Montecito Water District to Sell Nearly Half of Its State Water Allotment to Solomon Hills Housing Project

---

This article was underwritten in part by the Mickey Flacks Journalism Fund for Social Justice, a proud, innovative supporter of local news. To make a contribution go to sbcan.org/journalism_fund.

---

What does the Montecito Water District have to do with a massive housing project proposed in North County? On September 29, the district voted to approve a nonbinding letter of intent that would sell approximately 40 percent of its current state water entitlement to Solstra Communities California, the group aiming to build 4,000 homes on an expanse of rural land south of Orcutt. 

The project, Solomon Hills, would build a new community: apartments, townhomes and single-family houses, along with office and retail space, a school, fire station, a fitness building and pool, and wastewater reclamation facility. The project’s 400 apartments would be marketed as affordable. A little under two-thirds of the land would serve as parks or open space. 

In a project description document submitted to the County of Santa Barbara, Solomon Hills’ development team says imported water will serve as the main domestic water supply, including water from California’s state water project and potentially the controversial Cadiz Water Project, which seeks to extract groundwater from the Mojave Desert and pipe it through a former oil pipeline. It also mentions a deal with the Montecito Water District. 

In the September 29 meeting, Montecito Water District General Manager Nick Turner said that the district’s state water allotment cost the district about $5 million annually, plus variable costs, and was unreliable. Turner also said that, because of the water district’s diversification of water sources, including its deal with Santa Barbara and its desalinization plant, it did not need the allotment — it hadn’t used state water since 2019. 

“It’s a costly supply we don’t need,” he said.

At the meeting, some public commenters raised concerns about selling off what amounted to an avenue for possible water. What if the desalinization plant suffered damage? one commenter asked. What if Montecito grew in size, especially with housing laws increasing the density of development? What were the implications of selling the allotment’s transition lines? 

Still, the district’s boardmembers saw the opportunity to sell some of an unneeded allotment as a positive. 

What does that mean for Solomon Hills? After all, the amount of water the new project can receive depends on the year. Annually, the California Department of Water Resources announces an allocation of water for each community based on the snowpack and reservoir storage. In dry years, even though these communities are paying for state water, they may not receive it. On September 29, Turner presented data that showed in 2021 and 2022, the community’s driest years on record, the district received only 5 percent of its allotment. 

In the county’s project description document, county planners acknowledge this challenge, saying that Solomon Hills’ reliance on imported water that may not be available when it is ready to be developed is a potential barrier. Along with imported water sources, the document said that recycled water would irrigate parks, commercial areas, and landscaping. The project would also build storage basins to hold excess recycled water during wet weather.  

For decades, people extracted oil and natural gas on part of the project’s acreage — a possible complicating factor when it comes to the area’s groundwater. Today, within the hillsides, canyons, and valleys that make up the project’s 4,200 acres is a “complex” of dirt roads, oil wells, pipelines, and associated oil and gas production equipment. A more-than-1,700-page attachment for phase one of the project’s environmental assessment report focuses on hazardous materials and risks of upset. 

That report said it does not address groundwater contamination: that will require “comprehensive subsurface exploration.” But it does list several times where crude oil and produced water (wastewater full of salt, minerals, and metals from oil and gas extraction) spilled during oil production. 

On the project’s website, Solstra said it aims to give the land “a new purpose” by building on land where “all oil-related infrastructure has been carefully removed in compliance with local, state and federal requirements.” But the details on how that process will work are a little while off. The Solomon Hills project is at the start of a long environmental review process, which began about eight months ago. Solstra and Montecito Water District’s deal, for example, will not be finalized until the project is approved, which could take years, according to a press release from the district. 

“Kicking off the environmental review last March was an exciting milestone, but it was only the beginning of a thorough and deliberate process, not the end of one,” said Ben Humphrey, director of community development for Solomon Hills. 

Humphrey said that the development team is working with county staff to complete the project’s application and provide the necessary information for the project’s draft environmental impact report. 

“When the Draft [environmental impact report] is released, the whole county will have the opportunity to weigh in on one of the most important questions we face: where and how we create the attainable housing our families, workers, and neighbors need. We look forward to that conversation,” he said.