Los Angeles Times, Blowback

9-22-17

California is world-renowned for its protection of natural resources, and its environmental laws are America’s strongest — far more stringent than their federal equivalents. In fact, the rigor of California’s environmental process has caused many high-profile projects to seek legislative exemptions from state review. So when a critical infrastructure project makes it through California’s environmental permitting processes and is upheld by all levels of the state’s courts, it’s a big achievement.

For nearly a decade, the Cadiz Valley Water Conservation, Recovery and Storage Project, which will create a new water supply for 400,000 people and thousands of jobs, has followed the entire California Environmental Quality Act (CEQA) review and approval process from start to finish — public comment periods, public hearings, board approvals and litigation, all of which concluded last year, when the 4th District Court of Appeal sustained every approval of the project and concluded that it could be operated safely and sustainably.

So it’s disappointing that Sen. Dianne Feinstein (D-Calif.) and her allies, including state Assemblywoman Laura Friedman (D-Glendale), continue to perpetuate a series of myths about the Cadiz project as part of a campaign to derail it, including in a recent op-ed article for the Los Angeles Times. Here are just a few examples of the most common myths:

• Feinstein and Friedman claim the project would be “an environmental disaster” that could “destroy the Mojave Desert.” However, independent experts, public agency decisions and 12 state court opinions have concluded that the Cadiz project is no such threat to the Mojave Desert or the surrounding ecosystem, including the springs, flora, fauna and aquifer. In their op-ed, Feinstein and Friedman cited an old U.S. Geological Survey estimate of the area’s water recharge rate, prepared in 2000 for a different project. They fail to acknowledge that this out-of-date estimate was evaluated during the project’s CEQA review process and set aside in light of actual, measured data not previously available to the USGS. What’s more, the project’s use of groundwater was ultimately limited by San Bernardino County to a specific amount — 0.3% of total storage, annually — and to a hard floor in the water table, making the recharge rate moot. It is arithmetically, physically and legally impossible for the Cadiz project to do what Feinstein and Friedman claim it could do, given the county’s strict conditions and court-approved management provisions.

• Feinstein and Friedman also allege that Cadiz avoided review by locating its pipeline in a railroad right-of-way. But they ignore the fact that the federal government concluded in 2009 that no federal permits were required. Multiple federal agencies participated in the project’s CEQA review, and their comments were fully incorporated and addressed. Furthermore, sharing a right-of-way with a railroad is customary practice. Most railroads have other infrastructure in them — fiber optic lines, electric lines, sewer lines or gas lines. This “co-location” practice minimizes the potential for negative environmental effects because it protects virgin lands from new infrastructure, and it helps utilities better service communities in need. This doesn’t mean a project is not subject to environmental scrutiny. It just means a project doesn’t need a secondary permit to use the same corridor that the host railroad was already permitted to use.

• Feinstein and Friedman claim that the new administration is dismantling the federal regulatory framework that could have prevented Cadiz from using the railroad right-of-way. This is very misleading, and it also ignores the role that Feinstein herself played in any “dismantling.” After the federal government determined in 2009 that no federal permits were required, Feinstein wielded her tremendous federal appropriations power to create a new regulatory framework that would force the Bureau of Land Management to certify that the Cadiz project was within the scope of the railroad right-of-way, a new requirement unique to Cadiz. At the same time, Feinstein’s appropriations policy prohibited the BLM from processing any applications for permits that could be required under that new framework. While publicly insisting that Cadiz must undergo a federal review, Feinstein blocked all potential for there to ever be one. This Catch-22 set the stage for a widely criticized precedent that threatened the sensible use of existing railroads for necessary infrastructure — a precedent now being addressed by the federal government at the request of members of Congress from both sides of the aisle.

Feinstein’s and Friedman’s agenda — to stop this court-validated, job-creating water project — is no secret. But it’s not based in fact or law. The Cadiz project is a privately financed California project, regulated in accordance with our state and local laws and supported broadly by major labor unions; local, state and federal representatives; and business, agriculture and public-interest organizations. It offers a new, sustainable water supply, thousands of jobs and more than $875 million in economic activity — all without any negative environmental effects.

