Water Board President’s Coastal Commission Claims Questioned

Water Board President’s Coastal Commission Claims Questioned

By John Earl
Surf City Voice

Sometimes a person wants something so badly that he or she starts to believe it’s real–or maybe it actually becomes real.

For Cathy Green, president of the Board of Directors for the Orange County Water District, that something is a $1 billion ocean desalination plant that Poseidon Resources Inc. wants to build along the southeast coast of Huntington Beach in order to sell 56,000 acre feet of desalinated water to the public agency for the next 50 years.

OCWD manages the Santa Ana River groundwater basin and operates the largest toilet-to-tap recycling system in the world, which uses the same reverse osmosis process that would be used by Poseidon but for less than half the price.

The Municipal Water District of Orange County passed the Poseidon project off to OCWD 18 months ago after it failed for years to find buyers for the desalinated water.

Poseidon would add nothing to the District’s water supplies but would replace an equal amount of much cheaper water currently imported from the Metropolitan Water District of Southern California.

Feigns of due diligence aside, the intentions of the Poseidon-obsessed OCWD board have always been clear: there will be a desalination plant and OCWD will contract to buy all of its 56,000 acre-feet of desalinated seawater for the next two generations at about three times or more the price of imported water, regardless the cost or need.

Green, who has often helped Poseidon by-pass important project-related questions, showed up at the June 12 meeting of the California Coastal Commission, which will approve or disapprove two of several permits Poseidon needs to resolve before moving forward.

In the hope of making that happen, she had an important announcement to make.

“I am here to inform the commission that on May 14 that Orange County Water District’s Board of Directors voted to approve a term sheet (pre-contract) with Poseidon Resources to purchase the full 56,000 are feet per year capacity of the Huntington Beach desalination project,” she announced, firmly.

“When the commission was considering the desalination permit application in November of 2013, the issue of who would buy the water was unresolved. Today, this issue has been resolved,” she added.

But Coastkeeper representative Ray Hiemstra, who opposes the Poseidon project, happened to be at the meeting on another matter and was jaw-struck by Green’s announcement.

“It appears that Cathy Green is moving faster than some of the board on OCWD’s support of Poseidon,” he wrote in an email to other Poseidon opponents and the Surf City Voice.

Hiemstra was concerned because he knew that the existence of water purchase agreements was a reason for the Commission’s previous approval of Poseidon’s nearly identical Carlsbad desalination plant.

But no such deal was made with Poseidon at the May 14 OCWD meeting, as Director Harry Sidhu explained before he voted to approve the term sheet and go forward with final contract negotiations.

“It is not a hundred percent done deal today. It is just a good start in moving forward,” he advised the overflow audience there to speak during public comments.

Sidhu was technically correct but he overlooked an important point explained in the staff report. By approving the term sheet, “the District is signaling a desire to explore in much greater detail the exact terms of a final Contract with Poseidon Resources to purchase the plant water.”

The Poseidon train has left the station but Green is highballing it down the track–with the help of most of the other board members, including Shawn Dewane, Stephen Sheldon, Denis Bilodeau, Harry Sidhu, Roman Reyna, and Dina Nguyen.

But OCWD’s chief engineer, John Kennedy, thinks that Green had her facts right.

“She [Green] was just saying that the OCWD, via the approved term sheet, would buy all of the water, which is 100 percent accurate,” he explained. “We are working to see what portion of the water would be recharged into the groundwater basin by OCWD and what portion would go directly to the cities.”

If the project proceeds, he added, OCWD “would have an agreement with Poseidon to buy all of the water,” (emphasis added) along with parallel agreements with any water agencies that agreed to buy the water directly that otherwise would be injected into the groundwater basin.

But that’s a far cry from Green’s claim that the issue of who will buy the water has been resolved.

Who will buy the water was just one of several cost and water distribution issues still unresolved, as Kennedy himself pointed out in his report to the OCWD board on May 14.

That’s why he asked for and received $230,000 for a study to help determine “how much would the Water District take, if we do take the water, how are we going to get it into the ground, how much do the cities’ retail water districts want to take. And we would figure out exactly where the water’s going to go, exactly what pipelines and distribution system improvements we need.” (emphasis added)

Until now, only one Orange County water agency, Santa Margarita in South County, has committed to buy Poseidon’s water. Nor have any of the District’s 19 members, who pump groundwater from the basin for 70 percent of their supply, indicated their willingness. One member agency, the Irvine Ranch Water District, has openly opposed the project.

