Santa Clara Valley Water District Taxpayers Protest Hidden Taxes

 For Immediate Release: June 21, 2016

Barbara Barrigan-Parrilla, Restore the Delta, 209-479-2053, [email protected]
Brian Smith, 415-320-9384, [email protected]

Santa Clara Valley Water District Taxpayers Protest Hidden Taxes
Funding Delta Tunnels Planning

San Jose, CA – Today, ratepayers from Santa Clara Valley Water District questioned unfair, and possibly illegal, fees that have emerged in documents recovered under the Public Records Act. The documents reveal an elaborate money transfer mechanism set up years ago that is funding planning for the controversial Delta Tunnels project. Fees that taxpayers and ratepayers never approved.
Ratepayers shared their concerns during public comments at the SCVWD Board workshop on CA WaterFix today.

Bryan Carr, a SCVWD ratepayer from Monte Sereno said, “As a ratepayer in the District, I am upset that my water district has used ratepayer fees and parcel taxes to fund planning for the Delta Tunnels for years. The Tunnels will divert freshwater that keeps the San Francisco Bay-Delta estuary alive. We deserve a vote on how our taxes and fees are being spent, especially when these projects have not met state and federal environmental standards.”
See a full account of what was found in the PRA request. (Below.)
“The Delta Tunnels plan has been sold to the public as being paid for by ratepayers for about $5 month on their water bills. But it appears that all Santa Clara Valley taxpayers have been funding advanced planning for the controversial Delta Tunnels proposal for years,” said Barbara Barrigan-Parrilla, executive director of Restore the Delta. “If SCVWD cannot afford to pay for Delta tunnels planning at the $14 million level without relying on property taxes, how will they afford $1 to $2 billion for their share of the project?”
The district has insisted for years that it can raise property taxes on Santa Clara County homeowners without a public vote to help pay for the Delta Tunnels because the project is simply an addition to the State Water Project, the series of dams and canals that was authorized by state voters in 1960.
But the Howard Jarvis Taxpayer’s association warned SCVWD this March that these taxes may be illegal under Proposition 13, which requires a two-third vote by taxpayers for new fees. Their letter argued that the tunnels were not part of the original State Water Project plan and that any property tax hike to fund them would be illegal without voter approval.

"What the voters approved in 1960 doesn't say anything about tunnels," Timothy Bittle, an attorney with the Taxpayer’s association told The (San Jose) Mercury.

In addition, the district’s federal contribution to the tunnels has involved ratepayer money being spent on a cash fund to enable the Bureau of Reclamation to unleash $74 million in grants, paid for by U.S. taxpayers, to cover planning costs for big industrial irrigation districts, like Westlands Water District. Santa Clara Valley Water District customers have been taxed twice, at the local and federal for this project.

Santa Clara Valley Water District purchases water through two projects as a regional wholesaler and sells it to municipal retail water districts. About 40 percent of SCVWD's water supply is drawn from the Delta through the State Water Project (SWP), and the Federal Water Project (CWP). 
PRA documents suggest that since the beginning of the Delta Tunnels planning process, SCVWD has used local property taxes and benefited from Federal taxpayer dollars through a complicated shell game to pay for their share of Delta Tunnels project planning.
The Santa Clara Valley Water District is planning to pay for their $1 to $2 billion contribution for construction of the Delta Tunnels. SCVWD has used Ad Valorem parcel taxes since the beginning to pay for their share of Delta tunnels planning costs on the State Water Project side. This does not sit well with ratepayers who are actually tracking the project, especially those in Morgan Hill who do not receive SWP water. The Delta tunnels plan has been marketed to Californians as being paid for solely by recipients of the water that they would deliver. There has been no public discussion of relying on property taxes or federal tax dollars for funding.
PRA Documents Raise Serious Questions

Are Santa Clara Valley Water taxpayers already funding the unpermitted Delta Tunnels?

