From ‘end of the world’ to ‘no big deal’: Unions change their tune on Janus decision

The looming apocalypse in California

Public needs to keep eye on pensions, but suit says CalPERS withholds core data

The union as management

In Search of Public Employers Willing to Fight for Their Right to Free Speech

The recent Janus decision by the US Supreme Court gives public employees the right to quit union membership – or to never join a union in the first place. This sweeping ruling not only banned unions from requiring non-members to still pay so-called “agency fees,” but it required unions to obtain “affirmative consent” from public employees before enrolling them as members.

Needless to say, in states like California, where public sector unions exercise nearly absolute control over the state legislature, several laws were swiftly passed to thwart the impact of Janus. In terms of employer rights, two of these laws are particularly noteworthy:

SB 285 prohibits a public employer from “deterring or discouraging” public employees from becoming or remaining members of an employee organization. Public employers are already required to be extremely careful how they communicate the pros and cons of unionization, but now they’ll be even more hamstrung, while the unions have full access to employees to argue and advocate their position. Worse, this bill grants the Public Employment Relations Board jurisdiction over alleged violations of its provisions instead of the courts. This board is stacked with labor veterans and is very unlikely to ever rule in favor of a public employer vs. a union.

SB 550 requires employers to pay union legal fees if they lose in litigation vs. the unions.

Imagine the chilling effect these two laws are having on public employers. Can they say anything about union membership? What if they say “unions membership is good,” but because they didn’t say “union membership is great,” they deterred someone from joining the union, or renewing their union membership? Not only is SB 285 denying free speech to public employers, but it is so vaguely written that it is impossible for public employers to have any idea what might constitute a violation of the new law.

Moreover, if a union decides to make an example of any public employer whose communications with public employees are deemed transgressive, they will not be sued in a courtroom, but in an action before the biased Public Employment Relations Board.

CALLING ALL FREEDOM LOVING CALIFORNIA AGENCIES

If your school district, transit district, water district, city or county wants to challenge, or at least compel more clarity, with respect to the wording of SB 285, there is something you can do. Contact CLEO’s Matt Patterson, at matt@calpolicycenter.org, and let him know your agency is interested in fighting for employer free speech.

With only a few agencies as committed plaintiffs, it will be possible to go to court and ask for a declaration of rights, explicitly stating what an employer can and cannot say to a public employee regarding union membership. As it is, even saying nothing can put public agencies at risk.

Participation in this lawsuit will cost the plaintiffs nothing. It is an opportunity to clarify your rights as public employers.

REFERENCES

California’s Public Employment Relations Board – 2018, currently stacked 3-1 in favor of public sector unions 

The three:

  • Arthur A. Krantz “represented unions, employees and nonprofits in litigation, arbitration and administrative cases, and he worked on law reform, organizing, negotiation, and strategic campaigns to effect social change. Krantz did this work as an associate and partner at Leonard Carder, LLP.” San Francisco based Leonard Carder, LLP‘s home page states: “As one of the oldest and most renowned law firms representing labor unions and employees, Leonard Carder’s focus is to provide top-flight legal representation to the labor movement.”
  • Priscilla Winslow‘s “career in public sector labor law spans over 30 years, during which time she served for 15 years as Assistant Chief Counsel for the California Teachers Association where she litigated and advised on a variety of labor, education, and constitutional law issues.”
  • Eric Banks “served in multiple positions at the Service Employees International Union, Local 221 from 2001 to 2013, including Advisor to the President, President, and Director of Government and Community Relations.”

The other two:

  • Erich Shiners: “Prior to his service on the Board, Erich Shiners represented and advised public agency employers in labor and employment matters, including many cases before PERB. Most recently he was Senior Counsel at Liebert Cassidy Whitmore.” Liebert Cassidy Whitmore represents itself as California’s preeminent public management employment law firm with over 80 attorneys in five offices.
  • The fifth position is currently open on PERB, meaning that right now there is a 3-1 advantage favoring board members with union affiliations. Just vacating the PERB board was a possibly neutral party, Mark C. Gregersen, who according to his biography on the PERB website had “a career in public sector labor relations [that] spans over 35 years. Prior to his appointment to the California Public Employment Relations Board, he has served as director of labor and work force strategy for the City of Sacramento and director of human resources for a number of California cities and counties.”

A SUMMARY OF CALIFORNIA’S ANTI-JANUS LEGISLATION

In response to Janus, California’s unions representing public servants are doing the following:

1 – Expanding the pool of public employees eligible to join unions – AB 83SB 201, and AB 3034

2 – Making it difficult, if not impossible, for employers to discuss the pros and cons of unionization with employees – SB 285 and AB-2017

3 – Precluding local governments from unilaterally honoring employee requests to stop paying union dues – AB 1937 and AB-2049

4 – Making employers pay union legal fees if they lose in litigation but not making unions pay employer costs if the unions lose – SB 550

5 – Moving the venue for dispute resolution from the courts to PERB, which is stacked with pro-union board members – SB 285 and AB 2886

This catalog of countermeasures to Janus is undoubtedly incomplete. A few enacted in 2017 have probably slipped under our radar, and there will be many more crafted in the coming months and years

ADDITIONAL READING

In Search of Government Union Transparency, July 2018

California’s Government Unions Collect An Estimated $800 Million Per Year, July 2018

How Government Unions Will Attack the Janus Ruling, June 2018

California’s Government Unions Take Steps to Obliterate Janus Impact, June 2018

A Catalog of California’s Anti-Janus Legislation, June 2018

Funding the Post-Janus Fight Against Government Unions, May 2018

Janus vs AFSCME Ruling Imminent – What will Change?, May 2018

A Post-Janus Agenda for California’s Public Sector Unions, February 2018

After Janus, Will Union Grassroots Members Assert their Political Voice?, December 2017

How Can Local Officials Prepare for the Upcoming Janus vs AFSCME Ruling?, October 2017

In the Last 25 Years, Sonoma County’s Pension Liability Rose ELEVEN TIMES Faster Than Tax Revenues

In August of last year retired attorney George Luke sued the Sonoma County Employees Retirement Association (SCERA) and the Board of Supervisors (BOS) because according to County records they did not follow the law when pensions were increased in 2002 and 2003. According to the law, before increasing pension benefits the supervisors are required to (1) hire an actuary to determine the future annual cost of the increase, (2) enact by majority vote a board resolution adopting the new formulas and (3) present the cost to the citizens at a regular BOS meeting so they would have the ability to know how their tax dollars are being spent. None of these requirements were even minimally met and that is why Luke sued.

Growth of Sonoma County Pension Liability vs Other Indicators

What is really appalling is documents obtained by my organization, New Sonoma, just 2 years ago proved it was not the BOS that enacted these increases at all, but a closed door settlement of a lawsuit between the employee unions and SCERA over what pay items should be considered pensionable. Here is how it happened.

In 1998 to settle another lawsuit brought by the unions (they have sued the county many times) SCERA added 45 additional pay items to pensionable pay, but the unions sued again over 2 items the unions thought should also have also been considered pensionable, the employer pickup of the employees’ pension contribution and their health insurance premiums. As part of the settlement somehow new formulas, which SCERA cannot legally change, became part of the settlement.

There’s more. The agreement struck between the employee unions and the supervisors required the Safety employees to pay half the cost of the increase and the non-safety employees to pay 100% of the cost. But because costs were underestimated by SCERA’s actuary, the additional employee contributions have fallen well short of the amount needed to avoid shifting the cost to taxpayers. This has been admitted by the supervisors and even former assembly member and current SEIU negotiator Michael Allen who said instead of the increased employee contribution being 5% it should have been 20% of salary. His estimate is exactly what mine is and if true, the county would have $70 million more each year to spend on basic services like road and infrastructure maintenance, which has about a $1 billion backlog to go along with the $1.1 billion unfunded pension and retiree healthcare liability.

Unfortunately, George lost the first round of his suit because Sonoma County judge Rene Chouteau ruled that even if the County did not follow the law it did not matter because the 3-year statute of limitations had been exceeded, which some might think is a strange ruling when the violation was failure to notify citizens of the increase and there is no resolution adopting the increase (so it never really happened). The plan now is to appeal the ruling because case law indicates every time a new check is written for an illegal pension amount, the statute of limitations starts all over again.

Why should county employees and retirees be worried? As the chart indicates, these illegal increases caused pension liabilities to grow 772 percent from 1993 to 2017 — a rise that was eleven times more than the 66 percent increase in Government Fund revenues during the same period.

The bottom line is that what can’t continue won’t and the longer the supervisors and unions wait to reform the system, the more drastic cuts to pensions will eventually be.

Ken Churchill is the Director of New Sonoma, and organization of financial experts and citizens concerned with the finances and governance of Sonoma County. More information can be found at www.newsonoma.org.

REFERENCES

Here is a link to the full text of the amended complaint:
George Luke Vs. Sonoma County

Here is a link to the exhibits for the lawsuit:
George Luke Vs. Sonoma County Exhibits for Original Complaint

Here is a link to the exhibits for amended complaint:
George Luke Vs. Sonoma County Exhibits for Amended Complaint

Here is the article that appeared in the Press Democrat:
http://www.pressdemocrat.com/news/7471405-181/lawsuit-targets-enhanced-pension-benefits?artslide=0

Kavan-awesome

California is not creating jobs fast enough to support tax increases for pensions

On a superficial level, things look pretty good in California. Sure, we have big problems with wildfires and other periodic disasters, but the state’s finances have made a strong recovery since the depths of the recession. Indeed, Gov. Brown has repeatedly touted the multi-billion-dollar surplus and the state’s balanced budget.