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Poseidon’s Reliability Promise: Pay More For the Same

Poseidon’s Reliability Promise: Pay More For the Same

By John Earl
Surf City Voice

Will water ratepayers benefit if the Orange County Water District partners with Poseidon Resources Inc. to build a $1 billion ocean desalination plant in Huntington Beach?

The OCWD manages the Santa Ana River (groundwater) basin that provides over 70 percent of the water for central and northern Orange County.

For the past 19 months its board of directors has highballed the proposed project toward a contract with Poseidon that, so far, looks like a bad deal for ratepayers.

That deal would lock OCWD into buying 56,000 acre feet of desalinated water annually for the next 50 years, regardless of need.

And, at 3-10 times the price, it would replace an equal amount of water currently imported from the Metropolitan Water District of Southern California (MET) to help keep the basin at safe levels.

But most of OCWD’s producers (the 19 member agencies who pump water from the basin) will end up paying for Poseidon’s water, whether they want it or not.

One of those producer agencies, the Irvine Ranch Water District, thinks that would be unfair. Continue Reading

Posted in Headlines, MWD, MWDOC, OCWD, Poseidon, Water Boarding10 Comments

Poseidon Desal: Will OCWD Be Shipwrecked by Mermaids?

Poseidon Desal: Will OCWD Be Shipwrecked by Mermaids?

By John Earl
Surf City Voice

Centuries ago, explorers sailed Poseidon’s Seven Seas looking for beautiful mermaids and lands full of golden treasures.

Although some of the hapless adventurers may have found what they were looking for, those who didn’t drink too much seawater were usually disappointed.

Today, it looks like Poseidon, the God of the Sea, is up to his old tricks again.

This time, taking corporate form (same as being human under American law), he’s promising to build a new source of water–an ocean desalination plant in Huntington Beach–that will create an additional and reliable supply of water for the Orange County Water District’s ratepayers.

At least that’s what most people think he is promising.

But is he?

Any proposed deal between the OCWD and Poseidon Resources Inc. to build an ocean desalination plant will depend upon a subsidy of $400 million, doled out to Poseidon for a 15-year-period, courtesy of water ratepayers throughout Southern California.

The OCWD manages the Santa Ana River Groundwater Basin, which supplies over 70 percent of the drinking water for Central and North Orange County.

The desalination plant would turn about 56,000 acre feet of seawater into drinking water every year. Continue Reading

Posted in Headlines, MWD, OCWD, Poseidon, Water Boarding3 Comments

Garden Grove Desal Forum Tackles Issues Suppressed by OCWD

Garden Grove Desal Forum Tackles Issues Suppressed by OCWD

By John Earl
Surf City Voice

A public forum held by Garden Grove mayor Bao Nguyen last night at the city’s community center examined the cost of and alternatives to a proposed $1 billion ocean desalination plant promoted by the Orange County Water District.

Those issues–and the panel of local experts who discussed them last night–have been all but ignored by most of the OCWD Board of Directors, some of whom have strong financial and political ties to Poseidon Resources Inc., the company that would build the plant, and its big-business allies.

The OCWD maintains the county’s groundwater basin, which holds 66 million acre-feet of water and provides about 70 percent of the water used in central and northern Orange County, serving 2.3 million people.

For the past 18 months a clique of four board members, Cathy Green, Shawn Dewane, Stephen Sheldon,  and Denis Bilodeau, joined last January by Garden Grove Councilmember Dina Nguyen, have steered the District straight toward a long-term contract with Poseidon.

OCWD staff presented a proposed term sheet (pre-contract) to the board on May 14.

The board approved the term-sheet 7 -3. Nugyen voted for it.

Dina Nguyen on the right at May 14 OCWD meeting. She voted to negotiate a contract with Poseidon. Several Garden Grove residents attending the forum complained that she was non responsive. She did not attend the forum.

Dina Nguyen on the right at May 14 OCWD meeting. She voted to negotiate a contract with Poseidon. Several Garden Grove residents attending the forum complained that she was non responsive. She did not attend the forum.

Nguyen, who was the beneficiary of $11,000 in “independent expenditures” by a Poseidon related PAC in her recent election to the OCWD board, was invited to participate in the forum but was a no-show.

Staff is now negotiating a contract with Poseidon that would lock the district into buying 56,000 acre-feet of desalinated ocean water per year, regardless of need, for the next half-century.

Poseidon’s water would cost about $2,000 an acre-foot out the door, more than 3 times what OCWD currently pays for the untreated water it imports from the Metropolitan Water District of Southern California (MET) to help maintain the county’s groundwater basin supply.