  1. American taxpayers are being bilked for the tunnels charges accrued by the US Bureau of Reclamation despite the law and false claims from the State and Federal contractors that they are paying the costs. The USBR letter clearly indicates that like Westlands, Santa Clara Valley Water District, as a Federal Water Contractor has paid $0 to USBR for the $74 million in grant funds made available by USBR to the California Department of Water Resources. Remember the project has been sold to Californians as being paid for 100 percent by the water contractors.
  2. The Santa Clara Valley Water District, as a Federal Water Contractor, made advanced Operations and Maintenance payments to the Bureau of Reclamation to help create a slush fund so that USBR could advance other funds to DWR. Documents show a shell game is being played to mislead Congress and SCVWD ratepayers and that this game circumvents state and federal law by allowing Congressional appropriations to be redirected to pay for over one-third of the tunnels planning costs. (Links to Advanced O&M, Draft Letter to Water Districts). SCVWD received credit back toward Central Valley Project charges for advancing this money; hence, their contribution as a Federal Contractor toward grant funding is $0, meaning that about a one-third of their reported project funding was covered by Federal taxpayers.

Have SCVWD property taxpayers been fooled into paying for CA Water Fix planning expenditures through hidden fees?

  1. Santa Clara Valley Water District documents show that it has used the Ad Valorem State Water Project tax to pay 100 percent of SWP contractual obligations from 2009 to 2013, including funding of planning for the Bay Delta Conservation Plan/CA Water Fix in payments to DWR for a total of nearly $3.5 million (Nearly $14 million has been spent by SCVWD on CA Water Fix in payments to DWR, San Luis Delta Mendota Water Authority, and advanced O&M payments to USBR).
  2. The March 15, 2016 Howard Jarvis Taxpayer Association letter to SCVWD indicates that the Delta tunnels are an addition to, and not part of the State Water Project approved by voters in the 1960 SWP construction bond. They assert that tunnel construction expenses are ineligible to be funded by a property tax override. This raises the question of how the Howard Jarvis Taxpayer Association would evaluate the prior use of the Ad Valorem tax to pay for the funding of planning for the tunnels project, as a new project.
  3. Residents within Palo Alto have been charged for SWP water through these property taxes, despite not receiving any SWP water. Thus, these same property taxpayers have been paying for the planning of the Delta tunnels, even though they will not receive water from the tunnels.

Does the Santa Clara Valley Water District Board of Directors approve of bilking ratepayers and property taxpayers and saddling them with debt for decades to pay for a risky, expensive project that will not solve water supply problems and has yet to be authorized by Federal and State agencies as environmentally or financially sound?

  1. Documents show that SCVWD ratepayers have also paid another $5.5 million to San Luis Delta-Mendota Water Authority, which was mostly paid, in turn, to DWR for a tunnels construction fund, and as well as regular membership SLDMWA fees. Documents show the tunnels project has circumvented state and federal law, issuing contracts for the tunnels paying contracting rates in excess of $300 an hour, courtesy of Santa Clara Valley Water District ratepayers and taxpayers, as well as American taxpayers and Metropolitan Water District rate/taxpayers.
  2. Tunnels charges for the construction fund were buried in a series of contractual agreements with Westlands and other San Luis Delta-Mendota Water Authority members. Remember that SLDMWA along with Westlands were put on negative credit watch as a result of SEC fines. The Executive Director of SLDMWA was given excessive compensation while employed at Westlands with a sweetheart loan that has yet to be repaid, and membership payments by SCVWD to SLDMWA were used for false advertising campaigns aimed at draining the Bay-Delta estuary for growers.

Led by the former SCVWD executive director, Beau Goldie, who partnered with SEC fined Westlands Water District, the San Luis Delta Mendota Water Authority, and Stewart Resnick’s front group California Water Security, the Santa Clara Valley Water District Board of Directors needs to question staff further about how these deceptive financial schemes and marketing campaigns were created. They accept at face value staff rationale that the tunnels will deliver additional supply and refuse to look at independent science on drought forecasting.

In conclusion, Santa Clara Valley Water District management is now rationalizing to the board past contributions as “this is what was set up,” and future water and financial planning as “this is how we do things.”

They ignore that no independent or federal scientist has affirmed that additional water can be exported through the tunnels.  The project still does not have state permits or federal authorizations.


Live tweets from CA WaterFix commitee hearing – June 21st, 2016: Follow us on Twitter @RestoretheDelta


Schedule Change: Train the Water Advocate Courses for 6/23

Dear friends, 

The start time for the following classes have been changed to take place 30 minutes earlier than the original time due to a scheduling conflict on June 23rd. The Delta Boat Tour will take place 30 minutes later than the original time. 

