DROUGHT

S. Calif. water district exerts heavy influence on legislative negotiations

As congressional talks continue over California's historic drought, one participant in the negotiations has been more influential than it has claimed.

Metropolitan Water District, a consortium of 26 public agencies that supplies water to 19 million people in Southern California, sent Sen. Dianne Feinstein (D-Calif.) and Rep. Jim Costa (D-Calif.) proposals for managing the state's water that made it into bills that passed both houses last year, according to documents obtained through a California Public Records Act request.

Emails between Met staff, Feinstein's staff and others also reveal extensive negotiations last year over a draft bill by Feinstein that never got introduced but has been under discussion again this session. Most of the proposals focused on tweaking the way Endangered Species Act protections are applied in the Sacramento-San Joaquin River Delta, the source of water supplies for 25 million people and 3 million acres of farmland via two giant systems of canals and pumps.

Met supplied the documents Dec. 5, 2014, in response to a request from environmental groups, which along with House Democrats were clamoring to be included in negotiations.

The emails underscore the role of urban water districts in the negotiations. Much of the back-and-forth negotiations has been portrayed as agricultural contractors in the Central Valley pushing back against water reserved for endangered species via a set of much-litigated biological opinions, which kick in when chinook salmon or delta smelt are moving through the system, limiting the amount of water that the state and federal governments can pump to customers.

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But Met -- the largest supplier of drinking water in the country -- has also been a prime mover behind the congressional push, which drew a veto threat from President Obama last February and again in December, when the House passed bills from Rep. David Valadao (R-Calif.) that would have gone much further than the Feinstein bill in guaranteeing water deliveries for state and federal contractors. After months of negotiations last summer and fall between Feinstein, Costa and California's Republican House delegation, members withdrew after failing to get language included in the omnibus spending bill at the end of 2014, vowing to resume talks this year.

Met has claimed limited involvement in the debate over the Feinstein bill, but the emails show otherwise.

On Nov. 18, 2014, Met's general manager, Jeffrey Kightlinger, told his board members that the agency's involvement in the under-wraps Feinstein bill was limited. He emphasized that conversations with Feinstein's staff were "technical" and said he was ignorant of the bill's overall policy direction.

"I presume our input is not encouraging her to gut the Endangered Species Act in any way?" board member Paul Koretz asked.

"No, and frankly, most of our conversations have really been very technical, on issues -- impacts that would -- if you did a certain action, what would the impacts be potentially to the State Water Project, both pro and con, and those sorts of things," Kightlinger said. "So it's been pretty technical. She's keeping her policy cards close to her vest as to where she wants to go on policy, but her staff is doing a lot of reaching out to make sure the technical details are correct."

Koretz asked again: "And as you said, we haven't seen anything to lead us to believe that the Endangered Species Act would be negatively impacted by this bill?"

"Not in my view, no," Kightlinger replied.

The two-minute exchange between Koretz and Kightlinger didn't make it into Met's board meeting minutes the next month. On Dec. 9, the minutes were amended to reflect the exchange.

Kightlinger said such an aside wouldn't normally be included in the minutes and that it was added in later at Koretz's request.

He also said he stood by his statement that Met's involvement was "technical" rather than policy-oriented.

"What we looked at, I would consider pretty technical," he said, "where there was room for adaptability or flexibility within the biological opinions, which are, frankly, highly technical."

A statewide powerhouse

Met is the largest customer of the State Water Project, a massive midcentury system of canals and pumps that is intended to deliver more than a billion gallons per day from the delta to Southern California via a 440-mile aqueduct. It also takes 800 million gallons per day from the Colorado River, 240 miles away.

This year, however, the drought has reduced delta deliveries by about two-thirds, leaving a gap of about 500,000 acre-feet to be filled by conservation and mandatory water pricing, set to be voted on next month by Met's board. Met is governed by a board of 37 members, appointed from its various member agencies, but its executive staff is in charge of day-to-day operations.

Major players in the negotiations, according to the emails, were Met Assistant General Manager Roger Patterson; Westlands Water District General Manager Tom Birmingham; Met Special Projects Manager Brenda Burman, a former counselor to the Interior Department's assistant secretary for water and science and later deputy commissioner at the Bureau of Reclamation under President George W. Bush; and David Bernhardt, former Interior solicitor under Bush and a current attorney and lobbyist for Westlands, a major agricultural water contractor in the San Joaquin Valley.

