IID should prepare for QSA Outcome

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letter to the editorThere are 2 probable outcomes of Judge Connelly Court..   ( JUNE 5 2013 )      

1.INVALIDATION of QSA       

2.  VALIDATION of QSA

(Keep in mind the IID board never saw the final contract they approved!! )  ( the public never read it )   CEQA was not followed

 

Clearly there many questions to be answered with considerations for action. In either case it is the responsibility of the IID to be prepared.   INVALIDATION will require a substantial and immediate effort to start a major and historical negotiation for a new document defining the future of the Imperial Valley.    VALIDATION will require a well thought out plan to appeal the consequences of a profoundly political effort to trap IID in a fatally flawed contract that puts the burden of massive benefits for 22 million people on the backs of 170,000 valley citizens… A well thought out strategic plan ( strategy- tactics-management) must be on hand to set out our vision for a prosperous future with hope replacing the fear of multi billions of  for cost overruns and environmental liability that can last a lifetime and destroy the valley.

Do you think Imperial Valley deserves the best professional help available?

IID is facing many very large experienced water institutions. 

Why would IID want to validate contracts that rob it of well earned value ( desert miracle )

 

It might be helpful to review the actual values in play. Unfortunately IID receives mostly risk and uncertainty. The following is economic analysis which has largely been absent for 10 years.  CONSEQUENCES OF QSA:  

 
1. All American Canal—-100% paid for by citizens of Valley – heart of irrigation system—Conservation of 80,000 acre feet per year.  At a marginal cost  of 2000 per  af  or 160 million per year missed income. ( all figures for water price will be conservatively priced at 2000af for simplicity. Imagine what  water values will be in 45 or 75 year term of QSA ) This conserved water goes 100% to SanDiego for 110 years….basic value lost EIGHTEEN BILLION.    REPLACEMENT COST 2050  700 MILLION!  why?
 
2. MWD NUMBER ONE— 100,000af transferred at cost to MWD–zero profit—-IID takes responsibility for 100% of liability and gives them priority on use in shortage.  100,000 af times 2000 per af times 45 years is TEN BILLION-( lost to valley)- this should not be part of QSA it was stand alone contract with a 15 year cancellation clause !!!  why??
 
3.  200,000 af transfer to SD, cost unknown but 100% obligation of IID,  origional price$ 250 per af….Price will be frozen for 20 years at 650 per af with openend liability — financial and environmental !!!      Missed revenue 18.5 BILLION
( amendment #5 prepaid 50 million and will cost IID billions) nothing gained, billions lost–thanks dream team..
 
4.  100,000  af permanent transfer to Coachella of 100,000 top priority water — cost unknown but openended, money received 
75 per af per year…. tragic deal…..opportunity cost to IID  forever= billions  ( gives multi billion opportunity to CVWD ) why?
 
For perspective a 30% drought will cost S. California over 100 billion in gross revenues per year…..Drought insurance is an idea whose time has come( proposed 1985 awri-th) Present opportunity—new IID management.
 
For some reason the Dream Team thought QSA was a good deal?? In December-2009 when the entire QSA was invalidated and made permanent in Feb 2010,  The Dream team fought aggressively to convince the IID to APPEAL the invalidation??????? 
 

Do you think every effort should now be made to again invalidate the QSA ?

Would the court and the outside world look very favorably on IID if they hired MTO, one of the top Law Firms in the country. The leading partner, Ron Olson is not only one of the outstanding lawyers in the country, he owns and still manages a farm in Iowa..

His firm has powerful political connections at State and National level.. This firm is noted for imagination and expertise on complex contracts. Do Valley citizens deserve the best representation???

Should IID utilize an expert team to level  playing field against many large and experienced water institutions – with unlimited capacity to continue to take water from Imperial Valley  — to use powerful political lobby effort against us?

Should the IID develop a thorough Public Relations capacity to respond to daily barrage of questions that will be coming at IID and inform the world of  truth—this epic battle between AG and Urban ??  David vs Goliath…( QSA does great damage to AG position West-wide)

Should IID fully understand all its economic and financial options??? to date little economic input available!!! ( AWRI )

Should IID develop a respected and knowledgeable team to represent iid outside valley??

Should IID controlling most valuable water right in country—write the rules???  if not now, when?

Should IID follow lead of Director Hanks to capitalize  value of valley assets with new ideas and profitable concepts?

 

Clearly lots of questions need almost immediate attention as IID evolves from old fashioned irrigation district to a modern Water Services Institution.– managing billions of Valley assets.( when your assets are worth many billions, clearly the old non-profit iid management model becomes obsolete ).for the benefit of the citizens of Imperial Valley….We need to bring the money back to the valley; this must be managed appropriately..QSA is a massive transfer of assets out of valley….We have 27 days to address this profound opportunity…. 

Everyone needs to be active…This is your valley. Support the IID board and encourage them to be fully prepared.

 

If you care enough to give the very best, do it now…  Last best chance…

 
Good Luck
 
Tom Havens

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