretary of State Shirley Weber announced. Former San Diego Mayor Kevin Faulconer, who leads the polls, isn’t rattled. “Change is coming to California — and retirement is coming to Gavin Newsom,’’ he told Playbook in a statement.
BOTTOM LINE: Democrats not long ago widely anticipated a November recall — hoping for more time for the state to recover from Covid, according to the conventional wisdom.
But state Sen. Steve Glazer first laid out the argument here in the CA Playbook that Team Newsom should be looking at an early recall — to strike while the iron was hot. Glazer, a former campaign strategist for Jerry Brown, said Newsom should not give Republicans the opportunity to “stir up more mischief” in the months ahead.
CAGOP Chair Jessica Millan Patterson tried to put the best face on the date yesterday: “Shout out to California Democrats for manipulating their own recall rules. Now Californians only have to wait until September 14 to recall the worst governor in California history, Gavin Newsom.”
Glazer tells Playbook those GOP protestations about the early date “are crocodile tears. … They wanted Gavin Newsom out of office — and now voters will get the earliest chance to do that.”
Local elections officials face the Herculean undertaking of coordinating a statewide election in a matter of months. Complicating the task, Newsom signed legislation earlier this year requiring counties to mail every registered voter a ballot, which means elections officials must locate enough paper to print millions of ballots — but they must wait until the candidate filing period closes 59 days before the election, which could yield scores of hopefuls given the low bar to entry.
Elections officials spotlighted those challenges earlier this month when they urged Kounalakis to set an election for no sooner than Sept. 14.
While political observers once believed an early November election would best benefit Newsom by conforming to the typical rhythms of the election cycle, helping to boost turnout in an off-year election, that logic has shifted as California has reopened its economy and Newsom’s polling numbers have stabilized.
Democrats increasingly believe that Newsom would benefit from an earlier vote that allows him to capitalize on that momentum while depriving Republican foes of time to organize and fundraise.
Republicans have objected to legislative Democrats condensing the timeline on those grounds, arguing the majority party is manipulating the process to protect Newsom. In waiving the cost analysis, Democrats reversed a mandate they put in place in 2017 as part of an effort to delay the recall of state Sen. Josh Newman so it could be consolidated with a primary election.
Speaking of Newsom, the governor has mostly been laying low since an investigation last week found he vastly overstated California’s progress on fire prevention, giving just one press conference at which only two reporters asked him questions. Notably, on Thursday he did not unveil the final prizes — six Dream Vacation giveaways — in the state’s vaccine lottery; the Department of Public Health hosted the event instead.
Governor Claims California is “Roaring Back” – Not Exactly
CalMatters commentary by Dan Walters
Virtually any utterance from Gavin Newsom’s mouth these days, as well as those from his press office and other outposts of his administration, contains the phrase “roaring back.”
When, for example, the Legislature passed a state budget to meet the June 15 constitutional deadline, Newsom issued a statement declaring that “California’s economy is coming roaring back.”
Not surprisingly, it’s also the key slogan in his resistance to a campaign to recall him, something voters will decide later this year.
“Gov. Gavin Newsom has California roaring back,” the announcer in one of his campaign spots declares. “Newsom is delivering money to your pocket. Plus an extra $500 bucks for families with kids — $4 billion straight to small businesses through the nation’s largest grant program — cleaning up our streets and getting 65,000 homeless Californians into housing — and free pre-K for every California child, regardless of income.”
To some, it might appear somewhat unseemly that Newsom so obviously merges his official actions — and taxpayers’ money — with his political campaign, but the once-discernible line between politics and policy vanished long ago.
That said, do the facts support Newsom’s repetitive “roaring back” claim?
To be sure, some Californians have prospered in the 15 months since Newsom declared a public health emergency due to COVID-19 and imposed restrictions on personal and economic activities.
Those who could continue to work at home maintained their incomes and those on the top rungs of the economic ladder were enriched as the values of their investments such as stocks expanded, thanks largely to the Federal Reserve’s cheap money policies.
Newsom has a multi-billion-dollar revenue surplus mostly due to taxes on the affluent, money he’s now spending on the wide array of new benefits he’s touting in his campaign ads.
However, broader economic data offer scant support for the “roaring back” mantra the governor is chanting these days. It’s more like creeping back — slowly.
The state’s monthly report on employment, issued on June 18, frames the glacial pace of improvement. The state lost nearly 3 million jobs after Newsom ordered widespread business closures in March 2020, and since then we’ve recovered roughly half of them. Our 7.9% unemployment rate is still twice what it was before the shutdown and is the third highest of any state, slightly under Hawaii and New Mexico.