Poseidon and its allies on the OCWD board claim that its more expensive water would be a “reliability premium” akin to car insurance that would add to the county’s water supply portfolio and guarantee water during a drought.

But, in order to be financially viable, Poseidon is demanding hundreds of millions of dollars in ratepayer-backed subsidies for the first 15 years of the contract. In return, MET rules require that Poseidon’s 56,000 acre-feet of desalinated water replace an equal amount of (cheaper) imported water, which would then be made available to water agencies outside of OCWD’s service area.

There would be no net gain in water supply for the district, which would be paying three times as much for Poseidon’s replacement water while subsidizing the cheaper imported water for other agencies. And the county wouldn’t receive more water during a drought.

This reporter has repeatedly asked Poseidon officials and OCWD directors to explain the benefit to ratepayers of paying three times as much for water than necessary and subsidizing cheaper water for ratepayers outside of Orange County, but to so far mum’s the word.

For the first 15 years, the proposed pricing scheme would pay Poseidon a surcharge of up to 20 percent on imported MET water (at the higher MWD treated rate) on top of a 3 percent annual compounded surcharge that recurs for the life of the contract, underlying subsequently declining variable surcharge rates.

A Surf City Voice review of the proposed pricing scheme shows that after 15 years ratepayers would pay up to $2,700 per acre-foot for Poseidon’s water (assuming the required $56,000 af) versus about $1,048 per acre-foot for untreated MET water, which comes out to about $1.8 billion versus about $700 million in total for that period.

That’s about $1.1 billion dollars that could be used for the cheaper and more efficient water supply alternatives ignored by OCWD and Poseidon but examined by the forum panel of experts.

Panel members are former Huntington Beach mayor Debbie Cook, Irvine Ranch Water District’s Peer Swan, Coastkeeper’s Ray Hiemstra, and Garden Grove water officials. Members of the public, including Westminster City Councilmember Diana Carey, also spoke.

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Mesa Water District: ‘Plz Don’t Circulate this Story!’ And Director Fisler Gets Even

Mesa Water District: ‘Plz Don’t Circulate this Story!’ And Director Fisler Gets Even


By John Earl
Surf City Voice

Editor’s note: See related story, here.

Getting thirty-minutes of interview time in January 2012 with the Mesa Water District’s general manager, Paul Shoenberger, wasn’t easy.

Spontaneous interviews with Mesa Water staff or members of the board of directors are discouraged whenever possible by Communications Manager, Stacy Taylor. Potentially tough or touchy media questions must be submitted to her in advance so that she can provide public answers that fit Mesa Water’s “unified voice” template.

At Taylor’s insistence, general interview questions were submitted in advance, but with my stipulation that there was no guarantee that I would limit myself to the exact wording of those questions during the interview or would not ask follow up questions.

The interview took place in Mesa Water’s executive committee room and was strictly limited to 30 minutes in the presence of both Shoenberger and Taylor and was recorded by both parties.

The main topic of the interview was CalDesal, the secretive non-profit organization that Mesa Water started—with ratepayers’ money—several years ago—and still helps finance with free labor and services even though CalDesal supposedly went its own private way—to promote ocean desalination projects and the desalination industry.

Contrary to California’s open meetings law, the general public is not allowed at CalDesal meetings nor is it generally given meeting agendas and minutes. Financial documents, the “990” forms that non-profits are required to disclose, are also denied repeatedly to this reporter by CalDesal’s president, Shawn Dewane, who is also a Mesa Water board member.

James Fisler

A cheap shot of Mesa Water’s Director James Fisler at a CalDesal mixer. Photo: provided by Mesa Water District

At the time, I didn’t know that the entire process was being directed by a public relations consulting firm, Laer Pearce Associates, that charged Mesa’s ratepayers between $265 – $350 per hour and that hundreds, if not thousands, of dollars would be paid to LPA to prepare Shoenberger for the interview, on top of what was paid to Mesa’s communications manager, Stacy Taylor, who gets close to $200,000 a year including benefits.

Emails acquired under the Public Records Act later would reveal how cynically manipulative Shoenberger, Taylor and LPA had been and that Mesa Water officials are motivated more by vanity than a desire to objectively inform the ratepayers.

Before the interview, their goal was to limit and control the questions as much as possible. After publication, the main goal was to contain the interview and to marginalize this reporter, while violating copyright law (republishing the story without permission), even though LPA president Laer Pearce and Taylor both agreed that the edited interview was fair and accurate.

