May 5, 2004 - From the Dec., 2002/Jan., 2003 issue

Speaker Emeritus Robert Hertzberg On Next Steps For Salvaging The Colorado/IID/San Diego Water Deal

In the aftermath of the Imperial Irrigation District's rejection of a negotiated agreement with the San Diego Water Authority and MWD, most politicans and commentators have adopted a negative, and somewhat bitter, view on the discussions. In this interview with MIR, Speaker Emeritus Robert Hertzberg, who has played an active role in brokering the IID/San Diego negotiations, sees the significant progress that has been achieved and communicates optimism for a near-term resolution to the stalemate.

Robert Hertzberg

Bob, following up on our interview with you more than two months ago on the substantial work you did to craft a win-win agreement for the Colorado River/IID/SD transaction, it seems the vote by the IDD Board the other day has set back, maybe fatally, your efforts. Give us your perspective on just what happened and how negotiations might roll out in the near term.

We were in a position where we were required to reach a term sheet, the basic deal memorandum, by October 15th in order to deal with all the environmental review and the necessary lawyering. That gave a number of weeks for the political opponents in the Imperial Valley to begin to mount a campaign against us, which is a risk that we were aware of at the time. I certainly have a great deal of compassion and understanding for the elected officials who are subject to threats of recall and the like in terms of this issue. It's highly complex. It's very difficult, but it is, by any objective analysis, a very intelligent deal for all parties, and particularly for the Imperial Valley. So I still think, in conversation with a number of people from Imperial, there's an opportunity to try to patch this together. I think that the term sheet that we agreed to on October 15th still will provide the framework for the deal.

However, time is of the essence-we have to get this done. As the Governor and the Legislature currently are enveloped in budget discussions, the complexion and nature of the deal could change if an agreement is not reached until February or March.

Review for our readers again what's at stake re the Colorado River.

The Supreme Court decided in the case called Arizona vs. California the allocation of water rights-how many acre-feet of water there was among California, and the other river states, and Mexico. California has, since 1964, been taking between 800,000 acre-feet and 900,000 acre-feet more in water per year than they've been entitled to. The city of Los Angeles uses about 550,000 acre-feet per year-so all of Los Angeles times one and a half is the excess we've been taking over and above our allotment. That has come from the allotments for Arizona, Colorado, New Mexico, Nevada and the other river states. So during the Clinton Administration, David Hayes did a brilliant job in negotiating an agreement that said over the next fifteen years, if California meets certain milestones, that ramp down on a soft landing from our excess usage to what we're allocated per the Arizona vs. California case. So we were met with the challenge of how to balance the environmental need for the Salton Sea, and the transfers among the agricultural uses and the uses on the coastal plain, particularly when technology now allows farmers to grow as much of the crop as they could always grow, but using a lot less water.

Can you put in context the significance of the negotiations you led to get us to this point? What of substance, if anything, will be carried forward as the various parties attempt to reach agreement?

So much of the focus of the press and political commentators has been on Imperial and the fact that they are one vote short of making this deal. While that is very important, it is wise to recognize how much progress has been made with respect to organizational relationships that have been very contentious over all of these years.

The QSA was signed by all of the river states and California, signifying agreement among the state governments involved. The repaired relationship between the federal government and the state government is critically important. The fact that the state of California agrees with the parameters of the deal as negotiated and is engaged heavily in many aspects is a very important statement. The environmental interests, at least for the first 15 years going forward, are in agreement on how the Salton Sea fits into the water transfer framework. Metropolitan Water District, the San Diego Water Authority and Coachella are all in agreement.

So, we are down to only one agency and one vote. Obviously, that is very important. But, there have been gigantic strides in an area where it has taken many years to reach consensus. We shouldn't lose sight of those very important accomplishments.

Bob, obviously the IID vote in December was significant. Tell us how the different stakeholders are likely to react over time - the state, the Legislature, the Governor and the the Bush White House and its Interior Department. What are the likely actions each of the stakeholders will likely to pursue going forward?

Well, first I think the federal government has made its position perfectly clear. And I agree with the federal government that enough is enough. We have reached a very good agreement, it's a bipartisan approach, the Bush administration has taken a page out of the playbook of the Clinton administration, and it is simply enforcing that agreement. And I think they're forced to, given the politics among the River states. So certainly I think they're going to continue to hold firm.

