Court battle over Sinking Friant-Kern Canal grinds on

A judge’s tentative ruling issued Tuesday, July 2, makes it clear landowners in the Eastern Tule Groundwater Sustainability Agency (GSA) are not legally obligated to pay the Friant Water Authority (FWA) a minimum of $200 million in fines for damage to the Friant-Kern Canal.


Friant Says Eastern Tule Lax on Overpumping Penalties

FWA contends it’s owed the money to correct widespread damage to the Middle Reach of the Friant-Kern Canal caused by land sinking because of ongoing overpumping within the GSA. While the GSA must still pay for the damage its users are doing to the canal – as per a previous settlement – the judge declared that the 2020 agreement between the two agencies did not set a minimum payment. Eastern Tule declared the decision a win for water users along a corridor of east Tulare County stretching from Porterville south to Richgrove.

“We don’t owe $200 million,” said Eastern Tule manager Rogelio Caudillo. “We owe up to $200 million based on overpumping.”

The lawsuit, however, goes on.

In the same July 2 ruling, Judge Brett Hillman said lawyers for Eastern Tule must answer the FWA’s two main allegations. The agency – which oversees operation and maintenance of the Friant-Kern Canal and the machinery that moves its water – contends Eastern Tule’s managers still let its users pump too much groundwater before penalizing them. The lawsuit also accuses Eastern Tule of miscalculating the penalties it collects.

The Arvin-Edison Water Storage District – about 130,000 acres of mixed crops in Kern County at the southeast end of the Valley – is also a plaintiff with FWA in the case.


Fines Must Reflect Amount of Excess Pumping

A motion filed by Eastern Tule’s attorneys asked the court to strike a portion of the suit. Hillman declined to do so, but he did issue a definite opinion about the nature of the fines the GSA must collect and pay to FWA.

“Accordingly, the court denies the motion to strike as to the challenged portion of the complaint, but expressly finds that section 1.A of the agreement does not state an obligation to collect an unconditional minimum of $220 million, and is, obviously, subject to the following limiting condition: ‘… if the anticipated transitional pumping of 1,034,553 acre-feet actually occurs,’” Hillman wrote.

Of the $220 million, $200 million would go to FWA for keeping the Friant-Kern Canal flowing. The other $20 million would stay within the GSA, Caudillo said, to fund water-saving efforts.

“If you exceed the allocation, and you don’t have other (water) sources, you’re issued a fee,” he said. “Ninety-one percent of those fees go to Friant. Nine percent remains for other mitigation projects in the Eastern Tule GSA.”

The agreement to pay fines to the FWA, Hillman ruled, must be based on how much water is pumped by users in the Eastern Tule. There is no fixed amount Eastern Tule must collect over five years from its users. Caudillo believes Hillman is reading the 2020 agreement with FWA correctly.

“One of the key points Eastern Tule GSA made was about that $200 million,” he said. “The settlement agreement was that the Eastern Tule GSA would be paying the amount of funds as transitional pumping occurs. It’s a fee that the Eastern Tule GSA has placed on landowners in the eastern GSA boundaries for people who are overdrafting.”


Eastern Tule Owes for Causing Canal to Sink

The Eastern Tule GSA is obligated under its 2020 interagency agreement with FWA to pay for a portion of the cost of replacing a 10-mile section of the Middle Stretch of the Friant-Kern Canal – the 91% of their fees that go to the FWA. The GSA agreed that past overpumping of groundwater by its users is responsible for the canal slowly dropping into the Valley floor. The effect – known as subsidence – has been going on for decades as farmers pump water from the aquifer. And now it’s accelerating.

Because of the overuse of the limited and difficult-to-replace underground water supply, the state’s lawmakers implemented strict usage guidelines under the Sustainable Groundwater Management Act (SGMA) in 2014. The act formed a huge number of local agencies, the various GSAs, to oversee water users’ usage and mitigate waste.

