SCV NEWSMAKER OF THE WEEK:
Jerry Gladbach
Board Member,
Castaic Lake Water Agency and
L.A. County Local Agency Formation Commission

Interview by Leon Worden
Signal Multimedia Editor

Sunday, May 1, 2005
(Television interview conducted April 6, 2005)

Jerry Gladbach     "Newsmaker of the Week" is presented by the SCV Press Club and Comcast, and hosted by Signal Multimedia Editor Leon Worden. The program premieres every Wednesday at 9:30 p.m. on SCVTV Channel 20, repeating Sundays at 8:30 a.m.
    This week's newsmaker is E.G. "Jerry" Gladbach, a member of the Castaic Lake Water Agency board, the L.A. County Local Agency Formation Commission board and the state LAFCO board, and president of the Association of California Water Agencies.. Questions are paraphrased and some answers may be abbreviated for length.

Signal: You're a member of several obscure agencies. You're a longtime board member of the Castaic Lake Water Agency. You're this year's president of the state Association of California Water Agencies. You're on the Los Angeles County Local Agency Formation Commission board. And you were recently appointed to the statewide LAFCO board.

Gladbach: That's right. Commonly known as Cal-LAFCO.

Signal: CLWA, ACWA, LAFCO, Cal-LAFCO ... Is it true that the longer an agency's acronym, the less it does, or the more boring it is?

Gladbach: Well, perhaps. Another way of looking at it is that no one has the time to listen to the entire name. And most people don't know what it is, anyhow.

Signal: Seriously, though, you participate at both the local and state level in some agencies that fly just under the radar but have a rather profound impact on our political landscape.

Gladbach: Very much so. And that's one reason I got on both boards, is to influence what happens on a state level to benefit the Santa Clarita Valley.

Signal: If people have heard of LAFCO at all, they probably know it approves new cities and annexations. But it does a few more things. Oddly, your two interests — water and LAFCO — are converging right now. The county LAFCO wants to consolidate our local water utilities.

Gladbach: That's one interpretation. What happened a few years ago — there was new legislation passed that required all the LAFCOs to do what's called "municipal service reviews," and within L.A. County ... instead of doing one huge municipal service review for the entire county for all the services, we've taken what are the essential services.
    Let me just focus on water. We divided the county up into nine geographical regions. One of the regions is the Santa Clarita Valley. And within the Santa Clarita Valley, they did a municipal service review and there were a lot of questions and concerns as to some irregularities, overlapping boundaries, one agency serving another's customers.
    So what L.A. LAFCO recommended to the local water agencies was to do an in-depth study. The local agencies agreed with that, and (they) are funding that study. It's being performed by Stetson Engineers, which is a very reputable engineering firm with a lot of specialty in water. So they are in the process of really looking at the water agencies out here to see how they can perhaps realign their boundaries and better serve the community.

Signal: To drive this home, most people get their water from Newhall County Water District, Valencia Water Co., the Santa Clarita Water Division of CLWA, or County Water Works District 36. You're talking about either taking them and making them into one, or combining two or three of them?

Gladbach: What my expectation is, is that all four of them will remain.
    I can't predict what the engineering consultants will come up with, but my prediction is that all four will remain, but perhaps realign some of the boundaries. Also, there are a lot of areas that are not being served by any of those water agencies yet, and as you know with the growth out here, they will need to be served when development occurs. So the engineering consultants will determine which agency is best to serve that new development.

Signal: In its recommendation last November, LAFCO staff felt that there were some operating inefficiencies and specifically recommended that Newhall County Water District be absorbed into the agency you and your cohorts control — Santa Clarita Water. Critics argue that Newhall County is a public agency with an elected board; they've asked, where does LAFCO get off telling them they can't have their public agency anymore?

Gladbach: One of LAFCO's responsibilities is to oversee or to review the operations of governmental organizations within the county, and in some cases, dissolve that agency. It has happened in other counties.
    I don't think L.A. County is of a mind to dissolve agencies. I think they're of a mind to really push, in this case Newhall County Water District, to review its operations with the input from the engineering firm that's doing the in-depth study to make recommendations on perhaps how they can be more efficient. Part of that is the areas that they serve, and if it was more consolidated, then it could be more efficient.

