By Tom Havens
Sometimes a few facts tell important stories. The IID is full of facts that tell stories that you donâ€™t really want, but need to hear.
My story starts in 1977 when California suffered its worst yearly drought. I thoroughly researched historical weather patterns, the law and politics to determine that California faced a water crisis-shortage. My conclusion indicated the IID could play a dynamic role in a visionary advanced solution that included water conservation, banking and drought insurance.
The IID could become a leader in water while doing good for others and very well for its ratepayers and stakeholders….My theory was this paradigm shift in thinking would solve future problems not yet perceived and provide a leadership and high ground position. My Partner, Parsons and I had a signed contract in 1985 to conserve 600,000 acre feet and lease, at then market price of $400 per a/f which today would be over $2000 per a/f. Unfortunately just a few people thought IID should not do this and prevailed in blocking the project. Clearly their reasoning was flawed—My theory was correct and applies even today.
Did you realize that after 12 years millions has been spend in legal and engineering fees on “dream team” contract called QSA which is a nightmare? Competent math and experienced analysis was not a part of the process. No allowance was made for contingencies on this multi billion project. It now appears that an actual loss of one billion (DuMars) to over three billion (Havens) could be lost on this contract.
As director Hanks points out, it was incredible that IID didn’t insist on a cost plus contract. Worse, the Salton Sea liability could be many billions and last decades. This bird superhighway is a resting place for 400 species and a important part of the Pacific Flyway. 45 years, countless studies and commissions and hearings and millions have been spend on a not to be had solution. 100% of the benefits go to 22 million people on the coast, Why is the IID on the hook for profound liability??? You don’t get what you deserve, you get what you negotiate.
The State is losing billions per year, is billions in debt and any relief is politically not realistic for decades, if ever.
Did you know that 100% of the conserved water and financial benefits from the All American Canal, which you paid for, goes to San Diego?
The State paid for 65% of cost but when expenses come up, guess who pays? YOU DO. ( safety features) The gross value of this water over 110 year life is in excess of 50 billion and the valley gets zero.!!
Did you know that IID is obligated to sell CVWD 100,000 af of IID senior water at $75 per af ? That is all IID gets, but dream team did not put a cap on expenses so this obligation could create well over a billion in losses.! What if the water cannot be conserved at any price????
I could go on. The question is how did this happen? Why ? What can be done?
Unfortunately legal forces have created adverse consequences for the IID. Beginning in 1984 with decision 1600, which proved IID was wasting water and appealed and lost compounded the damage. This should have never gone to court….Every effort must be made today to change this very dangerous perception. It occurred at a different time with different circumstances and today would not be considered waste. Yet poor legal work created a devastating problem.
When the general public understands the QSA, they will be very pleased that my recommendation to bring in the best water attorney in the West was honored by this board. DuMars actions have already gone a long way in developing a new critical path and a better future for the valley.
After 30 years of observation, I am qualified to comment on the state of the IID and its current plight. Kevin has his hands full with an almost impossible situation. He certainly deserves new professional talent in water matters.
The power side also has problems. American Water Resources Inc. stands ready to support his efforts in many ways. We developed the conceptual framework for water conservation, water banking and drought insurance years ago. IID needs to embrace these concepts immediately.
We hope all will support our effort to change the highly negative perception of the IID outside the valley with a new strategic image development campaign. This would fit nicely with an effort by us to negotiate a joint venture with one or more professional firms that have developed commercial methods of extracting oil form algae and creating aviation fuel…Algae farming could provide hundreds of jobs and profoundly wonderful public relations for the valley.
Reality analysis says the IID is not a learning organization and has not evolved. I think Kevin has the mental capacity to make great progress in the transition to a better and more productive institution. We would like to assist and our persistent effort along these lines to advance the scope of IID to capture the wealth in its assets and new opportunities is what we do. We have spent 3 hard years in this effort and believe the IID is ready respond in a surprisingly aggressive way. Why not???
By framing the process of progress and opening the way to profitable opportunity for IID and the valley, from inception to a now aware organization, a period of growth and maturity will create momentum. We will help make it understandable and predictable, by providing a “map” and a timetable that outlines the structure and course of development. This dynamic and strategic process allows us to fit ourselves
into a truly enlightening period of improvement and will help to understand where we are, where we need to go and what we need to get there. We are doing it now.
This may be considered a revolutionary process for the IID. It is a win win for all…It is also necessary to go on offense to deflect the very serious threat from all around to steal our senior water fair and square. Economic justice will happen as IID takes on a new roll to write the rules on water as the most important player in the West with the most valuable water right. It is time for action and offense to replace the reactive and negative stance created by QSA.
This can truly be a new era and lay foundation for desert miracle number two. It is a time to come together and realize the great opportunity at hand by leading. We are looking forward in playing a strategic role in this paradigm shift into the future. We appreciate your support.
This board had little to do with QSA. Mendosa voted against it, Pierre ran against it, Matt and Jim had nothing to do with it and Kevin inherited it. I believe this board understands urgency. This is a complex, but must do situation where every effort must be taken to do better. Urgent— It could hardly do worse…
Three fundamental questions must now be answered:
1. What do we want to do?
2. How will we accomplish this?
3. Who will execute?
We have worked aggressively externally and internally to establish this new era and opportunity and look forward to your support for a major role in helping us help you in achieving profound success quickly and efficiently. If you care enough to give the very best, we are ready. It is time.
President American Water Resources Inc.