Searles Valley Minerals Contesting Groundwater Authority’s H2O Use Fees

Trona-based Searles Valley Minerals has filed a lawsuit against the Indian Wells Valley Groundwater Authority, alleging the groundwater replenishment fee the joint powers agency is imposing as part of the ongoing effort by governmental entities in San Bernardino, Kern and Inyo counties to come into compliance with the State of California’s Sustainable Groundwater Management Act will drive it out of business.
At the heart of the lawsuit is the contention that the joint powers authority formed under the auspices of state law is letting the federal government off the hook by ignoring federal agencies’ consumption of water at the furthest western extension of the Mojave Desert while forcing the onus of conservation efforts to be borne by the private sector.
In the face of a four-year running drought, California state officials in 2014 undertook efforts to head off the absolute depletion of the state’s regional water sources. In September 2014, then-California Governor Jerry Brown signed into law the Sustainable Groundwater Management Act, which requires local agencies to draft plans to bring groundwater aquifers into balanced levels of pumping and recharge. That was followed in 2015 by Brown mandating water-saving measures throughout the state.
In response, pursuant to a joint exercise of powers agreement, the Indian Wells Valley Groundwater Authority was formed with Kern County, San Bernardino County, Inyo County, the City of Ridgecrest and the Indian Wells Valley Water District as general members and the United States Navy and the United States Department of the Interior Bureau of Land Management as associate members, with each general member having one voting seat on the authority board and the federal associate members participating in all board discussions, but not having a vote.
The joint powers authority took as its mandate counteracting the overdraft of the aquifer underlying Indian Wells Valley, which lies at the extreme northeastern end of the Mojave Desert and the confluence of the northwestern corner of San Bernardino County, the southeastern end of Kern County and the southwestern extension of Inyo County.
Based upon a survey of water usage patterns undertaken by an engineering consultant, Carlsbad-based Stetson Engineers, the authority and the Indian Wells Valley Water District sought to derive a strategy for both reducing water use in the valley and increasing groundwater recharge to reach a balance of both that will end the overdraft. Several different plans, or models, were contemplated. Basically, the concept was to decrease the drafting of water from the regional aquifer through conservation, increased recycling of water and perhaps the minimization of evaporation, augmented by the importation of water from outside the valley to achieve, no later than 2040, a balance of water coming in with the amount of water usage, such that the depletion of the aquifer will end.
Stetson Engineers was designated the water resources manager for Indian Wells Valley, and the authority’s board in January 2020 passed a tentative proposed groundwater sustainability plan and voted to submit it to the state. Thereafter it made adjustments to the plan, which contained water use limitation elements and water replenishment measures. The plan incorporated a farmland fallowing option as well as an increase in the monthly assessment or fee that was imposed on the extraction of water by major pumpers. That fee had been previously collected to cover the costs associated with the administrative activity of the groundwater authority.
After a survey of water use by well owners both collectively and individually was made, the authority assigned water use allowances to the region’s well owners. Excess use fees, referred to as augmentation fees, were formulated for application to those well owners who pump above their allowances as well as on farmers who go beyond their respective share of the water supply set aside for agricultural usage. Money generated in this way will be used to purchase imported water and pay for the infrastructure needed to bring in the imported water.
One issue complicating the matter is that both the Bureau of Land Management and the China Lake Naval Air Weapons Station, as federal entities, are exempt from the groundwater sustainability plan and the Sustainable Groundwater Management Act, and therefore not subject to the restrictions that will be imposed in the groundwater sustainability plan. The China Lake Naval Air Weapons Station encompasses two ranges and totals over 1,100,000 acres or 1,719 square miles, much of that within Indian Wells Valley. While the China Lake Naval Air Weapons Station has made strides in recent years in reducing its water use, it still drafts some 1,600 acre-feet of water from the aquifer annually.
In September, Searles Valley Minerals, represented by Eric Garner, Jeffrey Dunn and Maya Mouawad with the law firm of Best Best & Krieger, filed a lawsuit in Kern County Superior Court against the Indian Wells Valley Groundwater Authority in an effort to protect what Garner, Dunn and Mouwad asserted are the company’s groundwater rights within the Indian Wells Valley Groundwater Basin, and to stop the collection of what they characterized as an illegal and unfair groundwater replenishment fee and a tax disguised, they assert, as an “extraction fee.”
Searles Valley Minerals uses solution mining, which involves soaking portions of the company’s dry Searles Lake in San Bernardino County with water to precipitate brine which is then extracted and processed to produce boric acid, sodium carbonate, sodium sulfate, several specialty forms of borax, and salt.
The groundwater replenishment fee, Garner, Dunn and Mouawad maintain, is unprecedented and exorbitant, and will increase the company’s water costs by 7,000 percent or $6 million per year – pushing Searles Valley Minerals out of business after more than 140 years of operation, and threatening the livelihood of the company’s 700 employees. The groundwater replenishment fee ignores and violates Searles Valley Minerals’ adjudicated water rights, according to the lawsuit.