An email from Taylor to Mesa Water directors and staff, and to LPA, for example, stated, in full:

  • Greetings: The attached story ran on the Surf City Voice blog on May 28, 2012. I purposely did not share the link to the post & removed all Surf City Voice links from the story. If you wish to share this, please do so using the attached instead of going to the website. I have also pasted the story below. So far, I found that Aquafornia (blog) has posted this story & it will probably be posted by OC Voice soon (I will let you know). Also, there is only one reply to this story as follows below the story. All in all, I think this turned out as good as can be expected from this type of media opportunity.

In another, earlier, email, Taylor wrote, “Plz (sic) don’t circulate the story link I sent you since doing so will add to its ‘popularity’ on the web (each click on the link will increase the story’s web ranking). Instead, I will capture the content for sharing. Please feel free to contact me any time re. this.”

Curiously, Ron Wildermuth, Director of Public Information and Conservation at West Basin Water District where Shoenberger had served for years as assistant general manager, was also included in the emails. “Good job,” he wrote to Shoenberger, “This is about as hostile and biased an interviewer I have seen in a while. You stuck to your points well.”

But Pearce praised the interview story.

“John Earl admits he is not objective, but insists he writes objectively,” he said. “On is (sic) story, I have to agree. He let his biases show, but told the CalDesal and Mesa Water stories fairly. Of course it helped that Paul tied everything to Mission and was not swayed off the core messages of the district.”

Although Pearce misunderstood my theory on journalistic objectivity (namely, that any reporter who claims to be without bias is either deluded or a liar, and that acknowledgement of that bias first and foremost to self helps facilitate honest, in-depth reporting), the objectivity he shows in his review of my story is also praiseworthy, despite the excessive cost to Mesa Water’s ratepayers.

Mesa Water Director (and current board president) James Fisler, was both complimentary and critical:

  • Very good job Paul! No dodging, just telling it like it is and sticking to Mesa’s message and priority of providing water. Good questions by Earl and good answers by you. Shows Mesa Water is on top of it’s (sic) mission. Earl’s only attempted “gotcha” of people at mixers is a poor attempt. Business and chambers have mixers all the time. They are very important parts of getting business done and learning new things by networking. Again, great job.

Fisler was referring to my photos of him and other directors at a CalDesal mixer-meeting attended by about 100 water officials, consultants and representatives of the desalination industry, but nobody from the general public.

In another email later that day, Fisler added:

  • “…If it was supposed to be a hit piece or something it failed miserably. I need to get a picture of Earl eating a donut at WACO.”

Fisler was expressing a grudge against this reporter that he still holds to this day. Writing under the pen name “nogrowther” on the Orange Juice blog, he lashed out at me over a year ago for publishing the detailed objections of Irvine Ranch Water district director, Peer Swan, to the Poseidon ocean desalination project proposed for Huntington Beach.

Fisler bitterly complained that I didn’t say the pledge of allegiance at water Municipal Water District of Orange County (MWDOC) meetings, that I was unkempt in appearance and that I liked to eat the donuts that are left out at MWDOC meetings for water buffaloes like him.

Eventually, Fisler’s “gotcha” wish came true, about a year later at the recent (May) joint-meeting of MWDOC and the Metropolitan Water District of Southern California (MET) held at the MWDOC board room in Fountain Valley.

I was sitting in one of the plebeian seats at the back of the room, directly opposite of the speaker’s podium, next to Debbie Cook, watching a presentation on MWDOC’s $120,000 video screen by MET’s general manager, Jeffrey Kightlinger about the Sacramento Delta. We need to spend billions of dollars fixing the Delta levies and to build a big double-barreled tunnel to import more water to southern California, he said.

Kightlinger was predicting the disastrous consequences to California’s economy of a Delta broken to pieces by a 100-year earthquake – coming any day now. Suffering from acute sleep deprivation, I desperately walked over to the refreshment table to help myself to a glazed twister.

“Anything to stay awake,” I thought. “Must…help…save…the…Delta.”

Out of the 100 or so water buffaloes present, only Fisler seemed unable to pay attention to the important message and had become obsessed, as I lifted the doughnut, with watching me like a hawk from one of the big black MWDOC directors’ seats behind the dais.

Smelling blood, the upcoming Delta catastrophe apparently gone from his mind, Fisler approached me.

Standing over me just a few feet away, dour faced, he shyly snapped a couple of photos of me holding my doughnut on a plate and kindly offering it up to him. He still didn’t laugh or even smile.Then he walked back to his seat where, perhaps, his attention returned to more important matters.