But objective assessments from government experts and academicians have warned of troubling aspects of the state’s financial condition. These include mega projects we can’t pay for, business flight out of California, unfunded pension obligations in the hundreds of billions of dollars, a state government that is growing much faster than population and inflation combined and a dysfunctional political system.

Close analysis reveals that California is like a home with a fresh coat of paint but a crumbling foundation. It may look pretty, but there are serious problems that are not readily apparent.

One area where there is a gulf between superficial appearance and reality is in California labor statistics. Here again, on the surface, the state’s 4.2 percent unemployment rate looks very good — and it is. During the depths of the recession, the state hit a high of 12.2 percent unemployment and tens of thousands of Californians were suffering. There’s no denying that we’ve seen a vast improvement.

But there are metrics beyond the simple unemployment rate that must be taken into consideration to fully comprehend the health of California’s labor force. A recent report from the California Center for Jobs and the Economy has troubling news: “California’s labor force grew only 16,922 over the 12 months ending July 2018, or 0.1 percent growth. The U.S. as a whole grew 1.8 million — a 1.1 percent expansion.” In other words, California’s labor force has seemingly hit a plateau — an unusual occurrence given the strength of the national economy.

When it was coming out of the recession, California was a job-creation machine. Indeed, for many quarters it was producing more jobs than economic powerhouses like Texas. But some context is necessary here. Because California was harder hit in the recession, we basically had nowhere to go but up. That gave the appearance that California was outperforming other states in job growth when, in truth, we had more ground to make up.

Some other figures from the California Center are equally disturbing, such as the fact that we are not creating jobs as fast as we were when coming out of the recession: “Between July 2017 and July 2018, Bureau of Labor Statistics (BLS) data shows the total number of employed in California increased by 120,600 (seasonally adjusted), or 4.9 percent of the total net employment gains in this period for the U.S. Based on the total numbers, California dropped to 5th place behind Texas (which has a civilian working-age population only 69 percent as large as California’s), Florida (55 percent as large), Massachusetts, and Georgia. Measured by percentage change in employment over the year, California dropped to 36th highest. Adjusted for working-age population, California dropped to 36th as well.”

Moreover, there is significant concern over the types of jobs being created: “Nearly half (48 percent) of net jobs growth since the recession has been in the lower-wage industries. For the 12 months ending July 2018, lower-wage industries accounted for over a quarter (28 percent) of new jobs, while middle-class blue-collar jobs produced over a quarter (30 percent) as construction levels remained higher compared to prior years.”

Diving into employment numbers isn’t that exciting for the average voter, but this is important because California will need a growing –— not stagnant — workforce that will share the burden of paying down the state’s prodigious level of debt — particularly all the pension obligations our politicians have committed us to. As explained by the California Center’s report, “While workers elsewhere continue to return to the workforce, California’s continued low rate has implications for future growth in the state, including the ability to sustain jobs expansion as fewer workers are available and continued effects on state and local budgets for higher social program spending compared to other states.”

Translated, this simply means we need more people working in well-paying jobs if California hopes to avoid insolvency.

Jon Coupal is president of the Howard Jarvis Taxpayers Association.

Towards a Grand Bargain on California Water Policy

When it comes to water policy in California, perhaps the people are more savvy than the special interests. Because the people, or more precisely, the voters, by huge majorities, have approved nine water bonds in the past 25 years, totaling $27.1 billion. It is likely they’re going to approve another one this November for another $8.9 billion.

The message from the people is clear. We want a reliable supply of water, and we’re willing to pay for it. But the special interests – or whatever you want to call the collection of politicians, unelected bureaucrats with immense power, and other stakeholders who actually decide how all this money is going to be spent – cannot agree on policy. A recent article in the Sacramento Bee entitled “Why San Francisco is joining Valley farmers in a fight over precious California water,” says it all. “Precious California water.” But what if water were so abundant in California, it would no longer be necessary to fight over it?

As it is, despite what by this time next year is likely to be $36 billion in water bonds approved by voters for water investments since 1996, the state is nowhere close to solving the challenge of water scarcity. As explained in the Sacramento Bee, at the same time as California’s legislature has just passed long overdue restrictions on unsustainable groundwater withdrawals, the political appointees on the State Water Resources Control Board are about to enact sweeping new restrictions on how much water agricultural and municipal consumers can withdraw from the Sacramento and San Joaquin rivers.

This is a perfect storm, and every conservation, recycling and storage project currently funded or proposed will not make up the shortfall. In 2002, well before these new restrictions were being contemplated, the California Dept. of Water Resources issued an authoritative study, “Averting a California Water Crisis,” that estimated the difference between demand and supply at between two and six million acre feet per year by 2020. An impressive response from the public during the most recent drought, combined with some investment in water infrastructure has narrowed that gap. But the squeeze is ongoing, with tougher challenges and tradeoffs ahead.

Abundance vs Scarcity

When thinking about solutions to California’s water challenges, there is a philosophical question that has to be addressed. Is it necessary to persistently emphasize conservation over more supplies of water? Is it necessary to always perceive investments in more supplies of water as environmentally unacceptable, or is it possible to decouple, or mostly decouple, environmental harm from investment in more water supplies? Is it possible that the most urgent environmental priorities can be addressed by increasing the supply of water, even if investing in more water supplies also creates new, but lessor, environmental problems?

This philosophical question takes on urgent relevance when considering not only the new restrictions on water withdrawals that face Californians, but also in the context of another great philosophical choice that California’s policy makers have made, which is to welcome millions of new immigrants from across the world. What sort of state are we inviting these new residents to live in? How will we ensure that California’s residents, eventually to number not 40 million, but 50 million, will have enough water?

It is this reality – a growing population, a burgeoning agricultural economy, and compelling demands to release more water to threatened ecosystems – that makes a grand political water bargain necessary for California. A bargain that offers a great deal for everyone – more water for ecosystems, more water for farmers, more water for urban consumers – because new infrastructure will be constructed that provides not incremental increases, but millions and millions of acre feet of new water supplies.

The good news? Voters are willing to pay for it.

How to Have it All – A Water Infrastructure Wish List

When considering what it would take to actually have water abundance again in California, the first step is to try to determine the investment costs, imagining a best case scenario where every good idea got funded. Here’s a stab at that list, not differentiating between local, state and federal projects. These are very approximate numbers, rounded upwards to the nearest billion:

Projects to Increase Supplies of Water

(1) Build the Sites Reservoir (annual yield 0.5 MAF) – $5.0 billion.

(2) Build the Temperance Flat Reservoir (annual yield 0.25 MAF) – $3.0 billion.

(3) Raise the height of the Shasta Dam (increased annual yield 0.5 MAF) – $2.0 billion.

(4) So Cal water recycling plants to potable standards with 1.0 MAF capacity – $7.5 billion.

(5) So Cal desalination plants with 1.0 MAF capacity – $15.0 billion.

(6) Desalination plants on Central and North coasts with 0.5 MAF capacity – 7.5 billion

(7) Central and Northern California water recycling plants to potable standards with 1.0 MAF capacity – $7.5 billion.

(8) Facilities to capture runoff for aquifer recharge (annual yield 0.75 MAF) – $5.0 billion.

Total – $52.5 billion. Increased supply – 5.5 MAF.

Projects to Increase Resiliency of Water Distribution Infrastructure

(9) Retrofit every dam in California to modern standards, including Oroville and San Luis – $5.0 billion.

(10) Aquifer mitigation to eliminate toxins with focus on Los Angeles Basin – $7.5 billion.

(11) Retrofit of existing aqueducts – $5 billion.

(12) Seismic retrofits to levees statewide, with a focus on the Delta – $7 billion.

Total – $24.5 billion.

The total of all these projects, $77 billion, is not accidental. That happens to be the latest best case, low-ball estimate for California’s completed high speed rail project. Without belaboring the case against high speed rail, two comparisons are noteworthy.

First, an ambitious program to create water abundance in California and water infrastructure resiliency in California based on this hypothetical budget is achievable. These numbers are deliberately rounded up, and the final costs might actually be lower, whereas it is extremely unlikely that California’s high speed rail project can be completed for $77 billion.

Second, because people will actually consume these new quantities of water that are being supplied and delivered, private financing will be attracted to significantly reduce the taxpayer’s share.

The Impact of a $77 billion Investment on Water Supply, Resiliency, and Ecosystems

As itemized above, at a capital cost of $52.5 billion, the total amount of water that might be added to the California’s statewide annual water budget is 5.5 million acre feet.

This amount of water would have a staggering impact on the demand vs. supply equilibrium for water. It is nearly equal to the total water consumed per year by all of California’s urban centers. Implementing this plan would mean that nearly all of the water that is currently diverted to urban areas could be instead used to ensure a cool, swift flow in California’s rivers, while preserving current allocations for agriculture. The options for environmentalists would be almost unbelievable. Restore wetlands. Revive the Delta. Refill the shrinking Salton Sea.