In addition to the official unemployment rate, the federal Bureau of Labor Statistics makes other calculations, including an important one on underemployment, called U-6, which includes not only workers without jobs but those who are only marginally attached to the labor force and those working part-time.
California’s U-6 rate through the first quarter, 18.4%, was four percentage points above the national figure and the third highest of any state, behind Hawaii and Nevada. Even more disturbingly, the U-6 rate in Los Angeles County, 24.1%, is higher than that of any state.
The federal Bureau of Economic Analysis reported this month that during the first quarter of this year, California’s economic output increased by 6.3%, slightly lower than the national rate and in the lowest third of the states.
The federal bureau also reported that California’s personal income grew by 42.8% during the first quarter, which sounds impressive until one looks at the nation as a whole and learns that California’s growth was the second lowest of any state. The bureau notes that nationwide, “transfer payments” — mostly federal aid programs rather than earned income — accounted for virtually all of personal income growth.
California’s economy is recovering, to be sure. But “roaring back?” Hardly.
As Recall & 2022 Elections Begin, Democrats Fight With Key Union
Politico
California Democrats are losing patience with a powerful labor ally just as a gubernatorial recall and contentious legislative primaries loom.
The State Building and Construction Trades Council of California, known colloquially as “the Trades,” has killed some of the Democrats’ most ambitious bills to tackle climate change and the state’s housing crisis, and lawmakers and others working on the issues are increasingly willing to voice their frustrations.
The divisions in this deep blue state reflect an internal struggle Democrats nationwide will face as their environmental efforts run headlong into once-reliable union jobs. The standard line has been that the party and labor can accomplish shared goals together, such as moving fossil fuel workers into alternative energy jobs. But cutting-edge California, which often sets the tone for other states on green goals, is showing how complicated that path actually is.
Tensions spilled into the open last month when Democratic state lawmakers joined a conservative Republican in opposing a bill that effectively would have required oil companies to use union labor. Lawmakers who opposed the measure worried it could benefit Trades members at the expense of displacing non-union oil workers.
“Let’s not pretend the Building Trades don’t have a lot of power in this room, in this building, and let’s not pretend like this bill is not helpful for them,” said state Sen. Susan Eggman (D-Stockton).
The state Senate ultimately approved the bill, further proof of the union’s power. But the episode was frustrating for some Democrats who saw the Trades torpedo their earlier bill to rein in petroleum production. To those lawmakers, the 450,000-member union thwarted their environmental goals, then had the gall to ask for their help to expand its membership base in the oil fields. It was a stark illustration, for many lawmakers, of a power imbalance that consistently favors the labor group.
“I want to find a place where we are able to have difficult conversations where labor is at the table and we go beyond just saying ‘no,’” state Sen. Monique Limón (D-Santa Barbara) said in an interview. “When members face personal attacks and are continuously bullied,” she added, “mistrust is going to occur.”
Organized labor rarely struggles to make its voice heard in Democratic-dominated Sacramento. But tensions have grown in the past year between unions and their legislative allies as labor has blocked Democratic proposals in the Capitol, overpowering environmentalists and affordable housing advocates. Another rift developed this past school year between teachers unions and Democrats when labor rejected attempts by Sacramento leaders to force schools to open.
To the Trades and its supporters, they are simply doing what their members expect: fighting to ensure the Legislature includes working people in its efforts to build millions of housing units and dramatically reorient the energy economy. To that end, labor has linked arms with oil industry employers against environmentalists and pushed to ensure that bills to accelerate affordable housing construction preserve a place for union-trained workers.
“There’s half a million really hardworking people that are depending on the state building trades and all the local affiliates to help them have a life here in California, and it’s not cheap to have a life here in California,” said Erin Lehane, chief of staff for the Building Trades. “We are privileged in our work to have such a righteous battle.”
Some Democratic legislators argue the group is wielding its clout with an increasingly heavy hand, thwarting action on increasingly urgent housing and climate issues. It’s a tension that has implications for national Democrats as President Biden touts the creation of high-wage labor jobs through an infrastructure package that could include climate programs like a clean energy standard.
“There’s enormous frustration with the Trades,” said a Democratic lawmaker who asked for anonymity to avoid antagonizing a powerful group. “To not be able to make progress on housing and climate is totally unacceptable, and they’re a huge part of the reason we’re not making progress.”
Despite frustrating some Democratic lawmakers in California — and, at times, Gov. Gavin Newsom — labor unions retain significant clout in Sacramento. Many lawmakers have longstanding ties to unions, dating back to their earliest days in politics. During campaigns, unions supply not just money but boots on the ground that are necessary to encourage union members and other Democrats to vote. Labor has already contributed $4.4 million toward Newsom’s effort to defeat the recall this year and has committed to providing an “army” of volunteers.