One other interesting tidbit found in the exchange of emails is a missive from Poseidon’s VP, Scott Maloni, an important member of Mesa Water’s inner circle of close friends. Always angry over my critical reporting of the dreamed of but still elusive Huntington Beach ocean desalination plant over the years, he refuses to answer my media questions and long ago banned other Poseidon CEOs from doing so. In his email to Shoenberger, he wrote:

“Paul – As I’ve told Kevin Hunt [former general manager at MWDOC], John Earl is not a journalist; you don’t owe him ‘transparency.’ Nothing good will ever come out of engaging him and he’ll never be someone you can trust or befriend. Best to ignore him or have your staff handle him.”

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‘Nowaterdeal’: Desal Plant Opponents Will Reach Out to Thousands of Orange County Voters

‘Nowaterdeal’: Desal Plant Opponents Will Reach Out to Thousands of Orange County Voters

By John Earl
Surf City Voice

A growing number of county ratepayers, inspired by the late Gus Ayer, and opposed to a plan by Poseidon Resources Inc. to build an ocean desalination plant in Huntington Beach, have a message for the Municipal Water District of Orange County (MWDOC) and its 28 member agencies:

No more secret negotiations or deals with Poseidon and don’t make us pay an additional $5 billion in local water bills—$8,500 per ratepayer—over the next 30 years for water that we don’t need.

Thirty-years is the time period in which the water agencies that contract with Poseidon would be required to pay for Poseidon’s desalinated water, whether it is needed or not, according to the water purchase agreement (WPA) made public by MWDOC in January.

The buyers “will agree to take (on a ‘take if delivered’ basis) [56,000] acre-feet per year of Product Water (the ‘Committed Amount’),” the WPA states. And if the buyers don’t take that amount of water, they will, “nonetheless pay Seller a per-acre foot charge to be set forth in the Contract…”

The WPA is not final, but it is the culmination of a decade-long relationship between MWDOC, its water agencies, and Poseidon.

The opposition group, heralding online as www.nowaterdeal.com, plans to spend tens-of- thousands of dollars to inform other ratepayers in high propensity voting areas of the county about Poseidon’s proposed “take or pay” contract, asking them to urge their local elected officials not to sign it.

Nowaterdeal is a coalition of members of Residents for Responsible Desal and other local ratepayers, including members of the Surfrider Foundation, League of Conservation Voters, and Orange County Coastkeepers, who at least until now had been fighting an uphill battle against Poseidon’s well financed lobbying efforts and a marketing campaign (largely unquestioned in the county’s major daily newspaper) that depicts its desalination plant as a future fallback point in case of prolonged drought or a natural disaster that would disrupt the flow of water to the public.

Poseidon would risk private investor flight without the guaranteed income, but take or pay would be risky for ratepayers if, as happened in drought drenched Australia, if the desalination plant were to sit idle due to lack of need. Currently, the Metropolitan Water District of Southern California (MWD), which sells water to MWDOC, has more surplus water stored up now (enough for 2.5 years) than ever before—testament to the ability to create backup reliability water without Poseidon.

Ocean desalination’s high maintenance and construction costs—and much higher energy costs—make it too risky, nowaterdeal says. Stuck with higher water rates and an idle desalination plant, ratepayers would fall into a rate trap. “As rates go up, people use less water” and “lower demand results in even higher rates, with fixed costs of the entire system spread over fewer units of water.”


Gus Ayer: MWDOC is pimping for Poseidon and should be eliminated. Photo: John Earl

The high cost-prediction is from information provided by Poseidon in the WPA and factors in conveyance and maintenance costs. With an inflation rate of 3.5 percent factored in, that means an estimated cost of $1,795 per acre foot for the desalinated water, compared to $285 per acre foot for local groundwater and $835 per acre foot for imported water, nowaterdeal says.

Acknowledging the higher cost of desalination, Poseidon VP Scott Maloni recently told the OC Register that Orange County residents have to ask, “What is the value of that reliability to them?”

But the underlying push for desalination plants along the California coast by the desalination industry and other development related business interests is not about drought relief alone, as MWDOC/MWD director Brett Barbre pointed out at a recent MWDOC committee meeting.

Barbre supports the Poseidon project and a smaller, less controversial, desalination project envisioned (but far from certain) for Dana Point in south Orange County. He also thinks that ratepayers throughout the county should have to pay for both projects on the basis that they would benefit everyone, even in water districts that say they don’t want or need the water.

“I believe that desal is not only for reliability. It’s also for growth,” he said. “And there are folks on the environmental side who don’t want any growth and they think if you don’t build water projects you can conserve your way to provide enough water for everybody. And that’s not ever going to happen.”