The environmentalist arguments against the three dams are weak. Shasta Dam is already built. The impact of expanding the Shasta Dam is purportedly the worst on McCloud creek, where it will affect “nearly a mile” of what was “once a prolific Chinook salmon stream,” (italics added). That negative impact, which seems fairly trivial, has to be balanced against the profound benefit of having another 500,000 acre feet of water available every summer to generate pulses of swift, cool water in the Sacramento River. The proposed Temperance Flat Reservoir is proposed on a stretch of the San Joaquin River that already has a smaller dam. The Sites Reservoir is an offstream reservoir that will not interfere with the Sacramento River.

The environmental benefits of these dams are not limited to their ability to ensure supplies of fresh water for California’s aquatic ecosystems. They can also be used to store renewable electricity, by pumping water from a forebay at the foot of the dam into the reservoir during the day, when solar energy already brings the spot price of electricity down to just a few cents per kilowatt-hour, then generating hydro-electric power later in the evening when peak electrical demand hits the grid. This well established technology has already been implemented on dams throughout California, and remains one of the most cost-effective ways to store clean, but intermittent, renewable energy. It will also be a profit center for these dams.

The environmentalist arguments against desalination are also weak. The energy required to desalinate seawater is comparable to the energy necessary to pump it from Northern California to the Los Angeles Basin. The outfall can be discharged under pressure a few miles from shore, where it is instantly disbursed in the California current. The impact from the intakes is grossly overstated by environmentalists, when considering that even if all of these contemplated desalination plants were built, the water they would intake is only a fraction of the amount of water taken in for decades by California’s power plants that are sited on the coast and use seawater for cooling.

As for the Delta, the primary environmental threat to that ecosystem is the chance that an earthquake destroys the hundreds of miles of levees, causing the agricultural areas behind those levees to be flooded. Not only would agricultural contaminants enter the water of the Delta, but the rush of water flooding into the areas behind the levees would cause salt water from the San Francisco Bay to rush in right behind, creating conditions of salinity that would take years to remove, if ever.

This is why investing in levee upgrades and a Delta Smelt hatchery is a preferable solution to the Delta tunnels. The tunnels would ensure a resilient supply of water from north to south, but the Delta would still be vulnerable to levee collapse. Levee upgrades and a Delta Smelt hatchery would accomplish both goals – resiliency of the water supply and of the Delta ecosystem. Moreover, the presence of massive water recycling and desalination facilities in Southern California would take a great deal of pressure off how much water would need to be transported through the Delta from north to south.

How to Finance $77 Billion for Water Infrastructure

Funding capital projects depends on three possible sources: operating budgets, general obligation bonds, or revenue bonds. Operating budgets, which used to help pay for capital projects, and which ought to help pay for capital projects, will never be balanced until real pension reform occurs. So for the most part, operating budgets are not a source of funds.

A useful way to differentiate between general obligation bonds and revenue bonds are that the general obligation bonds impose a progressive tax on Californians, since wealthy individuals pay about 60% of all tax revenues in California. Revenue bonds, on the other hand, because they are serviced through sales of, for example, water produced by a desalination plant, are regressive. This is because all consumers see these costs included in their utility rates, and utility bills constitute a far greater proportion of the budget for a low income household.

The Grand Bargain – Creating Water Abundance in California
(MAF = million acre feet)

By financing water infrastructure through a combination of revenue bonds and general obligation bonds, instead of solely through revenue bonds, water can remain affordable for ordinary Californians. The $24.5 billion portion of the $77.0 billion wish list, the funds for dam, aqueduct, and levee retrofits, along with aquifer mitigation, are not easily serviced through revenue bonds. A 30 year general obligation bond for $24.5 billion with an interest rate of 5% would cost California’s taxpayers $1.6 billion per year. Some of these projects, to the extent they are improving water delivery to specific urban and agricultural consumers, might be funded by bond issuances that would be serviced by the agencies most directly benefiting.

To claim that 100% of the revenue producing water projects can be financed through revenue bonds is more than theoretical. The Carlsbad Desalination Plant financing costs, principle and interest payments a nearly $1.0 billion for the plant’s construction, are paid by the contractor that built and operates the plant, with those payments in-turn funded through the rates charged to the consumers of the water. The contractor also retains an equity stake in the project, meaning that additional capital costs incurred privately are also funded via a portion of the rates charged to consumers.

Some of the revenue producing assets on the grand bargain wish list may also have a portion of them paid for by general obligation bonds. Determining that mix depends on the consumer. For example, a revenue bond for the reservoir projects may be applied to agricultural consumers who are willing to pay well above historical rates to have a guaranteed source of water for their orchards, which have to survive through dry years.

For urban consumers in particular, making the more expensive projects financially palatable may require general obligation bonds to cover part of the costs, so the remaining costs are affordable for ratepayers. For example, desalination is a relatively expensive way to produce water, making it harder to finance 100% with revenue bonds. But without desalination, wastewater recycling and runoff capture are not sufficient local sources of water in places like Los Angeles. The overall benefit to Californians of adding another 1.5 million acre feet per year to the state’s water supply, using desalination which is impervious to droughts, may be worth having some of its cost financed with general obligation bonds.

To fund roughly 50% of the revenue producing water supply infrastructure ($26.2 billion) and 100% of the water resiliency and distribution infrastructure ($24.5 billion) on this list would cost taxpayers about $3.0 billion per year. While this might strike some as an unthinkable amount to even consider, these projects meet all the criteria for so-called “good debt.” Constructing them all would solve California’s challenge of water scarcity, possibly forever. All of the projects are assets yielding ongoing and long-term benefits that will outlast the term of the financing. At the same time, water would become so abundant in California that prioritizing water allocations to revive ecosystems would no longer provoke bitter opposition. And California’s residents would live again in a state where taking a long shower, planting a lawn, and doing other water-intensive activities that are considered normal in a developed nation, would once again become affordable and normal.

Other Ways to Help Pay for Water Abundance in California

Enable and Expand Water Markets

Even if a grand bargain is struck between environmentalists, farmers, and water districts, and massive investments are made to increase the supply of water, enabling and expanding water markets will help optimize the distribution of available water resources. Similarly, reforming California’s labyrinthine system of water rights might also help, by making it easier for owners of water rights to sell their allocations. Fostering water markets while protecting water rights have interrelated impacts, and ideally can result in more equitable, appropriate water pricing across the state. It might also help make it unnecessary to impose punitive tiered rates or rationing on household consumers.

Reform Environmentalist Barriers to Development

CEQA, or the California Environmental Quality Act, is a “statute that requires state and local agencies to identify the significant environmental impacts of their actions and to avoid or mitigate those impacts, if feasible.” While the intent behind CEQA is entirely justifiable, in practice it has added time and expense to infrastructure projects in California, often with little if any actual environmental benefit. An excellent summary of how to reform CEQA appeared in the Los Angeles Times in Sept. 2017, written by Byron De Arakal, vice chairman of the Costa Mesa Planning Commission. It mirrors other summaries offered by other informed advocates for reform and can be summarized as follows:

  • End duplicative lawsuits: Put an end to the interminable, costly legal process by disallowing serial, duplicative lawsuits challenging projects that have completed the CEQA process, have been previously litigated and have fulfilled any mitigation orders.
  • Full disclosure of identity of litigants: Require all entities that file CEQA lawsuits to fully disclose their identities and their environmental or, increasingly, non-environmental interest.
  • Outlaw legal delaying tactics: California law already sets goals of wrapping up CEQA lawsuits — including appeals — in nine months, but other court rules still leave room for procedural gamesmanship that push CEQA proceedings past a year and beyond. Without harming the ability of all sides to prepare their cases, those delaying tactics could be outlawed.
  • Prohibit rulings that stop entire project on single issue: Judges can currently toss out an entire project based on a few deficiencies in environmental impact report. Restraints can be added to the law to make “fix-it ticket” remedies the norm, not the exception.
  • Loser pays legal fees: Currently, the losing party in most California civil actions pays the tab for court costs and attorney’s fees, but that’s not always the case with CEQA lawsuits. Those who bring CEQA actions shouldn’t be allowed to skip out of court if they lose without having to pick up the tab of the prevailing party.

Find Other Ways to Reduce Construction Costs

The Sorek desalination plant, commissioned in Israel in 2015, cost $500 million to build and desalinates 185,000 acre feet of water per year. Compared to Carlsbad, which also began operations in 2015, Sorek came online for an astonishing one-sixth the capital cost per unit of capacity. Imagine if the prices Israelis pay to construct desalination plants could be achieved in California. Instead of spending $15 billion to build 1.0 million acre feet of desalination capacity, we would spend less than $3.0 billion. How did they do this?

The bidding process itself adds unnecessary costs to public infrastructure projects. Moving to a design-build process could significantly reduce duplicative work during the plant’s engineering phase. Project labor agreements are another practice that at the very least deserve serious reconsideration. Would it be possible objectively evaluate the impact of project labor agreements, and determine to what extent those mandates increase costs?

What about economies of scale? If ten desalination plants were commissioned all at once, wouldn’t there be an opportunity for tremendous unit savings? What about creativity? Elon Musk, who has disrupted the aerospace industry by building rockets at a fraction of historical prices, said “the construction industry is one of the only sectors in our economy that has not improved its productivity in the last 50 years.” Is he even partly correct? Is that worth looking into?

Shift Government Spending Priorities

Cancel High Speed Rail: The most obvious case of how to redirect funds away from something of marginal value into water infrastructure, which is something with huge public benefit, is to cancel the bullet train. The project is doomed anyway, because it will never attract private capital. But what if Californians were offered the opportunity to preserve the planned bond issuances for high speed rail, tens of billions of capital, but with a new twist? If voters were asked to redirect these funds away from high speed rail and instead towards creating water abundance through massive investment in water infrastructure, there’s a good chance they’d vote yes.

