Montecito’s Water Supply Much Improved. Still Needs Love, Luck, and Lucre

An Historic Vote

On June 25, the five members of Montecito Water District’s Board of Directors will hold a public hearing – almost certainly to take place via Zoom – to discuss a proposed change in water rates for its customer base of roughly 4,000 Montecito households. The hearing will allow affected ratepayers as well as other members of the public to voice their views on the Board’s proposed plan to enter into a 50-year water supply agreement (WSA) with Santa Barbara that will rely on the city’s water desalination plant to meet 40 percent of Montecito’s annual water needs. Following the scheduled public debate, if the Board votes in favor of the plan, which is estimated to cost about $4 million per year, the new rates for Montecito’s desalinated water supply will become effective on July 1.

Over the past several years, much has been written in these pages about the Water District’s proposed plan, which became the basis for a heated 2016 political campaign that unseated the Board’s previous leadership amidst an historic, decade-long statewide drought. By all accounts, this campaign was a direct reaction to the prior board’s imposition of emergency water rationing rules and the levying of costly penalties against Montecito’s major water users as well as others who found themselves afoul of the new rules thanks to matters as trivial as a leaky toilet, in a town where 85 percent of the total water supply is used for landscape irrigation as opposed to interior household use.

Last week, the Montecito Journal published the first in a series of articles examining our town’s complex water world and the current board’s proposed agreement with Santa Barbara. That article drew from a variety of sources including former Water Board officials and conservation activists, some of whom strenuously object to the Board’s current plan, alternately arguing that it fails to promote water conservation, is unnecessary, too costly, or all of the above. In this story, we provide an insider’s account of how two individuals with decades of combined experience in engineering and water management effectively took control of Montecito’s water district four years ago with the express purpose of finding a new, local, and reliable source of water for the foreseeable future.

A Saga of Scarcity

At the turn of the last century, the only source of Montecito’s drinkable water was whatever fell from the sky and flooded down the mountain into the town’s underground aquifer, where it could be accessed only by privately-drilled wells. As the town’s population began to grow and a more reliable supply of water was needed, Montecito residents voted in 1921 to form a public agency to obtain more water. A year earlier, the city of Santa Barbara had constructed the Gibraltar Reservoir via a dam project nine miles uphill, which delivered water to the city via the Mission Tunnel. In the first decades of its existence, Montecito’s newly formed water district followed suit by creating the Juncal Dam, which created the town’s first above ground water source, Jameson Lake, which opened in 1930.

By the 1950s, Montecito’s population and water needs had magnified to the point where Jameson Lake was no longer sufficient. In 1958, engineers built the Bradbury Dam and created a second reservoir, Lake Cachuma. This roughly once-per-generation pattern of finding new water sources was repeated again in 1991, when Montecito and other Santa Barbara County residents voted in favor of joining the State Water Project (SWP), a series of pipelines which were completed in 1968. Along with creating both Lake Castaic and Pyramid Lake as major water reservoirs, the SWP delivered water from Northern California’s Feather River to a series of water districts in the central valley before what’s left of it ultimately dumps into Lake Cachuma.

As history has revealed, however, there are a few problems with all these above ground water sources that have nothing to do with how much water Montecito consumes or conserves or what percentage of that water is used for drinking as opposed to watering lawns. For one thing, reservoir water in Lake Cachuma, as just one example, tends to evaporate roughly 15,000 acre feet of water per year (the amount of water it takes to cover 15,000 acres of land with a foot of water). Also, Montecito’s claim to California’s state water is far down the list of priority customers with older claims. Under state law, water rights dating to before 1914 are honored before newer ones, so in drought years, when there’s not nearly enough state water to go around, the Montecito Water District (MWD), which pays about $6 million per year to participate in the program no matter how much it actually obtains, might receive just a fraction of its annual allocation.