Although most of Poseidon’s opponents have always been concerned about the environmental effects of ocean desalination, the main focus of their current campaign is economic, while advocating for the development of proven and much cheaper water sources, including the Orange County Water District’s (OCWD) groundwater replenishment system, capturing rainwater, and conservation.

To start, the group will focus on about 50,000 voters in 14 north county cities, including Anaheim, Brea, Buena Park, La Palma, Orange, Newport Beach, Santa Ana, Seal Beach, Tustin and Westminster.

Twenty Orange County water agencies had signed non-binding letters of intent or memorandums of understanding with Poseidon to purchase, cumulatively, over 80,000 acre feet of water each year. Since those non-binding agreements expired in June, 2011, not a single agency has yet to renew.

Correction 02/05/2013: Eighteen agencies have signed Letters of Intent that have no expiration date, according to Karl Seckel, MWDOC’s acting General Manager. Those agencies, with the exception of Fullerton, are slated to participate in “working group discussions” regarding Poseidon during the 2012 fiscal year. Four other agencies are participating in working group discussions but have not signed LOIs. Participation in working group discussions is contingent upon signing a confidentiality agreement with Poseidon, but not all agencies that signed an LOI signed that agreement. The MOUs, which one presumes carried more weight, have all expired.

As Poseidon works to form an agreement with MWDOC and its member agencies, it requires all parties involved in project discussions to pledge absolute secrecy at Poseidon’s whim.

That lack of transparency and the overall elitist/exclusionary attitude at MWDOC and other OC water agencies, including their secret and arguably illegal meetings with Poseidon–all observed by a growing number of citizen spectators at water board meetings, as well as the company’s financial support of an ethically challenged hit piece in the recent Huntington Beach City Council campaign, have inspired Poseidon’s opponents, not only to challenge its political hegemony with a renewed vigor but to question the nature of Orange County water management as whole.

A temporary setback occurred for nowaterdeal when its chief strategist, former Fountain Valley mayor Gus Ayer, a master at crafting successful political campaigns in Orange County, died last week.

Earlier in the month, at a recent joint meeting of MWDOC and OCWD, Ayer praised the latter for its groundwater replenishment program and overall good management, but accused MWDOC of “mission creep” and “pimping for Poseidon.”

He also questioned whether MWDOC should exist.

“It’s time for OCWD to take a very close look at taking over these [MWDOC’s redundant] functions and eliminating MWDOC,” he said. Ayer expanded on that theme in a column written just before his death and published in the Surf City Voice.

Ayer’s untimely death saddened his colleagues but his upbeat attitude continues to motivate them.

“Gus’s last words to me were ‘Give them hell’”, recalled former Huntington Beach mayor Debbie Cook, who, during the past two years, has actively campaigned for greater transparency in water management.

“That was his way of saying that, if we don’t participate in democracy, we deserve the inevitable results. Nobody can replace our friend’s skill set, but he sparked a fire that emboldens us to carry on.”


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Can the Municipal Water District of Orange County Find A Reason to Exist?

Can the Municipal Water District of Orange County Find A Reason to Exist?

Editor’s note: Gus Ayer, the former mayor of Fountain Valley, was probably Orange County’s top progressive political strategist and activist. He passed away on Feb. 13, 2013. At that time he was about to unveil a major grassroots campaign to inform the county’s water ratepayers and their elected public officials that the nearly $1 billion ocean desalination plant proposed for construction in Huntington Beach was unnecessary and would cost about $5 billion extra over the next 30 years. That campaign, which he played a major role in organizing, is still underway. He submitted this column to the Surf City Voice a few days ago.

Analysis and Commentary
By Gus Ayer
Special to the Surf City Voice

Sometimes it’s fascinating to watch a public agency as it flounders around trying to find a reason to exist.

Lately, the Municipal Water District of Orange County (MWDOC) is flailing like a beached whale.

After a Brooke Edwards Stagg OC Register article exposed the secretive nature of negotiations with Poseidon Resources for “Take or Pay” contracts on January 22, MWDOC scrambled into damage control mode.

  • Their General Manager was terminated after a hastily-called special Executive Session on February 1st, and is now relegated to a back room until his contract expires a few months from now.  Meanwhile an interim General Manager takes over his duties.
  • A press release linked to the term sheet of the Poseidon’s proposed “Take-or-Pay” contracts and a report on the costs of new pipeline projects was released and posted on Poseidon’s website. Sadly, it lacks the details that would allow any accurate analysis of the long term costs of the proposed plant.
  • MWDOC  is coming under increased scrutiny as a grassroots coalition begins a major public outreach program  to advise ratepayers how much they will pay for expensive desalinated water they don’t need.
  • IRWD Director Peer Swan publicly chastised them at a recent meeting for ignoring all of the efforts that had been made on a regional level to provide for water reliability, warning that they were recklessly advocating a project that would become a “stranded asset”
  • Simmering disputes between different regions of the county threaten to erupt again, which would lead for another round of talks about cities seceding from MWDOC or just eliminating this agency and their bureaucracy.