On energy, the group has been targeting bills to rein in petroleum production in order to retain its members’ jobs. On housing, it argues that bills to accelerate affordable housing construction must include guarantees that developers use “skilled and trained” workforces — shorthand for union-represented jobs.
Labor backers say such provisions ensure construction workers are paid fair wages and suppress an underground economy rife with exploitation. They point to a recent University of California, Berkeley study finding that many construction workers rely on welfare.
“Our number one obligation and commitment is to protect construction workers from exploitation in the underground economy,” Lehane said.
But developers and some Democrats pushing for more construction in this housing-starved state argue those demands either render bills unworkable for builders or unpassable in the Legislature.
“We have gone further than we’ve ever gone before with labor, to be met with a flat-out ‘no, do it our way or not at all,’ so there is really not a negotiation going on,” said Ray Pearl, executive director of the California Housing Consortium, which was among a coalition of affordable housing developers that submitted a compromise proposal the Trades summarily rejected. “It is definitely a scorched-earth, sort of my-way-or-the-highway-at-all-costs strategy.”
California voters consistently place climate change and housing atop their list of concerns as wildfires grow ever more devastating and housing prices continue to soar. The Trades and its allies argue that bills to address either issue cannot neglect blue-collar workers who built the state’s economy. But Democratic lawmakers, environmentalists and affordable housing developers have increasingly come to blame the Trades for creating an insurmountable impasse.
When the Trades take a position on a bill, they come with reinforcements. Committee hearings routinely feature a half-hour of testimony from other unions lining up to “stand with the State Building Trades.” Such shows of force resonate in labor-friendly Sacramento.
“I think that we have a huge amount of supporters in the Capitol that support working families,” Lehane said. “We’re kind of overwhelmed with the amount of support we get from lawmakers in Sacramento.”
Labor allies often invoke the Trades’ leader by name: Robbie Hunter, a famously hard-nosed negotiator who has clashed repeatedly with Newsom and lawmakers in recent years. While the union and governor have patched things up, sources said the Trades’ relationship with Assembly Speaker Anthony Rendon has disintegrated in the years since the group funded attack ads against a Democratic assemblymember accused of sexual misconduct.
The Trades have also taken out ads excoriating Democrats for proposals seeking to expedite housing construction, like Assemblymember Richard Bloom (D-Santa Monica), who faced ads calling his affordable housing bill last year a “developers’ Trojan horse.” The group retracted an ad depicting state Sen. Scott Wiener (D-San Francisco) brandishing money in front of a Monopoly board after Jewish groups condemned the spot as anti-Semitic.
The group’s take-no-prisoners approach, a growing graveyard of sidelined legislation and what legislators describe as a barrage of threats have lawmakers both fuming and struggling to chart a way forward.
“It’s one thing to have a couple bills a year you go nuclear about,” said another Democratic lawmaker who requested anonymity to speak candidly about the union. “But when you have 30 — not everything can be a relationship-ender, and some of these are relationship-enders.”
Some lawmakers are maintaining optimism. Wiener, the Legislature’s foremost Democratic advocate for accelerating housing construction, lost a coveted endorsement from organized labor last year and saw his bill to build housing on church land collapse amid Trades opposition.
But Wiener said on a housing panel last week that he believed it was possible to reach a larger bargain that increases housing production and thus jobs while expanding training programs.
“If we’re strategic about it, I think we can really come up with a grand deal and fix this. We can build the housing we need and pay construction workers good wages,” Wiener said. “It’s a tough, tense time now in that particular dispute, but we can move past it.”
The standoff over California’s enormous energy sector could prove harder to resolve. Organized labor and environmentalists are both mainstays of Democratic power in California. But an intensifying effort to combat climate change by transitioning away from fossil fuels has increasingly put the two constituencies at odds, with the Trades fighting to protect well-paying refinery jobs that they say green energy employment simply cannot replace.
This session alone, the Trades have killed a fracking bill and a measure to add environmental justice representatives to a powerful Southern California air quality agency, and they are opposing a bill to enshrine the state’s goal of carbon neutrality by 2045.
After years of diplomacy, environmental advocates are sharpening their rhetoric. California League of Conservation Voters president Mary Creasman said in an interview that the standoff has been building for years but “in the last couple years, it’s really kind of gotten fever pitched.”
“I think at this point the leadership of the building trades have kind of gone off the deep end. They’ve lost credibility. It’s like they’ve become this pawn of corporate polluters, and they’re acting actually against the best interest of their members and California in general,” Creasman said. “It’s not about members anymore. It’s about ego and power and control.”
The Trades point to their support of renewable energy projects, like wind and large-scale solar, that can reduce carbon emissions while creating stable jobs. But unions argue the energy economy cannot yet sustain a shift at the pace some Democrats and environmentalists want.
