Page 65 - Forbes India (December 2015)

area as an investment in the 1970s. three other allegations—including that is being tracked by Nasa. The
Over the next decade, he picked one challenging the agreement’s court ordered the state last year to
up tens of thousands more acres. constitutionality. The case is now conduct an environmental review
When a six-year drought started in being tried in Sacramento’s Third by mid-2016 that could result in
1987 and cost local farmers $800 District Court of Appeal. “We’re new limits placed on pumping.
million, he had much less skin in warriors out here trying to make In the second suit brought on
the game. Still he took note, quickly sure that a bunch of fat cats don’t by those two water districts and
realising that the contracts he had suck this state dry,” says Adam Keats, two others, Kern Water Bank
with the state, which delivered water chief lawyer for the opposition, who leaders agreed under a settlement
from the California Aqueduct—a adds that the Resnicks’ lawyers have to assess damages and, if necessary,
444-mile-long channel flowing with “a level of rabidness in protecting compensate the affected landowners.
runoff from the snow-capped Sierra their fortunes. They are fiercely The Resnicks are already looking
Nevada mountains—were vulnerable defending that golden goose”. to secure additional water sources.
when water was scarce and the state Neighbouring water districts to The couple could score big if a $15
couldn’t meet everyone’s needs. Kern Water Bank filed two complaints billion water project championed by
In what some critics have called in 2010 when farmers’ wells began Governor Jerry Brown is officially
secret meetings, some of his most drying up. In one, Rosedale-Rio approved in the next few years.
trusted advisors met with leaders from Bravo and Buena Vista alleged that At least two Wonderful farming
southern California water districts the water bank was pumping at executives are involved in a grassroots
and state water officials, helping “dangerous and unacceptable levels”. push for the project, now called
broker a sweetheart deal in 1994. Two Water levels dropped further as the California WaterFix, which would
decades later, it still gives the Resnicks drought raged on. An analysis of carry water from the Sacramento
nearly unrivalled access to water. three decades of water-level records River Delta through two 30-mile-long
Wonderful denies the meetings were obtained by Forbes shows that the tunnels to San Joaquin Valley farms.
done clandestinely, alleging that those Kern Water Bank members have There’s another cushion they’ve
who say so have an “axe to grind”. consistently pumped far more than been building for decades. They have
The upshot of that meeting: California their neighbours. Because California invested $100 million in technology
handed over public land and an was the last state in the West to initiatives designed to help manage
underground aquifer (former farmland start placing limits on groundwater water shortages and high utility costs;
and oilfields that had the potential pumping, with legislation passed their water expenses, which tripled
to store about 500 billion gallons of just last year and taking effect only in the past 15 years, account for 40
water) to five public water districts by 2020, it was legal, if not ethical. percent of their agricultural costs.
and the Resnicks’ Westside Mutual There was also an allegation that the “There’s no bigger incentive. We have
Water Co. The new owners agreed pumping may have caused land to sink a very aggressive R&D programme,”
to forfeit state water contracts. They in the Central Valley, a phenomenon Stewart says. In addition to drip
then installed a six-mile-long canal irrigation systems now used on all
and 85 wells at a cost of $50 million. their farms, they have spent $22
Forbes estimates that the Resnicks’ million on solar energy networks and
57 percent stake in the storage facility $41 million on fuel-cell research and
is worth at least $250 million. implementation to power their plants
But their ownership has been and facilities more cost effectively. A
under siege, challenged in court nearly new research project is also about to
continuously for the past two decades. roll out “supertrees” cultivated to yield
In 2010, the Center for Biological more with a regular tree’s amount of
Diversity, a nationwide environmental water, which could even be sold to
non-profit group based in Arizona, and rival farmers. Whatever the future
several other groups sued the bank brings, it would probably be a mistake
and its members, including Westside to bet against the power couple.
and the Res nicks’ parent company. A “You have to be an optimist
Sacramento County Superior Court to be a farmer. Fortunately,
judge ruled last year that the state with our management team, we
gave up the water resources without have some optimists and some
properly analysing the potential An FTC commissioner rules your ads are pessimists,” Stewart says. And, of nEwSCOm
environmental impacts but dismissed misleading? Game on: Quote him! course, some opportunists.

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