On Feb. 5, Metropolitan staff reviewed proposed bill language from Feinstein staff that would allow the National Marine Fisheries Service to modify import-export ratios for water coming into and leaving the delta, in order to allow water transfers that exceeded levels established to protect steelhead salmon in the San Joaquin River.

Patterson asked Met lawyers to vet some bill text that Feinstein legislative assistant Felix Yeung sent to Patterson under the heading, "Your language."

"Can you both take a look at this ASAP and confirm that you believe NMFS would have discretion under the BiOp to do this? It's intended to let them allow 1:1 pumping of any transfer water no matter what the underlying base ratio may be," Patterson wrote.

The 2009 biological opinion, which protects endangered salmon in the delta, likely did not envision water transfers, so exceeding the ratio should be permitted, Met Deputy General Counsel Linus Masouredis wrote.

The language showed up in Feinstein's S. 2918, which passed the Senate on May 22 under a "hotline" procedure that did not allow any hearings (E&E Daily, May 23, 2014). It also appeared in Valadao's H.R. 5781, which passed the House in December.

In June, Burman sent Costa's chief of staff, Scott Petersen, a six-page summary of aspects of the Feinstein bill that Met supported and a list of additional proposed changes to ESA implementation, including placing an "indefinite hold" on parts of the biological opinion protecting salmon, such as restrictions on exports and river flows.

Another example of the tweaks Met proposed concerned a provision in the biological opinion that limits withdrawals when smelt are near the pumps. Burman sent language to Feinstein and Costa staffers July 22, 2014, that would require the Interior Department to conduct modeling to see whether fish might be near the pumps, in addition to relying on manual surveys and measurements of water conditions when deciding whether to limit pumping.

"By requiring a reporting it is hoped that ... the Secretary will have to account for modeling and the presence or absence of fish in the river," Burman wrote to John Watts, Feinstein's legislative director.

Watts then emailed them draft bill language on July 29, the day before he sent it to Obama administration wildlife officials for vetting. He also sent a draft to officials from two other major water interests in the Central Valley: the Kern County Water Agency and Paramount Farms, the massive, privately held fruit and nut grower that processes more than half of the pistachios grown in California, under the brand name Wonderful Pistachios.

"I would appreciate your thoughts on the attached draft water bill language, which I have developed working with Metropolitan and Westlands," he wrote.

Pushback from Obama officials

The emails show a flurry of activity in September, after Feinstein gave Watts the green light in late July to share the bill with the Obama administration. They also show administration officials pushing back on the Feinstein draft bill in an attempt to enforce the ESA.

"The original language puts Reclamation and the Services in the position of potentially violating the measures in the opinions required to prevent jeopardizing the species," officials from the Fish and Wildlife Service and the National Marine Fisheries Service wrote in the revisions, which Watts sent to Westlands and Met staff on Sept. 6, 2014.

"I do think we have to respect the Administration's conclusion that a mini-jeopardy analysis would not work and would constitute a significant amendment to the ESA," Watts then wrote to Birmingham, Burman, Bernhardt and Patterson on Sept. 13, 2014. "We don't have to accept their substitute, however."

Watts said that NMFS West Coast Regional Administrator Will Stelle's suggestion to work within the biological opinions might be more politically feasible.

"I believe we need to try this approach because it has two very significant and probably essential advantages: 1) It allows us to say that we are working with the BiOps rather than overriding them, which is politically essential; and 2) It helps protect us from enviro lawsuits that we are going outside the biops, requiring reconsultation," he wrote.

Kightlinger said he stood by his statement that the draft bill wouldn't have weakened the ESA, despite the administration's findings. "My language was that there was nothing we have provided that in our view would amend or change the Endangered Species Act, and I don't believe there is," he said.

An environmentalist who has been following the negotiations said the proposals were aimed directly at weakening the law. Several of Burman's suggestions, such as lifting flow restrictions in the San Joaquin River, were also sought in a 2009 lawsuit from Met, Westlands, Kern and others. The 9th U.S. Circuit Court of Appeals upheld the existing regulations in December (E&ENews PM, Dec. 22, 2014).