“We do not believe we should be killing off industries we remain dependent on until we are no longer dependent on them,” Lehane said. “It’s going to happen that we are going to not be dependent on fossil fuels, but we’re just not there yet.”
State Sen. Henry Stern (D-Canoga Park) is trying to play a longer game. He has one bill aimed at bringing oilfield work under the union umbrella along with the refinery jobs that are already unionized. He’s still shepherding the bill despite the Trades and oil industry undermining his separate proposal to accelerate greenhouse gas targets.
“It’s trench warfare at this point; everyone’s sort of dug in,” he said. “But while you’re in the trench, you’ve got to be thinking about the path to peace, the whole time. I swear there’s some nugget of progress to be made in here, and showing some good faith to those working in the industry.”
Building Trades Union Leader Abruptly Retires
CalMatters
Robbie Hunter is retiring after nearly nine years as the president of the State Building and Construction Trades Council of California, which represents nearly 500,000 construction workers.
The union announced Hunter’s retirement in a tweet Wednesday, praising him for “always standing for and with the hardworking members of the building trades and their families.”
Hunter, who had also worked as a union leader in Southern California, has widely been considered as one of the most powerful labor officials in the state. His union has shaped state policies on topics ranging from gig economy to environment and the state’s high-speed rail project.
“As evidenced by the trades’ escalating density, Robbie, one of organized labor’s most skilled dealmakers, represented the trades nearly half million members with unmatched dedication. He never shied away from a righteous fight or a worker in need in his very long career,” said Tom Baca, the union’s financial secretary, in a written statement.
Hunter’s union’s opposition to the state’s proposal to ban fracking has irked environmentalists and some lawmakers who believe the restriction is critical to address climate change.
Hunter also has pushed lawmakers to require affordable housing developers to hire skilled construction workers, an approach that the builders say can drive up the cost of projects and make them less feasible.
Hunter defended the push in his recent interview with CalMatters.
“You cannot address poverty and housing by driving construction workers and our families into poverty,” Hunter told CalMatters. “It just doesn’t work.”
Jobs Recovering Slowly
CalMatters
How you interpret California’s latest unemployment numbers may have a lot to do with whether you’re a glass half-full or glass half-empty kind of person.
If you’re the former, the report from the Employment Development Department is cause to celebrate: It shows that California’s unemployment rate dropped to 7.9% in May, down from April’s revised rate of 8%. The Golden State also gained a whopping 104,500 jobs in May, marking the fourth consecutive month employers added more than 100,000 positions to their payrolls. Never has California seen so much job growth coming out of a recession, according to Michael Bernick, a former EDD director and attorney at Duane Morris.
But if you’re the latter, the report is cause for concern: Despite record job growth, California’s labor force only grew by 12,400 workers — meaning thousands of open jobs are going unfilled. The Golden State has only regained 51.8% of jobs lost since the onset of the pandemic, far below the national rate of 66%. And the small business economy is “decimated,” with openings down 40.8%, according to Bernick.
Scott Anderson, an economist with Bank of the West in San Francisco: “A full California labor market recovery … is still likely several years away. Even with stepped-up job growth, California has been unable to close the yawning unemployment gap with the nation.”
Although middle- and high-wage workers have largely recovered employment, low-wage workers have not. Some experts say the jobs opening up in restaurants and retail aren’t paying workers enough to live in a state where the median home price tops $813,000. Other business owners say expanded unemployment benefits are incentivizing workers to stay home. EDD last week reinstated its work search requirement: Starting July 11, Californians will need to begin looking for work in order to keep receiving unemployment benefits.
As workers ask for higher wages, businesses are pleading for financial relief of their own. California is expected to borrow $26.7 billion from the federal government to pay unemployment benefits — a debt that will be paid by businesses via payroll taxes. In ongoing budget negotiations, Gov. Gavin Newsom has proposed covering $1.1 billion of that cost; lawmakers, $2 billion.
Rob Lapsley, president of the California Business Roundtable: “If they don’t do anything more … it could drive (businesses) right over the edge.”
California Remained World’s 5th Largest Economy in 2020
California Dept. of Finance
California remained the fifth largest economy in the world in 2020 for the fourth consecutive year, behind Germany and ahead of the United Kingdom, with a GDP of $3.1 trillion in current dollar terms. In real terms, California’s GDP contracted by 2.8 percent in 2020 compared to a decrease of 3.5 percent for the nation.