Second, I think the other states are going to amp up their rhetoric. They're angry-rightfully so. Look, we negotiated a very favorable agreement, as it relates to California. You should get your house in order and figure it out.


Third, as it relates to the farming interests, I think you're going to see in the Imperial Valley a number of legislators who've talked to me in terms of just being an honest broker regarding information. They're going to start introducing bills that go to the heart of the existence of Imperial. There are going to be bills introduced that reduce the salary that members of the Board receive-they currently get paid the same as Board of Supervisors members. You're going to see bills introduced related to their government structure and the like, to be a landowner as opposed to a publicly elected district as we have seen in other districts.

As it relates to San Diego, San Diego has a big problem because they were trying to create an additional source of water they could rely on. If this doesn't go forward, they've got to rely on the Metropolitan Water District, and they'll be out in the marketplace looking for additional sources of water. Metropolitan Water District will now have to try to secure the necessary water for San Diego to replace the deficit that's now going to be down here.

As it relates to the federal and state government on environmental issues, certainly a lot of the stand-down and a lot of the other elements that related to the Salton Sea will be in play. So this was a very significant deal. Had it gone forward, it would have redefined water politics in California and the West for many years to come, and defined water transfers. And so I'm still hopeful there's an opportunity for it to go forward. Let's just keep our nose to the grindstone and keep working.

Two other significant players are the Governor and California's Resources Secretary Mary Nichols. How do they react?

Mary Nichols has been stellar in this. She's been in on holidays working around the clock. I spoke to her yesterday, and she's been very, very good, as has Bob Hight from Fish & Game and Tom Hannigan from the Department of Water Resources-just stellar. They have been very helpful and interested, including participating in 19-hour meetings. And I think the Governor will probably engage more in this in an effort to put his personal stamp on it. I know he sent a letter to the Board, and I suspect you'll see him engaging them more over the next coming weeks in an effort to deal with this very significant problem. Already we've seen in the press stories that the Northern California legislators are worried that if we can't get our water house in order in Southern California, we're going to come back up north for water on their turf.

And who now is the go-to guy for water in the Legislature now that you've been termlimited out?

Sen. Mike Machado, the Chairman of the Water Committee, has been very committed. Joe Canciamilla, the Chair of the Assembly Water Committee who's also from Northern California, has participated in a number of these negotiations, did water tours with us, is very knowledgeable, and worked very well with myself and Senator Costa. He has evidenced a tremendous interest and concern in this issue and participated in the oversight hearings. So you're going to see those in the Legislature-Lynn Daucher from Orange County on the Republican side and Dennis Hollingsworth and his staff played a very critical role in these negotiations. He was a Republican Assemblymember, and he's now been elected to the Senate and represents that area. So I think those will be the four key players that I can see on this issue.

Bob, give our readers some calendar benchmarks to enable them to gauge the success or failure of this multi-party negotiation over water from the Colorado.

A lot of the legwork has been done behind the scenes with the lawyers and the environmental reviews to put us in a position to sign the QSA. I think that becomes very important. So, are we going to have a review or reconsideration by the Board? What level of activities the parties, the federal, the state government and others engage in over the next couple of weeks should be pretty significant? I think you'll see the quiet time as it relates to this issue in the first couple weeks of January because the Governor and Legislature will be involved with the Governor's swearing-in, the state of the State, and the initial unveiling of the state budget on the 10th of January. So I suspect that the second tier is the second two weeks of January, and then you'll see some amp-up, and then, really, you've got to close by February. And if that doesn't happen, I think all the wheels come off. In the meantime, I think you're going to start seeing some bills being introduced and some action being taken by legislators, whether they'll be through oversight hearings and other activities to begin to increase the scrutiny. And I think you'll see the federal government, come January 1st, living true to its promise to cut off the water.

Lastly, what's it like leaving the legislature and practicing law with a national law firm? Any less intensive? Less challenging?

I tell you, I love it. I was working in my government job until three o'clock in the morning on my last day of government service, and I got up the next morning and was at my desk at seven o'clock in the morning. It's been fabulous. I haven't been in the system long enough to be institutionalized by it. I'm thriving, I'm excited, and I'm having a great time. I'm still excited to work on this, to be involved at least tangentially in the Imperial water deal. There are a lot of exciting opportunities in this law firm of Mayer, Brown, Rowe & Maw and they have been open arms with me. It is an international firm, and I've been overseas in some of their offices and I'm enjoying it tremendously. I'm very excited to be in the mix.



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