Just What is MWDOC?

The hierarchy of Water districts can be confusing.

We pay our water bills to local water agencies, including many individual cities, independent agencies like the Irvine Ranch Water District, and even one privately owned water company, Golden State Water.

One regional agency manages our groundwater supplies (Orange County Water District).

Another super regional agency manages imported water for most of Southern California, the Metropolitan Water District, commonly known as “MET”.

Then we have MWDOC, which was established in 1951 to administer purchases of imported water from Met on behalf of smaller Orange County cities and unincorporated areas.  MWDOC’s original role role was just as a middleman between MET and 16 small cities with a population of around 80,000.  Three cities (Anaheim, Santa Ana, and Fullerton) were big enough to buy water directly from MWD.

In the boom days after World War II, MET was seeking customers to buy the water from the Colorado River Aqueduct. Orange County developers were looking for more water to meet the demands for swathes of development that would replace agriculture and ranching.

What Does MWDOC Do?

MWDOC has seven elected directors. They appoint four directors to the MET board. They share a headquarters building with the Orange County Water District in Fountain Valley.

MWDOC holds seven redundant meetings a month, each of which guarantees a $221.62 daily payment to each of its seven directors, who typically  attend all committee meetings and also receive benefits and health insurance.   Directors also travel, with a budget over $30,000 a year to attend local, state and national conferences (not including their meeting payments).  If you are one of the directors appointed to MET, you also get paid to attend MET meetings.

In a recent year one director, Director and MET rep Brett Barbre was paid $51,859 for attending 242 meetings and also cost rate-payers $17,435 for benefits, including pension and health insurance.  This wasn’t his day job. He also is a lobbyist for clients like trash-hauler Athens Services.

In an OC  Register Watchdog  http://taxdollars.ocregister.com/2010/03/05/when-brainstorming-costs-nearly-500000/52647/  article, he is described as a “political operative,”  and campaign finance records show that Barbre was paid $20,000 plus expenses for consulting on Troy Edgar’s 2012 campaign for State Assembly.

MWDOC’s Mission

In addition to doing the accounting for MET purchases and sending four people to attend meetings of MET’s 51 person board, MWDOC has struggled to expand its mission to include:

  1. Administering Water Efficiency grants for Orange County cities trying to do the bare minimum of effort under statewide mandates.
  2. A few education programs
  3. Sponsoring breakfasts, dinners and seminars where vendors, consultants and lobbyists can hobnob with elected officials, all subsidized with ratepayer funds and agency staff time.

MWDOC and Desalination

MWDOC directors seem determined to play in the world desalination: turning sea water into drinking water, although MWDOC has no construction management experience and no experience in operating water systems. We might attribute this ambition to their sense of impotence with the bigger players, boredom, or the need to justify their existence. Beware of arrogance combined with incompetence—it often leads to disastrous outcomes.

It’s unclear that MWDOC has any legal authority to undertake any efforts in this area.

Historically, the cities and water agencies that belong to MWDOC have chafed at their budgets and MWDOC’s financial management.  The underlying tensions became so high several years ago that South County agencies looked at seceding from MWDOC to form their own agency. In a settlement agreement, MWDOC committed to a new compact that made several changes,

1.)    MWDOC agreed to change the way it billed for its services to lower costs for South County agencies.

2.)    MWDOC agreed to a specific list of services that they would undertake and differentiated between Core and Choice services

3.)    MWDOC agreed to listen to South County agencies regarding appointments to the MET Board.

4.)    MWDOC agreed to reduce their bloated reserve funds.

Under this agreement it’s very clear that spending on desalination projects is listed under the Choice category, where cities have a right to participate. Although Director Brett Barbre speaks about changing what’s in each category, the actual agreement signed by the cities has no mechanism to do this. Barbre favors placing ocean desalination in the Core category, but any attempt by MWDOC to redefine Desalination projects as core projects would likely lead to renewed secession attempts or lawsuits.

Calls for Abolishing MWDOC

How many water agencies do we need, each with their own expenses for directors and their benefits, lobbyists, consultants and public relations staffs? MWDOC directors recently discussed a project to renovate the exhibits in the hallway that they share with OCWD, with a budget of $1.3 million dollars plus staff time.