Time changes have been made to the following classes on June 23rd and the Delta Boat Tour: 

–  Legislative Update — Federal, State, and Local – 3:30 pm to 4:30 pm June 23rd only: Class start time changed to 3:30 pm

– Organizing to Save the Delta, Stop the Tunnels in Your Local Community – 4:30 pm to 5:30 pm June 23rd only: Class start time changed to 4:30 pm 

–  June 23 only: Informational Delta Boat Tour – 6:00 pm to 8:30 pm, departing Stockton. Limited to 35 people. $40/per person. Start time changed from 6:00 pm

We hope that you are still able to attend these courses and we apologize for any inconveniences. 

If you can no longer attend, please let us know. Thank you for your participation and support!  

P.S. There is still time to register for classes ranging from topics on the Drought Update to California Water History – you have until tomorrow afternoon to register for classes. Open House is available on a drop by basis Wednesday, Thursday, Friday at our office in downtown Stockton from 10 am to 7 pm. We hope to see you there! 


Fresno Bee: Westlands’ commitment to secrecy

In case you missed it…

The Fresno Bee
Westlands’ commitment to secrecy
By the Editorial Board
June 15, 2016
Original link here

This is the Walnut Grove home of Jason Peltier, a former deputy general manager of the Westland Water District. Peltier received a $1.4 million loan at 0.84% interest from the district to buy the home in 2007 and has until 2021 to repay the final $1 million-plus. Rich Pedroncelli The Associated Press

Westlands Water District is a Fresno-based public agency formed in 1952 to deliver irrigation water to hundreds of thousands of fertile acres on the Valley’s west side.

As a public agency, Westlands’ employees, growers and board of directors should exhibit a 100 percent commitment to transparency. Westlands, after all, conducts the people’s business, and sunlight is the best disinfectant against backroom deals, shady practices and favoritism.

In fact, Westlands claims that it promotes transparency. Here’s what the district says on its website: “Westlands Water District is committed to providing current and accurate information to our water users and to the general public.”

Don’t believe it.

What Westlands claims and what it does are two different things. Thanks to the investigative efforts of Associated Press reporter Ellen Knickmeyer, we now know that Westlands is a mortgage lender, too.

Not the kind of lender where any citizen can go in, fill out forms, pass a credit check and walk out with a mortgage. Rather, it’s an agency that had not an ounce of compunction about loaning one of its top executives, Jason Peltier, $1.4 million in 2007 so he could buy a riverfront estate about 150 miles away from Fresno in Walnut Grove.

Three more things. Peltier, who no longer works for Westlands, received one mighty fine interest rate (0.84 percent). He now owes, with accumulated interest, $1.57 million on the loan. And he has since bought another house – at Pebble Beach.

In response to queries from Knickmeyer for her June 9 report, the district and Peltier vigorously defended the loan. We wonder, if it was a win-win arrangement, as both sides say, why not announce it to the world?

It’s obvious why they didn’t. The arrangement stunk to the high heavens.

“In response to written questions, (Westlands) Chief Operating Officer Dan Pope said the home loan was allowed under a district rule that gives officials the authority to set salaries,” Knickmeyer reported. “There was no public record of the district board’s loan decision, Pope wrote, because it was made in a closed session.

“The AP could find public mention of the loan only on the website of a federal agency that oversees municipal bonds. Posted there were Westlands’ annual audits, which from 2010 on reported a $1.4 million loan to an unidentified management-level employee.”

The public had a right to know about the buddy-buddy deal Westlands made with Peltier. The fact that Westlands failed to disclose it is evidence of its aversion to sunlight.

Revelations about the Peltier loan come on the heels of a March announcement that Westlands would pay $125,000 to settle Securities and Exchange Commission civil charges that the district misled investors about its financial health. As part of the settlement, Westlands General Manager Tom Birmingham agreed to pay $50,000.

The charges, which Westlands and Birmingham neither admitted nor denied, involved accounting maneuvers that allegedly masked revenue reductions caused by drought and corresponding cuts in water deliveries.

Westlands growers are battling the drought, environmental regulations that reduce water deliveries, and serious drainage problems. The last thing they need are more self-inflicted wounds like the Peltier loan and the Enron-like accounting maneuvers.

We remind the district of a biblical observation that every farmer should understand: You reap what you sow.

