State budget proposes to buy water rights from farmers

Tulare County Farm Bureau is concerned farmers will be forced out of their land, water agencies say the proposal is unlikely to make it into the final budget

SACRAMENTO – State lawmakers are proposing to set aside $2 billion to buy up water rights and repurpose farmland to rebalance the water supply amidst the state’s second drought in the last decade. 

Most of the money being proposed in the 2022-23 budget, $1.5 billion, will be used to buy land with senior water rights to secure surface water from state and federal water projects as drinking water for disadvantaged communities struggling with contaminated groundwater and enhance stream and river conditions for habitats. Senior water rights are those that predate the state’s regulation of water use in 1914, which often supersede other rights to water supply during dry years.

“The state Senate’s budget proposal establishes a voluntary water reconciliation program, helping to rebalance the state’s water supply and water rights system, rather than relying on the current regulatory processes that have failed to provide adequate flows for decades and do not adequately anticipate changing conditions,” according to a May 10 report of the California Senate Budget Subcommittee on Resources, Environmental Protection and Energy.

The goal of the proposal is to retire water use incrementally in overdrafted groundwater basins, such as those in Tulare County, to help ensure that no region or area served by a water agency is disproportionately impacted by the drought. It is the most sweeping land retirement proposal since the landmark 1992 Central Valley Project Improvement Act, according to California Water Research, an independent research and analysis firm of California’s water system. The state would only purchase water rights and land from willing sellers.

Tricia Stever Blattler, executive director of the Tulare County Farm Bureau, said her board and members have significant concerns about the proposal. She said the concept of a “willing seller” is somewhat subjective because state-mandated restrictions on pumping groundwater and environmental laws reducing the water supply for agriculture are forcing farmers to compromise crop production. 

“When you think about those cut backs, which have all been imposed by government, they’ve somewhat set the stage to force landowners to consider selling their rights,” Stever Blattler said. “While everyone keeps suggesting it is voluntary, the factors affecting a landowner’s willingness to go into these voluntary programs is strongly pressured by government regulations impacting their alternate choices.”

The farm bureau is also concerned with the state setting a precedent of purchasing water rights from private land owners. Stever Blattler said consolidating more than 100 years of water rights under the state’s control could not only be used to leverage other private property rights but also drastically change the character and economy of rural areas and the nation’s ability to have a domestic supply of food.

“I think it’s a very concerning proposal and we would not be in favor of seeing the government acquire these rights,” Stever Blattler said.  

Aaron Fukuda, general manager for Tulare Irrigation District (TID), said he’s been told by lobbyists the “voluntary water reconciliation program” is unlikely to make the final cut for the 2022-23 budget. Fukuda said there isn’t much of a market for landowners with senior water rights to sell them to the state when there are always other water districts looking to buy. Senior water rights only apply to surface water from federal and state water projects, so there isn’t much incentive to sell them to the state. 

“There is an aura of confusion around this piece of the budget proposal,” Fukuda said. 

Not all water rights can be purchased with land either. Fukuda said public agencies, like TID, hold all of their member water rights in a trust on behalf of the landowners. If the land was to sell, the water rights would remain with the district. Landowners who are members of private ditch companies could sell their water rights but it is rarely done outside the district.

“There wasn’t a whole lot of information about what this would accomplish and how it would work,” Fukuda said.

While little is known about the state’s plans to acquire water rights, Fukuda said Tulare County agencies have already received $22 million in grants to repurpose land as part of the state’s effort to reduce water use in overdrafted basins, such as those fed by the Kaweah and Tule rivers. The Kaweah Delta Water Conservation District and Greater Kaweah Groundwater Sustainability Agency received $10 million to develop a comprehensive land repurposing program in the critically overdrafted basin. Groundwater sustainability agencies (GSA) are the entities in charge of creating, implementing and tracking plans for their subbasins to comply with the Sustainable Groundwater Management Act (SGMA). Passed by the legislature in 2014, the law requires overdrafted basins to replenish more water than is pumped out of the ground in a year by 2040. The Pixley Irrigation District GSA also received a $10 million for a program to retire land, develop habitats and protect and enhance water resources in communities in southern Tulare and northern Kern counties.

These organizations were among the first recipients of funding from the Multibenefit Land Repurposing Program​, part of Governor Newsom’s multi-faceted response to the ongoing drought. Additionally, Visalia-based Self-Help Enterprises, in a collaboration with Environmental Defense Fund’s California Water Team, was awarded $2 million to help local agencies address known data gaps, plan and implement projects, and address deficiencies in sustainability plans. The money is being granted through the state’s Department of Conservation.

“Worsening drought and depleted groundwater are unfortunate realities in California,” said David Shabazian, director of the state’s Department of Conservation​. “We are supporting local governments, farmers, ranchers, and other stakeholders in exploring whether some agricultural lands might be put into alternative uses to reduce water demand and the burden on local aquifers.”

With requests exceeding available grant funds by more than 120% for this first round of funding, Governor Newsom’s California Blueprint adds another $60 million to support regionally-led efforts to find land-use alternatives to reduce groundwater use that reflect local objectives and priorities. This builds on the additional $50 million investment advanced by the Governor and Legislature in last year’s budget package. The proposed 2022-23 state budget currently includes another $500 million for acquisition and repurposing of lands to assist GSAs in implementing SGMA.

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