Eye On Modesto

Thoughts and observations about Modesto and Stanislaus County

Archive for the tag “Water Sales”

Comparing Our Board to Theirs is an Insult Says OID Board Member

Welcome to Oakdale

Welcome to Oakdale (Photo credit: jurvetson)

By Emerson Drake

Comparing our Board to theirs is an insult were the first words out of  Oakdale Irrigation District (OID) Director Jack Alber’s mouth when I met him.  I didn’t take offense, since to that point I hadn’t said anything, while it did show they were concerned about the public perception of them.  But I will compare the experience of going to a OID meeting for the first time with their counterparts at the MID.

The Board room is in the back of the building and is between the sizes of the StanCoG and MID Board rooms. Everyone was friendly (although they didn’t have any coffee available) and you weren’t met by an armed guard the way you are at MID. The OID Directors sit on the right side and staff sits across on the left. Their attorney, Tim  O’laughlin, is on the end sitting sidewise and closest to the public.  At OID meetings O’Laughlin makes nice with all of the Directors, unlike the dour, impatient attitude he displays at MID (maybe because he lost his million dollar a year gig at MID?)  There are about three rows of seats  with a bench the width of the room in the rear.

The meeting started out amiably enough with O’Laughlin receiving a “revised hourly rate” on the consent calender (a public information request was made for the contract.) The meeting started to get interesting when a discussion of Trinitas LLC buying into the district came up.  Trinitas is offering to pay $2,600 an acre to buy in and $60 per acre foot for water.  On top of this their potential contract says they will be forced to pump water from their wells on dry years.

Apparently Trinitas has set the going rate for the buy in and for water rates  for future farmers to join the District. An owner of Hofstra’s Dairy reminded the Board the proposed water sale amount is the same his farm is hoping to purchase and it is more beneficial if the water is kept locally. The Trinitas proposal was referred to LAFCO for approval.

The next question they wrestled with were their obligations on the Garr Pipeline.  Somewhere in the past they assumed ownership of the Garr and now it needs extensive repair. It needs about $400,000 in repairs and generates $1,200 a year in income (but they don’t want me to compare the two districts boards.)  This was sent to counsel (O’Laughlin) to see if it would set a legal precedent and just how far their potential liability goes. Needless to say in the past someone annexed a pig in a poke.

The Stanislaus Economic Development and Workforce Alliance donation was next.  OID used to donate $4,000 yearly but in these hard times has cut back to $2,000 a year.  Now Bill Basset is looking for a four-year  committment and the majority of the Board was unwilling to make it. Bassitt has already made a presentation to the OID Board but they were concerned about OID’s future and decided to make it one year and $2,000. 

MID on the other hand is considering a $20,000 a year committment and Bassett hasn’t bothered to show up at their meetings to make a presentation. MID just loves to spend our money,  ratepayer money.

Then came the headline discussion regard ing the potential water transfers(sales) to San Francisco. It was made known very quickly the Board had no information other than what they had read in the Bee.  But that was somewhat disingenuous since Tim O’Laughlin had the proposal in his hands. They just wanted to keep the public in the dark for another two weeks.  But having seen the ludicrous longtime binding contract MID was asked to sign, forewarned is forearmed.

During the discussion Denise Hanlan, a Oakdale resident addressed the Board and asked questions about the water table levels in Oakdale.  In a move that would make Tom Van Groningen proud, Director Frank Clark gaveled her down.  He pounded the sound block and mover onto the rostrum  and finally progressed to his fist to silence her saying she was out-of-order. All she was doing was addressing an item on the agenda which is her right. Ms. Hanlan asked for a little civility but Director Clark wasn’t in the mood.  Former Mayor Pat Kuhn suggested he might have been a little harsh and reminded the Directors they were only stewards of the resource and not the owners.

OID makes its money through wholesale electric sales from the Tri-Dam Project.  They sell between $10 and $12 Million yearly depending on the price of electricity. Next year they expect to make $10 M and with a budget of approx. $12 M they will be using $2M from their reserves which will still leave them with more than $10M.

Here’s an interesting comparison.  MID’s annual budget is about $440M mostly in electric costs. They keep aprox.$100M in reserve ever since their bankers started to complain about the low reserves and lowered their bond rating (MID has since raised their reserve level and the Bond community adjusted their rating upward.) OID on the other hand has $41.9M in reserve right now.

So MID has one-quarter of its budget in reserve and OID has almost four times its annual budget in reserve.  Who is more fiscally responsible?  OID.  I don’t believe they’ll mind that comparison.

The bottom line is when it comes to the potential water sales  it’s all in the contract and we’re going to have to wait and see just what it says.  We’ll be visiting the OID again to follow-up on their decision.

There are several different stories in publications of the Modesto Bee and the Oakdale Leader and I’m going to give both addresses. But first I’m going to post a comment made in the Bee by Theorvii which provide the background details some might find interesting.

By Theorvii

JUST THE FACTS – OID gets an allotment of 300KAF from New Melones – shares the first 600KAF into New Melones with SSJID. Take for instance this year – OID used approximately 233KAF of their 300KAF allotment – 67KAF remaining. OID has made efficiency improvements from their previous sales such as regulating reservoirs and the Rubicon system from Australia.