We are grateful that the Legislature didn’t advance Feinstein’s and Friedman’s agenda in the recently ended legislative session. And we urge California’s leaders to continue to stand up for jobs, for citizens who need water, and for our state’s strong environmental review laws by rejecting sustained efforts to change the rules of the game for Cadiz or any other CEQA-approved project.

Tracy Rafter Hernandez is chief executive of the Los Angeles County Business Federation. Carlos Rodriguez is chief executive of the Baldy View chapter of the Building Industry Assn. of Southern California.

This piece is part of Blowback, our online forum for rebuttals to The Times. If you would like to write a full-length response to a recent Times article, editorial or Op-Ed and would like to participate in Blowback, here are our FAQs and submission policy.

(9-23-17) Yesterday, Senator Feinstein issued a press release regarding a risk she claims is presented by conserved water that will be delivered from the Cadiz Water Project to Southern California communities. We are stunned and disappointed by the allegations made by Senator Feinstein, which reflect a lack of understanding of the Project and disregard for state requirements that all drinking water meet federal and state standards issued by the US Environmental Protection Agency and the State’s Division of Drinking Water. Her statement suggests that Cadiz water might be delivered to consumers without satisfying these standards; this is irresponsible and not true.

Water quality at Cadiz is regularly tested using licensed professional laboratory services, is the subject of annual reports to San Bernardino County and was extensively surveyed in connection with the comprehensive Court-approved environmental impact report (EIR) for the Cadiz Water Project.  Cadiz water quality, as described in the EIR, is below current State & Federal MCLs. Total Dissolved Solids (TDS) of the Cadiz supply are considerably lower than both the MCL and the amount in the Colorado River Aqueduct (“CRA”) and would reduce the service area’s treatment requirements, a benefit valued at nearly $400 million.

Delivery of Cadiz groundwater to the CRA will be done in full accordance with applicable federal and state standards.  Cost-effective and permitted treatment technologies are available to reduce constituents below existing state and federal standards should such treatment be necessary in the future.   Importantly, no water from Cadiz would ever enter the CRA that does not meet all local, state and federal standards and no water will reach consumers unless it satisfies these same standards.  It is misleading and shameful for the Senator to suggest that the state and federal drinking water regulatory system would or could be bypassed or that the water conserved by Cadiz will put the public at risk.

(9-18-17)

Despite running an aggressive negative campaign, with the adjournment of the California Legislature on September 16, 2017, opponents of the Cadiz Valley Water Conservation, Recovery and Storage Project failed to secure passage this year of Assembly Bill (AB) 1000, a bill introduced in July 2017 with the intention of blocking the advancement of the Project.  The Legislature is now adjourned until January 2018 and the bill remains on suspense in the State Senate’s Appropriations Committee.  The Company is grateful the California Legislature did not further advance AB 1000 in this legislative session and intends to complete as soon as possible our efforts to implement this important Project, which offers Southern California broad water supply and economic benefits without causing environmental harm.

About Cadiz

Founded in 1983, Cadiz Inc. is a publicly-held renewable resources company that owns 70 square miles of property with significant water resources in Southern California. The Company maintains an organic agricultural development in the Cadiz Valley of eastern San Bernardino County, California and is partnering with public water agencies to implement the Cadiz Water Project, which over two phases will create a new water supply for approximately 400,000 people and make available up to 1 million acre-feet of new groundwater storage capacity for the region.  Cadiz abides by a wide-ranging “Green Compact” focused on environmental conservation and sustainable practices to manage its land, water and agricultural resources. For more information, please contact cdegener@cadizinc.com

By Scott Slater, President & CEO, Cadiz Inc.

KCET.org

9-15-17

California has always stood apart from the rest of the nation. As the sixth-largest economy in the world, our state has led the conversation on issues ranging from advancing social justice to fighting climate change. And, on no issue has our state’s leadership been clearer than environmental law. Indeed, the landmark California Environmental Quality Act (CEQA) is the most detailed environmental review process in the country, even surpassing its federal counterpart in its stringent requirements.

The CEQA review process ensures not only that the projects built in California are safe for the environment, but also that they are uniquely tailored to the nuances of our natural resources and our communities’ needs. In other words, California projects are uniquely ours and ours alone. So a recent op-ed that suggests the Trump Administration is single-handedly pushing a California water project is not only far-fetched in its claims about the project’s ties to the federal administration, but also does a grave disservice to our state’s world renowned environmental laws by supporting legislation that would weaken them.