REVENUE
Preliminary General Fund agency cash receipts for the first eleven months of the fiscal year were $1.603 billion above the 2021-22 May Revision forecast of $177.082 billion. Cash receipts for the month of May were $1.468 billion above the 2021-22 May Revision forecast of $18.847 billion.
nPersonal income tax cash receipts to the General Fund for the first eleven months of the fiscal year were $960 million above forecast. Cash receipts for May were $642 million above the month’s forecast of $14.653 billion. Withholding receipts were $951 million above the forecast of $5.13 billion. Other cash receipts were $453 million above the forecast of $12.485 billion. Refunds issued in May were $750 million above the expected $2.699 billion.
nSales and use tax cash receipts for the first eleven months of the fiscal year were $175 million above forecast. Cash receipts for May were $181 million above the month’s forecast of $3.049 billion. May cash includes the remaining portion of the final payment for first quarter taxable sales, which was due April 30, as well as the first prepayment for second quarter sales and use tax liabilities.
nCorporation tax cash receipts for the first eleven months of the fiscal year were $627 million above forecast. Cash receipts for May were also $627 million above the month’s forecast of $342 million. Estimated payments were $324 million above the forecast of $181 million, and other payments were $268 million above the $244 million forecast. Total refunds for the month were $35 million lower than the forecast of $83 million.
JOBS
nCalifornia unemployment rate decreased from 8.0 percent (revised) in April to 7.9 percent in May 2021,
3.6 percentage points higher than February 2020’s rate of 4.3 percent. Civilian employment increased by 39,500 people as unemployment decreased by 27,100 and 12,400 Californians rejoined the labor force. There were 1.2 million fewer employed and 525,400 fewer people in the labor force in May 2021 than in February 2020.
nCalifornia added 104,500 nonfarm jobs in May 2021, nearly one-fifth of the nation’s gain. As of May 2021, California has recovered 51.8 percent of the 2.7 million jobs lost in March and April 2020. Nine sectors gained jobs: leisure and hospitality (62,300), educational and health services (16,500), information (11,200), professional and business services (7,300), other services (2,700), manufacturing (2,400), government (1,700), financial activities (1,200), and trade, transportation, and utilities (1,100). Construction (-1,600) and mining and logging (-300) lost jobs.
BUILDING ACTIVITY & REAL ESTATE
nCalifornia permitted 128,000 housing units on a seasonally adjusted annualized rate in April 2021, down from 136,000 units in March 2021 but above the 72,000 units in April 2020 and above the 2020 average of 105,000 units. Permitted multi-family units fell from 57,000 in March 2021 to 52,000 in April 2021 and single- family units fell to 76,000 in April from 79,000 in the previous month.
nThe statewide median price of existing single- family homes remained above the historic $800,000 for the second consecutive month, reaching a new record of $818,260 in May 2021. This is up 0.5 percent from April and up 39.1 percent from May 2020. Sales of existing single-family homes in California totaled 446,000 units on a seasonally adjusted annualized rate in May 2021, down 2.7
percent from April 2021 but up 86.7 percent from May 2020’s pandemic low of 239,000 units
https://www.dof.ca.gov/Forecasting/Economics/Economic_and_Revenue_Updates/documents/2021/Jun-21.pdf
Drought in the West: “Unlike Anything We Have Seen”
Washington Post
Much of the American West , from parched Northern California through Arizona and New Mexico, is drying out at a record pace.
The onset of this severe drought was far quicker than previous ones — the result of a meager Sierra Nevada snowpack and early seasonal heat that evaporated the runoff needed to fill the reservoirs and rivers.
“It’s difficult to point to one occurrence and say, ‘Hah, this is climate change,’’’ said John Yarbrough, the assistant deputy director for the State Water Project with the California Department of Water Resources.
But this year — the second consecutive that the nation’s most populous state will be in drought — has been different from previous ones. Yarbrough said that only 20 percent of the expected runoff from an already well-below average snowpack arrived in reservoirs. The rest evaporated during the unseasonably warm spring.
“The relationship broke down,” Yarbrough said. “It is unlike anything we have seen.”
The heat and drought have forced decisions from farmers and policymakers far earlier than in years past — what crops to grow, what fields to fallow, how much to spend to protect the state’s $50 billion agricultural industry.
Gov. Gavin Newsom (D) has declared a drought emergency in 41 of the state’s 58 counties, covering about a third of the state’s population, and set aside $5.1 billion to manage some of the immediate consequences. On Thursday, Newsom declared a state of emergency because of the heat wave, a move that makes more energy available within the power grid.
There are many in Lake Oroville and across the region.
More than half of the western United States is in the grips of “extreme” or “exceptional” drought, indicating widespread water shortages and major impacts on crops and pasture. In California, Arizona and Utah, the period between June 2020 and May 2021 has been the driest ever recorded.
