Vested rights: SLO County officials sort out which pipeline projects will be exempt from the Paso Basin pumping moratorium 

After a long summer of dealing with a hot topic, the San Luis Obispo County Board of Supervisors is now tasked with hashing out a key piece of a moratorium banning new water use over the Paso Robles Groundwater Basin.

Supervisors passed the two-year urgency ordinance as a sort of timeout on new water use over the basin after well levels in the area showed continuing decline. The board must now determine a vital element of the ordinance on Nov. 26, when they’ll decide on a set of requirements that will allow for exemptions if a project had already made significant investment and preparation—or what they call a vested right—before the ordinance went into effect on Aug. 27.

Exactly where the line will be drawn is a source of heated debate, as the line has been moving.

The major concern that triggered the ordinance has been a rising demand in groundwater, largely attributed to a boom in new vineyards. As the area increases in notoriety as a wine region and demand for grapes and wine grows, a tenuous mix of economic benefits and water resource worries has saturated the situation.

According to recent figures, agriculture makes up about 67 percent of total groundwater use.

The ordinance was written to bar new water use across the board, so as to avoid singling out viticulture. How exactly to determine who’s actually in—or out—of the pipeline of planned projects is the big question. Two separate sets of requirements have been written: one for permanent tree crops like wine grapes and tree fruit, and another for annual crops. In addition, an offset program is still in the works. Coming up with across-the-board requirements that have the teeth to stop people trying to game the system while not being so heavy-handed as to spur lawsuits has led decision makers into rough waters, especially for 1st District Supervisor Frank Mecham, whose district encompasses a significant portion of the basin.

“I want to be sure that we’re on firm legal footing, and also a fair and equitable footing,” Mecham told New Times. “Everybody has an opinion on this, and nobody has all the answers. If you put me in a position that I have to make a decision, you may not like what I’m going to do.”

Even though the county has brought together stakeholders and reached some consensus on the guidelines, there remains a divide between a rural residential group and the agriculture industry. Members of PRO Water Equity have said the vested right language is lax, and they want to see a clear line.

“If they go for the proposed language that we have seen, we’re not a whole lot better off than the original language,” said Jan Seals, the group’s treasurer and a resident of the Geneseo Road area.

The draft resolution requires exempted parties to have had a well permit application, a contract for drilling a well if it wasn’t already installed, and paperwork for leasing or buying the land—all before Aug. 27. In addition, at least three of six requirements regarding contracts and site preparation must be met.

The requirements were changed after the planning department gathered input from industry stakeholders, finding concern that too many people legitimately in the pipeline would be hung out to dry.

Dana Merrill, president of Mesa Vineyard Management and owner of Pomar Junction Winery, has submitted an application for a vested-right exemption and was involved in offering input.

“The discussion was actually more positive than I thought it might be. It was a good airing out of concerns,” Merrill told New Times, adding that actually getting to that table took some time. “It took a lot of clamoring and complaining to get up to bat and be able to suggest things.”

As the ordinance neared, people hoping to make it through the gate before it closed found themselves very busy. The mere idea of the ordinance was enough to stir up a frenzy of site preparation and contractual agreements.

According to Supervising Environmental Health Specialist Richard Lichtenfels, a “rush period” for well applications overlying the basin peaked from July 29 through Aug. 26—just before the ordinance went into effect. During that one-month period, 140 applications were submitted for wells over the basin. Normally, about 13 applications are received per month in the entire county. In a 14-month period between May 1, 2012, and June 25, 2013, 185 applications were submitted for the basin.

That slew of applications, as well as other activities that peaked before Aug. 27, caused some people to wonder if the ordinance will actually do anything to slow the increase in irrigated vineyard acreage.

“It’s the unfortunate unintended consequence,” Seals said. “If they manage to get in enough of the criteria to meet vested rights, then the basin loses.”

Merrill sees it a bit differently.

“It’s kind of like doing your income taxes or your midterm paper the night before turning it in,” Merrill said. “It might not be the most brilliant approach, but if it’s due, and you turn it in the night before, it’s in on time.”

As of press time, an additional 15 applications for exemptions had been submitted to the county planning department, according to Acting Planning Director Kami Griffin. The list includes 14 vineyards, anywhere from four to 450 acres each, as well as a four-acre olive orchard, totaling almost 1,500 acres. It’s a diverse bunch, and includes both small, family-run vineyards and large, higher-profile vineyards. Some are additions to existing operations, and some would be inaugural plantings. Some of the applications are short, two-paragraph letters written by the owners themselves; some are long documents written by hired legal muscle.

The largest vineyard proposed is run by Lodi-based Vino Farms, which saw half of the vineyard already planted as of the ordinance date. SLO-based attorney Joseph Diehl, Jr., who wrote the application, couldn’t be reached for comment as of press time.

In the case of Vino Farms and others, significant steps were already taken well before the ordinance was ever mentioned. Some applicants, however, clearly got in gear at the last minute. Estrella River Vineyard, LLC, plans to expand its Jardine Road vineyard by about 170 acres. The company filed an application for a well permit on Aug. 21 and completed the rest on Aug. 26, including signing contracts with a well driller, paying for an irrigation system design, hiring a company to rip the land, and signing a contract to sell their grapes.

Santa Barbara-based attorney Wesley Strickland, who wrote the letter for Estrella River Vineyard, declined comment to New Times, citing the pending status of the application.

Many of the applications come from smaller vineyards, where the applicants have expressed concern that pulling a plug on investments already made will lead to a considerable loss—even financial ruin. What’s not yet clear is how many projects are waiting in the pipeline.

County Supervisor Adam Hill, who pitched the moratorium idea with Supervisor Bruce Gibson in May, noted that while this process has been a bit rushed, it’s a natural progression that happens when government responds to a crisis.

“It’s one of those things, unfortunately, that it isn’t politically ready until a bunch of people are suffering from the problem,” Hill told New Times.

Meanwhile, however the supervisors decide to wrangle with the vested rights question, the issue is sure to stay hot.

“Philosophically it’s a classic problem of personal property rights vs. the larger community responsibility,” Hill said. “There’s nothing more politically sensitive than water and property rights.”

Staff Writer Jono Kinkade can be reached at [email protected].

-- Melody DeMeritt - former city council member, Morro Bay