A November 2017 report by the California Water Impact Network revealed that Montecito, Santa Barbara, Goleta, and Carpinteria collectively received an average of just 28 percent of their allocated water from 1998 to 2015, “despite the fact that Santa Barbara County voters were told in 1991 ballot information that the State Water Project was expected to deliver 97 percent of contract amounts to urban water users.” This year, according to Nick Turner, Montecito Water District’s general manager, we are scheduled to obtain only 20 percent of our allocated supply of state water, the good news being, using a very loose definition of good news, that this paltry amount actually represents a slight increase from the 15 percent figure originally forecasted earlier this year.

A Decade-Long Drought

California has seen more frequent, longer lasting, and geographically wider droughts in recent years. The state’s most recent dry up began in 2007 and two years later, led to California’s first water-related statewide Declaration of Emergency. The drought intensified a few years later between 2012 and 2014, when, according to a February 2015 report by the California Department of Water Resources, the state experienced its three driest years in recorded history. “Calendar year 2014 saw record-low water allocations for State Water Project and federal Central Valley Project contractors,” the report states. “Reduced surface water availability triggered increased groundwater pumping, with groundwater levels in many parts of the state dropping 50 to 100 feet below their previous historical lows.”

For Montecito as well as other towns that are mostly dependent on state water, the situation was dire, despite heavy rains that briefly inundated California in 2011. “We had far below average rainfall for four years in a row,” said the MWD’s Turner. “Jameson Lake was at dead-pool level, meaning there was no usable water. And Lake Cachuma fell down to seven percent capacity. The only reason it had any water in it was because of the state water that was being put there.”

To deal with this crisis, the MWD’s board of directors voted in 2014 to impose water rationing, imposing heavy fines on water consumers who exceeded their allowed monthly volume. “The board implemented a system of penalties and fees which was painful for customers but successful in getting demand and water supplies aligned,” said Turner. “A 50 percent cut took place almost instantaneously and people cut back on their water usage.” It’s unclear however, exactly how much of the water that officials estimate was conserved at the height of the rationing actually takes into account the 1,000-plus wells that have so far been drilled beneath Montecito, a figure roughly supporting 25 percent of our town’s single-family residences.

In 2015, Santa Barbara brought back to life its inactive desalination plant, which first opened in 1991 but was quickly shut down after a few months of heavy rains, with much of its equipment eventually sold to Saudi Arabia. “That year, in the heart of the drought,” continued Turner, “the board began discussions with Santa Barbara to explore a partnership to participate in desalination.” But after months of fruitless negotiations over the terms of the deal, and with a majority of Montecito’s elected water officials balking at the desalination plant’s hefty price tag of $90 million, the proposed deal with Santa Barbara fell apart.

The Big Take Over

Neither Floyd Wicks nor Tobe Plough remember the exact date they decided to join forces and take over Montecito’s Water District, but they both agree it happened sometime in mid-2016. Plough, an engineering project consultant whose main client is Exxon-Mobil, says he was first approached by his friends, fellow Montecito residents Phil Bernstein,owner of a Santa Barbara agricultural import-export firm, Fred Gluck, CEO of McKinsey & Company, a global consulting firm, as well as Bob Hazard, a retired businessman and the Montecito Journal‘s Associate Editor, all of whom asked for his advice on how to solve the town’s deepening water crisis.

“I had seen Phil socially and we talked about all kinds of stuff at the gym and that sort of thing,” Plough recalled. “We started talking about the water situation here.” At the time, Bernstein and other residents who chafed at the Water Board’s fee structure, hoped Wicks and Plough might help determine how to develop a combined water recycling and desalination project at the location of the town’s sewage treatment site, which abuts the ocean. During one of those discussions, in an informal meeting over coffee at Gluck’s house, Plough met with Wicks, an executive with decades of experience at various California water companies. At the time, Wicks was consulting on behalf of a client, the Costa Mesa-based PERC Water Corporation. Wicks agreed to ask PERC to bid on such a project, which was estimated to cost $70 million. But thanks to opposition from the current Water District Board as well as foreseen resistance by the California Coastal Commission, the project never came close to breaking ground. “That’s one reason I decided I was going to run with Tobe,” said Wicks.