Cancel the Delta Tunnels: By investing in levee hardening, the Delta’s ecosystems can be fortified against a severe earthquake. Reducing the possibility of levee failure protects the Delta ecosystems from their worst environmental threat at the same time as it protects the ability to transfer water from north to south. Investing in hatcheries to increase the population of the threatened Smelt is a far more cost-effective way of safeguarding the survival of that species. And investing in infrastructure on the Southern California coast to make that region water independent greatly reduces the downside of a disruption to water deliveries through the Delta. Canceling the Delta Tunnels would save $20 billion, money that would go a long way towards paying for other vital water infrastructure.

Reform Pensions: The biggest out of control budget item, by far among California’s state and local agencies, is the cost of public sector pensions. A California Policy Center analysis released earlier this year, based on public announcements from CalPERS, estimated that the total employer payments for pensions for California’s state and local government employees is set to nearly double, from $31 billion in 2018 to $59 billion by 2024. And that is a best case baseline. If there is a severe market correction, those required contributions will go up further. No discussion of how to find money for other government operations can take place without understanding the role of pension costs in creating budget constraints.

Reduce State Spending: Other ways to shift spending priorities in California, while worth a discussion, are mostly controversial. Returning the administrator to faculty ratio in California’s UC and CalState systems to its historical level of 1:2 instead of the current 1:1 would also save $2.0 billion per year. Outsourcing CalTrans work and eliminating redundant positions could save $2.5 billion per year. Reducing just state agency headcount and pay/benefits by 20% would save $6.5 billion per year. Just enacting part of that, incremental pension reform for state workers, could stop the runaway cost increases that are otherwise inevitable.

California’s state budget this year has broken $200 billion for the first time. Of that, general fund spending is at $139 billion, also a record. Revenues, however, have set records as well. The rainy day fund is full, and an extra deposit of $2.6 billion has it overflowing. Why not spend that $2.6 billion on water infrastructure? For that matter, why not spend all of the $1.4 billion of cap and trade revenue on water infrastructure?

Financing more water infrastructure will more likely come via public and private debt financing. But redirecting intended future borrowings, in particular for high speed rail and for the Delta Tunnels, could cover most if not all of the infrastructure investments necessary to deliver water abundance to Californians. And at the least, redirecting funds from government operating budgets can defray some of the operating costs, if not some of the capital costs.

Work to Build a Consensus

How many more times will California’s voters approve multi-billion dollar water bonds? The two passed in the last four years, plus the current one set for the November ballot, raise $20 billion, but only $2.5 billion of that goes to reservoir storage. Only another $3.3 billion more goes to any type of supply enhancements – mostly to develop aquifer storage or fund water recycling. Meanwhile, consumers are being required to submit to permanent water rationing, and dubious projects are being funded to save water. Artificial turf is a good example. There isn’t a coach in California who wants their athletes to compete on these dangerous surfaces. On a hot day in Sacramento, the temperature on these “fields” can reach 150 degrees. They are actually keeping sprinkler systems operating on these horrendous boondoggles, just to reduce the deadly heat buildup.

Credibility with voters remains intact to-date, but cannot be taken for granted. If a grand bargain on California’s water future is struck, it will need to promise, then deliver, water abundance to California’s residents.

Change the Conventional Wisdom

California’s current policies have stifled innovation and created artificial scarcity of literally every primary necessity – not just water, but housing, energy and transportation. Each year, to comply with legislative mandates, California’s taxpayers are turning over billions of dollars to attorneys, consultants and bureaucrats, instead of paying engineers and heavy equipment operators to actually build things. The innovation that persists despite California’s unwelcoming policy environment is inspiring.

California’s policymakers have adhered increasingly to a philosophy of limits. Less water consumption. Less energy use. Urban containment. Densification. Fewer cars and more mass transit. But it isn’t working. It isn’t working because California has the highest cost of living in the nation. Using less water and energy never rewards consumers, because the water and energy never were the primary cost within their utility bills – the cost of the infrastructure and overhead was the primary cost.

Changing the conventional wisdom applies to much more than water. It is a vision of abundance instead of scarcity that encompasses every vital area of resource consumption. A completely different approach that could cost less than what it might cost to fully implement scarcity mandates. An approach that would improve the quality of life for all Californians. Without abandoning but merely scaling back the ambition of new conservation and efficiency mandates, embrace supply oriented solutions as well. Build wastewater recycling and desalination plants on the Pacific coast, enough of them to supply California’s massive coastal cities with fresh water. Instead of mandating water rationing for households, put the money that would have been necessary to retrofit all those homes into new ways to reuse water and capture storm runoff.

Paying for all of this wouldn’t have to rely exclusively on public funds. Private sector investment could fund a large percentage of the costs for new water infrastructure. Water supplies could be even more easily balanced by permitting water markets where farmers could sell their water allotments without losing their grandfathered water rights. If the bidding process and litigation burdens were reduced, massive water supply infrastructure could be constructed at far more affordable prices.

The Grand Bargain

Water abundance in California is achievable. The people of California would welcome and support a determined effort to make it a reality. But compromise on a grand scale is necessary to negotiate a grand bargain. Environmentalists would have to accept a few more reservoirs and desalination plants in exchange for plentiful water allocations to threatened ecosystems. Farmers would have to pay more for water in exchange for undiminished quantities. While private financing and revenue bonds could cover much of the expense, taxpayers would bear the burden of some new debt – but in exchange for permanent access to affordable, secure, and most abundant water.

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This is the third and final part of an investigation into California’s water future. Part one is “How Much California Water Bond Money is for Storage?,” and part two is “How to Make California’s Southland Water Independent for $30 Billion.” Edward Ring is a co-founder of the California Policy Center and served as its first president.

 

Don’t believe the hysteria: There are other ways for public workers to get benefits

How to Make California’s Southland Water Independent for $30 Billion

The megapolis on California’s southern coast stretches from Ventura County on the northern end, through Los Angeles County, Orange County, down to San Diego County on the border with Mexico. It also includes the western portions of Riverside and San Bernardino counties. Altogether these six counties have a population of 20.5 million residents. According to the California Department of Water Resources, urban users consume 3.7 million acre feet of water per year, and the remaining agricultural users in this region consume an additional 700,000 acre feet.

Much of this water is imported. In an average year, 2.6 million acre feet of water is imported by the water districts serving the residents and businesses in these Southland counties. The 701 mile long California Aqueduct, mainly conveying water from the Sacramento River, contributes 1.4 million acre feet. The 242 mile long Colorado River Aqueduct adds another 1.0 million acre feet. Finally, the Owens River on the east side of the Sierras contributes 250,000 acre feet via the 419 mile long Los Angeles Aqueduct.

California’s Plumbing System
The major interbasin systems of water conveyance, commonly known as aqueducts

California’s Overall Water Supplies Must Increase

Californians have already made tremendous strides conserving water, and the potential savings from more stringent conservation mandates may not yield significant additional savings. Population growth is likely to offset whatever remaining savings that may be achievable via additional conservation.

Meanwhile, the state mandated water requirements for California’s ecosystems continue to increase. The California State Water Board is finalizing “frameworks” that will increase the minimum amount of flow required to be maintained in the Sacramento and San Joaquin rivers order to better protect fish habitat and reduce salinity in the Delta. And, of course, these rivers, along with the Owens and Colorado rivers, are susceptible to droughts which periodically put severe strain on water users in California.

At about the same time, in 2015, California’s legislature began regulating groundwater withdrawals. This measure, while long overdue, puts additional pressure on urban and agricultural users.

California’s water requirements for healthy ecosystems, a robust and growing farm economy, as well as a growing urban population, are set to exceed available supply. Conservation cannot return enough water to the system to fix the problem.

How Can Water Supplies Increase?

In Southern California, runoff capture is an option that appears to have great potential. Despite its arid climate and perennial low rainfall, nearly every year a few storm systems bring torrential rains to the South Coast, inundating the landscape. Until the Los Angeles River was turned into a gigantic culvert starting in 1938, it would routinely flood, with the overflow filling huge aquifers beneath the city. Those aquifers remain, although many are contaminated and require mitigation. Runoff harvesting for aquifer storage represents one tremendous opportunity for Southern Californians to increase their supply of water.

The other possibilities are sewage recycling and desalination. In both cases, Southern California already boasts some of the most advanced plants in the world. The potential for these two technologies to deliver massive quantities of potable water, over a million acre feet per year each, is now predicated more on political and financial considerations than technological challenges.

Recycling Waste Water

Orange County leads the United States in recycling waste water. The Orange County Sanitation District treats 145,000 acre feet per year (130 million gallons per day – “MGD”), sending all of it to the Orange County Water District’s “Ground Water Replenishment System” plant for advanced treatment. The GWRS plant is the biggest of its kind in the world. After being treated to potable standards, 124,000 acre feet per year (110 million GPD), or 85 percent of the waste water, is then injected into aquifers to be stored and pumped back up and reused by residents as potable water. The remainder, containing no toxins and with fewer total dissolved solids than seawater, is discharged harmlessly into the ocean.

