Water Security vs. Water Marketing

It’s not long ago that Lake Cachuma, the main water source on the South Coast, was in danger of going dry in a seven-year drought.

Water agencies from Carpinteria to Goleta spent millions of dollars scrambling to buy surplus state aqueduct water from around the state to avert a local shortage. They did so not only because their groundwater levels were plunging and Cachuma was failing, but because their yearly allocations from the aqueduct had dropped to zero.

Yet on Tuesday, the water managers serving Santa Maria, Buellton, Guadalupe, Santa Barbara, Goleta, Montecito and the Santa Ynez and Carpinteria valleys will ask the County Board of Supervisors to grant them the right to sell their state water allocations outside the county — not permanently, but potentially for years at a stretch.

“As water purveyors, we need to have the flexibility to do what we need to do,” said Joshua Haggmark, Santa Barbara water resources manager. “The county, up to now, has said we can’t sell water out of the county. If we can’t use it, we just lose it. It creates an additional financial hardship for our customer.”

For Santa Barbara and Montecito, the big change since the last drought is that they are jointly paying for a $72 million desalination plant that the city built on its waterfront in 2017. With plenty of that water on hand, they don’t need so much state water for the foreseeable future.

“We need to offset that cost somewhere,” Haggmark said. “This isn’t selling our state water forever; it’s leasing our allocation.”

Together, the eight water agencies make up the Central Coast Water Authority, which owns and operates the pipeline from the California Aqueduct in Kern County to Lake Cachuma. Because the county, not the CCWA, holds the pipeline contract with the state Department of Water Resources — a sore point with Haggmark and other water agency managers — they have to get the county’s permission to loosen the water marketing rules.

Currently under the contract, only exchanges of state water, and not outright sales, are allowed: The price is limited by the state, and buyers must return the water to the sellers. South Coast water agencies are still on the hook for the extra state water they bought during the last drought.

Water managers want the flexibility to sell state water in wet years because, they say, they have nowhere to store it. But a county staff report for Tuesday’s meeting advises the board not to allow sales of state water outside the county, noting that allocations from Cachuma to the South Coast and Santa Ynez Valley were severely cut during the drought of 2011-2018.

“We’re really frustrated with the county’s position,” Haggmark said. “They don’t have any knowledge of water planning or responsibility to ratepayers.”

Supervisor Das Williams, who represents eastern Santa Barbara, Montecito and the Carpinteria Valley, said the managers won’t say to whom they want to sell their state water.

“The response we get is, ‘It’s none of your business,’” he said. “Is this really going to help the water supply, or could this potentially hurt it?

“There is plenty of storage in Cachuma. We don’t want short-sighted decisions to be made that could lead to water being transported out of the county when we might need it here. When you are tempted to liquidate water for money, it puts additional stress on the groundwater basin that sometimes you cannot afford. Without the county, there’s no way to guard the interests of the whole region.”

Up north, Santa Maria, the largest state water contractor in the county, has an entitlement twice as large as the South Coast’s and has long sought more flexibility in water marketing rules. During the recent drought, Santa Maria sold state water to the South Coast.

Twenty-four of the 29 state water contractors in California have already approved the new water marketing rules; Santa Barbara County is one of the last holdouts. That may make it harder for CCWA members to buy extra supplies of state water in the next drought, said Shad Springer, Santa Maria’s director of utilities.

“It’s not that the city has immediate plans to sell water out of the county or anywhere else,” he said. “An important aspect of this is that as these [rules] are being adopted by other water contractors, the old tools may not be available to us. There may not be a market out there where we could import additional water from the existing exchange program.”

Last month, in a bid to win the Board of Supervisors’ approval, the CCWA agreed that each member would have the “first right of refusal” if another wanted to sell state water outside the county.

Supervisor Steve Lavagnino said he likes that idea.

“I have no beef with the CCWA,” he said. “I want to make sure that somebody else inside the county gets the offer first,” he said.

Contract Extension

At Tuesday’s hearing, the board also will consider whether to extend the county’s contract with state Water Resources for another 50 years. The current contract is set to expire in 2038, when the eight water agencies — that is, the ratepayers — will pay off their debt for the $575 million aqueduct branch to Cachuma.

The CCWA favors extending the contract so that any future costs connected to the aqueduct can be spread out over decades. But the California Water Impact Network (C-WIN) and AquAlliance, two watchdog groups, are suing to stop the 50-year extension. They say that that the state’s environmental review failed to consider the cost of future aqueduct-related projects for ratepayers.

Over several decades, the department has considered different plans for improving the health of the fragile Sacramento-San Joaquin River Delta, where massive pumps divert water into the state aqueduct. Most recently, the department has proposed building a $16 billion tunnel under the Delta to protect this critical water source from climate change and seismic threats.

The C-WIN lawsuit notes that historically, the state aqueduct was built on “paper water” and has failed to reliably deliver even half of what the contractors, including Santa Maria and the South Coast agencies, are paying for. A delta project would not provide a single drop of new aqueduct water for Santa Barbara County, said Carolee Krieger, a Montecito resident and the founder of C-WIN.

“We would be vulnerable to anything the Department of Water Resources wants to build, and we would have to pay our share of it,” she said. “We don’t need to do this. By 2038, we will have paid off the pipeline, and we’re entitled to the water we’ve paid for, indefinitely. There is no new water in the system.”

The CCWA has voted to opt out of the delta project, but Krieger is not convinced: The project itself has not been approved yet.

“What if they change their mind?” she asked.

Melinda Burns volunteers as a freelance journalist in Santa Barbara as a community service; she offers her news reports to multiple local publications, at the same time, for free.