"It would definitely weaken protections for endangered species in the delta, there's no question about it," said Doug Obegi, a staff attorney with the Natural Resources Defense Council. "Those are provisions that were litigated and the court upheld, and now Met is seeking to get Congress to waive those protections for endangered steelhead."

Other emails that environmental groups obtained from Westlands also show Bernhardt and Birmingham working with Valadao's staff on the bill that passed the House in December 2014 (E&ENews PM, Dec. 9, 2014).

"Where can I find the latest numbers for the amount of water that has been dumped into the ocean for fish etc?" Valadao's legislative director, Jessica Butler, wrote to Birmingham and Bernhardt on Dec. 8, 2014, at a House Rules Committee hearing the day before the bill passed the House.

Met voted to oppose the first Valadao bill last March, however, on a motion from Koretz. Kightlinger said that wasn't inconsistent with Met's work on the bill.

"That is staff's job, to work with elected officials," he said. "Final positions on final bills are the board's prerogative."

'This wasn't just the technical points'

A House Democrat who represents Northern California tribal Indian and farming constituencies, Rep. Jared Huffman, said he was surprised by Met's intimate involvement.

"It certainly confirms the type of input we know Sen. Feinstein and the Republicans were getting, but I am surprised to see the significant role that the Metropolitan Water District was playing behind the scenes," he said.

Huffman, a former senior attorney with the Natural Resources Defense Council, pointed out that Met's involvement with the Feinstein bill could have led to a conference committee with Valadao and the other House Republicans, whose February bill went much further.

H.R. 3964 would have undone a San Joaquin River restoration program that has been the object of a court settlement and intricate compromises between state and federal officials for decades, capped the delivery of water for environmental purposes, lengthened irrigation contracts and lifted certain environmental protections in area watersheds, among other controversial provisions (E&E Daily, Feb. 6, 2014).

"This wasn't just the technical points they were submitting in isolation," Huffman said. "This was attached to a really big, nasty piece of legislation."

"Everybody knows this was part of negotiations between Senator Feinstein and Valadao and the Republicans," he continued. "Whatever they may have been suggesting for Senator Feinstein, they knew it was going to be attached to something very controversial and very destructive, or else it could never have passed muster with the Republicans."

Talks appear to have slowed down between Feinstein and the Northern California contingent. Huffman said he hasn't discussed the bill with Feinstein since a meeting in January with Northern California Democrats (Greenwire, Jan. 28).

Feinstein's spokesman said he didn't have a timeline for when a bill might be introduced.

"Over the past year the senator and her staff met, emailed and spoke with dozens of agencies and groups about drought legislation, and those consultations continue," spokesman Tom Mentzer said in an email. "That back-and-forth is how bills get drafted, especially controversial bills like this one. Feedback is sought, applied when appropriate, and a bill slowly comes together."

"I won't comment on specific conversations except to say they all share the same goal: developing an emergency bill (with a limited duration) that will help the whole state and improve conditions for fish and wildlife by prudently increasing water supplies -- all while not violating environmental laws such as the Endangered Species Act and the Clean Water Act," Mentzer added.

Met officials have found more success in dealing directly with the federal agencies. Late last year, they successfully challenged FWS's calculation of the number of smelt that can legally be killed each year -- another metric defined in the 2008 biological opinion. That led to FWS more than doubling the amount that can be killed this water year, from 78 to 196 (Greenwire, Jan. 29). Burman proposed the same adjustment to Petersen on June 12, 2014.

Birmingham and Kightlinger said they hadn't been in discussions over a drought bill this year. Kightlinger visited Washington, D.C., earlier this year and met with lawmakers including Feinstein, Huffman, House Majority Leader Kevin McCarthy (R-Calif.) and Reps. Ken Calvert (R-Calif.), Adam Schiff (D-Calif.) and Grace Napolitano (D-Calif.), but discussed only the political chances of a bill, rather than specifics.

"We, Met, would like to see a bipartisan bill that parties can agree to," he said. "Historically, water has not been a partisan issue, but like many things these days, it's getting more and more partisan."

Birmingham said the need for a legislative fix has only increased since last year's talks.

"I would observe that the drought has worsened and the need for some action is only exacerbated," he said. "It's my hope that some legislation providing congressional direction on how the existing biological opinions will be applied to the operations of the Central Valley Project and State Water Project during the ongoing crisis will be enacted."

Twitter: @debra_kahn | Email: dkahn@eenews.net

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