Finally, each of those GSAs had to formulate a plan for how it will make water users comply, and how it will penalize them if they don’t. The FWA alleges the Eastern Tule plan still allows users to draw too much water. That, they say, will make the Friant-Kern sink even more. And so they’re making a demand for payment. Eastern Tule says they’re wrong.

Now the court or a jury will decide.

“It is unfortunate to see resources, both time and money, expended on litigation matters versus collaborative and solution-oriented approaches,” said Tulare County Supervisor Dennis Townsend, who also serves as the Eastern Tule’s chairman, when the lawsuit was filed against the GSA in February. “The Eastern Tule GSA was formed in 2017 to improve groundwater management in the context of significant legacy challenges, including overdraft and land subsidence. The Agency will continue honoring the terms of the settlement agreement and will continue on its path to sustainability.”


Judge Finds Friant Attorneys Clipped Critical Information

To strengthen their contention the Eastern Tule owes the FWA $200 million, its attorneys cited a portion of the 2020 agreement between the agencies. Judge Hillman spotted that FWA legal counsel had carefully omitted portions of the text that undermined their argument. Hillman said in essence they had misrepresented the contract by omission.

“Plaintiffs essentially dodge the contention that they falsely allege the agreement requires an unconditional collection of a minimum of $220 million by plucking Eastern Tule GSA’s mention of section 3.A to assert that Eastern Tule GSA falsely argues the [complaint] ‘alleges that FWA is ‘guarantee[d]’ $200 million in penalties from the pumping of overdraft water,’” Hillman opined.  “Plaintiffs then follow with another deceptive partial citation to section 1.A (though they correctly identify it as a separately stated contractual obligation), again omitting the limiting condition:  ‘… if the anticipated transitional pumping of 1,034,553 acre-feet actually occurs.’”

In other words, Eastern Tule only has to collect fines when an offense has really happened. But Hillman has not made a final ruling that the FWA’s arguments are completely invalid. Now, the judge wants to see more evidence.

The ruling added credence to Eastern Tule’s position, as well.

“The Eastern Tule GSA raises compelling arguments that the [plaintiffs’ complaint], at least as far as it concerns Eastern Tule GSA’s penalty collection, runs into significant separation of powers issues, …” Hillman wrote.

Eastern Tule argues that the FWA is attempting to usurp its authority to decide when fines are appropriate. Hillman’s ruling acknowledges the issue should be subjected to further review.

“Clearly the court grasps the strengths of the Eastern Tule GSA’s position, because the ruling confirms Eastern Tule GSA’s interpretation of the agreement that there is no assurance of an unconditional minimum payment of $200 million to Friant,” said attorney Gina Nicholls, who represents the Eastern Tule in the suit.

Lawyers for the FWA, however, assert Eastern Tule isn’t being as cooperative and honest as it should be. They allege the Eastern Tule administration fudged the numbers to lower the amount its users owe the FWA.

“Because average annual precipitation was a known component of Eastern Tule GSA’s determination of the amount of ‘sustainable yield’ prior to the settlement, plaintiffs apparently mean to allege Eastern Tule GSA improperly inflated the precipitation component of ‘sustainable yield,’ and in so doing effectively issued ‘free precipitation credit,’” Hillman’s ruling stated.

FWA also alleges those running the Eastern Tule tried to dodge part of their responsibility for keeping the Friant-Kern Canal in top working order.

“Another component of the ‘precipitation credit’ contentions is that Eastern Tule GSA subtracted the alleged credit amount it issued in 2020 (referred to by plaintiffs as the ‘2020 Precipitation Credit Giveaway’) from an amount allegedly ‘budgeted for its Penalty Program – i.e., the water from which … penalties are to be imposed and the resulting funds collected and paid to FWA,’” Hillman wrote.

The two parties will be back in court on August 16 for a status conference. A settlement conference is scheduled for next year on May 16. The trial itself is set for 9 a.m. on June 2, 2025 before Hillman in Department 2 of the Tulare County Superior Court in Visalia.

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