“Every dry year is not the same as every other dry year, and every drought is not the same as any other drought,” said Felicia Marcus, a visiting fellow at Stanford University’s Water in the West program. “This one’s come on hot and quickly. And that has created an acceleration of the problems you might otherwise see, in part because our ecosystems, our forests, our groundwater resources haven’t recovered from the last one.”
The heat and drought are hallmarks of climate change.
Human activities have already raised global average temperatures more than 1 degree Celsius (1.8 degrees Fahrenheit) above preindustrial levels. In many western states, the increase is close to 2 degrees Celsius— a threshold the United Nations associates with catastrophic warming.
Unless people drastically reduce planet-warming emissions, the world faces a future of increasingly frequent and severe environmental disasters: coastal flooding, mass extinctions, deadly hurricanes, uncontrollable wildfires.
For much of the West, the future is now.
Last year, wildfires burned more than 4.3 million acres across California — the most in state history — and now at least one-quarter of the state’s residents live in high fire risk zones, according to state fire officials.
Under a worst-case scenario, in which emissions continue to increase, scientists anticipate that Western summers could warm by as much as 4 degrees Celsius. Drought severity will triple. Wildfire “season” will become a year-round event.
Even desert plants and animals — creatures that evolved to withstand water scarcity — are unable to cope with the ongoing drought. Creosote and mesquite bushes wither. Giant saguaro cactuses are shriveling in the heat.
In recent weeks, several Northern California counties and cities have begun imposing water-saving regulations. Marin County, just north of San Francisco, was among the first to do so, prohibiting most outside water use in residential areas.
Healdsburg, in Sonoma County wine-growing country, imposed a mandatory 40 percent reduction in use compared with last year on all residents. The city took the step earlier this month after it became clear that it would not meet the initial 20 percent conservation target set in the spring.
Farmers have been told that state and federal water allotments will be curtailed, and hundreds of growers who have rights to draw from the nearby Russian River were informed this week that they would likely not be allowed to do so this year.
“Big agriculture will find a way to survive, they have the resources and flexibility,” said Sarge Green, a water management specialist with the California Water Institute at the California State University at Fresno.
Large growers have the resources to drill deeper groundwater wells, and the deeper they go in California’s San Joaquin Valley, the saltier the water is. There is talk of trying out desalination techniques to remove the salt from the deep-well water, making it useful for crops of almonds, pistachios, lettuce and others.
That is a longer-term idea. Right now, Green predicts that California agriculture will take a 20 to 30 percent financial hit this year.
“It’s going to be a big hurt,” Green said. “And it’s the small towns that get the hardest hit in times like this.”
At the same time, more than 40 million Americas are facing dangerous triple-digit temperatures this week as the summer’s first major heat wave sweeps across the West.
Long-established records were tied or toppled as the mercury spiked to 107 degrees Fahrenheit in Salt Lake City, 108 degrees in Billings, Mont., 121 degrees in Needles, Calif. Facing surging electricity demands, Texas grid operators asked residents to turn down their air conditioning.
In Lake Oroville, the dam, which at 770 feet high is the nation’s tallest, and its electricity production could soon be affected.
Another 60 feet or so of evaporation, which could come within weeks, will drop the water line below the turbines that provide power to the broader grid. Power companies across the California are preparing residents for a summer of rolling outages.
The extreme heat and drought have turned much of the West into a tinderbox.
Parched vegetation combusts more easily, giving wildfires more energy to burn. Already, firefighters are battling about 15 blazes in Arizona, at least nine in New Mexico and over two dozen more across other Western states.
This week’s extreme temperatures have made the fires dangerously unpredictable.
“The fact that it is so hot makes things more difficult for firefighters on the ground,” said Barb Satink Wolfson, a fire ecologist at Northern Arizona University and program coordinator for the Southwest Fire Science Consortium. “Fire behavior is elevated. The effects on the landscape are more severe.”
Nights offer no reprieve. Falling temperatures and rising humidity after dark typically tamp down fire behavior, giving firefighters a chance to get their bearings and get the blaze under control. But overnight lows in the region are not expected to drop below 90 degrees this week.
It’s not clear whether the state’s monsoon season, which lately has run from July through September, will bring any relief. The seasonal rains have disappointed two years in a row; 2020 was the Southwest’s driest monsoon season on record.
“We called it the ‘nonsoon,’” Wolfson said. “Really at this time of year we’re all sort of holding our breath, just hoping for rain.”
Driving west toward California wine country, the effects of the drought and the decisions being made around it are evident.
Green, flourishing fields are separated from fallow ones by a road or a fence line. “For sale” signs stand along the road at some farms. The dry, hot wind blows a fine dust through the orchards and rows of crops.
In Sonoma County, one of the first that Newsom declared to be in a drought emergency, grape growers are deciding how to plant and where to do so with water at a premium. There are 18 distinct growing regions within the county, most famous for its chardonnay.
