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Madera County GSAs Special Board Meeting, March 29, 2022

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By Joel Hastings

The Madera County Board of Supervisors meeting as the Madera GSAs board of directors held a special session on March 29, 2022, at the county administration building in Madera and online via WebEx. All five supervisors were present and went into closed session at 9:00 a.m., considering two pending legal items, a suit filed by the Madera Irrigation District and one by a group of cattle folks. Chair Tom Wheeler called the open session to order at 10:05 a.m. with thanks for the more than an inch of rain that had fallen in his foothill district, followed by an opening prayer and flag pledge.

The Meeting

With nothing to report from the closed session, public comment was invited. A local citizen complained about lack of follow through from the high speed rail district that had not built a promised fence, allowing unhoused people to continually camp out on her property. Received sympathetically, she was directed to county staff whom she was told could provide help with these issues.

After quickly approving a personnel matter regarding staff vacation cash-out and funding for several positions in the sheriff’s department for guards in the jail, Chair Wheeler moved to the main item of business, consideration of the rate study for the GSAs.

SGMA Rates

First at the podium was Stephanie Anagnoson, who in her role as county Director for Water and Natural Resources, has been leading this program from the start. She introduced Kevin Kostiuk and two other representatives present virtually from Raftelis, the firm that has evaluated costs for the GSA in three subbasins (Madera, Chowchilla and Delta-Mendota) to include recharge, land repurposing, water supplies and domestic well mitigation. These projects were included in the GSPs, part of the strategy that includes supply augmentation and demand reduction. The costs of these programs are to be funded by rates being developed by Raftelis to be assessed to irrigated acres within the GSAs. These rates must be approved by affected property owners in a “218 vote.”

Anagnoson said that today the board is requested to give the go ahead to Raftelis to complete the rate study for adoption at their meeting on April 12 allowing the staff to prepare notice to affected parcels. There would be a 45-day protest period and then a public hearing would occur on June 12. With no majority opposition, the board would approve the rates as final, subject to a 218 vote.Technoflo

She noted that at the meeting earlier in the month, concern had been expressed that Madera County was too far out in front of other GSAs, setting itself up for criticism and opposition. Anagnoson said, as she had last time, that this GSA was not the first to implement allocations and costs. She said that proceeding in the first wave, though, would allow participation in water allocation from the Sites Dam project and continued grant funding from the state.

Economist Duncan McEwan pointed out the prohibitive costs, an estimated $182 million per year loss to the county economy if 40,000 acres was taken immediately out of production. That’s why the GSP plans for gradual reduction of water use over 20 years as allowed (and required) by SGMA.

Anagnoson concluded her presentation with a slide showing the current rates being considered for the first five years in each of the three subbasins. The differences occur because of the different amounts of acreage and the varied costs of the projects being planned in each subbasin.

Five Year Rate Schedules ($/enrolled acre)

Subbasin         FYE 2023         FYE 2024          FYE 2025        FYE 2026         FYE 2027

Madera              $184                $200                 $236                 $279                 $329

Chowchilla        $190                $194                 $202                 $210                  $218

Delta-Mendota  $92                  $104                 $129                 $162                  $202

Smoothed Over Five Years

Subbasin          FYE 2023        FYE 2024        FYE 2025        FYE 2026        FYE 2027

Madera             $246               $246                $246                $246                $246

Chowchilla       $203               $203                $203                $203                $203

Delta Mendota $138               $138                $138                $138                $138

Supervisor Discussions

With that, the floor was opened for discussion by the supervisors. David Rogers who had met with several dairymen pointed out that dairy represents a $600 million economic impact in the county. He asked if the plan has enough flexibility to allow adjustments for unforeseen circumstances. Anagnoson replied that the board has the authority to make changes if various projects don’t come online, such as water from the Sites project, and could thereby reduce fees. Rogers asked if fees could begin lower and be raised as more projects were undertaken, speaking particularly about domestic well mitigation. The staff answer was that the Department of Water Resources (DWR) is putting a high priority on domestic wells and that the current “self-help” plan in place is regarded only as an emergency, short term effort, while the GSP includes more permanent solutions.

Supervisor Brett Frasier pointed out that these rates are for the first five years and after that, as more funding is needed, he asked if another 218 vote would be needed… the answer was “yes.” Supervisor Rob Poythress said the adjusted rate schedule (see above) is counter intuitive in that the rate increases as water allocations decrease, resulting in decreased crop yields. He said he preferred a “smooth rate,” that is the same rate for five years. Chair Wheeler asked if the rate is lowered during this first term, then goes back up, would another 218 vote be needed? The answer was that as long as the rate did not exceed the highest rate, no new vote would be needed.