This legislation, Assembly Bill 1000, targets the Cadiz Valley Water Conservation, Recovery and Storage Project, but its short-sighted quest to destroy Cadiz would actually undermine CEQA, threaten thousands of California jobs and jeopardize safe water supplies for hundreds of thousands in the process. And, it ignores the process Cadiz has already completed to ensure it will not harm the desert environment, where we’ve operated for more than 30 years.

The Cadiz Water Project is a California project that’s been thoroughly reviewed and deemed environmentally safe in accordance with CEQA by public regulatory agencies and California’s courts. The project will safely and sustainably conserve groundwater on private land in the eastern Mojave Desert that is now being lost to evaporation and rendered useless due to high salinity at dry lake playas. This groundwater does not now – nor has it ever – supported desert springs, animals, plants or any other wildlife. Moreover, the amount of groundwater being captured by the project represents less than one-tenth of 1 percent of all the water in storage in the region and will continue to be recharged and replenished on an ongoing basis.

Importantly, the project relies on the most accurate and up-to-date science about the local hydrology and is modeled after safely managed and regulated groundwater projects across the state. The full CEQA review process considered all studies of the area, including science produced decades ago in connection with different projects, and adjusted the Project’s parameters and permits in consideration of any concerns raised by the public and regulatory agencies about differences between old and new work completed.

The Cadiz Water Project is an example of the CEQA process working. Since its first iteration in the year 2000 and over the course of the current review process, the project has been amended significantly to address concerns about environmental impacts. For example, the old project would have been built on virgin public lands, and could have impacted various species. Today’s project will use an existing, disturbed railroad right-of-way instead, avoiding these habitats.  Also, the old project was only constrained by its only Project participant at the time, the Metropolitan Water District of Southern California. Today’s project is subject to the independent enforcement authority of San Bernardino County, not a Project participant, which can cut off the project’s operations at any time if we are in violation of the management plan–  an independent enforcement mechanism long sought by critics, including Senator Dianne Feinstein.

By targeting a CEQA success story with “do over” “double jeopardy” reviews, AB 1000 not only undermines the environmental review process for this particular project – but it also sends a dangerous message about the strength, the importance and the supremacy of California’s environmental review process and environmental laws.

Why does that matter? Because undermining this process puts not only jobs and critical infrastructure development projects – like solar and renewable energy, affordable housing and school and hospital construction projects – at risk, but it puts the environment at risk as well. Political will changes quickly, and undermining CEQA now to block a project certain groups don’t like is short-sighted and can quickly be abused by those groups who’d rather scrap CEQA and its checks on development entirely.

AB 1000 is opposed by more than 75 local, state and national labor, business, water agencies and organizations as well as government officials from both sides of the aisle, in part because of the risky precedent that would mostly be borne by California’s working families. The State Senate rightfully put the bill aside earlier this month. It would be a grave disservice to the people of California to jam the bill through during the final days of the legislative session as proponents of AB 1000 have been seeking. It’s exactly the kind of rule bending and breaking that Californians loathe and never forget – especially when reliable water and good jobs are at stake.

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California Assembly Bill (AB) 1000 is a “gut and amend” bill introduced outside of the normal legislative process that would create a secondary, undefined environmental review for water conveyance projects in the Mojave Desert, including the Cadiz Water Project.  Ironically, in the name of environmental protection, AB 1000’s proponents are urging the Legislature to undermine and circumvent California’s world-renowned, well-defined and judicially reviewable environmental protection laws in favor of selectively subjecting some but not all projects to different levels of scrutiny.  The process referenced in AB 1000 is unprecedented and without defined standards.

As the Company previously announced, on September 1, 2017 the California State Senate Appropriations Committee held AB 1000 on the Senate’s suspense file rather than voting to further advance the legislation during the current California legislative session, which adjourns on Friday, September 15^th. The suspense file is a special category of bills with a fiscal impact that are subject to additional scrutiny by the Appropriations committee in both the Senate and Assembly. With no further suspense file hearings scheduled in the Senate prior to September 15, bills that remain on suspense, including AB 1000, cannot be further considered by the Legislature in this session without the action of the Senate President Pro Tempore or the Chair of the Senate Appropriations Committee.