The Orange County Grand Jury recommended consolidating water agencies to reduce costs and provide services more efficiently. Others have recommended that MWDOC reduce its role back to the simple accounting functions it was originally designed to achieve, with its other functions transferred to other agencies with a strong record of success, like the Orange County Water District and the Irvine Ranch Water District.

We think that’s a great idea. MWDOC has outlived its usefulness and their continued mission creep wastes the ratepayers’ dollars and creates mischief. MWDOC’s functions can easily be absorbed into other agencies and it’s time to start a process to sunset this relic of a bygone era.

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Revisions in Progress: Surf City Voice resumes regular publication July 23, announces Cal Water News debut

Revisions in Progress: Surf City Voice resumes regular publication July 23, announces Cal Water News debut

By John Earl

The Surf City Voice is taking a working vacation in order to make revisions that are necessary to improve our coverage of water management issues in Orange County and southern California. On July 23 we will resume regular publication with updated coverage of previous stories and brand new stories. Rest assured, this is not down time: we will continue gathering news in the no-nonsense investigative fashion that thousands of readers have grown accustomed to since our start two years ago. In fact, when we resume publication we will be expanding our coverage of water news statewide with the opening of our companion news portal, Cal Water News (www.calwaternews.org). Cal Water News will address, in part, the problem of news blackouts by mainstream media, non-profit, and corporate news services of stories related to transparency and misconduct by water management officials. It will also actively encourage and assist public citizens to become more involved in the management of the water that they own.

Posted in Headlines, MWD, MWDOC, Water Boarding0 Comments

Prenuptial Agreement Stops Investigation of MET Chairman John V. Foley

Prenuptial Agreement Stops Investigation of MET Chairman John V. Foley

By John Earl
Surf City Voice

The Fair Political Practices Commission has cleared the chairman of the Metropolitan Water District of Southern California (MET), John V. Foley, of allegations that he violated the Political Reform Act.

The allegations were made in a complaint filed by Merle Moshiri, a Huntington Beach resident, last March, alleging multiple income reporting and conflict of interest violations by Foley. The FPPC ruing is dated April 17.

Moshiri alleged that Foley failed to disclose at least $640,000 of income from his wife’s consulting business from 2004 to 2011 and another $15,000 that he earned as a private consultant to the Moulton Niguel Water District since he retired as that agency’s general manager in 2008. Moshiri claimed he also violated the Act by voting on issues that affected his wife’s financial interests.

Public officials are required by the Act to disclose all reportable income on financial disclosure (700) forms that are filed as public records with their local public agencies or the state. They are also required to disclose conflicts of interest and to recuse themselves from any votes that could result in financial benefit for them or their spouses.

The foundation for the complaint’s dismissal is a prenuptial agreement between Foley and his wife, Mary Jane Foley, which provides a loophole that arguably tests the effectiveness of the Act in protecting the public from conflicts of interest held by public officials. Continue Reading

Posted in Headlines, MWD, MWDOC, Water Boarding1 Comment

Proposed MWDOC Transparency Reform Meets Inside Resistance

Proposed MWDOC Transparency Reform Meets Inside Resistance

By John Earl
Surf City Voice

Municipal Water District of Orange County Director Brett Barbre’s proposal to increase transparency at the agency through self-policing of financial and conflict of interest disclosures is moving at a snail’s pace, if at all.

Last February, Barbre told the Voice that he wanted to have the MWDOC board of directors certify that to the best of its knowledge no conflicts of interest exist for its elected directors, representatives that it appoints to the Metropolitan Water District of Southern California (MWD), and all MWDOC employees who are required to report under state disclosure regulations.

Barbre would have the board review so-called 700 financial disclosure forms and compare income sources to a list of MWDOC vendors to help weed out potential conflicts of interest.

“I believe we need to police ourselves,” Barbre said, in an e-mail to the Voice at that time. “If it’s not placed on the agenda, look for some fireworks,” he advised.

It wasn’t put on the agenda, but Barbre brought the issue up anyway March 14 under another, broader, agenda item during the last moments of a meeting of the Administration and Finance Committee, which he chairs. A brief but telling discussion ensued with board president Jeffrey Thomas cautiously agreeing to place the item on April’s meeting agenda.

But the item has yet to be discussed in detail or for purposes of a vote because General Manager Kevin Hunt, acting on instructions from Thomas, who Hunt says acted on advice of legal counsel, kept it off the agenda. Continue Reading

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