Amid Drought, State Water Rights System Delivers a Rich Supply to a Few

By Jason Dearen and Garance Burke
Associated Press

Call them the fortunate ones: Nearly 4,000 California companies, farms and others are allowed to use free water with little oversight when the state is so bone-dry that deliveries to nearly everyone else have been severely slashed.

Their special status dates back to claims made more than a century ago when water was plentiful. But in the third year of a drought that has ravaged California, these "senior rights holders" dominated by corporations and agricultural concerns are not obliged to conserve water.

Nobody knows how much water they actually use, though it amounts to trillions of gallons each year, according to a review of their own reports by The Associated Press. Together, they hold more than half the rights to rivers and streams in California.

But the AP found the state's system is based on self-reported, incomplete records riddled with errors and years out of date. Some rights holders have vastly overstated their usage — in the mistaken belief, asserts Tom Howard, executive director of the State Water Resources Control Board, that it will preserve their right to draw more water in the future.

"We really don't know how much water they've actually diverted," said Bob Rinker, a manager in the board's water rights division.

Relic of Gold Rush Era

With a burgeoning population and projections of heightened climate-related impacts on snowpack and other water supplies, the antiquated system blunts California's ability to move water where it is most needed.

When gold miners flocked to the West in the 1800s, the state drafted laws that rewarded those who first staked claims on the region's abundant rivers and streams. Since then, Western states have upgraded to different, more rigorous water accounting systems that track every precious drop, but California still relies on an honor system, even during drought.

The system's inequities are particularly evident in California's Central Valley, where some farmers struggle while others enjoy abundant water.

"In a good year we wouldn't be able to stand here unless we got wet. This year it won't produce anything," said second-generation rice farmer Al Montna as he knelt in the dust, pulling apart dirt clods on the 1,800 acres near Yuba City he left idle because of scarce water. "Our workers will just have to go elsewhere to look for work."

About 35 miles north, just outside Oroville, fourth-generation rice farmer Josh Sheppard had more than enough water, thanks to superior rights to Feather River water dating to the late 1800s. On a recent afternoon, pulses of liquid spilled across his fields to soak the loamy soil for planting.

"No one thinks of it when there's ample water and plenty to go around, but in these times of tightness it is a very contentious resource that gets fought over," Sheppard said. "We are going to be very stark defenders into the future of ensuring that this right ... remains in place."

Analysis of State Database

Because the state doesn't know how many entities hold these superior rights or how much water they use, the AP obtained and analyzed the water board's database for 2010 — the last complete year of water usage reports — and interviewed state officials and dozens of so-called senior rights holders.

The state only collects the records every three years on a staggered basis, meaning some of its information is at least a few years old.

Howard, the board's executive director, acknowledged the state should get a better handle on water use. "Anything to improve the information we have would help," he said, citing the need for annual reporting of usage and real-time stream flow data.

While much of the water reported by this group is consumed by people or farms, some of the biggest users generate hydroelectric power for profit and then return that water to the river for use downstream. The state doesn't know how much is used for each purpose.

More than half of the 3,897 entities with these water rights are corporations, such as the state's biggest utility, Pacific Gas & Electric Co., which generates hydroelectric power, and the Hearst Corp., which has water rights for its remote, Bavarian-style forest compound called Wyntoon.

Also among the biggest rights holders are state and local government agencies — including the water departments of San Francisco and Los Angeles, which channel river water to millions of residents.

San Francisco, whose water rights date to 1902 when its mayor nailed a handwritten notice on a tree, uses free Sierra Nevada water to generate power for its airport, schools and firehouses.

Amid Scarcity, Some Get Plenty of Water

This year, the state cut water deliveries to farmers and cities by 95 percent, and the federal government also imposed sharp restrictions on its water customers. But companies, farmers and cities with water rights that predate 1914 were exempt this year from mandatory cuts, even though they collectively are the biggest water consumers in the state.

As the dry summer months loom, some water scientists question the usefulness of conservation efforts that do not restrict consumption by most water users with old rights. In a catastrophic emergency, the state might ask these users to conserve, but even then they could choose not to.

"Obviously, senior water rights holders have the most to benefit from the current system," said Peter Gleick, a water scientist and director of the nonpartisan Pacific Institute. "It gives them first call on water and more certainty during droughts and shortages."

In an age of weather extremes, those with century-old rights say the system works well because it provides a reliable supply of water, which is crucial for farmers deciding what to plant each spring. And in a drought, the state lets some of them sell any extra water to cities, corporations and farms that need it, at the rate the market will bear.

"To the degree that we can help share and develop more water resources for all the needs out there, I know we'll support that," said Sheppard, who irrigates his rice fields with supplies from the Joint Water Districts Board, which has pre-1914 water rights. "We've been aggressive about conserving and we independently installed meters on our land so we know we don't waste much."

The water board's Howard said it would be impossible to do away with the system.

"People have made investments based on promises in the existing system," Howard said. "Towns grew up and land was developed based on promises of a secure water supply. Do we strand those investments to start over?"

No Metering Required

The water board does not require monitoring or meters for users whose rights date back a century or more, or who have rights to draw from a waterway adjoining their land. So the bookkeeping by Sheppard's district provides the state with its only reckoning of how much water the district's landowners use.

The law is different in other Western states such as Wyoming and Colorado, where agencies have more sway to track water use and restrict flows in times of scarcity. California rights holders have successfully defeated legal and legislative efforts to strengthen that state's oversight, said Andy Sawyer, a longtime water rights attorney at the board.

California made some progress toward accountability in 2009, when a new law required rights holders to report their water use and gave the board power to punish them for failing to file statements properly and on time. But the rights holders could gain exemption from the strict monitoring requirements in that law by convincing authorities it was too costly.

Partly due to poor accounting, the state had issued only 28 violations since 2009 to senior water rights holders as of May 20 — 24 for failing to file the proper paperwork and four for illegally storing water. It's rare that the state catches anyone taking more than they should, and even then, there are few punishment options.

The water board doesn't have staff to systematically verify water usage or check even the most obvious mistakes in the records, said Aaron Miller, a senior engineer at the water board. He added that the state nonetheless uses this inaccurate data to make decisions about how and where to grant new water permits.

The AP found major errors in the water consumption reports for eight of the entities the state listed as its top 25 users.

For instance, Teichert Land Co., a Sacramento-based development firm, originally reported drawing 7.6 million acre-feet from the Valley-American River in 2010. But Teichert environmental manager Becky Wood confirmed that figure was an error, saying Teichert really only used 300 acre-feet.

No one from the state ever asked why the company reported using so much water, Wood said.

"You would hope that they would at least have the systems to check against what your right is and what you're reporting in the middle of a drought," she said.