If AB 1000 were removed from the suspense file, it must be considered and passed by the full Senate and then considered and passed by the full Assembly by Friday, September 15^th in order to become law. Prior to passage in the Assembly, AB 1000 should also be considered and passed by the Assembly’s Water, Parks & Wildlife Committee and the Assembly’s Appropriations Committee. If AB 1000 were to complete these steps, it would then go before the California Governor for his consideration. The Governor must consider all bills approved during the legislative session prior to October 15, 2017.  If the Governor does not veto the bill, AB 1000 would become law on January 1, 2018.

AB 1000 is widely opposed by more than 70 local, state and national organizations, including labor unions, local government groups, chambers, cities, and water agencies, as harmful public policy that would create new uncertainty for all infrastructure improvements in California, jeopardizing jobs and reliable services for communities in need.

We are grateful that the California Senate leadership has held AB 1000 on the suspense file. We will continue to work with the Stop AB 1000 coalition to educate the Legislature about the bad policy precedent this bill would establish, as well as its unjust treatment of the Cadiz Water Project. To learn more about AB 1000, visit www.StopAB1000.com.

US Department of the Interior Publishes New Opinion on the Scope of Railroad Rights-of-Way issued under 1875 Act

September 5, 2017

(9-5-17) On September 1, 2017, the Acting Solicitor and Principal Deputy Solicitor for the United States Department of Interior (“Interior”) issued Memorandum Opinion M-37048 related to the scope of railroad rights-of-way granted pursuant to the General Railroad Right-of-Way Act of March 3, 1875, 18 Stat. 482 (“1875 Act”). M-37048 permanently rescinds M-37025, issued by Interior in November 2011, and concludes that:

“[R]ights-of-way granted to railroad companies under the 1875 Act include the right to lease portions of their easement to third parties without BLM permit or grant provided that such leases are limited to the surface, broadly defined, of the easement and do not interfere with the continued use of the easement as a railroad.”

M-37048 further provides that railroad purposes, as have been required for third party uses, should be interpreted broadly. And, railroads have “wide discretion” in leasing access to rights-of-way and have historically undertaken a broad number of permissible incidental uses.

“Thus, even assuming the 1875 Act right-of-way is limited to a “railroad purpose,” as long as the proposed use is not otherwise prohibited, provides some incidental benefit to the railroad, and does not inhibit the continued use of the right-of-way for railroad operations, the railroad company may lease land within their 1875 rights-of-way for third party uses”.

In September 2008, the Cadiz Water Project leased from the Arizona & California Railroad Company (“ARZC”) a portion of its active 1875 Act railroad right-of-way to co-locate the Project’s water conveyance pipeline and related facilities and enable the delivery of water conserved at Cadiz to Southern California water agencies via the Colorado River Aqueduct.     The Project’s activities will be undertaken pursuant to a consensual lease with the ARZC, are not inconsistent with the use of the railroad and further a multitude of railroad purposes all beneficial to the railroad.

Consequently, the Company believes the Cadiz Water Project is clearly within the scope of ARZC’s right-of-way, as defined by the new M-Opinion 37408. In May 2017, the Company’s requested that the US Bureau of Land Management (“BLM”) rescind its October 2, 2015 evaluation of the Project’s proposed activities within the ARZC right-of-way and clarify that the Project’s proposed use is within the scope of the ARZC right-of-way. These requests are still pending.

M-37048 is available at this link: https://www.doi.gov/sites/doi.gov/files/uploads/m-37048.pdf

Background

Following the execution of the Company’s lease with ARZC, in January 2009 Interior opined that the Project’s proposed use of the ARZC right-of-way was within the right-of-way’s scope.

In January 2015, the Company, Santa Margarita Water District (“SMWD”) and the ARZC filed a joint request with the BLM seeking a, then legally-required, certification that the Cadiz Water Project was within the scope of the ARZC right-of-way and therefore needed no further federal permitting from the BLM.  On October 2, 2015, the California Office of the BLM changed the position Interior took in 2009 and issued a guidance evaluation advising that the Project was not within the scope of the ARZC right-of-way.   The BLM’s review was undertaken pursuant to the November 2011 M-37025 and BLM’s related implementing memoranda issued in 2012 and 2014.

