STOCKTON PROPOSES BANKRUPTCY PLAN
(Stockton, CA) – On Tuesday, June 5, 2012, the Stockton City Council will consider a contingency plan to be followed should the City and a sufficient number of its creditors be unsuccessful in reaching an agreement that prevents insolvency and restores the fiscal health of the City. The contingency plan will be presented at the regularly scheduled Council Meeting. The public session begins at 5:30 p.m.
The City and its largest creditors have been engaged in confidential mediation that began two months ago. The mediation allows the City to work with creditors to restructure debt and agreements under a process determined by state legislation which became effective January 1, 2012, AB 506. The legislation provides for a 60-day period of negotiations with an option to extend for an additional 30 days. The City and most mediation participants recently extended the mediation period through June 25, 2012.
“We remain hopeful that we can reach an agreement with a sufficient number of our creditors to get our fiscal house in order,” said Mayor Ann Johnston. “However, we must have a plan for any possible outcome to protect the health, safety and welfare of our community and maintain basic services. Without significant fiscal relief, the General Fund will be out of money by June 30, 2012.”
The state constitution requires cities to adopt a balanced budget by July 1 of each year. The majority of the City’s budget is not impacted by the City’s fiscal crisis. The total budget of $521 million includes $366 million in restricted funds, which cannot be used to resolve the General Fund crisis. The $155 million General Fund provides for services such as police, fire, libraries, parks maintenance and administrative functions. This funding comes from property tax, sales tax, utility users tax, business license tax and other sources, all of which have experienced significant declines for the past four years.
The City Council has addressed $90 million in deficits over the last 3 years and is faced with a $26 million deficit in the fiscal year that begins July 1, 2012. The Council believes that any further service cuts will endanger the health and safety of the community.
The contingency plan that the Council will consider will allow the City to continue to operate, should the City be faced with insolvency by the end of the fiscal year, which is June 30, 2012. The proposed plan would give the City Manager authority to file for Chapter 9 protection, if there are no other options to balance next year’s budget. The plan allows the City to provide day-to-day services until a long-term plan of adjustment can be negotiated and approved, should bankruptcy protection become necessary.
“This City has been in business for over 160 years and we will continue to be in
business,” continued Mayor Johnston. “We will come through the AB 506 process or chapter 9 with a financially sustainable future. Even though we have inherited this mess, we are committed to doing everything in our power to leave this City better, stronger and healthier.”
information provided by the city of Stockton, CA
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Selenium is Still Leaking into the San Joaquin River
Chris Eacock stands with his hands on his hips and looks out over the Central Valley’s sunny expanse of farms and wetlands and tries to explain the situation. As a natural resource specialist for the Bureau of Reclamation for the past 30 years, he began his career doing soil surveys and handling grazing leases on Bureau-owned land. Today, he manages the tougher side of that equation, the tainted drainage water now coming from farms. Salt and selenium from irrigated land on the west side of the valley have poisoned wetlands, damaged ground water and rendered farms unproductive. Eventually, the waste reaches the San Joaquin River and flows into the Bay-Delta, endangering wildlife and the state’s water supply.
Eacock insists that the situation has improved. “There is less pollution, people are still in business, and we’re all still talking to each other out here,” he said.
But more than a few are critical. “The discharges have gone down significantly, and they get a lot of credit for that,” said Tom Stokely, water policy analyst with the California Water Impact Network. “But there is still contamination happening in the wildlife refuges, and there is virtually an unlimited supply of selenium in those soils.”
In high concentrations, selenium is toxic to fish, livestock, humans and birds.
On the west side of the San Joaquin River, an area of large farms and agribusinesses stretch from Bakersfield to Patterson. The land, about 1.2 million acres, was once an alkaline desert, a sagebrush basin filled with coyotes, foxes, fish and watering holes. The city of Los Banos, in its center, was called the baths in reference to the artesian pools that once existed near the area. But in the 1960s, state and federal projects brought water to the desert via the construction of large reservoirs, water pumping facilities and canals. The Central Valley now has a complex network of interconnected channels and irrigation districts that move water all over the state.
The west side’s warm climate is great for year-round growing, but the land is also naturally rich in salt and selenium, and irrigating it creates a waste water problem and land-use issue, as salt and selenium progressively build up in the soil.
To address this, the Bureau began constructing the San Luis Drain in 1968; it was supposed to ship agricultural waste water to the Delta and the ocean. Instead, the drain was partially constructed and ended at Kesterson Reservoir, north of Los Banos and within a national wildlife refuge. The continuous flow of selenium tainted water poisoned bird, livestock and aquatic life, and in 1984, bird deformities were discovered there.
Kesterson was filled and the drain was closed, but since then, farming has continued on the west side, and selenium has continued to flow into the Grasslands Ecological Area, a 370,000-acre parcel that is the also largest freshwater wetland ecosystem in California. Most of the contamination now comes from the Grassland Drainage Area (GDA)—97,000 acres of irrigated farms within Charleston Drainage District, Pacheco Water District, Panoche Drainage District, part of the Central California Irrigation District (CCID), and Firebaugh Canal Water District.
After Kesterson closed, the drainage flowed into Salt Slough and Mud Slough, and then it flowed into the San Joaquin River. (Sloughs are swampy waterways.)
Today, the drainage water mostly flows into Mud Slough, but discharges are still regularly 5 to10 times higher than recommended by the U.S. Fish and Wildlife Service.
Eacock says this is still an improvement, “We’ve done better than expected,” he said. “The EPA and the Regional Board established the metrics, and the grasslands area farmers are meeting those limits.” The EPA has removed several water bodies from its impaired waters list, including Salt Slough in 2008 and three segments of the San Joaquin River, and declared the program a success. But the waste is still flowing into Mud Slough via the Grassland Bypass Project (GBP), which is a comprehensive plan to address the problem.