Searles Valley Minerals’ 90-year-old water rights are the most senior in the Indian Wells Valley Groundwater Basin.
Garner, Dunn and Mouawad take issue with the fashion in which the China Lake Naval Air Station is not subject to the restrictions in the plan nor its fees.
“Searles Valley Minerals’ right to pump water in the basin for domestic uses is senior to any water right reserved to [the] Weapons Station, and because [the] water district’s groundwater pumping began no earlier than 1955, its appropriative right, if any, to basin water remains junior to Searles Valley Minerals’ right,” according to the lawsuit. “The authority falsely asserts in its groundwater sustainability plan that any pumping allocations under the groundwater sustainability plan will be ‘consistent with existing groundwater rights and priorities.’”
In a joint statement, Searles Valley Minerals and Garner, Dunn and Mouawad maintain the groundwater management plan that the authority is attempting to implement “represents an arbitrary and illegal taking of Searles Valley Minerals’ water rights,” and Searles Valley Minerals has been “singled out” by the authority.
The community of Trona presently has a population of 1,900 and has been piggybacking on Searles Valley Minerals for the provision of domestic water. The groundwater management plan will transform Trona into a ghost town, according to Garner, Dunn and Mouawad.
“Moreover, all domestic and municipal activities for the disadvantaged Trona communities are supplied by groundwater that Searles Valley Minerals pumps from the basin,” according to the statement. “The economic impacts of the authority’s new fee would devastate these communities.”
The authority’s decision to impose hefty new “replenishment fees” on the valley’s civilian water users while providing no check on other groundwater users in the basin such as the China Lake Naval Air Weapons Station is indefensible, Garner, Dunn and Mouawad contend.
“Searles is a pillar of the Trona and Ridgecrest communities, providing jobs and economic benefits to these communities since we were founded in 1873,” said Burnell Blanchard, vice president of operations for Searles Valley Minerals. “We’ve maintained our workforce through natural disasters, a global pandemic and the subsequent economic crisis. Now, we face the threat of closing our doors and putting hundreds of people out of work because the authority has refused to recognize our long-established groundwater rights.”
According to the lawsuit, which exists in the form of a petition for a writ of mandate, a complaint for declaratory and injunctive relief and a takings claim under the California Constitution, “An actual controversy has arisen and now exists as to whether the authority’s adoption of the groundwater sustainability plan, sustainable yield report, engineer’s report, extraction fee and the replenishment fee constitute an unlawful taking of property for public use without just compensation.”
The suit calls upon the court to make a finding that the “authority attempted to determine Searles Valley Minerals’ water rights in a way that is inconsistent with applicable law.” If, the suit says, “the court finds that the authority’s actions did not deprive Searles Valley Minerals of all economically beneficial use of their groundwater rights as alleged, then Searles Valley Minerals alleges in the alternative that the authority committed an unlawful physical taking by erroneously deeming the entire basin’s sustainable yield to be reserved by the Weapons Station, and then putting that groundwater to public use without compensating Searles Valley Minerals. What the authority claims as a transfer of federal reserved rights is in reality an unlawful taking of Searles Valley Minerals’ groundwater rights. Because the basin groundwater given to the Weapons Station will be physically unavailable to Searles Valley Minerals due to [the] authority’s adopted groundwater sustainability plan, sustainable yield report, engineer’s report and replenishment fee, this claimed transfer and its related actions constitute a physical taking.”
According to the joint statement by Searles Valley Minerals and its lawyers, “The authority’s ‘sustainable’ groundwater management plan is anything but sustainable – it’s a significant new burden on a select few groundwater users that will push many entirely out of operation without any regard to existing water rights.”
“This litigation is about far more than one company and one groundwater agency,” said Garner. “Arbitrary taxes and fees that ignore historic water rights threaten to wreak havoc on businesses and industries. The outcome of this litigation will have far-reaching implications for every groundwater agency and every business that holds a water right in the State of California.”
The authority’s new fee will have impacts beyond Searles Valley Minerals. As of today, January 1, 2021, the fee is to apply to customers of the Indian Wells Valley Water District, who will see an increase of about $300 per year on their water bills. Searles Valley Minerals requested that the fees be enjoined by the court to prevent the economic hardship they would create for the company, and for thousands of businesses and local residents who live in the City of Ridgecrest and historically disadvantaged Trona communities.
The groundwater authority utilized a water conservation model unfairly favorable to the China Lake Naval Air Weapons Station and the Indian Wells Valley Water District, according to the suit, in a way by which the water allotments were “predetermined,” such that virtually all of the basin’s sustainable yield was ultimately allocated to the China Lake Naval Air Weapons Station and the water district. “This deficiency and bias are shown, in part, by the fact that the authority relied on a numerical groundwater model owned and controlled by the Weapons Station,” the lawsuit states. “[The] authority used [the] Weapons Station’s model to make erroneous calculations but has not made the numerical groundwater model available to stakeholders or the public despite repeated requests to do so.”