The October 2015 Cadiz evaluation led to expression of concern from bi-partisan members of Congress, the railroad industry, and business, labor and agriculture communities, because it signaled that the co-location of longitudinal infrastructure within railroad rights-of-way would no longer be encouraged by the federal government, as it had for more than 100 years.

In accordance with the lease with the ARZC, the Cadiz Water Project was required to provide many benefits to the ARZC in furtherance of railroad purposes. Yet, inconsistent with the previous M-37025, these purposes were rejected by the BLM in its October 2015 evaluation, because they did not originate from a railroad purpose. The Company believed the October 2015 evaluation was incorrect and biased, as evidenced by documents received through a Freedom of Information Act request.   The BLM’s October 2015 Cadiz evaluation was referred to Interior’s Inspector General, the Securities and Exchange Commission and is the subject of an ongoing investigation by the House Oversight Committee.

Further, the evaluation was controversial because it threatened the Company with a referral to the Department of Justice and the filing of a trespass action if we did not obtain a new, separate right-of-way permit to construct within the ARZC’s right-of-way.  However, BLM also indicated that it was unable to accept an application, since an annual appropriations rider authored annually by Senator Dianne Feinstein expressly prohibited federal spending on the evaluation of a right-of-way application filed by the Company.  That is, if the Company filed an application for a right-of-way, the federal government could not spend any funds to review it.

On March 1, 2017, nineteen members of the US House of representatives from 10 Western State wrote to the Interior Secretary to request that he withdraw the BLM’s implementing memoranda and the California Office’s 2015 Cadiz evaluation and also find that the Cadiz Water Project is within the scope of the ARZC right-of-way, summarizing: “For more than 140 years… co-locating utilities within previously granted and already disturbed rights-of-way has helped minimize additional environmental impacts and disturbances… The new standard is arbitrary and represents a gross expansion of BLM’s authority at a time when BLM struggles to meet its primary mission objectives.”

On March 31, 2017, the BLM withdrew the 2012 and 2014 implementing memoranda.  The BLM has not yet acted specific to the outstanding 2015 Cadiz Water Project evaluation.

(LOS ANGELES, CA) –Today, Cadiz Inc. [NASDAQ:CDZI] (“Cadiz”, the “Company”) announced that the California State Senate set aside AB 1000 following a hearing of its Appropriations subcommittee. The Company issued the following statement:

“Designed to block the Cadiz Water Project, AB 1000 (Friedman, D- Glendale) would have set a dangerous precedent undercutting the California Environmental Quality Act – the strictest environmental protection law in the nation; usurped local control; and threatened jobs, water and economic growth for Southern California.

The bill was widely opposed by more than 70 local, state and national organizations, including labor unions, local government groups, chambers, cities, and water agencies, because it was bad policy that would have created new uncertainty for any infrastructure improvement in California, jeopardizing affordable, reliable services for all communities.

The Cadiz Water Project will safely and sustainably conserve groundwater presently lost to evaporation and add a new, reliable water supply in Southern California – something that is particularly important given the region’s ongoing water challenges. The Project went through a multi-year public, independent California environmental review process, was approved by California public agencies and upheld by California’s Courts, which confirmed the Project will protect the desert environment.

We are grateful the State Senate has taken this action and look forward to delivering reliable water, nearly 6,000 good-paying jobs and almost $1 billion in economic growth to Southern California through this environmentally responsible project as soon as possible.”
About Cadiz

Founded in 1983, Cadiz Inc. is a publicly-held renewable resources company that owns 70 square miles of property with significant water resources in Southern California. The Company maintains an organic agricultural development in the Cadiz Valley of eastern San Bernardino County, California and is partnering with public water agencies to implement the Cadiz Water Project, which over two phases will create a new water supply for approximately 400,000 people and make available up to 1 million acre-feet of new groundwater storage capacity for the region. Cadiz abides by a wide-ranging “Green Compact” focused on environmental conservation and sustainable practices to manage its land, water and agricultural resources. For more information, please visit www.cadizinc.com