GM Steve Knell came from the Imperial Irrigation District where their water comes from the over-committed Colorado River System. He once said that IID conserved more water in one year then OID had allotted to them. Add Trinitas @ 25KAF and that number becomes 258KAF for this year. Still 42KAF remaining. 

Unlike MID & TID who carry any excess over to the next year because they control the Don Pedro Dam, New Melones is a Federal dam controlled by the Army Corps of Engineers and the Bureau of Reclamation and the waterbank account goes to 0 (zero, zip, zilch, nada) on November 1 each year. All dams need to be at 70% capacity by November 30 to allow for flood control requirements by the Bureau of Reclamation. The FEDs can use the leftover 67KAF from this year any way they choose and OID has no recourse. 

OID still has others “outside the district” that want to be annexed as well – it’s just now the price and conditions are a known entity. The Board said on Tuesday that they will consider those annexation requests as well and possibly move forward at LAFCO after February when they expect to go with Trinitas. They may incrementally “eat up” their excess water through annexation. MID & TID CANNOT annex because they are tapped out to capacity by the Raker Act. Otherwise they would have annexed the “Westside” of Stanislaus County – west of the San Joaquin River. 

The one area of the county that is still in play is the Paulsell Valley – the east end of Claribel Rd., Warnerville Rd. and south of Dry Creek to Modesto Reservoir sandwiched between Crabtree Rd. and the Hazeldean/Tim Bell Rd. area. A lot of former rice ground and grazing lands converted to trees. Kind of a “No Man’s Land” between MID & OID. 

The only other area asking is north of Woodward Reservoir and that could only be serviced potentially by Stockton East or SSJID via Little Johns Creek or Shirley Creek. Don’t expect it to happen – but those are the most likely scenarios. Rock Creek Water District does not have the capacity in Salt Springs Valley Reservoir or the conveyance south of Highway 4. One wild card for the northern part of the county is the Calaveras County Water District who has been sniffing around Salt Springs Valley using it as a conveyance for potential ag water into western Calaveras, northern Stanislaus or northeastern San Joaquin county. Still very much a concept on paper without the dollars behind it to make it a reality.

OID also has a plan – since 2008 – and they have followed it. That being said, Director Bairos also commented Tuesday that they will need to dip into their reserves for approximately $2 million in the 2013 calendar year to balance their budget. The key is that they actually do have a “reserve account” and have allocated money and water for a drought or rainy day – whichever connotation you want to use. 

Not saying I support the proposals (Brisbane or the hypotheticals being thrown out on CCSF.) I am VERY well-versed on both the MID and OID proposals. Brisbane approached TID & MID before contacting OID and was rejected.  I caution the public to not get the cart before the horse and wait until the facts come out. If it is the same enslaving contract as MID was considering, I have the utmost confidence that the OID Board will vote at least 3-2 to kill it with Alpers and Clark possibly supporting a sale.  Clark is more likely to oppose then Alpers at this time.  But Alpers is also not going to jeopardize the district for a couple of million dollars.  STILL TOO MANY UNKNOWNS TO REALLY SPECULATE ON SF!

Also forgot – OID’s previous spills to MID used to be about 15KAF – their latest inventory was approximately 8KAF in 2012.

A better article to read than the Bee’s is at http://www.oakdaleleader.com/section/44/article/9249/ 





MID Board Split on Public Comment Time and Everything Else

By Emerson Drake

With the temporary stoppage of the proposed water sale things have definitely quieted down at recent MID meetings. We’re back to fewer people attending and just a smattering of people actively commenting on current issues. At the latest meeting only four people stood up to comment during ” public input for the good of the district.”  Since the Board reduced the alloted amount of time from five minutes to three several months ago on the pretext of shortening waiting  lines and with only four people speaking (that is becoming the average post water sale) it seemed like an appropriate time for the rules to return back to normal.

Director Larry Byrd presented the board with a request to move the alloted time back to five minutes. But that was not to be. Since Director Warda was absent the board was down to just four members. Director Wild spoke against the idea saying he would like to discuss it more but then stayed quiet. After all, like his mentor Van Groningen, Wild prefers to violate Brown Act laws and discuss things with other board members away from public scrutiny. Please understand they like to talk not in “closed session” but in the backroom without witnesses. If they were to repeat anything from closed session they would be in violation of Board policy and could be censured.  But if a Director relates something that took place “behind the wall”,  ie: illegally, there isn’t anything Van Groningen and Wild can do.  Director Blom was willing to second the motion.  But seeing Directors Van Groningen and Warda were against a revision of the relatively new rule, no second was made.  That’s the way the MID works.  Rather than expose a rift and discuss their differences they choose to remain silent in front of the public. 

I later spoke to Director Wild regarding his comments. Concerning five-minute allotments he said “I’ve been keeping track of people who speak and during their first three minutes they are succinct and present themselves well. But during their last two minutes they berate the Board and I don’t like it.”  Personally, I always thought elected boards were supposed to reflect the will of the people, but when elected officials ignore the public’s input it only stands to reason some frustration might surface.