Across the West last fall, wildlife biologists were shocked when migrating birds began dying by the hundreds of thousands. When Martha Desmond examined the carcasses, she found the animals were “emaciated.”
Years of drought had so depleted their food supply that birds were breaking down the muscles in their wings just to maintain enough energy to fly. A freak windstorm over Labor Day weekend and one of the worst fire seasons on record likely sealed the animals’ fates.
“We’re really setting ourselves up to be in the same situation right now,” said Desmond, a New Mexico State University ornithologist who studied last year’s die-off. “These are dangerous times for animals.”
Hard Times in America’s Fruit & Nut Basket – Farmers Struggle With Drought
NY Times
ORDBEND, Calif. — In America’s fruit and nut basket, water is now the most precious crop of all.
It explains why, amid a historic drought parching much of the American West, a grower of premium sushi rice has concluded that it makes better business sense to sell the water he would have used to grow rice than to actually grow rice. Or why a melon farmer has left a third of his fields fallow. Or why a large landholder farther south is thinking of planting a solar array on his fields rather than the thirsty almonds that delivered steady profit for years.
“You want to sit there and say, ‘We want to monetize the water?’ No, we don’t,” said Seth Fiack, a rice grower here in Ordbend, on the banks of the Sacramento River, who this year sowed virtually no rice and instead sold his unused water for desperate farmers farther south. “It’s not what we prefer to do, but it’s what we kind of need to, have to.”
These are among the signs of a huge transformation up and down California’s Central Valley, the country’s most lucrative agricultural belt, as it confronts both an exceptional drought and the consequences of years of pumping far too much water out of its aquifers. Across the state, reservoir levels are dropping and electric grids are at risk if hydroelectric dams don’t get enough water to produce power.
Climate change is supercharging the scarcity. Rising temperatures dry out the soil, which in turn can worsen heat waves. This week, temperatures in parts of California and the Pacific Northwest have been shattering records.
By 2040, the San Joaquin Valley is projected to lose at least 535,000 acres of agricultural production. That’s more than a tenth of the area farmed.
And if the drought perseveres and no new water can be found, nearly double that amount of land is projected to go idle, with potentially dire consequences for the nation’s food supply. California’s $50 billion agricultural sector supplies two-thirds of the country’s fruits and nuts and more than a third of America’s vegetables — the tomatoes, pistachios, grapes and strawberries that line grocery store shelves from coast to coast
Glimpses of that future are evident now. Vast stretches of land are fallow because there’s no water. New calculations are being made about what crops to grow, how much, where. Millions of dollars are being spent on replenishing the aquifer that has been depleted for so long.
“Each time we have a drought you’re seeing a little glimpse into what will happen more frequently in our climate future,” said Morgan Levy, a professor specializing in water science and policy at the University of California, San Diego.
California’s fertile Central Valley begins in the north, where the water begins. In normal times, winter rain and spring snowmelt swell the Sacramento River, nourishing one of the country’s most important rice belts. On an average year, growers around the Sacramento River produce 500,000 acres of sticky, medium-grain rice vital to sushi. Some 40 percent is exported to Asia.
But these are not normal times. There’s less snowpack, and, this year, much less water in the reservoirs and rivers that ultimately irrigate fields, provide spawning places for fish and supply drinking water for 39 million Californians.
That crisis presents rice farmers in the Sacramento Valley, which forms the northern part of the Central Valley, with a tricky choice: Should they plant rice with what water they have, or save themselves the toil and stress and sell their water instead?
Mr. Fiack, a second-generation rice farmer, chose to sell almost all of it.
His one 30-acre field of rice glistens green in the June sunshine, guzzling water that pours out of a wide-mouthed spigot. His remaining 500 acres are bare and brown. What water he would have used to grow rice he has signed away for sale to growers of thirsty crops hundreds of miles south, where water is even more scarce.
At $575 per acre-foot (a volume of water one acre in size, one foot deep) the revenue compares favorably to what he would have made growing rice — without the headaches. It makes “economic sense,” Mr. Fiack said flatly.
Rice is far less lucrative than, say, almonds and walnuts, which is why Mr. Fiack’s fields are surrounded by nut trees and even he is dabbling in walnuts. But rice farmers are uniquely advantaged. Because their lands have been in production for so long, they tend to have first dibs on water that comes out of the Sacramento River, before it is channeled through canals and tunnels down south.
Also, unlike the owners of fruit and nut trees, whose investments would wither in a few weeks without water, rice farmers can leave a field fallow for a year, even two. In the era of climate change, when water can be unreliable, that flexibility is an asset. Rice water transfers have been an important part of California’s drought coping strategy.