Currently the combined water districts in California’s Southland discharge about 1.5 million acre feet (1.3 billion GPD) of treated wastewater each year into the Pacific Ocean. Only a small percentage of this discharge is the treated brine from recycled water. But by using the advanced treatment methods as are employed in Orange County, 85% of wastewater can be recycled to potable standards. This means that merely through water reuse, there is the potential to recycle up to another 1.2 million acre feet per year.

Needless to say, implementing a solution at this scale would require major challenges to be overcome. Currently California’s water districts are only permitted to engage in “indirect potable reuse,” which means the recycled water must be stored in an aquifer or a reservoir prior to being processed as drinking water and entering the water supply. By 2023, it is expected the California Water Board will have completed regulations governing “direct potable reuse,” which would allow recycled water to be immediately returned to the water supply without the intermediate step of being stored in an aquifer or reservoir. In the meantime, it is unlikely that there are enough uncontaminated aquifers or available reservoirs to store the amount of recycled water that could be produced.

Desalinating Seawater

The other source of new water for Southern California, desalination, is already realized in an operating plant, the Carlsbad Desalination Plant in San Diego County. This plant produces 56,000 acre feet per year (50 MGD) of fresh water by processing twice that amount of seawater. It is the largest and most technologically advanced desalination plant in the Western Hemisphere. It is co-located with the Encina Power Station, a facility that uses far more seawater per year, roughly ten times as much, for its cooling systems. The Carlsbad facility diverts a portion of that water for desalination treatment, then returns the saltier “brine” to the much larger outflow of cooling water at the power plant.

Objections to desalination are many, but none of them are insurmountable. The desalination plant proposed for Huntington Beach, for example, will not have the benefit of being co-located with a power plant that consumes far more seawater for its cooling system. Instead, this proposed plant – which will have the same capacity as the Carlsbad plant – will use a large array of “wet filters” situated about 1,500 feet offshore, on the seabed about 40 feet below the surface, to gently intake seawater that can be pumped back to the plant without disrupting marine life. The outgoing brine containing 6 percent salt (compared to 3% in seawater) will be discharged under pressure from an underwater pipe extending about 1,800 feet offshore. By discharging the brine under pressure, it will be instantly disbursed and immediately dissipated in the powerful California current.

While desalination is considered to be energy intensive, a careful comparison of the energy cost to desalinate seawater reveals an interesting fact. It takes a roughly equivalent amount of electricity to power the pumps on the California aqueduct, where six pumping stations lift the water repeatedly as it flows from north to south. To guarantee the water flows south, the California aqueduct is sloped downward by roughly one foot per mile of length, meaning pump stations are essential. The big lift, of course, is over the Tehachapi Mountains, which is the only way to import water into the Los Angeles basin.

Barriers to Implementation – Permitting & Lawsuits

The technological barriers to large scale implementation of water recycling and desalination, while significant, are not the primary impediments. Permitting and financing are far bigger challenges. Moreover, financing costs for these mega projects become more prohibitive because of the difficulties in permitting.

The process necessary to construct the proposed Huntington Beach Desalination Plant is illustrative of just how difficult, if not impossible, it is to get construction permits. The contractor has been involved in the permitting process for 16 years already, and despite significant progress to-date, still expects approval, if it comes, to take another 2-3 years.

One of the problems with permitting most infrastructure in California is that several agencies are involved. These agencies can actually have conflicting requirements. Applicants also end up having to answer the same questions over and over, because the agencies don’t share information. And over the course of decades or more, the regulations change, meaning the applicant has to start the process over again. Compounding the difficulties for applicants are endless rounds of litigation, primarily from well-funded environmentalist organizations. The failure to-date of California’s lawmakers to reform CEQA make these lawsuits potentially endless.

Barriers to Implementation – Financing

Even if permitting were streamlined, and all technical challenges were overcome, it would be a mistake to be glib about financing costs. Based on the actual total cost for the Carlsbad desalination plant, just under $1.0 billion for a capacity of 56,000 acre feet per year, the capital costs to desalinate a million acre feet of seawater would be a daunting $18.0 billion. On the other hand, with permitting reforms, such as creating a one-stop ombudsman agency to adjudicate conflicting regulations and exercise real clout among the dozens of agencies with a stake in the permitting process, billions could be shaved off that total. Similarly, CEQA reforms could shave additional billions off the total. How much could be saved?

The Sorek desalination plant, commissioned in Israel in 2015, cost $500 million to build and desalinates 185,000 acre feet of water per year. Compared to Carlsbad, Sorek came online for an astonishing one-sixth the capital cost per unit of capacity. While there’s undoubtedly more to this story, it is also undeniable that other developed nations are able to deploy large scale desalination plants at far lower costs than here in California.

Financing costs for water recycling, while still staggering, are (at least in California) not comparable to those for desalination. The GWRS water recycling plant in Orange County was built at a capital cost of $905 million – $481 million was the initial cost, the first expansion cost $142 million, and the final expansion cost $282 million. This equates to a capital cost of $7,300 per acre foot of annual yield. If that price were to apply for new facilities to be constructed elsewhere in the southland, one million acre feet of recycling capacity could be built for $7.3 billion. Until there is direct potable reuse, however, it would be necessary to add to that cost the expense of either constructing storage reservoirs, or decontaminating aquifers for underground storage.

It’s anybody’s guess, but with reasonable reforms to contain costs, and taking into account additional investments in aquifer mitigation, a budget to make California’s Southland water independent might look like this:

  • 1.0 million acre feet from water recycling – $7.5 billion
  • 1.0 million acre feet from desalination – $15.0 billion
  • 0.5 million acre feet from runoff capture and aquifer mitigation – $7.5 billion

Total – $30 billion.
How much again is that bullet train? Water abundance in California vs. high speed rail

While runoff capture, water recycling, and desalination have the potential to make Southern California’s coastal megapolis water independent, it will take extraordinary political will and innovative financing to make it happen. The first step is for California’s voters and policymakers alike to recognize that conservation is not enough, that water supplies must be increased. Once the political will is established, it will be necessary to streamline the regulatory process, so cities, water agencies, and private contractors can pursue supply oriented solutions, at realistic prices, with a reasonable certainty that their applications will be approved.

 *   *   *

This is part two of an investigation into California’s water future. Part one is “How Much California Water Bond Money is for Storage?,” and the third and final part is “Towards a Grand Bargain on California Water Policy.” Edward Ring is a co-founder of the California Policy Center and served as its first president.

Teacher pay fray



When is a political campaign neither political nor a campaign?

California law prohibits government officials from using taxpayer dollars “for the purpose of urging the support or defeat of any ballot measure.” But on February 13, in the meeting room of the Santa Ana Unified School District, school officials revealed a political campaign that began with shaping public opinion and will end in November with a district-wide vote on a bond measure that will cost residents hundreds of millions of dollars.

In rebuking San Diego’s pension initiative, state high court slams our basic voting rights

How Much California Water Bond Money is for Storage?

Californians have approved two water bonds in recent years, with another facing voters this November. In 2014 voters approved Prop. 1, allocating $7.1 billion for water projects. This June, voters approved Prop. 68, allocating another $4.0 billion for water projects. And this November, voters are being asked to approve Prop. 3, allocating another $8.9 billion for water projects. This totals $20.0 billion in just four years. But how much of that $20.0 billion is to be invested in water infrastructure and water storage?

Summaries of how these funds are spent, or will be spent, can be found on Ballotpedia for Prop. 1, 2014, Prop. 68, 2018 (June), and the upcoming Prop. 3, 2018 (November). Reviewing the line items for each of these bonds and compiling them into five categories is necessarily subjective. There are several line items that don’t fit into a single category. But overall, the following chart offers a useful view of where the money has gone, or where it is proposed to go. To review the assumptions made, the Excel worksheet used to compile this data can be downloaded here. The five categories are (1) Habitat Restoration, (2) Water Infrastructure, (3) Park Maintenance, (4) Reservoir Storage, and (5) Other Supply/Storage.

California Water Bonds, 2014-2018  –  Use of Funds
($=millions)

The Case for More Water Storage

It isn’t hard to endorse the projects funded by these water bonds. If you review the line items, there is a case for all of them. This November, voters will have a chance to approve $200 million to restore Salton Sea habitat, a sum that joins the $200 million of Salton Sea habitat restoration approved by voters in June 2018 in Prop. 68. This November, voters will have a chance to approve $150 million to turn the Los Angeles River back into a river, instead of the concrete culvert that was completely paved over between 1938 and 1960.

Who would be against projects like this? But Californians are heavy water consumers in a relatively arid state. Habitat restoration and park maintenance spending must be balanced against spending for water infrastructure. And conservation mandates must be balanced with investments in infrastructure that increase the overall supply of water. Here’s how Californians are currently managing their water:

Total Water Supply and Usage in California

As can be seen on the above table, residential water consumption represents less than 6% of California’s total water diversions. Indoor water consumption, only about half of that. Yet conservation measures imposed on California’s households are somehow expected to enable more water to be returned to the environment. Even with farmers, where conservation measures have the potential to yield far more savings, putting more irrigated land into agricultural production easily offsets those savings.

Not only does conservation fail to return sufficient water to the environment for habitat maintenance, but there is a downside in terms of system resiliency. During the last drought, when households were asked to reduce water consumption by 20%, it wasn’t an impossible request to fulfill. But as these reductions in consumption become permanent, far less flexibility remains.