A current example might be a request for the 2013 budget PN# U00018 for $500,000 to replace the Board room’s audio and video equipment. All of this money for a fancy system and they still refuse create an archive for recordings of meetings or even save for more than 100 days the recorded discs of proceedings, let alone  broadcast their meetings on streaming video.   To this day they continue to destroy ALL electronic recordings of their meetings and refuse to consider approving the minutes of their meetings until AFTER the recordings have been destroyed.

In the next two years they want to spend $1.75 Million on a smart grid security system PN#U00513. These people are spending us into the poorhouse.  The IT department wants to spend over $4.1 Million in just the next two years. CAP-40 CAP is their designation for this.

I could go on about this but my point is their “wish list” was created when they thought they were going to be able to spend Millions of Dollars from the water sale  money they were telling the public was going to irrigation infrastructure.

Another ongoing concern is the money being funneled through Martino Graphics. Year to date Directors Tom Van Groningen and Glen Wild have apparently signed what are called expense approvals in the amount of $21,000.  There is no purchase order assigned for these expenditures.  The account number they use is 312500 00.0 401 and the payment explanation is Board Development and Internal Communications.  These are NOT pre approved by the Board members.  Directors Van Groningen and Wild along with General Manager Allen Short have personally made these arrangements with Martino Graphics and Carol Whiteside.

Ms.Whiteside confirmed in an email to me on 10/10/12 she’s been the recipient of a total of $9,000 as partial fulfilment of her contract with Martino Graphics which she suspended in July.  Her work has never been brought to the Board and Tom Van Groningen says he has a copy of her work but no presentation has ever been made.  As a point of interest Ms. Whiteside was paid $1,500 directly to her for an earlier presentation to the Board and public.  Questions abound as to why Van Groningen and Wild have made these obviously deceptive arrangements and why was the ante upped and how do they account for the remaining $12,000?

In addition, we know $6,000 of these billings ($3,000 each ) have been pulled at successive meetings from the consent portion of the agenda. The question remains unanswered as to whether or not  the checks have been sent.

When I asked Director Van Groningen if the Board pre approved the expenses, his response was “they approved them when they voted in the consent Calender.”  In other words NO they didn’t. So what we are hearing is two members of the Board, outside the scope of the public, and their fellow Board members, can approve expenditures which would advance their positions on future votes.

It appears we won’t have any relief from this type of underhanded dealings until after the 2013 elections when Van Groningen and Wild have to stand in front of the public asking for their votes.

Joan Rutschow Addressing The MID Board of Directors


Contracts (Photo credit: NobMouse)

By Joan Rutschow of the Stanislaus Taxpayers Association

Good morning, MID Board and ratepayers and voters.  I would like to address the water contract.

The water sale contract puts San Francisco in 1st position ahead of Modesto residents and farmers.

MID would have no “out” on the contract for 50 years unless San Francisco defaults.  San Francisco can terminate the deal in any year by deciding not to allocate funds.  Very simply, the contract ties up our water for 50 years, giving San Francisco priority over Modesto.  San Francisco would be entitled to the full contract amount even if MID cuts deliveries to Modesto and our farmers due to drought or any other unforseen reason. 

Bee Article (6-16-12), “San Francisco cannot agree to a water sale contract that gives preference to Modesto!”  MID is agreeing to sell water we might not have!  Suggesting that we have excess water to sell, MID management has increased the risks that we will face onerous bypass flow regulations under our new FERC license and jeopardize our ability to meet local needs.  San Francisco understands this and can terminate the agreement if they cannot live with the bypass requirements.  There is no similar right to terminate by MID!!!  MID will be solely responsible for all costs, compliance with all laws, agreements with all third parties.  The agreement shifts all risk, liability and compliance with laws onto the MID ratepayer.  This entire contract stinks to high heaven! 

Question – what caused this gigantic mess?  A long list of poor policies and poor decisions by management and directors!  Let me count the ways:

1.  $1.3 billion debt (Editorial in  Modesto Bee, 6-6-12 – Ed Bearden)

2.  Phase 2 treatment plant failures

3.  Significant deterioration of MID’s balance sheet during past ten years (Editorial in Modesto Bee, 5-17-12, Jeff Burda –  unfunded pension obligations of $60 million (2010), unfunded health care obligations – $66 million)

4.  Unprecedented increase in electric rates, reversing our competitive advantage for job creation

5.  Recent settlement of the biomass lawsuit for $1.2 million

MID management has put the rate payers and farmers into a deep financial hole.  Unfortunately, MID is willing to sacrifice our economic lives for its immediate financial needs.

Selling our water is NOT a good idea.  It is a disaster.  It violates Modesto’s contract with MID from 2005 to supply Modesto with 30 – 36 million gallons per day of treated Tuolumne River water.  MID is trying to break that contract.

Yes to food, yes to jobs, yes to life, because water = food = jobs = life itself.

NO to selling our precious resource (our water) to San Francisco!

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