Signal: Who is LAFCO?

Gladbach: LAFCO stands for Local Agency Formation Commission. ... It's really an arm of the state Legislature, and it gets its power from the state Legislature. It's totally independent of the county.
    Every county has a LAFCO. L.A.'s LAFCO is made up of two members of the board of supervisors, a representative from the city of Los Angeles, representatives from two other cities other than Los Angeles, representatives from two special districts, and then two members at large — one appointed by LAFCO itself, and one appointed by the county Board of Supervisors. So it covers a wide range of interests.

Signal: Is LAFCO itself pro-growth?

Gladbach: LAFCO is — really its purpose is to encourage the orderly development and expansion of local governmental agencies, whether that be a city, or water district, or vector control district or sanitation district.

Signal: Last year, Newhall County adopted that resolution — it's been interpreted many ways, but basically it said there isn't enough water to sustain the current pace of growth. Some have criticized it as a slow-growth position. Are you suggesting it's just coincidence that LAFCO decided to look at Newhall County at this time?

Gladbach: No, we had (Newhall County) on our schedule long before that.
    L.A. LAFCO started doing the municipal service reviews in late 2003, and we had laid out the order in which we were going to do (them). We anticipated that we were going to get to the Santa Clarita Valley and have that one complete in mid-2004.
    They also felt that it was important that we ran in sequence. The first one that we did was for the island of Catalina, and then the Las Virgenes area, and then Antelope Valley and then the Santa Clarita Valley.
    The LAFCO hired a consultant to do the (municipal service reviews) for water and, of course, like anything else, you do them in sequence; you don't do them all at once. It just kind of fell out that way.
    But I'm sure that what was happening here, although it was already planned — I mean, the final report wasn't complete; even the draft report wasn't complete until after Newhall County did the resolution. I'm sure that that influenced a lot of the text, including the recommendations and the final reports.

Signal: So the resolution did have a bearing on the result?

Gladbach: I think it did, yes.

Signal: What did LAFCO not like about that resolution?

Gladbach: I think that LAFCO and all state agencies look at — today, California has 35 (million), 36 (million), 37 million people. In 20 years, we're going to have another 15 million to 20 million people, and LAFCOs — again, this comes up at Cal-LAFCO conferences — they're not going to say that each county has to take this many people, but logic has that there were certain places that were very logical to increase population. I think Santa Clarita Valley was one of those.
    Recognizing that, you can't have a state agency or an arm of a state agency allowing a local entity to go against that need to supply a vital utility for growth.

Signal: Newhall County in its present form dates back to the 1950s. Santa Clarita Water started as a private company in the late 1940s. How did these operating inefficiencies and overlapping service areas develop?

Gladbach: It turns out that they each have a plan, and its kind of like a jigsaw puzzle.
    You've got two questions here. First, let me answer one of them. Newhall County Water District serves four distinct areas. One is Newhall, which is where they really started. And then there's an area in Canyon Country that Newhall County Water District decided to serve. And a third one is the Castaic area. And then more recently is Tesoro (del Valle), which is up San Francisquito Canyon. And it's interesting that they're four distinct, non-connected geographical areas.
    As (the question) related to Santa Clarita Water, in that case, the company, when it was owned by the private family, they started up Seco Canyon and they expanded and bought other water companies. So most of their operations were at least all connected. They have some areas that are not connected geographically. So that's how those things happen.
    And then, when new areas, new developments, need service, they may go to Newhall County Water District, but Newhall County Water District would get with Santa Clarita and realize it was better for Santa Clarita to serve them — even though this new development was in Newhall County Water District's service area — which would really help out the new development and the new residences.
    Unfortunately, those changes of service were never reported to LAFCO. So LAFCO was a little bit miffed that they've been doing all this stuff in the Santa Clarita Valley and nobody's told LAFCO. So they kind of got their hands slapped.

Signal: Gaze into your crystal ball. You've said you think all four water retailers will remain, but do you see Newhall County being absorbed into Santa Clarita Water?