California’s climate has always endured periods of drought, sometimes lasting several years. Meanwhile, the population continues to increase, farming production continues to rise, and we have higher expectations than ever in terms of maintaining and restoring healthy ecosystems throughout the state. We cannot merely conserve water. We need to also increase supplies of water. Ideally, by several million acre feet per year.

How Much California Water Bond Money is for Surface Storage?

Prop. 1, approved by voters in 2014, was called the “Water Quality, Supply, and Infrastructure Improvement Act of 2014.” It was marketed as necessary to increase water storage in order to protect Californians against droughts, and was overwhelmingly approved by over 67% of voters. But only about one-third of the money actually went to water storage, and it took nearly four years before any of those funds were allocated to specific storage projects. It was only this month, July 2018, that the California Water Commission awarded grants under their “Water Storage Investment Program.”

A review of these grants indicates that only two of them allocate funds to construct large new reservoirs. The proposed Temperance Flat Reservoir will add 1.2 million acre feet of storage. Situated south of the delta, it will be constructed on the San Joaquin River above a much smaller existing dam. It is estimated to cost $2.7 billion, and the California Water Commission awarded $171 million, only about 6% of the total required funds.

The proposed Sites Reservoir is situated north of the delta, west of the Sacramento river. It is an offstream reservoir, meaning that it will be filled using excess storm runoff pumped out of the Sacramento river during the rainy season. It is designed to store up to 1.8 million acre feet of water and is estimated to cost $5.2 billion to construct. The California Water Commission awarded $816 million, a large sum, but only about 16% of the total required funds.

Two other surface storage projects were approved, expansion of the existing Los Vaqueros and Pacheco reservoirs. Both of these reservoirs serve water consumers in the San Francisco Bay Area, both are supplied water via the California Aqueduct, and both expansion projects are estimated to cost not quite a billion dollars – $795 million for Los Vaqueros and $969 million for Pacheco. The California water commission awarded Los Vaqueros $459 million, and they awarded Pacheco $484 million.

When you consider surface storage, the total capacity of a reservoir is a critical variable, but in many ways more significant is the annual “yield.” This is the amount of water that on average, over decades, the reservoir is planned to deliver to water consumers in normal years. While the Los Vaqueros and Pacheco reservoir expansions combined will add roughly 250,000 acre feet of storage capacity, most of this added capacity is to save for drought years. Los Vaqueros may actually yield up to 35,000 acre feet per year in normal years; Pacheco may yield around 20,000 acre feet per year in normal years.

With respect to annual yields, the case for the much larger Sites and Temperance Flat reservoirs becomes more compelling. The Temperance Flat Reservoir is projected to yield 250,000 acre feet of water in normal years, the Sites Reservoir, a massive 500,000 acre feet. To put this in perspective, 750,000 acre feet represents 20% of ALL residential water consumption in California, or, put another way, each year these reservoirs will yield a quantity of water equivalent to 100% of the reductions achieved via conservation measures imposed on California’s residents during the drought. But will they ever get built?

According to spokespersons for the Sites and Temperance Flats projects, some federal funding is expected, but most of the funding will be from agricultural and urban water districts who will purchase the water (as well as the right to store surplus water in the new reservoir) as soon as its available. The projects still require congressional approval, and then will face a multi-year gauntlet of permit processes and the inevitable litigation. If all goes well, however, both of them could be built and delivering water by 2030.

How Else is Water Bond Money Being Used to Increase Water Supply?

All three of the recent water bonds had some money allocated to invest in water supply. Prop. 1 in 2014, in addition to investing $1.9 billion in surface water storage, allocated $1.4 billion to other projects intended to increase water supply. The projects they approved are either intended to store water in underground aquifers, or fund advanced water treatment and recycling technologies which have the practical effect of increasing water supply. While it isn’t clear from these groundwater storage proposals how much water they would then release in normal years, it appears that cumulatively the projects intend to eventually store as much as 1.0 million acre feet in underground aquifers.

At a combined cost total cost of under one billion, the aquifer storage projects just approved appear to be more cost effective than surface storage. It is also a critical priority to recharge California’s aquifers which have been drawn down significantly over the past several years, especially during the recent drought.

Prop. 68, the “Parks, Environment, and Water Bond” passed earlier this year, while mostly allocating its $4.0 billion to other projects, did allocate $290 million to “groundwater investments, including groundwater recharge with surface water, stormwater, and recycled water and projects to prevent contamination of groundwater sources of drinking water.”

The upcoming Prop. 3, the $8.9 billion “Water Infrastructure and Watershed Conservation Bond Initiative” that will appear on the November 2018 ballot, invests another $350 million to maintain existing, mostly small urban reservoirs, along with $200 million to complete repairs on the Oroville Dam. Prop. 3 also includes $1.6 billion to otherwise increase water storage and supply, including $400 million for wastewater recycling and $400 million for desalination of brackish groundwater.

It is important to emphasize again that all of the funds allocated in these three water bonds are paying for what are arguably worthwhile, if not critical projects. $6.3 billion for habitat restoration, $6.2 billion for water infrastructure, $1.6 billion to maintain our parks. But despite the worth of these other projects, Californians urgently need to increase their annual supply of water to ensure ecosystem health, irrigate crops, and supply urban consumers. And to address that need, out of $20 billion in water bonds passed or proposed between 2014 and this November, only $5.8 billion, less than one-third, is being used to increase water supplies.

What Other Ways Could Water Bond Money Be Used to Increase Water Supply?

Clearly the most important region to increase water supply is Southern California. Two thirds of all Californians live south of the Sacramento River Delta, while most of the rain falls on in Northern California. One way to increase California’s supply of fresh water is to build desalination plants. This technology is already in widespread use throughout the world, deployed at massive scale in Singapore, Israel, Saudi Arabia, Australia, and elsewhere. One of the newest plants worldwide, the Sorek plant in Israel, cost $500 million to build and desalinates 120,000 acre feet of water per year.

Theoretically – because capital costs in California are far higher than in most of the rest of the developed world – desalination offers a cost-effective solution to water scarcity. Uniquely, desalination creates new water, not dependent on rainfall, not requiring storage for drought years, not requiring redirecting of water from other uses. Imagine if Californians invested in desalination plants along the entire Southern California Coast. Eight desalination plants the same size as the Sorek plant would cost $4.0 billion to build if constructed for the same cost as the one in Israel cost. They could desalinate 1.0 million acre feet per year.

The energy costs for desalination have come down in recent years. Modern plants, using 16″ diameter reverse osmosis filtration tubes, only require 5 kWh per cubic meter of desalinated water. This means it would only require a 700 megawatt power plant to provide sufficient energy to desalinate 1.0 million acre feet per year. Currently it takes about 300 megawatts for the Edmonston Pumping Plant to lift one million acre feet of water from the California aqueduct 1,926 ft (587 m) over the Tehachapi Mountains into the Los Angeles basin. And that’s just the biggest lift, the California aqueduct uses several pumping stations to transport water from north to south. So the net energy costs to desalinate water on location vs transporting it hundreds of miles are not that far apart.

The entire net urban water consumption on California’s “South Coast” (this includes all of Los Angeles and Orange County – over 13 million people) is 3.5 million acre feet. It is conceivable that desalination plants producing 1.0 million acre feet of new water each year, combined with comprehensive sewage reuse and natural runoff harvesting could render the most populous region in California water independent.

Why is Infrastructure so Expensive in California?

The Carlsbad desalination plant in San Diego cost $925 million to build, and it has a capacity of 56,000 acre feet per year. That is a capital cost per acre foot of annual yield of $16,500. How is it that the Sorek desalination plant in Israel cost $500 million to build and has a capacity of 120,000 acre feet per year – a capital cost per acre foot of annual yield of only $4,100? Why did it cost four times as much to build the Carlsbad desalination plant?

This is the prevailing question when evaluating infrastructure investment in California. Why does everything cost so much more? The Sites reservoir is projected to cost $5.2 billion. An off-stream reservoir of equal size, the San Luis Reservoir, was constructed in California in the 1960s at a total cost, in 2018 dollars, of $2.3 billion. That all-in cost includes not just the dam, but also includes pumping stations, the forebay, the intertie to the California Aqueduct, and conveyances to get some of the water over the Diablo Range into the Santa Clara Valley. All of these costs (in today’s dollars) for the San Luis Reservoir, compared to the proposed Sites Reservoir, cost less than half as much. Why?

It’s easy to become enthusiastic about virtually any project that will increase our resiliency to disasters and droughts, improve our quality of life, steward our ecosystems, and hopefully create abundance of vital resources such as water. But when considering the need for these various projects, it is equally important to ask why they cost so much more here in California, and to explore ways to bring costs back down to national and international norms. We could do so much more with what we have to spend.

 *   *   *

This is part one of an investigation into California’s water future. Part two is “How to Make California’s Southland Water Independent for $30 Billion,” and the third and final part is “Towards a Grand Bargain on California Water Policy.” Edward Ring is a co-founder of the California Policy Center and served as its first president.

 

 

 

 

School officials want you thinking how to spend millions, but not how they’ll get it

Survey says? Whatever they want it to say.

Under the guise of measuring public opinion, Santa Ana school officials are trying to shape it – and they’re using taxpayer dollars to pay for it.

In April and May, Santa Ana Unified School District officials papered the city with mail that looks like a poll. The direct-mail campaign included questions about how residents would spend $479 million to “support high quality instruction, repair deteriorating facilities, provide modern science labs, replace failing heating and ventilation systems, and replace portable classrooms.”