This year, rice farmers in the Sacramento Valley will produce around 20 percent less rice.
Not everyone is enthusiastic about that.
Kim Gallagher, a third-generation rice farmer, left fallow only 15 percent of her fields. She worries about the effect on the rice mills and crop-duster pilots who live off rice farming, not to mention the birds that come to winter in the flooded fields. “These are trade-offs every farmer has to make, what they can fallow and what they can’t,” she said. “Everyone has a different number.”
Fritz Durst, a fourth-generation rice farmer, worries that California rice buyers would come to see his region as an unreliable supplier.
He, too, hedged his bets. He is growing rice on about 60 percent of his 527 acres, which enables him to sell the Sacramento River water he would have used on the rest.
But there’s a long-term risk, as he sees it, in selling too much water, too often. “You also have people here who are concerned that we’re setting a dangerous precedent,” he said. “If we start allowing our water to go south of the Delta, those people are going to say, ‘Well, you don’t need that water. It’s ours now.’”
Federico Barajas is in the unenviable position of having to find water. As the manager of the San Luis and Delta-Mendota Water Authority, he has negotiated a deal to buy from water districts like Mr. Durst’s.
There’s just one problem: Because the rivers are so hot and dry this year, the federal government, which runs the Shasta Dam, where cold Sacramento River water is stored, has said the water needs to stay in the reservoir through the summer months for another source of food: fish that hatch in California’s rivers.
He’s not accepting defeat. “We’re still looking for anybody out there who has any drop of water we can purchase and transfer,” he said gamely.
Nearby, off Interstate 5, Joe Del Bosque had been counting on that rice water from the north. It’s how he’s survived the droughts of the past, he said. “This is the worst year we’ve had,” Mr. Del Bosque said.
Mr. Del Bosque grew up working on melon farms with his farmworker father. Today, Mr. Del Bosque owns a melon farm near the town of Firebaugh. He grows organic cantaloupes and watermelons on most of his 2,000 acres, destined for supermarket shelves nationwide. The license plate on his GMC truck reads “MELONS.”
This year, he’s left a third of his land fallow. There’s just not enough water. He had planted asparagus on a few fields, too, only to pull it out. A neighbor pulled out his almonds.
The hot, dry San Joaquin Valley became cotton farms at the turn of the 20th century, at the time with water flowing from the north through fields of alfalfa and then strawberries and grapes. Almonds took over as prices soared. And with more demands on the surface water flowing through the river — to maintain river flows, for instance, or flush seawater out of the California Delta — farmers turned increasingly to the water under their land.
It provides 40 percent of the water for California agriculture in a normal year, and far more in dry years. In parts of the state, chiefly in the San Joaquin Valley, at the southern end of the Central Valley, more groundwater is taken out than nature can replenish.
Now, for the first time, under the state’s Sustainable Groundwater Management Act, growers in some parts of the San Joaquin Valley face restrictions on how much water they can pump. That is set to transform the landscape. If you can’t pump as much water from under the ground, you simply can’t farm as much land in the San Joaquin Valley.
“There’s just no way around that,” said Eric Limas, the son of farmers who now manages one of the most depleted irrigated districts, called Pixley, a checkerboard of almond orchards and dairies. “The numbers just don’t add up.”
So thoroughly have aquifers been depleted that farmers are now investing millions of dollars to put water back into the ground. They’re buying land that can absorb the rains. They’re creating ponds and ditches, carving up the landscape, again, to restore the groundwater squandered for so long.
Meanwhile, towns in the Central Valley are beginning to run out of municipal water, including Teviston, just south of Mr. Limas’s office, where town officials have been delivering bottled water to 1,200 residents for nearly two weeks.
Stuart Woolf embodies the changing landscape of the San Joaquin Valley.
Mr. Woolf took over his father’s farm, headquartered in Huron, in 1986, retired most of the cotton his dad grew, switched to tomatoes, bought a factory that turns his tomatoes into tomato paste for ketchup. His operations expanded across 25,000 acres. Its highest value crop: almonds.
Mr. Woolf now sees the next change coming. The rice water from the north won’t come when he needs it. The groundwater restrictions will soon limit his ability to pump.
He has ripped out 400 acres of almonds. He’s not sure he will replant them anytime soon. In the coming years, he estimates he will stop growing on 30 to 40 percent of his land.
He has left one field bare to serve as a pond to recharge the aquifer, bought land in the north, where the water is, close to Mr. Fiack’s rice fields. Now, he is considering replacing some of his crops with another source of revenue altogether: a solar farm, from which he can harvest energy to sell back to the grid.
“Look, I’m a farmer in California. The tools we had to manage drought are getting limited,” he said. “I’ve got to fallow a lot of my ranch.”