Public Comment

With board discussion concluded, the floor was opened for public comment. Rob Diepersloot was first to the microphone, identifying himself as a dairyman from the western part of the county. He said he was speaking for about 20 dairy farming operations in the Madera GSA contributing about $600 million in economic activity and paying “millions of dollars in local and state taxes that support Madera County, its services and schools.”

Diepersloot said dairies require thousands of irrigated acres to grow feed for these herds and to allow manure to be applied in amounts that comply with state regulations. He said the GSA’s sudden imposition of fees for overuse of water would immediately make growing feed crops prohibitive and require finding alternative manure management strategies, potentially forcing dairies out of business. He said the plan makes no allowances for unpredictable weather and that dairy farmers are already working to build out infrastructure to capture water in wet years, saying that penalties assessed in year one might be offset by water captured in years two or three. He noted that since dollars collected from penalties are not included in the budget for projects, a delay would not impact the ability to carry out the GSP.

He made several requests. He asked that there be a yearly accounting of income and expense for the GSAs, an annual budget to determine fees and penalties and a suspension of penalties for one year to be stepped up over a five-year term. He asked that there be an option to pay twice a year and looked at with a three-year rolling average, allowing farmers to adjust their use before paying penalties. He asked that farmers be able to meet with county officials to discuss individual water allocation and usage and that farms crossing more than one subbasin be considered as a single farming unit. Finally, he asked for help from the county in obtaining grant funding for nutrient management technologies. He concluded by saying, “We are happy to do whatever we can to work with the Board and County staff…”  (See complete letter below.)

Next up was Christina Beckstead, executive director of the Madera County Farm Bureau who said that the “smoothed over rates” were a surprise and she and her board wanted to take time to consider therm. Speaking next was Geoff Vanden Heuvel of the Milk Producers Council, a statewide trade association of dairy farm operators, who observed that there could be value in the “smooth” rates.

Next, comments were invited from those who were on WebEx. Letitia Casillas Luquin of the Leadership Counsel of Justice said it had been her understanding that a volumetric component would be included in the rates, allowing smaller users and those who reduced water consumption to benefit directly. She said this would help smaller farmers and discouraging the large operations from over-pumping. She said, “It seems the county was turning its back on residential wells which have been impacted by their large farm neighbors who have over-pumped.”

Jack Rice of the Madera Ag Water Association, a grower group with irrigated crops in the white areas, said it’s important to provide clarity to farmers about fees. He said he supported an annual review of GSA finances with rates to be adjusted as needed. He said he hadn’t seen the “smoothed” rates before either. He observed that water district rates have a long history so it’s easier to predict what’s ahead, but the GSA is in a more difficult situation.

Board Discussion

With no further public comment, it came back to the board. Supervisor Rogers asked Director Anagnoson to comment on the points made by dairy producer Diepersloot. Starting with his last request, she said that she and her staff are happy to work on grant funding for dairy technology. She said that an annual review of GSA income and expense, with a budgeting process was being planned as part of good fiscal management. She said the amount and timing of penalties would be up to the Board but that in effect there is a lag time since penalties would only be imposed and collected in the year after water was used. So, a penalty for 2022 water use would not be collected until 2023.

Supervisor Poythress said he wanted to add some “perspective and context” to the discussion. He said, “We are here today because our aquifer is being depleted.” He went on to say he has witnessed that personally in his farming operations having to drill new wells with impacted water quality. “Things cannot continue the way they are,” he emphasized, “or we’ll exhaust our basin.”

Poythress said the fees being considered are for projects while the penalties are to keep people from over-pumping. Last year, Irriwatch showed him he was quite a bit over his allocated water use (ETR) on his property and he adjusted this year. He said many growers have done this as well. “It is all about pumping within your allocation,” he said, “and you don’t penalize those who are complying.”

With a motion needed to give direction to staff, Poythress moved and to proceed with the plans but with a flat rate option offered. Anagnoson said she can provide a flat rate schedule. She noted more consideration is needed if farm units over more than one subbasin are to be considered. With that Supervisor Leticia Gonzalez seconded and the roll call vote showed unanimous approval. (Note: four were present because Supervisor Frasier had excused himself moments earlier for an urgent family matter. He had indicated his support before stepping out.) At 11:20 a.m. the meeting adjourned, with the next session set for April 12th.