Officials asked the questions in anticipation of a district-wide vote on a multi-million-dollar bond. On a 4-1 vote last month, the district’s board of trustees placed the bond on the November ballot.

State law allows government officials to communicate nonpartisan information, but not to engage in politicking.

“This mailing was neither a scientific survey or a poll or mere educational outreach,” said Will Swaim of the California Policy Center. “It was a push poll, an attempt by Santa Ana Unified officials to persuade voters, and that would be illegal under state law.”

A push poll is meant to promote a political message under the pretense of collecting public feedback.

The Santa Ana survey is part of a broader trend in California politics. “It’s now common for local officials seeking tax increases or bond issues from voters to hire campaign consultants on the fiction that they will provide unbiased information to the voting public,” said veteran political commentator Dan Walters.“These consultants conduct polling to determine which angles of proposals are most attractive to voters, write the measures to stress those popular features and then produce literature and ads to trumpet those selling points.”

On first glance, the Santa Ana mailing looks like an actual survey. The front page states, “Santa Ana Unified School District wants to hear from you.” On the second page, respondents are told that “developing a plan for the future of our schools should be a community-driven process.”

But the “survey” strongly implies that the bond is essential – and that it’s so likely to succeed at the polls in November that voters should start thinking about how they’d like to spend hundreds of millions of dollars.

These millions will come from Santa Ana residents and businesses – a fact the district downplays.

A bond is a loan that will be repaid by local taxpayers over a period of years. Public officials have priced the November bond all over the map – from $479 million when they first launched it, they soon raised the price tag to $518 million. More recently, without explanation, the district announced the bond was $232 million. None of those numbers include interest payments that will double the cost to taxpayers. The district is still paying off two previous bonds.

“Santa Ana’s campaign strategy is a little like sending your kids a bill in January for all the toys you gave them in December,” said Swaim. “Everybody’s excited to think about spending. It’d be great if district officials told their residents about the costs to individuals and businesses.”

One of the first things respondents saw on the April-May survey was a message in capital letters: “Improving the Quality of Local Schools.” The accompanying note from the district superintendent emphasizes the district’s pressing need for more cash.

Further, the survey asks respondents to rank their priorities on bond spending. The menu of options ranges from upgrading classrooms and repairing deteriorating roofs and electrical systems, to replacing failing heating and ventilation systems.

Critics say the district’s approval of every proposed teacher pay raise and rising pension debt is consuming so much money that almost nothing is left for facility maintenance or hiring new teachers. Hence, the November bond.

“Santa Ana can ill afford another tax increase,” says Art Pedroza, a Santa Ana resident and publisher of the website New Santa Ana. “Our residents include many seniors on fixed incomes and young families struggling to survive. This latest bond measure will raise their cost of living.

“Ultimately this bond measure is a gift to the unions at taxpayer expense.”

Kelly McGee is a Rhodes College (Memphis) graduate and CPC journalism intern.

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Proposition 65 Photo Contest





Have you seen a Proposition 65 sign lately? The signs are everywhere in California. Are they absurd? Funny? So absurd, they’re funny?

Now your sense of humor can win you a prize, just as it has for Contessa who has won $1500 (weeks 6 ,912,  14, 15, 18, 19, 20. 2223, 24, 26, 29, 32, and 47); Shanae, who has won $1200 (weeks 14, 5, 7 , 10, 1116, 21, 28, 43, 46, and 49); Joseph who has won $500 (weeks 41, 44, 45, 48, and 51); Danielle $400 (weeks 27,  30, 33, and 36) and John (weeks 37, 38, 39, and 40), who have won $400; Jamey (weeks 8 and 13) and Gary (week 25 and 42) who have won $200 and Tony (week 2), Stephen (week 3) Greg (week 17), Mary (week 31), Chantal (week 34), and David (week 35) who have each won $100. When you see a particularly absurd sign, snap a picture. The person who submits the best picture of the week will win $100 each and every week for the next 2 weeks. After, you are eligible to win an additional $1,000 if one of your winning pictures is voted the best of the 52 weekly winners.


Eligibility:  Everyone is eligible to participate.  There are no age limits.

Here’s How to Enter a Picture. 

Step 1:  Find a Prop 65 warning that you find humorous or absurd. Take a picture of the warning.  Make sure it is legible.  If the context is not clear, take a picture of the place that you found it as well and combine or post both pictures side by side.  Don’t forget to add a caption.

Step 2:  Post your photos on any or all of the following: Facebook, Twitter and/or Instagram. Use the tag @calpolicycenter (on Facebook or Twitter) or @californiapolicy (on Instagram) in your post and include the Hashtag “#Prop65Contest”.

Step 3: Make sure your account is public so we can see the post!

How Winners Will be Determined:

Clear Pictures Required – Pictures must show a clear legible Proposition 65 Warning and the Setting in which it was taken. See pool above and beach shoe example below.

A clever caption must be included– either in the picture or in the post message. Posts should make folks laugh or at the very least, smile.

Creativity And Impact Count! We will judge entrants on originality, humor, quality, and impact of message. The “impact of message” will be measured by checking out how many people liked/retweeted/shared your photo.

PRIZES

Weekly $100 Winner for 52 weeks!    Each week, we’ll choose a winner from the pictures posted during the week– and the winner will receive $100 payable via Venmo. The contest will run for 52 weeks. There’s no limit to the number of $100 prizes you can win.  Technically, you could win the prize for all 52 weeks. So keep posting new photos. Don’t stop even if you have been declared the week’s winner. Each week’s contest will begin on Monday and end on the following Sunday at 12:00 PDT. The weekly winner will be announced the next day (Monday) by 6:00 P.M. PDT .

$1,000 Prize for the Best of the Best – At the end of the contest, we’ll have a playoff – pitting the best of the best in a crowd-sourced vote to determine the No. 1 Prop 65 Warning photo.  The winner will receive the grand prize of $1,000 payable via Venmo.

How To Find Proposition 65 Signs  They are everywhere.  Just open your eyes and you will find them in any place that is open to the public, even Disney rides.  There’s another source that is making its way to store shelves. Products produced after August 30, 2018 are required to bear a Proposition 65 warning on the outside of the package.   Watch for the new packaging. It should provide you with even more photographic opportunities.

Why are we running this contest? Because Proposition 65 is not serving its intended purpose – to warn consumers of real risks of cancer or birth defects from chemicals.  Instead, Californians are warned that normal activities like breathing, eating (even healthy, organic foods), drinking (coffee*, beer, or alcohol), driving, swimming, walking in beach shoes, picnicking, or even using a restroom puts them at risk of cancer and their progeny for birth defects. To get an idea of the pervasive nature of Prop 65 warnings, watch



Why are there so many warnings?  Because of the way California assesses risk. More on this here.

 Of even greater consequence, is the slew of absurd warnings that result.  The warnings are virtually guaranteed to be disregarded, and in the process, much like the “Boy who cried Wolf,” ensure that the real warnings that should be heeded are ignored.

This contest is an effort to bring people to their senses.  There’s nothing like humor to illustrate a point.

IMPORTANT INFORMATION ABOUT THE CONTEST
By participating you affirm you are the sole author/owner of the photograph and are placing the photograph in the public domain with the understanding that it may be republished on our site and used inother social media.
We can change these rules at any time, for any reason.

By entering the Contest, you agree that you have read these Official Rules and are in agreement with them.  By participating, you hereby waive any and all rights that exist in your submission and any derivative works made therefrom, including any moral rights, right of publicity, copyright and other intellectual property rights.  You further agree that anyone may utilize, replicate, alter, adapt, modify, publish, perform, broadcast, translate, produce derivative works from, distribute, present, or display any and all portions of your submission in any media now known or later created, anywhere and forever.



STAY CONNECTED. USE THE FORM BELOW TO BE UPDATED WHEN NEW WINNERS ARE ANNOUNCED.



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AFSCME’s push for rent control proves the importance of the Janus union-dues ruling

Why Teachers Unions are the Worst of the Worst

When considering the influence of unions on American society, there are vast differences depending on what type of union one considers.

Private sector unions, for all the criticisms they may deserve, have nonetheless played a vital role in securing rights for the American worker. Subject to appropriate regulations, private sector unions have the opportunity to continue to play a vital role in American society. If they would bother to embrace the aspirations of their members, instead of the multinational corporations their leaders now apparently collude with, they might even support immigration reform. That would elevate the wages and benefits of all American workers, especially those doing low paying jobs.

Public sector unions, on the other hand, should be illegal. They negotiate with elected officials who they help elect. They negotiate for a share of coerced tax revenue, rather than for a share of profits, meaning there are no competitive checks on how much they can demand. The agenda of public sector unions is inherently in conflict with the public interest. But given the reality of public sector unions, it is important to recognize that some public sector unions are worse than others.

Public safety unions, for example, have successfully lobbied for pension benefits that are not sustainable. This calls for a difficult but necessary economic discussion that can only end two ways – either these pension benefits are going to be reduced, or cities and counties across California and elsewhere will go bankrupt in the next major recession. But public safety unions have not undermined their profession the way the teachers unions have.

The teachers unions are guilty of all the problems common to all public sector unions. They, too, have negotiated unsustainable rates of pay and benefits. They, too, elect their own bosses, negotiate inefficient work rules, have an insatiable need for more public funds, and protect incompetent members. But the teachers union is worse than all other public sector unions for one reason that eclipses all others: Their agenda is negatively affecting how we socialize and educate our children, the next generation of Americans.

