Water is a critical issue in Southern California, particularly during this historic drought. We’ve talked a lot about water on this blog, including recent articles about the Santa Margarita Water District’s mandatory water conservation policies and the Capistrano Taxpayers Association water rate litigation. We’ve received word that there is yet another legal battle over water rights bubbling up in our backyard, as San Juan Hills Golf Club has filed a lawsuit against the City of San Juan Capistrano and the San Juan Basin Authority (a consortium of municipal water agencies including Santa Margarita Water District, Moulton Niguel Water District, South Coast Water District and the City of San Juan) alleging that the City and the San Juan Basin Authority have breached a contract and violated the Golf Club’s water rights. At issue is 1997 agreement between the San Juan Basin Authority and the prior owners of the golf course which provided that the golf course’s overlying usage rights entitle it to use up to 550 acre feet per year of water from the aquifer below the property. Overlying usage refers to a property owner’s right to access water reserves located below their property. In this case, the golf course property sits above an underground aquifer that is part of the San Juan water basin. The Golf Club, claiming to be the successor to this water contract, claims that the San Juan Capistrano groundwater plant draws water from the same aquifer as the Golf Club, draining the groundwater and threatening the sustainability of the aquifer as a water source for overlying users. According to the complaint:
As a result of The City’s unauthorized and illegal actions (which could only occur with the permission of the SJBA), the water levels of the Aquifer dropped to the point where, in 2014, The Golf Club could no longer extract enough water to irrigate its property, let alone extract the full 550 acre feet it was entitled to draw upon.
The Golf Club seeks monetary damages to compensate it for the lost aquifer water and the Golf Club’s inability to draw its 550 acre feet of water, as well as a court order preventing San Juan Capistrano and the San Juan Basin Authority from pumping water from the aquifer until groundwater reserves return to their historic static levels.
Water rights in California are among some of the most complicated legal issues anywhere. Water rights are a hybrid of property rights, contractual rights and public policy, with a dose of historic custom and practice thrown in for good measure. In some ways, this litigation sits at the nexus of the drought conservation measures and the water rate litigation. The complaint contains both a new and interesting argument against the San Juan Capistrano Groundwater Recovery Plant, but also raises the ante on water usage rights at a time when public water agencies are asking, indeed requiring, water customers to make severe cuts in their usage. The suit also begs the question of whether, property rights and contracts aside, it is good policy to force residential users to make severe cuts in their household water usage while golf courses and other large property owners continue to use water at historic usage rates. One acre foot of water is about 325,000 gallons. So 550 acre feet is about 178 million gallons of fresh water taken from the aquifer per year. That’s a lot of swimming pools!
Stay tuned, and we’ll continue to keep an eye on San Juan’s water wars.
The Golf Club has filed notice that it is seeking a Preliminary Injunction. The court has scheduled this for hearing on October 9, at 2 PM in Department C12. The Golf Club has also filed three declarations by Zak, Kear and Burnett, not yet on the court website. The three appear to be environmental or geotechnical experts (based on Google). Whatever they have to say, we’ll have to wait for the court to catch up.
The implications of a Preliminary Injunction are profound. San Juan Capistrano could be ordered to stop or limit operations at the Ground Water Recover Plant. With close to $50 million invested in the “draught-proof” plant, the impact on city finances will be dramatic. Still, not too dramatic, since the city itself has already experienced difficulty in extracting water from its own proven wells during the past 3-4 months. Already, operation of the GWRP has been curtailed due to a reduction in feed water, wells have failed, and the City Manager’s report on water production reflects a 50% reduction in monthly production.
The wider implication of all this will be interesting to observe. The San Juan Basin Authority is co-defendant in the case. The SJBA is an independent agency, but it is co-governed (not a consortium) of the four water districts. SJBA gets its authority from the State Department of Water Resources, where there is a new and urgent emphasis on the regulation of groundwater. Because the very purpose of SJBA is to manage and protect the San Juan Basin groundwater, they have an divergent or possibly conflicting interest from that of San Juan Capistrano.
On the other hand, SJBA has issued millions of dollars in debt that funded the construction of the GWRP. The SJBA actually owns this asset and leases it to the City of San Juan Capistrano to operate. San Juan’s lease payment is SJBA’s only source of revenue to service the bondholders. So forcing San Juan to stop operating the GWRP would leave the city paying a lease on a facility that can produce no water. Again, if this occurs, it seems that the interest of the two defendants would diverge.
But hold on! The governing body of SJBA is a board of directors drawn from the boards that govern the three agencies and the city. In the case of San Juan, it is one member of our city council (Kramer). Can these people possibly find a solution to the obvious depletion of the basin that isn’t adverse to the interests of their own agencies?
The Golf Club is merely the canary in this disaster. But unfortunately, it would appear that the Golf Club has already been damaged. This may end up costing the taxpayers in San Juan, but also perhaps in Dana Point, Ladera Ranch, RSM, and Laguna Niguel through the SJBA.
The GWRP is an ill-conceived idea that is failing to serve its advertised purpose, notwithstanding the new lawsuit. When was SJBA board going to show some leadership? Are they waiting for the wells to run dry? Are they even thinking about the permanent damage that can occur? They’ve been sitting on a technical report for the past two years that asserts that seawater intrusion into the San Juan Basin is “imminent”, due to over pumping of the wells. And now this.
Arguments hereabout that seek to treat “golf” as a bad water use and “people” as a good water use divert attention from the underlying and most critical question. Have SJBA and the city behaved responsibly? If they pump the underground aquifer dry, or permanently damage it, are they reckless? After all, they have been holding themselves out to be experts in this area for the past 20 years. Over $50 million has been borrowed and spent chasing a pipe-dream of self-sufficiency.
If the allegations in the lawsuit are correct, the city won’t on the hook alone. They are conspiring with the surrounding agencies through the auspices of SJBA to over-use a natural resource that others, including the Golf Club, have historically depended on. If they are stripped of their access to this water, the value of their property is significantly harmed and the golf “business” they operate on the property would probably have to close.