Ellen Hanak, director of the PPIC Water Policy Center, and Alvar Escriva-Bou, PPIC senior fellow, testified before the Assembly Water, Parks, and Wildlife and Local Government Committee Joint Informational Hearing on the Sustainable Groundwater Management Act in Sacramento today (February 15, 2022). Here are their prepared remarks.

The San Joaquin Valley—California’s largest farming region—has the biggest groundwater overdraft in the state. This makes the valley ground zero for implementing the Sustainable Groundwater Management Act (SGMA). In collaboration with numerous research and stakeholder partners, PPIC has done extensive work on what SGMA means for this region. This has included analyzing promising solutions for bringing basins into balance, and reviewing how well the first groundwater sustainability plans (GSPs) for the region’s 11 critically overdrafted basins—submitted in early 2020—address key challenges.

Our remarks today recap the nature of the overdraft problem facing the valley, areas for improvement in the region’s sustainability plans, and some near-term priority areas where the state can play an important role in supporting local success.

Tackling the Valley’s Overdraft Problem

In Water and the Future of the San Joaquin Valley, we estimated that the region’s annual groundwater overdraft for the 1988–2017 period was nearly 2 million acre-feet (maf), or 11% of net water use. The consequences of this overdraft are widespread—affecting communities, the regional economy, and the environment. Falling water levels have caused wells to go dry and reduced groundwater reserves, sinking lands are damaging critical infrastructure, and overdraft is posing risks to water quality and ecosystems. As the region’s main water user (nearly 90% of net water use), agriculture will need to lead adaptation efforts.

Ending overdraft involves reconciling groundwater math and socioeconomics. The groundwater math problem is straightforward: attaining balance requires augmenting supplies, reducing demands, or some combination of these strategies. The socioeconomics problem involves picking the portfolio of solutions that brings the most benefits to the region, relative to the costs. We estimate that about a quarter of the region’s groundwater deficit could be met by augmenting water supplies at a cost farmers can afford—mainly by expanding groundwater recharge efforts. The balance will likely need to be met by managing demand—i.e., using less groundwater. Water trading can significantly lower the regional costs of managing demand—in terms of jobs, revenues, and GDP—by enabling water to go to the most productive farmlands.

Successful implementation of this mixed portfolio will require substantial coordination among parties both within and across basins—both to develop water trading and recharge agreements and to expand shared infrastructure needed to support these actions, such as regional water conveyance. This represents a major governance challenge in this region, where basins are large, with a diverse array of stakeholders. Although SGMA has brought many parties together for groundwater sustainability planning, ongoing institutional fragmentation will pose significant challenges to developing the level of coordination required.

Areas for Improvement in Sustainability Plans

SGMA requires local groundwater sustainability agencies (GSAs) to develop and implement plans to bring their basins into long-term balance. It provides a flexible timeline, but with guardrails: following plan adoption, local entities have 20 years to attain sustainability, but groundwater use must not cause significantly unreasonable undesirable results along the way.

The Department of Water Resources recently released its statutory reviews of plans for 10 of the valley’s 11 critically overdrafted basins. To the surprise of some, DWR judged them all to be “incomplete”—and outlined improvements GSAs must incorporate by this summer. The stakes are high: basins that fail to address the concerns could see their plans judged inadequate, potentially triggering intervention by the State Water Board.

DWR’s reviews highlight several key areas for improvement: (1) plans generally need to do more to address undesirable results of groundwater use, such as impacts on drinking water wells and land subsidence; (2) some plans need to improve coordination on data, methods, and management approaches within their basin; and (3) some plans need to flesh out supply and demand management actions to bring basins into balance. Addressing these gaps will be essential to meeting the goals of SGMA.

Our work highlights some additional issues that could limit success:

• Overdraft optimism. Some plans likely underestimate the extent of historical overdraft in their basins, and hence the need for solutions.
• Supply optimism. Most plans appear overly optimistic about the potential for new supplies to fill the gap. In the aggregate, the plans assume that new supplies will address more than three-quarters of overdraft, while demand management will save less than one-quarter. This is the inverse of our estimates, which considered both the costs and the amount of water that might be physically available.
• Avoidance of demand management. Since reducing water use largely means reducing the amount of irrigated cropland, there’s been reluctance to seriously consider the demand side at this early stage of SGMA implementation. To their credit, GSAs in a few basins have begun establishing pumping allocations and exploring flexible tools that could reduce the economic costs, such as fees tied to volumes pumped, groundwater trading, and monetary incentives for land fallowing.
• Climate and drought complications. The warming, changing climate is making droughts more intense, something the plans generally did not anticipate. The return of severe drought so soon after the last one makes balancing groundwater basins even harder. Drought means fewer opportunities for recharging basins (the key supply solution), and more groundwater pumping—with more risks of causing undesirable results such as dry drinking water wells and land subsidence. This makes it more urgent to put solutions in place now to address these impacts and manage demand.

Near-term Priorities

SGMA gives local stakeholders the lead in managing their basins. Since the law was enacted, valley stakeholders have made significant gains in understanding their groundwater basins, and in organizing efforts to manage this vital resource. But with increasingly intense droughts, the clock is ticking. Here are five priority areas where the state can provide strategic support:

1. Address undesirable results of pumping. DWR’s reviews rightly underscore the importance of addressing these impacts, either by avoiding pumping in vulnerable areas, or by mitigating impacts when feasible. Holding GSAs accountable through the regulatory oversight process is the best way to ensure they take this seriously.
2. Accelerate demand management. The state can lend vital technical and financial support to local efforts by promoting robust accounting systems—an essential underpinning of effective demand management programs. Making common tools available could facilitate consistency across planning areas.
3. Promote realistic efforts on new supplies. Groundwater recharge provides the best opportunity for augmenting supplies in this region, but current local plans anticipate two to three times more water than is likely available. DWR and the State Water Board should jointly help determine what’s available, incentivize local cooperation on harnessing these supplies, and facilitate permitting.
4. Assess smart infrastructure investments. The state can be a key partner in identifying and investing in the smart regional infrastructure improvements—such as conveyance—that can help the region flexibly recharge and trade water.
5. Plan for successful farmland transitions. At least 500,000 acres of farmland are likely to come out of irrigation by 2040 to meet groundwater sustainability goals. The state can encourage coordinated approaches so that this land is well managed in alternative uses (e.g., solar energy, habitat). The new Department of Conservation program to support multi-benefit farmland repurposing is a helpful step in this direction.

Local stakeholders must play a central role in attaining groundwater sustainability, and the path ahead may seem daunting. The state can help chart the way with strategic regulatory guidance, technical support, and financial incentives that promote more cooperation both within and across basins—a key to efficient, equitable SGMA solutions.

To see the briefing slides that accompanied this presentation, click here.