According to a U.S. Fish and Wildlife Report and the analysis of Dr. Dennis Lemly, a USDA biologist, specializing in contaminants and aquatic ecosystems, the current selenium concentrations in the San Joaquin River put juvenile salmon and steelhead at risk. Lemly writes, “USBR wants it both ways, to identify a problem and then say there is no problem. The correct conclusion is that available data and a reasonable interpretation of it clearly show that significant risks of substantial selenium toxicity exist, which will not be eliminated or substantially lessened by the GBP.”
He continues, “The success of salmon reintroduction depends on good water quality, and the selenium is going to create a significant hazard for those fish. It has to be below 2 parts per billion, anything above that endangers fish. In this case, because of bioaccumulation, the solution to pollution is not dilution. We have known this for decades. This is no secret. They have to stop the selenium at the source.”
That is the plan—eventually. By 2019, discharges to Mud Slough and the San Joaquin River are supposed to be eliminated altogether, with fees charged per pound of selenium over the limit beginning in 2015. That limit, however, is still 5 parts per billion, more than double the recommended amount.
Westside Farming Salting Up – Is There a Cost-effective Solution?
On a larger scale, the Bureau is under court order to provide drainage to the entire San Luis Unit, which includes part of the Grasslands area and Westlands Water District, which is the largest water district in the nation. The current plan includes land retirement, drainage reuse facilities, treatment systems and evaporation ponds.
But it has significant problems. First, it’s pricey.
The official Bureau estimate of the capital cost is $2.6 billion. However, the total taxpayer cost could be more than $7 billion. The annualized cost is estimated at $141 million for 50 years.
“Their own report shows that the project fails most of their standard benefit-cost tests by a wide margin,” said Dr. Jeffrey Michael, Director of the Business Forecasting Center at the University of the Pacific. “It is absurdly expensive, but it really isn’t optional as the courts have ruled that the government is obligated to provide drainage according to the 1960 Act.”
Notably, the money hasn’t been appropriated by Congress; new legislation is required for that. Instead, only $364 million (or 5 to 14 percent of the total) remain from the original authorization.
Second, the plan doesn’t entirely fix the environmental problems caused by selenium and salt. The minerals will have to go somewhere. But where? Some suggest that more land retirement is a better alternative than trying to manage the waste. Lawsuits have ensued; the farming community is demanding drainage service, and the environmental community is calling for discharges to stop. In addition, according to a National Academy of Sciences report on Bay-Delta stressors, the latest version of the Bay-Delta Conservation Plan may increase exports to the area and exacerbate conditions.
No clear resolution is in sight.
A few, frustrated after 30 years of political wrangling and litigation, have stepped up and decided to deal with the issue directly, individually. One of them is Westlands Farmer, John Diener. “The question is, how are we going to solve this problem?” Diener said. “The Bureau of Reclamation is in the middle of this political situation, and everyone goes back and forth, and nothing is happening. So let’s get something done here.”
Diener is getting something done on his own land, Red Rock Ranch in Five Points, CA, located southeast of Fresno; he farms about 3,000 acres of fruit and vegetable crops including almonds, grapes, wheat, alfalfa, tomatoes, onions, garlic and spinach. The combination of continuous irrigation and poor drainage has resulted in concentrated levels of salinity and selenium in the soils. Trapped irrigation water forms a shallow, or perched, water table. With nowhere to go, the salty water rises closer to the surface towards the root zone and affects the fertility of the soil. In Westlands Water District, more than 200,000 acres have saline groundwater within 10 feet of the soil surface. More than 100,000 acres have already been retired.
Diener manages a 640-acre parcel on his ranch that has no discharge at all. He uses a subsurface drain tile system that leaches salt out of the soil and water table, and then returns land to production. The drainage water is then re-cycled several times to irrigate blocks of increasingly salt-tolerant plants (halophytes), such as wheat grass and prickly pear cactus.
“Ultimately, the goal is not exposing the drain water to the community at large, whatever that is – the ducks, people or whatever. It’s a matter of how we treat resources that we have at our disposal and how we manage those things for the best benefit of everybody,” Diener said.
But the situation is anything but easy. “We need to find a way to keep the land productive, but that becomes difficult when you have environmental concerns stemming from soils with naturally high levels of these mineral deposits,” said Dr. Gary Bañuelos, an Agricultural Research Service plant/soil scientist. “We’re hoping to produce crops on unproductive land with minimum water and slowly manage the selenium content out the soil.”
Still, there is no way with typical plants that sufficient quantities of selenium can be removed. All the selenium does is regenerate from a deeper soil depth and slowly migrate towards the surface, Bañuelos added. “Instead, we’re changing the perception that these soils are not useful,” he said.
Prickly pear cactus, a salt-tolerant crop, naturally produces antioxidant rich fruit and adding selenium makes it even healthier. (Selenium is essential to good health in small amounts.) But even with mineral absorption from cacti and other salt-loving plants, eventually, it all gets super concentrated, and Diener ends up with a big pile of salt on his ranch, which is the case for many farms on the west side. Water supplied by the federal and state projects brings the equivalent of 40 railroad cars of salt into the area every day, about 4,000 tons of salt daily.
Diener hopes to sell the excess salt to glass producers, since sodium ash is used in the glass manufacturing process. “The glass factory in Madera needs 20 tons a day, and we can generate that in a minute,” Diener said. “The idea is make the waste into marketable products.”
The next article in this series looks at the big picture – how California’s water plans and projects fit together or don’t.