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Rough water on the lake

Some residents bristle at Monterey County’s plans to use more water from Lake Nacimiento


From the ample tinted windows of his spacious, new, and "completely useless" office, Dan Heath gazed out at a spectacular view of Lake Nacimiento, its azure, placid waters sparkling through a dissipating blanket of morning fog.

Heath, however, was anything but placid on this particular morning. A couple of developers across the lake, he said, are plundering the land without interference from San Luis Obispo County authorities.

And even more ominously, Heath is convinced that a single clause in a water project’s environmental impact report is about to "yank the rug out from under my whole life."

Heath is owner of Water World Resort Inc., which has operated Lake Nacimiento Resort and recreational facilities at San Antonio Lake for the past four decades. Heath himself has been at the company’s helm since 1974.

Now he’s embroiled in a do-or-die water rights battle with Monterey County officials that Heath believes holds the key to his financial stability and to future public availability of two extremely popular local recreational lakes.

If water is drawn from the lakes in the quantities now anticipated, recreation could be severely impaired, and Heath’s usual annual revenue stream could be cut in half.

"I have a business that I can’t give away now. It’s lost its value," he said.

In bad times, when water levels were low, he used to pray for rain, he said. These days he’s facing an opponent more formidable than any drought–an intractable bureaucracy that is, according to Heath, "cold-hearted and uncaring."

"I don’t know how long my future at this lake is going to last.

The fight is getting pretty old," he said.

Heath’s woes are compounded by the fact that his legal conflicts are with a public agency with whom he has done business for many years, the Monterey County Water Resources Agency (MCWRA).

Nacimiento Lake is located entirely in San Luis Obispo County, but the water supply is owned and controlled by Monterey County, the result of a 1950s arrangement with the federal government when SLO officials cared little for the idea of participating in an expensive water-storage project.

Today, Nacimiento hosts an average of 202,000 visitors annually, almost all of whom are guests at Heath’s Nacimiento Resort.

But even such a significant presence and 30 years of steady revenue sharing with Monterey County apparently is not enough to keep intact Heath’s arrangement with water officials. All the county people with whom he once worked are now gone.

"I’m the last one standing," Heath said. "Now I’m dealing with people who don’t know me, and who don’t care about me or my situation."

As he spoke, Heath’s voice trembled slightly, reflecting the "extreme frustration" he admitted he is feeling.

For years, artichoke farmers and other agricultural interests in Monterey County have been siphoning water from underground aquifers to the point where today those subterranean supplies have been severely overdrafted. Seawater has begun to intrude into these emptying aquifers, threatening a major component of Monterey County’s water supply.

To deal with this problem, Monterey County supervisors have authorized a special mail-in election in June to fund the Salinas Valley Water Project, which would take 9,750 acre-feet of water annually from Nacimiento and San Antonio lakes and deliver it to farmers in the Castroville area. (An acre-foot of water covers one acre a foot deep, and will provide for the needs of a family of four for a year.)

The county’s plans include modification of the spillway at Nacimiento Dam in order to comply with state and federal flood-control requirements. The dam’s height would be unaffected, as would the lake’s total storage capacity. But the feature could "spill" more water when needed, meaning that the lake could be filled more often, and earlier in the year, than now occurs.

Construction of a diversion facility called a "rubber dam" on the Salinas River is planned near Marina to handle seasonal high flows of water from the Salinas River.

Water facility infrastructure and fish protection are key elements of the plan, according to documents prepared by the Monterey County Water Resources Agency.

Heath has no problem with the plan to move water from Nacimiento to the Castroville-area artichoke fields.

"This is why the dam was built in the first place," he said. "I supported the Salinas Valley Water Project when it first came along and I have supported it ever since. It will only deliver 9,700 acre feet of water from the Salinas River. In a typical year, that would only be a foot from Nacimiento and a foot from San Antonio. That’s not going to hurt anybody. That’s a good thing. If it helps solve the saltwater intrusion problem, then so be it."

But there was a short paragraph in Monterey County’s environmental impact report for the Salinas project that sent cold chills up Heath’s back.

"It said the county planned to release an additional 10,000 acre-feet of water a month, between the months of April and October, from the two lakes," he said.

"I thought there must be some kind of mistake, but the county people said no, that’s what their ‘computer model’ predicted," he said.

Such diversions, Heath insisted, are not only unnecessary, they will ruin him. "There is no place for that extra water to go."

Monterey County Supervisor Lou Calcagno responded: "We can’t ignore a solution just because a few people think they come first. It was never hidden from anyone what the objectives of that dam were: solving sea water intrusion, and insuring adequate water in Salinas Valley aquifers."

Heath has filed two lawsuits claiming $200 million in an attempt to recover financial losses he said he will incur because of actions of the Monterey County Water Resources Agency.

* * *

Even while Heath’s legal conflict intensifies, another significant lawsuit, with different players but similar intent, winds its way through the courts.

A nonprofit public benefit corporation, the Nacimiento Regional Water Management Advisory Committee recently filed an amended complaint in San Luis Obispo County Superior court, challenging Monterey County’s use of Nacimiento as "wasteful" and in violation of the Public Trust Doctrine of the state of California.

According to the committee president, Jim Marshall, the planned actions of Monterey County jeopardize everyone in neighboring San Luis Obispo County.

"Monterey County’s mismanagement [of Nacimiento waters] threatens the economic, environmental, and social and cultural well-being of the entire Central Coast area," said Marshall in a January committee bulletin. "But this mismanagement has hit residents, recreationists, and businesses in northern San Luis Obispo County the hardest."