Gladbach: I don't see it being absorbed totally into (Santa Clarita) Water. I see some of the areas that Newhall County Water serves as being absorbed into Santa Clarita Water Co., and I see other areas as a trade off — some of Santa Clarita Water Co. going to them.
    As an example, there's an area, a condo development near the freeway south of Lyons that is served by Santa Clarita Water Co. And everybody around them is served by Newhall County Water District. So I think it's logical for Newhall County Water District to serve them.
    What happens on Lyons Avenue is that you have water pipes belonging to the three different utilities going down the same street. And we all pay for that.

Signal: Let's explore a hypothetical. Let's say that on the basis of the findings of Stetson Engineers, LAFCO decides Newhall County and Santa Clarita Water should consolidate. Would you, would CLWA (which owns Santa Clarita Water), be willing to entertain the idea of Santa Clarita Water being absorbed into Newhall County, to create one larger, independent water retailer with its own elected board?

Gladbach: I'm not sure. Well, you're asking me my opinion. I'd say I'd have to see the finances on them, because Castaic Lake Water Agency has really put in a lot of money into the Santa Clarita Water Co. You just can't take something away from an organization and give it to another one. I think that would require a lot of study.

Signal: Let's switch gears a bit. You mentioned those 15 million people coming to California. According to the Southern California Association of Governments, in the next 20 years the population of North Los Angeles County — the Santa Clarita and Antelope valleys and Tejon — will more than double from 500,000 people today to 1.2 million in 2025. Where are on Earth are we going to find enough water for all those people?

Gladbach: I can't speak for the Antelope Valley — and hopefully most of them will go to the Antelope Valley — but, nevertheless, one thing I'm going to give you is two parts to this answer:
    As you mentioned, I'm also president of the Association of California Water Agencies, and one thing I did shortly after I became president was name a task force of 35 people from around the entire state of California to put together what we call the Water Blueprint, which is a plan for what's needed in the water community to meet the population growth in the next 25 years.
    And the Association of California Water Agencies board just approved that (at) its last meeting. ... We're in the process of printing it and we'll be presenting it to the governor, because a lot of the recommendations require the governor and his administration (to perform) certain actions, as well as the state Legislature. So there will be a major presentation and unveiling of that at that time.
    The report deals with what we would need to meet the increased population of the state, and focusing on all the regions of the state. That's part of the answer as to what's necessary to meet those demands.
    Obviously, more storage in northern California to capture a lot of the runoff, more of the runoff, (is needed); also, increase conveyance systems to deliver it to Southern California.
    Within the Santa Clarita Valley itself — what we've done a few years ago was that we had our consultants take a look at every parcel that wasn't developed within our service area, and look at the General Plan that was either by the city or by the county, to determine what land use that parcel was to be put to, and from that we can determine how much water is needed for that parcel. So, when you cumulatively add all those up, you can come up with a total water supply necessary, and that's what we've done.
    We're in the process — we've purchased 41,000 (acre)-feet (of water) from Wheeler Ridge a few years ago — "we" being Castaic Lake Water Agency. (One acre-foot of water is 328,000 gallons; about enough to serve two average households for year.) We're in the process now of purchasing more water from two other water agencies near Bakersfield. And we're also — as you know, water, you can't depend on rain. This was an unusually heavy year for rain. It's that way throughout the state and throughout the world. What we have, then, is storage projects that in years (of) excess (rainfall), we put water into the storage, and then in years of drought, we pull it out.
    What I always tell people, it's just like my checkbook; in those months that I'm doing good is when it goes into savings. In those months when things are tough, I'll pull money out of savings. What we've done, instead of storing money, (it's water) in reservoirs — still a reservoir, but it's underground.
    We have two projects in Kern County now, one with Semitropic Water Storage District where we've got over 50,000 acre-feet of water in storage there now. We're also working with other districts, with other projects.

Signal: How much water does the Santa Clarita Valley use in a year?

Gladbach: About 85,000 acre-feet.

Signal: If half of that comes from the State Water Project today, can the state project deliver enough water to accommodate those 700,000 million new people who will be coming to the north county in the next two decades?

Gladbach: You're going to have to, like I say, build more reservoirs in northern California to capture that water.

Signal: But does it rain that much in the Sierra Nevadas (the source of state water)?

Gladbach: Well, yes. A lot of the water currently goes off into the ocean untouched. I mean, much more so than what's necessary to protect the fish and other wildlife in the (Sacramento River) Delta. If the facilities were built, we could capture a lot more of that water. The State Water Project is only delivering half of what it was designed for.