Westlands must let the sunshine in and become an ethical, transparent public agency. If the district doesn’t, its fertile fields are destined to become dust in the wind.


Media Release: Restore the Delta Praises Federal Investments in California Water

For Immediate Release: June 15, 2016
Barbara Barrigan-Parrilla, 209-479-2053, [email protected]

Restore the Delta Praises Federal Investments in California Water
DOI Announces $30M Water Reuse and Reclamation Projects

Stockton, CA – Restore the Delta today praised an announcement by the Department of the Interior that $30 million will be invested in water reuse and reclamation projects across the state of California.

The announcement comes as Deputy Secretary of the Interior Michael L. Connor comes to California to attend meetings regarding the San Francisco Bay-Delta.

“These are the exactly kinds of investments we have been calling for as California enters our fifth year of drought,” said Barbara Barrigan-Parrilla, executive director of Restore the Delta. “Rather than waste $15 billion on building the Delta Tunnels to move water to corporations growing nuts for Asia, these projects that actually create ‘new’ water for cities and rural Californians. Investing in drought-resistant water supplies builds regional water sustainability and can reduce water exports from the over-pumped, San Francisco Bay-Delta, an ecosystem on the brink of collapse due to lack of flowing fresh water.”

The projects will be funded under the Title XVI, part of the Department of the Interior’s implementation of the June 2013 Climate Action Plan “Preparing the United States for the Impacts of Climate Change.”

The funded projects include:

City of Corona Water Recycling and Reuse Project, Corona Comprehensive Reclaimed Water Conversion, Phase 1 – $4 million

San Diego Area Water Reclamation Program, Pure Water San Diego Program – $5 million

Eastern Municipal Water District Recycled Water System, Recycled Water System Pressurized and Expansion Project – $1,222,164

Lower Chino Dairy Area Desalination and Reclamation Project, Chino Desalter Phase 3 Expansion Project – $7.2 million

San Diego Area Water Reclamation Program, Padre Dam Water Recycling Facilities – Phase 1 Expansion – $4.5 million

Sonoma County Water Agency, North Bay Water Reuse Program – $4,706,150

San Diego Area Water Reclamation Program, Sweetwater Authority Water Reclamation Project – $3.7 million

Learn more about these projects.

Read the report “A Sustainable Water Plan for California” (Environmental Water Caucus, September 2015)


Action Alert: Make Comments at the SCVWD CA WaterFix Workshop NEXT TUESDAY!

Dear friends,

Please JOIN US next Tuesday to urge the Santa Clara Valley Water District to end their support for the Delta Tunnels! If you can attend, we ask that you plan to make a 2 minute public comment voicing your thoughts on the Delta Tunnels project and to send in your RSVP in to [email protected] ASAP!

If you can’t make the workshop, make sure to send your written comments on the Delta Tunnels to: [email protected], title the e-mail “Comments for CA WaterFix Workshop 6/21.” In your written comment, please INCLUDE a note requesting that your comments are read out loud at the workshop.

Event: Santa Clara Valley Water District CA WaterFix/Delta Tunnels Workshop
Time: 9:00 am on June 21, 2016, Next Tuesday

Location: SCVWD Headquarters, 5750 Almaden Expressway, San Jose

You can use these points to help you get started.

As a Santa Clara Valley Water ratepayer, we urge you to speak on these items at the opening public comment session:

1) You do not want to pay for a project that will cost $1 billion before cost over runs and that will not provide the District with additional water supply. Staff estimates of increased water supply are not accurate. They need to consult the CA WaterFix website and look at climate change modeling done by environmental NGOs.

2) You do not support a project that will result in worsened water quality for the South Bay. Water quality in the South Bay is directly dependent on flushing action from fresh water from the Delta.

3) You do not support a project that will divert even more water from a healthy San Francisco Bay-Delta estuary to big, industrial agriculture known for record use of pesticides and chemicals that get into our food supply.

4) You do not support Santa Clara Valley Water District partnering with San Luis Delta Mendota Water Authority to weaken Bay-Delta water quality standards through litigation or public media campaigns.

5) You support use of ratepayer money toward conservation, storm water capture, ground water capture and clean up, recycling.

6) You do not support the use of Ad Valorem property taxes to pay for Delta tunnels planning, construction or operation, or for supporting anti-Delta programs in partnership with San Luis Delta-Mendota Water Authority.