Triangle T Water District and the Absurdities of CA Water

While it may not be an outlier, the absurdity of the Triangle T Water District is a great example of why people say that in California, water flows uphill towards money.


U.S. Bureau of Reclamation

Bloomberg recently published a story (“Groundwater Gold Rush”) reporting on how Wall Street banks, pension funds, and insurers have been plowing money into buying land in California, reaping enormous corporate profits by converting rangeland into almonds and other permanent crops while draining California’s groundwater and drying up community drinking water wells.  I’d like to tell the rest of the story about how Wall Street interests formed the Triangle T Water District, because to my mind the Triangle T Water District highlights the absurdities and inequities of California water policy – including the fact that instead of paying to fix the damage they caused through unsustainable groundwater pumping, state and federal agencies have provided millions of dollars of taxpayers monies to subsidize corporate profits. 

The story begins around 2010, when the John Hancock Agricultural Investment Group (which is apparently part of the John Hancock Financial Services company and is related to the John Hancock Life Insurance Company) bought approximately 12,000 acres of rangeland for cattle near the San Joaquin River.  That land had never been irrigated before and had little or no water rights to divert from the San Joaquin River. However, the lack of water didn’t dissuade these Wall Street profiteers, who – seeing that money grows on trees – planted thousands of acres of new almond trees, installed massive new wells and pumps, and began mining the groundwater. 

And as a result, the ground sank. 

Unsustainable groundwater pumping by John Hancock and other nearby landowners caused the ground to sink nearly 2 feet in just a handful of years (what’s known as subsidence).  This subsidence is causing tens of millions of dollars of damage to water delivery and flood control infrastructure, and impacting the restoration of the San Joaquin River.  Staff from U.S. Geological Service and the general manager of the San Luis Canal Company (Chase Hurley), were quoted in this 2013 Modesto Bee story, explaining that the conversion of the land to new almond orchards meant that “they’re pumping too much water from the deep aquifer and causing subsidence.” The story also notes that, “Merced County farmer Cannon Michael questioned the wisdom of growers who plant permanent crops, like nut trees, on land that has no access to river or canal water.” 

John Hancock is certainly not the only landowner to convert rangelands to almond orchards and other permanent crops, relying on unsustainable groundwater pumping.  In fact, in 2014 the Modesto Bee reported that more than 30,000 acres of land in Stanislaus County had been converted to almond orchards, most of which was previously rangeland that had never been irrigated, and much of which was dependent on groundwater pumping. Another study by the California Department of Conservation found that between 2014 and 2016 – in the midst of drought! – 130,000 acres of rangeland in California were converted to orchards or vineyards, dramatically increasing the demand for water.  And sadly, there are all too many examples in recent years where conversions of rangeland to industrial agricultural in California, in areas dependent on unsustainable groundwater pumping, have caused drinking water wells – all too often, wells serving communities of color – to dry up in the San Joaquin Valley (for example, see here or here). 

Absurdity #1: Despite causing millions of dollars in damage, the State and Feds never forced Triangle T to pay for the damage their unsustainable groundwater pumping caused.  Nor did anyone force Triangle T to stop their unsustainable groundwater pumping.  The Bloomberg story notes that Triangle T agreed to reduce groundwater pumping, which cut the rate of subsidence near the San Joaquin River at Sack Dam in half – but that means their groundwater pumping is still unsustainable, and is still causing subsidence damage.  And if these Wall Street investors don’t have to pay to fix the infrastructure they damaged, that means taxpayers – and possibly farmers and residents in nearby water districts -- will end up having to pay to fix the damage, or it just won’t get fixed. 

Not only do they not have to pay for the damage they caused, but instead State and federal agencies have awarded more than ten million dollars in grants of taxpayer money to subsidize Triangle T’s unsustainable operations and help facilitate water diversions that harm salmon and the restoration of the San Joaquin River.  Public records show that the California Department of Water Resources has awarded more than $10M to these Wall Street profiteers in the Triangle T Water District, including a $4.197M grant from DWR in 2021 and a $7.6M grant award from DWR in 2022.  The federal government has also awarded grants of taxpayer monies.  Instead of using this money to help ensure safe and affordable drinking water for the communities that lack this basic right, or to help small, disadvantaged farmers comply with the Sustainable Groundwater Management Act, or to help protect and restore the environment, taxpayers are subsidizing corporate profits.    

Again, Triangle T isn’t an outlier. For example, unsustainable groundwater pumping by growers in the Westlands Water District caused significant subsidence damage to the California Aqueduct, which may cost more than one billion dollars to repair. And just like with Triangle T, instead of forcing these industrial agribusinesses to pay for the damage they caused, State and Federal agencies are proposing to spend hundreds of millions of dollars of taxpayer monies to repair the damage caused by agribusinesses in the Westlands Water District. 

Absurdity #2: The formation of the Triangle T Water District in 2017 highlights the distinctly un-American (but legal!) process where voting is based solely on the value of land ownership.  The landowners got to vote whether or not to support the creation of this new district, with each landowner having “one vote for each dollar’s worth (assessed value) of land to which he or she owns title.”  If you don’t own land, then you don’t get to vote – even if the District’s operations affect your water supply and/or the rates you pay for water. 

Ultimately, the landowners voted in favor of the proposal, and created the Triangle T Water District in 2017. The District’s bylaws provide that with respect to voting in District elections, “each holder of title to land within the District shall have one vote for each dollar’s worth of land to which he holds title.”  While this voting procedure doesn’t disenfranchise a lot of people living in the Triangle T Water District (the Commission concluded that there are fewer than 12 residents residing in the District), in other water districts that include sizeable populations – including disadvantaged communities – state law allows this distinctly un-American procedure. 

Oh, and in another absurd twist, when the John Hancock Life Insurance Company submitted a petition to the Madera County Local Area Formation Commission in 2015 to form the Triangle T water district, the Commission’s analysis of the petition stated that, “groundwater supplies within the District are adequate.”

While it may not be an outlier, the absurdity of the Triangle T Water District is a great example of why people say that in California, water flows uphill towards money. 

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