Marshall said the Public Trust doctrine permits courts to restrict or reduce established water rights "such as those held by Monterey," when "mismanagement of water resources threatens the economic, recreational, aesthetic, ecological, environmental, or other publicly held attributes of natural resources."

Marshall said, "It is up to us to hold Monterey County accountable for its mismanagement of this critical resource."

The courts "must intervene and put a halt to decades of poor judgment and wasteful practices," he added.

The advisory committee, which seeks to influence policy and practices relating to the management of Nacimiento waters, contends –like resort owner Heath–that the environmental impact report prepared by Monterey County is "fundamentally flawed."

Citing specific allegations, Marshall said Monterey County officials have violated the state constitution and other laws "by failing to solve the seawater intrusion problem; by wasting water during wet and dry seasons; and by failing to halt nitrate contamination on the eastern side of the Salinas Valley."

Two members of the Monterey County Water Resources Agency (MCWRA) board of directors, Steve Collins and Rich Morgantini, issued a statement in January taking on virtually all the individuals and entities which have filed lawsuits against their agency.

The proposed Salinas Valley Water Project, the men said in a January commentary in the Monterey Herald, "provides an equitable, affordable solution to the water problems of the Salinas Valley, allowing us to retain control over our water future."

The directors wonder, they said, about the "motivation" for the numerous lawsuits challenging use of Nacimiento water, and note that lawsuits have caused the water agency to spend more than $1.3 million to fight litigation.

"San Luis Obispo County residents ... claim they will be harmed in their residential and recreational lifestyle by the proposed increased water releases," they said. "Nacimiento and San Antonio lakes were built and paid for by Monterey County residents for water supply and flood control, not for recreation and housing. Of course, there is an economic impact on those residents, but they have benefited for nearly half a century from Monterey County’s water projects."

* * *

Across a narrow leg of the lake from Heath’s waterfront office, yet another sea of change is occurring.

Two new landowners have been burning brush and carving roads on a 600-acre parcel of Nacimiento property in a series of actions that Heath said have been "devastating" to the environment, and were completed before SLO County officials even knew what was happening.

Two Los Angeles-area businessmen, designer Jacques Dumani and portable-storage heir Wayne Hughes, put a torch to the acreage in a "controlled burn" overseen by the California Department of Forestry. The men also have been paying for dirt roads to be cut into the land, and securing electricity.

Resort owner Heath’s anger is palpable as he points to high electrical power poles stretching a mile over a hilltop overlooking Nacimiento.

"As a part of their plan, they needed electricity installed on the property, but [SLO] county wouldn’t issue a permit for underground installation without other issues being addressed," wrote Heath in an e-mail to media and officials recently.

"So [Hughes and Dumani] found a way around the county [regulations] and got PG&E to install and adorn the ridge line with a very ugly set of power poles and wires."

Heath said the men have apparently decided to do the work they want accomplished, and deal with permission and permits at a later date.

Indeed, San Luis Obispo county planners, anxious to see the road brought up to code, are planning to issue a "negative declaration" and a permit when they are satisfied the roads won’t contribute to an erosion problem.

"They don’t follow the rules," said Heath of the two new landowners. "So they just keep on grading regardless of who tells them to stop until they get it all done," said Heath. "It will cost hundreds of thousand of dollars to fix this destruction and stop the erosion currently occurring ... with no end in sight."

Both men are planning residences on their adjoining properties. Hughes initially said he planned to build a youth camp on his land, but recently appeared to be backing away from that notion.

Dumani would not respond to New Times telephone queries. Hughes said through a company spokesman that he is "firmly committed to protecting the environment at Lake Nacimiento, and shares concerns of Heath and others about the watershed." Hughes said it is his dream to eventually build a youth camp on his property, but such a facility is "not in current plans."

Heath–whose father was the original developer of Heritage Ranch–said he has done his job regarding the helter-skelter lakeside development.

"I have enlightened everyone as much as I can. I’ve done my civic duty. If this county and Monterey County want to sit idly by and do nothing, and see this kind of stuff happen, that’s their problem," he said. "I don’t like it from an environmental position, and I don’t like it from a view shed perspective."

The land being developed, Heath said, "is in serious jeopardy. What should really be happening here is that the county of San Luis Obispo should stand up to these people who think just because they have a lot of money, they can do what they darn well please. They need to be forced to undo all the damage they have done, re-vegetate this land, remove the illegal roads, and return this land to its original state."

But Heath’s real concern is the EIR clause that threatens his professional existence.

"When county [officials] said they were going to do this, I went to them, pointed it out, told them what it would do to me, they said, ‘Too bad. Tough luck.’

"I’ve invested a million and a half dollars over the last year. Now they pull the rug out from under me and tell me there is nothing they intend to do to mitigate the damages. But I have a lot of confidence in the law."

Heath said his dilemma "is not fair, and it’s not right. I can’t let it happen to me. If I wanted to sell now, after 30 years, I have lost my ability to do so. In a heartbeat. No one will buy this [resort] with that environmental impact report."

But the part that "hurts the most is that Monterey can be so ruthless and cold-hearted about it."

"That’s not true," said Calcagno. "I am very much interested in recreation as part of the lakes, which add a lot to both counties. But we have a mandate from our residents."

Citing ongoing litigation, Monterey County officials declined to comment on their battle with Heath. Æ

News editor Daniel Blackburn can be reached at dblackburn@newtimesslo.

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