The lawsuit propounds, “Defendant authority further states in the groundwater sustainability plan that the remaining pumpers ‘can and should implement additional conservation measures,’ implying that Weapons Station and the water district do not need to conserve groundwater. This conclusion is contrary to [the] authority’s Sustainable Groundwater Management Act obligation to manage the basin ‘consistent with Section 2 of Article X of the California Constitution.’”
The bias of the groundwater sustainability plan in favor of the China Lake Naval Air Weapons Station is demonstrated, according to Garner, Dunn and Mouawad, by the fashion in which the Navy is being permitted to engage in a profligate use of the desert’s precious water resources, utilizing hundreds of acre-feet of water on functions that have nothing to do with the Navy’s mission. “Groundwater uses on the base that are not directly associated with essential Weapons Station activities, such as its golf course, are not ‘primary’ under water law,” the lawsuit states. “If the Weapons Station wants to use basin water for those secondary purposes, the Weapons Station may appropriate water pursuant to California law and pay for that water with federal funds. The cost of that groundwater should not be subsidized by Searles Valley Minerals.”
In response to the lawsuit, the Indian Wells Valley Groundwater Authority has accused Searles Valley Minerals of seeking to shirk its responsibility to act as a responsible water user and participate in the effort to fund the means of replenishing water taken out of the aquifer in excess of the region’s water recharge.
“At its core, Searles’ lawsuit is nothing more than a claim that its use of water for a commercial industrial purpose should be free of all costs and given a priority over and above all other uses in the basin,” Kern County Supervisor Mick Gleason, the chairman of the Indian Wells Groundwater Authority, said in the aftermath of the suit’s filing.
Gleason said Garner’s, Dunn’s and Mouawad’s suggestion that the authority and its members were ganging up on Searles Valley Minerals was self-servingly inaccurate. He said the contrary was the case, in that virtually all water users and water purveyors in the region understood the need to meet the state mandates and cooperate in managing the local availability of water. He cited examples of this cooperation and willingness to assist other entities functioning under the water-use limitation regime imposed by the authority.
“The City of Ridgecrest has even offered to provide recycled water to Searles in order to reduce Searles’ draw on the basin’s natural water supplies,” Gleason was quoted as saying in a press release from the authority.
Searles Valley Minerals is simply selfishly and self-centeredly reacting against reasonable steps being taken to balance the use of the valley’s water with its recharge rate, and is not offering any workable solution of its own, according to Gleason.
The Indian Wells Valley Groundwater Authority will stand up to and hold up under the counterproductive weight Searles Valley Minerals is heaping upon the authority by the filing of the lawsuit, Gleason insisted.
The board for The Indian Wells Valley Groundwater Authority consists of Chairman Gleason, whose district as Kern County supervisor includes Indian Wells Valley; Ridgecrest Councilman Scott Hayman; Indian Wells Water District Director Ron Kicinski; Inyo County Counsel John Vallejo; and San Bernardino County Registrar of Voters Bob Page.
The Indian Wells Valley Groundwater Authority will vigorously contest the lawsuit brought by Searles “and any other lawsuit which seeks to sidestep a reasonable allocation of costs required to maintain the basin as a viable water source,” the authority said in a press release.
Searles Valley Minerals is not the only entity that has taken issue with the groundwater management plan and bringing the matter before the court. Mojave Pistachios, LLC, in conjunction with Paul and Mary Nugent, lodged a lawsuit against the Indian Wells Valley Groundwater Authority, alleging the Sustainable Groundwater Management Act is being misapplied in a way that will render agricultural production in the valley untenable. Those plaintiffs maintain, like Searles Valley Minerals, that the groundwater sustainability plan is biased in favor of the China Lake Naval Air Weapons Station.
The lawsuit states that the groundwater sustainability plan is “flawed because its primary objective — to protect the Navy — was predetermined.”
Citing the consideration that the technical analysts that Mojave Pistachios had hired were banned from participating in the authority’s policy advisory committee and technical advisory committee meetings, the lawsuit maintains the framers of the groundwater sustainability plan did not consider the agricultural community’s input by “fail[ing] to incorporate and respond to stakeholder comments.”
According to the lawsuit, the Indian Wells Valley Groundwater Authority board openly acknowledged early last year that the Navy was “in the driver’s seat” in terms of formulating the plan. The authority’s water extraction allocations were, according to the Mojave Pistachios lawsuit, “determined internally by the Indian Wells Valley Groundwater Authority staff, fed into the model developed by the Navy’s contractor, and cemented into the fabric of the groundwater sustainability plan without public comment and before the sustainable management criteria were even considered. The Navy model has not been peer-reviewed, and despite [the] plaintiffs’ requests, the Indian Wells Valley Groundwater Authority refused to release the model to stakeholders.”
-Mark Gutglueck

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