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North County Irrigated Lands Group Has Been Dissolved

As you may be aware, the California Regional Water Quality Control Board (RWQCB) established regulations (Order No. R4-2007-0104) that required water quality monitoring for anyone who was involved with commercial agriculture.   These regulations were complex and the monitoring requirements were such that the vast majority of agricultural operators joined forces to pursue compliance with the regulations and share the cost.   In the San Diego region there are multiple monitoring groups with the largest being operated by the San Diego Farm Bureau.

 

In response to requests that were received by a number of customers, the Rainbow Municipal Water District formed the North County Irrigated Lands Group, LLC (NCILG) in order to serve as a monitoring group that was recognized by the RWQCB.  The NCILG was formed in 2013 as a financially separate organization from the water District because it had to stand alone financially as State law prohibits subsidies from water sales for such purposes.

 

At the outset, the goal of the NCILG was to provide monitoring services that would be cost effective for agricultural operators in our service area.   The NCILG membership total was 98 members representing 565 acres of agricultural operations.   Fees were collected in early 2014 and then parts of the fees were refunded due to a pause in the regulatory process.  The remaining funds were expended during 2014 and 2015 though administrative and regulatory costs.

 

All members of the NCILG were in compliance with the RWQCB regulations at the time of the inception of the NCILG.   Subsequent to that, the terms and conditions of the RWQCB regulations have lapsed and technically there is no current regulation for discharges from commercial agriculture.   The RWQCB is working on revised regulations and has indicated an intent to adopt those regulations in the fall of 2016.

 

After evaluating the prior and proposed regulations, RMWD has estimated that the annual cost of managing the NCILG would be around $150,000.00.   These costs would include the development and implementation of a monitoring plan, preparation of monitoring reports, billing and collecting fees from members, and overall administration of the group.

 

RMWD has analyzed how to apportion these costs to the members of the NCILG and determined that the only fair way to do so was on a per-acre basis.   Since there are relatively few acres in the NCILG, the cost per acre was very high.    With annual costs of $150,000, the per acre fee would be $265.   This high costs is due to the small number of acres in the NCILG.   As a comparison, the Farm Bureau group has over 40,000 acres in the monitoring group.  A challenge that the NCILG faced was that the members in the group were spread over a very large area which requires a more complex and detailed monitoring plan. 

 

Another analysis was done to look at the sensitivity of these costs to members leaving for another group.   The largest individual member of the NCILG has about 30% of the total acreage in the entire group and the costs for this member would be many times the cost for them to gain coverage from a larger monitoring group such as the Farm Bureau.   The rational thing for this member to do would be to leave the NCILG and join the Farm Bureau.  Unfortunately, should this one member leave, the costs for the remaining members does not change, so the cost per acre with just one member leaving rises to $404 per acre.   This increase in turn will cause other larger members to leave the group with a commensurate increase in per acre cost for those who remain.  

 

At the April 26, 2016 Board of Directors meeting, the RMWD Board considered this situation and concluded that based on these facts the NCILG is not financially viable.   After considering a couple of options, the Board voted to dissolve the NCILG entirely.  A letter containing this information was sent to all members of this action.

 

Fortunately, there is a pause in the regulations at this moment that ensures that none of the NCILG members will be in violation of the regulations.   As of this date, there is no requirement for commercial agriculture operators to be in a monitoring group.   That is expected to change this fall as the RWQCB will adopt new regulations.

 

When new regulations are put into place, members of the former NCILG have several options:

 

-        Decide to comply with the regulations individually

-        Form into new localized groups – The San Mateo Irrigated Lands Group has four members that area adjacent to each other.

-        Join a larger regional monitoring group such as the one operated by the San Diego Farm Bureau.

 

We regret that the NCILG was unable to meet the goals that spawned its creation.  We will be notifying the RWQCB of the status of the NCILG once the legal paperwork has been completed.

 

If you have any questions you may contact us at 760-728-1178 

 

Recorded Dissolution Document.pdf