(Central Delta Water Agency, et al. v. Department of Water Resources, et al.)

CFS is lead counsel in Central Delta Water Agency, et al. v. Department of Water Resources, et al., also known as “Monterey Plus,” which challenges the environmental review of the Monterey Amendments (as amended and approved in 2010) and challenges the constitutionality of the amendments, including the transfer of the Kern Water Bank from the state to private control. The case is currently fully briefed and awaiting oral argument before the 3rd District Court of Appeal in Sacramento (Case No. C078249).

In 1995, a handful of southern California water agencies and the California Department of Water Resources (“DWR”) met in secret and negotiated the Monterey Agreement, a plan to amend the long-term contracts for the operation of California’s State Water Project (“SWP”), one of the largest public works projects in the country and an essential component of California’s water delivery infrastructure. The Monterey Agreement, and the Monterey Amendments, as the contract amendments became known, provided for a wide-ranging alteration of the relationship between the State of California, the owner and operator of the SWP, and the water contractors (the agencies that contract with DWR for SWP water to deliver to agricultural, residential, and commercial customers).

The Monterey Amendments eliminated critical checks and balances that had been built into the SWP system when it was first proposed and presented to the citizens of California for their approval, by ballot initiative, in the early 1960s. These checks and balances included provisions that protected residential and commercial customers (i.e., urban contractors) in times of drought while providing agricultural contractors with favored access to cheaper water in times of plenty. The effects of these changes have been wide-ranging, from major shifts in agricultural production like the rapid and unsustainable growth of nut tree farms in the southern San Joaquin Valley to the approval of sprawl development projects lacking assurances of long term water supplies.

The Monterey Amendments also accomplished the transfer of the Kern Water Bank—one of the largest water banking facilities in the world—from public control through DWR to private control through the Kern Water Bank Authority, a public-private joint powers authority that is majority-controlled by appellant Paramount Farming, a major international agribusiness company largely responsible for the growth in nut tree crops in the San Joaquin Valley.
Despite having first been adopted almost two decades ago, the Monterey Amendments are not a done deal. They have always been subject to review under the California Environmental Quality Act (“CEQA”). The first attempt at CEQA review, completed in 1995, was rejected by the courts in 2003. The second attempt, initiated in 2003 and completed in 2010, is the subject of this action by Plaintiffs and Appellants Central Delta Water Agency, et al. (“Plaintiffs”). As a result of this action, DWR is currently undertaking a third attempt, focusing on one portion of the Monterey Amendments regarding the transfer, use, and operation of the Kern Water Bank (“KWB”).

This action challenges the Monterey Amendments and presents three separate grounds for reversal of the Superior Court’s Judgment. First, DWR’s 2010 environmental review of the Amendments violated CEQA because DWR failed to make a decision on whether to approve or disapprove the Monterey Amendments (or “Project”). In an apparent effort to immunize its 1995 authorization of the contract amendments from judicial scrutiny, DWR attempted to retrospectively analyze the Monterey Amendments’ environmental impacts, refusing to make new project approvals after completing its environmental review in 2010. But the prior approvals had been voided by a 2003 writ and order issued as a result of a CEQA challenge. DWR was required under CEQA to not only perform proper environmental review of the Amendments, but also to either authorize or reject them on a final basis at the conclusion of that review. DWR’s failure to do this violated CEQA, and this Court should remand the matter with directions to DWR to either properly approve or properly reject the project.

Second, the 2010 Environmental Impact Report (“EIR”) violated CEQA because DWR failed to adequately analyze the no project alternative by failing to take account of how the provisions of the SWP contracts would govern the allocation of surplus water in the absence of the Monterey Amendments.

Third, this appeal challenges the Superior Court’s determination that Plaintiffs’ reverse-validation claim was not timely. Altering the SWP contracts and giving away the KWB violated numerous California constitutional and statutory provisions, including prohibitions on the giving away of public resources, changing the terms of public bond agreements, and selling or conveying any component of SWP infrastructure. If DWR’s actions in connection with the 2010 EIR are construed as a decision to adopt the Monterey Amendments, that approval is subject to a validation challenge. And if it is construed instead, as DWR contends it should be, as a decision to “continue” the Monterey Amendments rather than to authorize them, it is still challengeable under validation law as a reenactment of the prior authorizations. In either case, Plaintiffs’ reverse-validation action was timely as it was filed at the earliest possible opportunity after the final authorization (or reenactment) of the contract amendments by DWR.

Key Documents:

Appellants’ Opening Brief
DWR’s Response Brief
SWP Contractors’ Response Brief
KWB Parties’ Opening and Response Brief
Appellants’ Reply Brief and Opposition to KWB Parties’ Cross-Appeal
KWB Parties’ Reply Brief
PCL Amicus
Appellants’ Response to PCL Amicus
DWR Response to PCL Amicus
KWB Parties’ Response to PCL Amicus

(Center for Food Safety, et al. v. Department of Water Resources, et al.)