Work Rules Harm Public Schools

One of the most compelling examples of just how much harm the teachers union has done to California’s schools was the 2014 case Vergara vs. the State of California. In this case, attorneys representing public school students argued that union negotiated work rules harmed their ability to receive a quality education. In particular, they questioned rules governing tenure (too soon), dismissals (too hard), and layoffs (based on seniority instead of merit). In the closing arguments, the plaintiff’s lead attorney referenced testimony from the defendant’s expert witnesses to show that these and other rules had a negative disproportionate impact on students in disadvantaged communities.

Despite winning in the lower courts, the Vergara case was eventually dismissed by the California Supreme Court. Teachers still get tenure after less than two years of classroom observation. Incompetent teachers are still nearly impossible to fire. And whenever it is necessary to reduce teacher headcount in a district, the senior teachers stay and the new teachers go, regardless of how well or poorly these teachers were doing their jobs. The consequences of these self-serving work rules are more than academic.

The evidence that California’s public schools are failing is everywhere. Los Angeles, a city whose residents are – perhaps more than anywhere else – representative of America’s future, is home to the Los Angeles Unified School District (LAUSD), with 640,000 K-12 students. And as reported earlier this year in the LA School Report, according to the new “California School Dashboard,” a ratings system that replaced the Academic Performance Index, LAUSD is failing to educate hundreds of thousands of students. In the most recent year of results, 52 percent of LAUSD’s schools earned a D or F in English language arts, and 50 percent earned a D or F in math. Fifty percent of LAUSD’s schools are failing or nearly failing to teach their students English or math.

Attack Innovative Charter Schools

In the face of failure, you would think LAUSD and other failing school districts would embrace bipartisan, obvious reforms such as those highlighted in the Vergara case. But instead, these unions are relentlessly trying to unionize charter schools, which would force those schools to adhere to the same union work rules. In Los Angeles, the Alliance Network of charter schools has delivered demonstrably better educational outcomes for less money, while serving nearly identical student populations.

How does it help to impose union work rules on charter schools that are succeeding academically? How does that help the children who are America’s future?

A Left-Wing Political Agenda

The other way the teachers union is unique among public sector unions is their hyper-partisanship. Despite and often in defiance of their memberships, nearly all unions are left-wing partisan organizations. Nearly all of them support left-wing causes and Democratic political candidates. But the teachers unions do so with a zeal that dwarfs their counterparts. Larry Sand, a former LAUSD teacher and prolific observer of teachers union antics, has spent years documenting their left wing agenda.

For example, reporting on the annual conventions of the two largest national teachers unions, Sand writes: “The National Education Association convention at the beginning of the month gave us a clue which theory would become reality when the union passed quite a few über liberal New Business Items, maintained its lopsided leftward political spending, and gave rogue quarterback Colin Kaepernick a human rights award. And here in the Golden State, the California Teachers Association continues its one-way spending on progressive initiatives and endorsed 35 state legislators in the June primary – all Democrats.

A week after the NEA convention, the other national teachers union, the American Federation of Teachers held its yearly wingding and left absolutely no doubt as to its future political direction. The resolutions passed by the union at the convention would make any socialist proud. Universal health care – whether single-payer or MediCare for All, full public funding for, and free tuition at all public colleges and universities, and universal, full-day, and cost-free child care are what AFT wants for the country. Additionally, the union resolved to double per-pupil expenditures for low-income K-12 districts and to ‘tax the rich’ to fully fund ‘IDEA (Individuals with Disabilities Education Act), Title I and state allocations to public colleges and universities.'”

Left-Wing Student Indoctrination

This left-wing political agenda finds its way into the classroom, of course. At the same time as California’s K-12 public school students are not being effectively taught English or math skills, they are being exposed to agenda-driven political and cultural indoctrination.

Again, as documented by Larry Sand: “Nor are textbooks safe. Communist and notorious America-hater Howard Zinn’s “A People’s History of the United States” is assigned in many high school history classes. Zinn felt that the teaching of history “should serve society in some way” and that “objectivity is impossible and it is also undesirable.” As a Marxist, he’d prefer a society that resembles Stalin’s Russia. Additionally, Pacific Research Institute’s Lance Izumi notes that pages and pages of the latest California History, Social Science Framework ‘are devoted to identity politics, and the environmentalist, sexual, and anti-Vietnam War movements, with detailed and extensive bibliographical references. In contrast, the contemporaneous conservative movement, which succeeded in electing Californian Ronald Reagan as president, with its complex mixture of social, economic and national security sub-movements, is given cursory and passing mention, with no references provided.'”

Public sector unions are going to be with us for a long time. But in the wake of the Janus ruling, members who don’t agree with the political agenda of these unions can quit, depriving them of the dues that – to the tune of nearly a billion per year just in California – make them so powerful.

Teachers, in particular, should carefully consider this option. America’s future depends on it.

How the Los Angeles Unified School District spent its summer vacation

LAUSD schools open in two weeks after having had the July from Hell.

The Los Angeles Unified School District is heading into the new school year after something less than a whiz-bang summer. The follies began with a report revealing that the predicted 2017 graduation rate of 80 percent didn’t quite hit the mark. In reality, it was 76.1 percent because the state’s Department of Education changed its definition of “graduate” after a federal audit questioned the accuracy of California’s method of figuring out who really completed high school. Using the old formula, students were counted as graduates if they transferred to adult education programs to earn their diploma or passed a high school proficiency exam. But now they are more honestly considered dropouts. The value of a diploma had previously gone south after the district decided in 2015 to pad its numbers with “credit recovery classes” – allowing students to take frequently useless crash courses on weekends, holidays, etc. Additionally, the demise of the California High School Exit Examination in 2016 gave the false impression that grad rates were improving.

Of course, none of this should be at all shocking, as earlier this year California’s school rating system showed that 52 percent of LAUSD’s schools earned a D or F in English language arts, 50 percent earned a D or F in math, and just 40 percent of all students graduate college or are career ready.

At the same time, the education advocacy organization Parent Revolution released a report which showed that in LA’s 44 lowest-performing schools, 46 percent of their teachers were not evaluated at all from 2014 to 2017. (In the 2016-17 school year alone, 70 percent of teachers working at those 44 schools were not evaluated, “even though only 27 percent of students at those schools were proficient in English language arts and only 20 percent were proficient in math.”)

The LA school board also took a hit. Ref Rodriguez, one of the four reform-minded board members, was forced to resign after pleading guilty to a felony count of conspiracy and four misdemeanor counts for making contributions in another person’s name during his 2014 campaign board run. Although Rodriguez escaped prison time, he did have to vacate his board seat. Given his strong pro-charter school stance, that’s good for the education establishment, but bad for kids. While the board could pick a temporary successor, considering the new 3-3 split, getting a majority to agree on anyone will be difficult. The board will probably call for an election to fill the vacant seat, but it’s doubtful that will happen before next spring.

There was, however, some good news…for some students. At the same time the district has been scandalously neglecting its least capable students, the school board decided that principals at bottom performing schools would not have to hire “must place” teachers who have either been deemed ineffective or were bumped due to the state’s archaic quality-blind seniority system. While that sounds like a much needed improvement, it really is a zero-sum game since the unwanted teachers will now be foisted on all the other schools. LAUSD school board vice-president and rare right-thinker Nick Melvoin saw through this sham and said that the same logic should apply to all students. But Melvoin knows well that districtwide hiring practices must be negotiated with the teachers union. Speaking of which….

The United Teachers of Los Angeles is talking strike. Starting two years ago, UTLA president Alex Caputo-Pearl threatened not only to call for a teacher walkout, but ominously to unleash a “state crisis” on California. Well, looks like crisis time is on the horizon. In a July 24th press release, UTLA submitted its “Last, Best and Final Offer” to LAUSD and demanded a “48-hour response from the district.” The union said that the 2 percent ongoing salary increase, an additional one-time 2 percent bonus and a $500 stipend for materials and supplies offered by the district was “insulting.” The union then trotted out all the usual bogeymen, blaming unaccountable charter schools, pro-privatization ideologues and new school superintendent Austin Beutner for the district’s woes.

But union kvetching aside, Beutner just may be the right man for the job. While UTLA whines that he is a “billionaire investment banker, not a teacher,” his status as a businessman is a good thing. He is dealing with a school district whose unfunded liability for retiree health benefits has risen to $15.2 billion, up from $13.5 billion in 2016. As CALmatters Jessica Calefati reports, LAUSD could be “just two years from financial ruin.” Nick Melvoin added, “We’re in a death spiral.”

Speaking recently to LA business leaders about the deficit, Beutner posited, “By 2021, if we haven’t changed things appreciably, we will be no more, and that reckoning will not be pretty.”  While Beutner didn’t say what would follow the apocalypse, Dan Walters writes that there will be political pressure, particularly from the teachers unions, for a taxpayer-funded state bailout.

The summer has turned out to be long, hot and horrible for the country’s second largest school district, and the fall and winter aren’t looking any brighter. Students and taxpayers will remain collateral damage for a system where unaccountable bureaucrats and the teachers unions run the show.

Larry Sand, a former classroom teacher, is the president of the non-profit California Teachers Empowerment Network – a non-partisan, non-political group dedicated to providing teachers and the general public with reliable and balanced information about professional affiliations and positions on educational issues. The views presented here are strictly his own.