Letter Submitted to Board By Dairymen

March 28, 2022

Board of Directors

Madera County Groundwater Sustainability Agency

200 W 4th

Madera, California 93637

Dear Members of the Board:

We represent the nearly 20 separate dairy farming operations in the Madera County GSA. Collectively, our dairies comprise 1,000s of acres.  We proudly live and work in Madera County and directly employ hundreds of its residents.  We generate an estimated $600 Million annually in productive economic activity.  Collectively we pay millions of dollars in local and state taxes that supports Madera County, its services, and schools.  We have been watching with concern the development of the Madera County GSP and the recent rate study which will inform the GSA on rates, schedules and penalties.

Our specific concern is that the fee and penalty structure in the proposed rate study, combined with unrelated regulatory requirements imposed on us by the state’s Nutrient Management Program, will put the dairies in this GSA’s jurisdiction out of business.

Currently, our dairies grow feed crops which utilizes the nitrogen produced by our cows’ waste and prevents it from impairing groundwater quality. This practice allows us to both meet the state’s nutrient management requirements, and to produce the required feed to sustainably operate our business. The proposed GSP’s sudden imposition of rigid penalties for the overuse of water – penalties which are assessed right away and year after year – would immediately make growing feed crops cost prohibitive for dairies. We would have to find immediate external solutions for managing our nitrogen, and for procuring feed for our business, the combination of which could prove devastating to the continuation of our businesses.   What we need is time so that alternative nutrient management technologies can be identified, financed and implemented as well as alternative feed sources identified along with additional surface water supplies to enable continued utilization of our farming acreages, albeit at a lower level.

We are also concerned that the rigid fee and penalty structure does not properly consider the unpredictability of weather. We ask that any new tax or regulation on businesses for their water use should consider that weather and rainfall are unpredictable on a year-to-year basis. We are working closely with Stephanie Anagnoson, Director of Water and Natural Resources, to build out infrastructure for our dairies to efficiently capture water during the next wet season. Which means we could be in a very different place in a few years. Penalties that are assessed on Year 1 for water over usage may be offset by water captured in Year 2 or 3 with better infrastructure, for example.

With these concerns in mind, we respectfully request that this Board consider the following actions as it moves forward with its Groundwater Sustainability Plan:

  1. Yearly accounting within the GSA, so that all money going in and coming out is recorded
  2. Annual review of budget to determine fees and penalties.
  3. Penalties to be suspended for the first year, and then stepped up over a 5-year period.
    1. Option to pay annual penalties on a biannual basis (twice a year).
    2. Penalties to be looked at within a 3-year rolling average, allowing farmers to adjust their usage before paying penalties.
  4. Annual individual appointments with county to discuss water allocation and usage.
  5. Allowing all farms that cross subbasin boundaries to have 1 farm unit (including both subbasins).
  6. Request for a commitment from the county to assist in obtaining grants to help finance alternative nutrient management technologies.

We hope this Board considers our requests. Since the projects in the GSP are funded through the fees, and not the penalties, we believe that our requests are reasonable, and would not stop the GSP from moving forward. We are happy to do whatever we can to work with the Board and County staff to make them happen. Thank you for your time.

Sincerely,

Rob Diepersloot on behalf of the dairy farms in the Madera County GSA

DISCLAIMER OF RESPONSIBILITY; Waterwrights strives to provide clients with the most complete, up-to-date, and accurate information available. Nevertheless, Waterwrights does not serve as a guarantor of the accuracy or completeness of the information provided, and specifically disclaims any and all responsibility for information that is not accurate, up-to-date, or complete.  Waterwrights’ clients therefore rely on the accuracy, completeness and timeliness of information from Waterwrights entirely at their own risk. The opinions expressed in this report are those of the author and do not represent any advertisers or third parties.

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Madera County is comprised of three subbasins, designated by the CA Department of Water Resources as critically overdrafted, and “high priority”: (1) the Chowchilla Subbasin; (2) the Madera Subbasin; and (3) a portion of the Delta-Mendota Subbasin. Each of these subbasins  submitted a Groundwater Sustainability Plan (GSP) by January 31, 2020. These subbasins are required to achieve “sustainability” by the year 2040. The method by which sustainability will be achieved will be illustrated in the GSP, which was be drafted in partnership by the irrigation district, water districts, cities and Madera County. The Madera County Groundwater Sustainability Agency (GSA) is administered by the Madera County Department of Water and Natural Resources: Stephanie Anagnoson, Director, 200 W. Fourth Street, Madera, CA 93637, (559) 675-7703 x. 2265 or (559) 675-6573. The County of Madera Board of Supervisors is the Board of Directors of the GSAs for the three subbasins. The current board is composed of five members: Robert Poythress, chair, Brett Frazier, Letitia Gonzalez, David Rogers and Tom Wheeler.

Emergy

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