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Water crisis squeezes California's economy

A recent federal ruling to reduce the amount of water that flows through the delta is likely to boost food prices and trim jobs in agriculture.

By Daniel B. WoodStaff writer of The Christian Science Monitor / September 12, 2007

Los Angeles

California farmers, who produce half the nation's fruits and vegetables, say they will idle fields and cut back on planting lettuce, cotton, rice, and more.

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Silicon Valley computer-chip makers and other industrial/commercial users say they will rethink manufacturing processes that use water, or dramatically raise the price of products they sell.

Cities from Sacramento to San Diego say drought-era practices of rationed water – low-use toilets and washers, designated water days for lawns and cars – are back, including stiff fines for those who don't follow the rules.

After 35 years of hemming and hawing over how to fix the largest estuary in the Western Hemisphere – the sprawl of canals, levees, and flood plains that join the Golden State's two river systems – the state has been told by a federal judge that business-as-usual is now illegal.

A new ruling to stop pumping up to 37 percent of the water that flows through the delta to protect endangered fish species has sent shock waves of concern into the three main sectors that have long competed for it: cities, farms, environment.

The estuary provides water to 23 million Californians and about 5 million acres of farmland. Overused and under maintained for years, the delta and its water are at the heart of the state's economic vitality, its wildlife habitat, shipping, transportation, drinking water, and recreation.

"In the water business we are facing the biggest challenges here in over half a century … there is no way any knowledgeable person could contest that," says Tim Quinn, executive director of the Association of California Water Agencies, which represents more than 450 of the state's water agencies that provide water to 95 percent of the state's farms and cities. "The state has had some success in better managing this problem for the last decade, but we have hid ourselves from the biggest issue … and Mother Nature is telling us there is no more hiding."

The biggest issue, say Mr. Quinn and others, is the clash between the environment, the California economy, and the population, which is pouring in at more than 600,000 per year.

In recent years, the use of water in the delta has been crippled as a result of drought as well as age, with deteriorating levees that are vulnerable to flood, earthquake, and subsidence. It was environmental groups who most recently challenged water use. The ruling by US District Court Judge Oliver Wanger in Fresno Aug. 31 came after a suit against state and federal water officials by the Natural Resources Defense Council (NRDC) and three other environmental groups.

The agricultural community in the Central Valley appears to be the most worried about the consequences of the judge's action.

Stephen Patricio, chairman of the board of directors for the Western Growers Association and a 30-year farmer of 2,000 acres of cantaloupe near Firebaugh, Calif., says the impact of a 30 percent or more reduction of water to his region will have a domino effect on other jobs.

He expects his $6 million payroll, employing about 600 people during the harvest, will drop to about $1.5 million this year and force him to cut 400 jobs. Those losses will contribute to another 2,400 layoffs in related industries: truck drivers, tractor operators, seed operations, warehousing, repair, and fuel, he says.

The announcement is already having an effect on the loans farmers receive to operate their farms during 2008.