CFS is lead counsel in a companion case to Central Delta – Center for Food Safety, et al. v. Department of Water Resources, et al., which challenges the environmental review of the Kern Water Bank transfer (“Monterey Plus Revised Environmental Impact Report”). The court-ordered EIR was a result of the trial court victory in Central Delta but, perhaps predictably, DWR again failed to fully analyze the environmental impacts of transferring and operating the Kern Water Bank, particularly those impacts associated with the conversion of thousands of acres of crops to unsustainable permanent crops like almonds and pistachios. The case is currently before the Hon. Timothy M. Frawley in Sacramento County Superior Court (Case No. 34-2016-800002469).

The Kern Water Bank is a major component of the State Water Project (“SWP”). It was originally conceived of as a state wide water storage facility located in Kern County. The state, through the Department of Water Resources (“DWR”) began planning the KWB in the early 1980s.

On December 13, 1995, as part of the larger Monterey Amendments to the long term contracts of the SWP, DWR transferred the KWB to the Kern County Water Agency, who immediately transferred the KWB to the Kern Water Bank Authority (“KWBA”), a public-private joint powers authority that currently holds title to and operates the KWB. Although ostensibly a public agency, KWBA is controlled by a single entity: Paramount Farms / Wonderful Companies, through its ownership of KWBA member Westside Mutual Water Company and its political control of two other KWBA member water districts.

An EIR was first prepared for the Monterey Amendments (including the KWB transfer) in 1995 by the Central Coast Water Authority. This EIR was the subject of litigation filed by the Planning and Conservation League and two other petitioners. As a result of that lawsuit, the 1995 EIR was de-certified and the project approvals stricken, but the KWB was allowed to continue to be controlled and operated by KWBA, on an interim basis, until the completion of new environmental review.

After several years of settlement negotiations, in 2003 DWR started work on a new EIR for the KWB transfer, again as part of a review of the larger Monterey Amendments. On February 1, 2010, DWR certified a new EIR for the new project, now called Monterey Plus, and on May 5, 2010, DWR filed a notice of determination, explaining that it had decided, after review of the EIR, to continue operating the SWP under the Monterey Amendments (plus the terms of the preceding settlement agreement), including leaving the KWB transfer in place.

In 2014, Judge Timothy M. Frawley of the Sacramento Superior Court found that the Monterey Plus EIR did not comply with CEQA with respect to the development, use, and operation of the KWB. The court concluded that DWR violated CEQA by failing to adequately describe, analyze, and (as appropriate) mitigate the potential impacts of the Project associated with the anticipated use and operations of the KWB. The court stated that the failure to include relevant information regarding the operations of the KWB precluded informed decision-making and informed public participation, thereby thwarting the statutory goals of the EIR process. The court issued an order that required DWR to correct the deficiencies and rectify the EIR by preparing a legally sufficient Revised EIR for the transfer, development, use, and operation of the KWB as a water banking and recovery project.

In 2016, pursuant to the Superior Court’s 2014 Order, DWR issued the Draft Revised EIR for the “Monterey Plus — Kern Water Bank Development and Continued Use Operation.” The Revised EIR was supposed to address all potentially significant environmental impacts of the transfer, use, and operation of the KWB, but it failed this purpose in a number of ways. First, the Revised EIR does not adequately analyze the environmental impacts of the use of KWB water to irrigate the vast increase in permanent crop acreage that directly and indirectly resulted from the KWB transfer. These impacts include significantly increased pumping from the Bay-Delta and increased economic, political, and practical pressure on DWR to ensure a constant supply of water to these agricultural users.

Second, the Revised EIR fails to add any additional review of the environmental impacts of the Monterey Amendments’ deletion of Article 21(g)(1). Article 21(g)(1) was a provision in the original long-term contracts that required DWR to not deliver “surplus” water (any water above what DWR plans to deliver to satisfy the contractors’ “annual entitlements”) if such delivery would contribute to a dependency on that water. In other words, surplus water was to be used for temporary purposes only – not for housing and not for permanent crops like almonds or pistachios. Because the Revised EIR revealed new information that demonstrated that surplus water has in fact been used to grow permanent crops, DWR’s original analysis and conclusions made in the Monterey Plus EIR must now be revisited.

CFS led a coalition of groups in filing a new lawsuit on this EIR. The suit is currently pending.

Key Documents:

Petition for Writ of Mandate

CFS is actively challenging the preparation and approval of the extensions to the long-term contracts for SWP deliveries, currently being negotiated between DWR and the contractors. A draft environmental impact report was prepared for these contract extensions, to which CFS commented. A final EIR and new decision on the extensions is expected in early to mid-2017.

Key Documents:

CFS Comments to EIR
San Jose Merc News Op/Ed