With the November 2016 water board election just weeks away, Plough and Wicks quickly set to work raising more than $80,000 in campaign contributions from a small network of private donors. Billing themselves as the “Water Security Team,” the two technocrats ran on a platform of securing a reliable local supply of water for Montecito combined with an avoidance of the kind of harsh conservation measures the current board had adopted. “There were only two seats up for election, so we knew we weren’t going to get a majority,” said Plough. “But at least we could get some of the train cars back on the track because [the current board] had a total train wreck.”

After a contentious election, both Plough and Wicks won their races and took office on December 5, 2016. “Our first priority was to implement the plan we ran on,” Plough recalled. “That was going to take time, but then we had another problem: It started to rain, and I mean really rain.” Even in drought-prone California, there can always be too much of a good thing when it comes to water, and in this case, Montecito’s water district had $5 million worth of allocated state water sitting in the San Luis Obispo County Reservoir. “This is water that the Board had collected from all these purveyors of state water and it is what we were supposed to live on,” he explained. “Floyd and I started looking at the height of the San Joaquin River and realized we needed to get a deal to get that water out of there.”

Mother nature had other plans, though, and after several storms in early 2017, the reservoir spilled its banks. Although the rain helped replenish Jameson Lake and Lake Cachuma, Montecito ended up losing about $2 million worth of its supply of state water, which would have been enough to last about a year. As a result, Wicks guided the MWD into a water banking agreement with the Semitropic Groundwater Banking and Exchange Program, an underground basin located in Kern County, that unlike Montecito’s local reservoirs, isn’t subject to evaporation, and can store water during years of plentiful rainfall until the next drought. “We lost a lot of water, but the good news is that this got us into water banking,” said Plough. “And then Floyd and I were able to get a third and fourth vote in favor of our plan. We were able to say, ‘Hey guys, we need a source of water that’s more reliable, and here’s a perfect example.’”

Those extra votes came in 2018 when Cori Hayman, a lawyer with an extensive background in complex litigation; Brian Goebel, an entrepreneur who previously worked for the Treasury and Homeland Security departments;and Ken Coates, a board member of both Direct Relief and the Samsung Clinic, won their respective races to join the board after campaigning on the same platform of water security. “The board has worked tirelessly during the past couple of years since I have been in office, and in the prior two years when Floyd and Tobe came on board,” said Hayman. Their collective mission, she explained: “To bring water security to ‘this side of the mountain’ without relying on the State Water Project, water purchases, and the continuing environmental and water rights constraints of Lake Cachuma.”

Diversity Matters

Although both Plough and Wicks ran for office with the express purpose of finding a local source of water on this side on the mountain, both board members insist that desalination is just one of many potential sources of water that MWD should continue to explore in the future. Regardless of how the board votes on June 25, they argue, the Water District should continue its participation in the state water project as well as the recently-adopted Semitropic groundwater banking system.

Given that the proposed deal would only supply Montecito with 40 percent of its annual water needs, Plough said that it’s just one part of a diverse portfolio of state and regional water sourcing in which Montecito will need to continue to invest. “But from a reliability perspective, to have 40 percent of our water be almost 100 percent reliable? That’s never happened before,” he said. “So even if we have a horrendous situation, we still have that 40 percent, and everybody is going to have healthy and safe water. They may not be able to irrigate and keep their gardens green outside, but everybody is going to have water for their households.”

Wicks added that the overall water price increase of 2.8 percent per year over the course of the proposed plan is miniscule compared to the benefits. “I’m an engineer by trade and so I always look at what we can do if our water supply is out of service,” said Wicks. “Are we still able to do what the community needs? You can’t just hold the community hostage. To me, if you fail to plan, you plan to fail.”