Signal: Is the state association, ACWA, focused on increasing the capacity of the State Water Project, or is it at least equally focused on alternative supplies, like desalination and recycling? Can we look forward to purified toilet water?

Gladbach: The Association of California Water Agencies, as I might point out, is not only active in the state Legislature in Sacramento, but also at the federal level. We have an office in (the District of Columbia) with a staff of three people who work on federal legislation and appropriations, also.
    But ACWA is not only interested in developing more water supply, but also conserving what water supply we have, as well as pushing for recycled water as well as desalination. There's a task force to work with the federal level; there's a task force in California that's working with federal offices to increase the possibility of desalination. In fact, there are probably five or six pilot projects on desalination in Southern California.

Signal: What has been the hurdle to desal? The cost?

Gladbach: The cost has been, so far. I mean, in the past, probably five or six years ago.
    (To) put it in perspective, the Metropolitan Water District charges $555 an acre-foot for water. I won't compare what Castaic does because Castaic's cost comes through property taxes, but our costs are probably the same amount.
    In the past, the desalination, you're talking $2,000 to $3,000 an acre-foot. So it was unreasonable. And most of that was energy. Desalination is very energy-intensive.
    The technology of desalination has changed significantly in the past five years to a point where the cost is probably $800 to $900 an acre foot, depending on where you are. And I'm going to talk about the Metropolitan Water District of Southern California, which is a major wholesaler of water in Southern California, because it's their members who are really into doing the pilot projects for desalination. That will give them a $250 subsidy per acre-foot. So if you've got an $800 cost and (the pilot project) gives you $250, that's down to $550, which is about equal to what they're having to pay so (now) for water. So I think you're going to see some major developments in desalination in the next few years.

Signal: Here in the SCV, we can expect to see a tenfold increase in recycled water, right?

Gladbach: Right. We're using around 1,700 acre-feet of recycled water now. We have plans to go to 17,000 acre-feet.

Signal: What will it be used for?

Gladbach: It will be used for golf courses, landscaping, parks, things like that...

Signal: What's up with groundwater contamination? We've heard a lot about some of our groundwater not being "available" because it's polluted with perchlorate from the old Whittaker-Bermite plant.

Gladbach: There are two different aquifers in the Santa Clarita Valley. An aquifer is the area in the ground which holds water. We have the alluvial aquifer, which is the top 100 feet or so of ... the riverbed, or the area surrounding the river.
    And then below that, (by) several hundred feet, in fact probably a couple thousand feet, is what we call the Saugus aquifer. And it's the Saugus aquifer that's contaminated. Although when I say it's contaminated — I was thinking about this, this afternoon, how I could relate that? If I take my yard, both front and back, (there) might be a very small area on (one) side (that's contaminated). ... The whole aquifer is not contaminated. It's probably less than maybe 5 percent of the aquifer (that) is contaminated. So 95 percent of it is good to use right now. And we're working on, we'll be having wells installed, and a treatment plant installed by the end of this year to draw out the contaminated water and treat it. So that will be useful.

Signal: Those 41,000 acre-feet of water will basically double CLWA's allotment from the state project. But those 41,000 acre-feet are still tied up in court. What's going on with that, and why does it seem that anytime CLWA makes a move in any direction, it gets sued?

Gladbach: I think, in fact, on that end, anything in any report we put out, we put more effort into it, significantly more effort than anybody else in the state. And yet we get sued on it. I think it's because people use it as a mechanism to stop growth and slow down growth down here.
    The 41,000 acre feet, although it's held up in court, we have the right to use it for existing users. But we're getting close to wrapping that up. The lawsuit was against our environmental impact report. We did a revised environmental impact report — and another environmental group sued us. So we're working on that.

Signal: So in spite of the tremendous growth we're seeing, Santa Clarita Valley residents don't need to worry about rationing anytime soon?

Gladbach: I don't see it. No.

    See this interview in its entirety today at 8:30 a.m., and watch for another "Newsmaker of the Week" on Wednesday at 9:30 p.m. on SCVTV Channel 20, available to Comcast and Time Warner Cable subscribers throughout the Santa Clarita Valley.


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