9-15-09

 
9-15-09
Merced Sun-Star
Furor over Atwater city councilman not going away
Calls continue for Frago to resign...JONAH OWEN LAMB
http://www.mercedsunstar.com/167/v-print/story/1057353.html
ATWATER -- Much of the furor over a series of racist e-mails forwarded by Atwater City Councilman Gary Frago to city staff and a county official may have died down, but those calling for his resignation are staying vigilant.
At Monday night's City Council meeting -- and the previous meeting -- calls for Frago's resignation continued despite his apologies, resignation as mayor pro tem and participation in racial sensitivity classes.
Napoleon Washington, the president of Merced's chapter of the National Association for the Advancement of Colored People, in no uncertain terms repeated his group's call for Frago to step down.
But his speech was not only aimed at Frago. He also lambasted the City Council -- with the exception of Councilman Nelson Crabb -- for its weak response, he said.
"This issue will not go away and it will not go away until Mr. Frago resigns from office," said Washington to the council. "The council needs to take an appropriate stand."
No council member has publicly called for Frago's resignation. Frago did not return calls from the Sun-Star.
While no council member responded to Washington's remarks on Monday night, City Attorney Dennis Myers told Washington the council had done all if could legally. The council has no power to remove Frago from office, he said.
Myers told Washington the only option to remove Frago from office is a recall or the ballot box when his term runs out.
"You can come up and give the speech every time, that's your right," said Myers.
Aside from the continued public pressure at council meetings, the NAACP has asked the city for its policy on discrimination, and an ethnic breakdown of city staff, said City Manager Greg Wellman.
In a letter sent to the city on Sept. 3, the group also laid out a seven-point program it would like the city to take to prevent discrimination in hiring, firing and promotions.
On Sept. 3, the group also met with city officials to discuss the progress of citywide racial sensitivity training.
Councilman Joe Rivero said the city's sensitivity training will be a tool giving people an obvious path to take in the future. But he did say in the end it is up to each individual whether or not they act in a certain way or not.
Crabb, who says he will not take any sensitivity classes since he did nothing wrong, said at this age you know what is OK to say and what isn't, and no class will change that.
As for Frago's sensitivity classes in Oakland, the NAACP has its reservations.
Washington said in the end it is impossible to know if Frago will change or not. And unless it becomes clear that Frago has actually changed, the NAACP plans to keep protesting until he is out of office, said Washington.
A Sun-Star story on July 17 revealed that Frago sent at least seven racist e-mails to city and county officials from October 2008 to February 2009. The e-mails denigrated President Obama, the first lady and black people in general.
Subsequently, the City Council released even more of Frago's derogatory e-mails and convened two large public meetings on the issue where Frago apologized and the city formally reprimanded him in a letter.
Interviews for Merced County CEO spot upcoming
A handful of candidates has been selected from 29 applicants...CORINNE REILLY
http://www.mercedsunstar.com/167/v-print/story/1057371.html
The Merced County Board of Supervisors will begin interviewing chief executive candidates in the coming weeks, with hopes of naming a new county CEO by next month.
Supervisor Deidre Kelsey said Monday that 29 people applied for the job. The pool has been narrowed to a handful of candidates who will begin interviewing with the board this month, Kelsey said.
The county's current CEO, 62-year-old Dee Tatum, has held the job since 2001. He announced late last year that he will retire this December.
The CEO is the highest nonelected official at the county. The position's responsibilities include implementing policies set by the Board of Supervisors and managing the county's 2,400 employees and its $450 million annual budget.
In announcing his retirement, Tatum suggested that supervisors begin interviewing candidates by June to allow him some overlap with his successor. The county has fallen well behind that timeline, but officials said they nonetheless expect to achieve a smooth transition.
"I think we're still going to have time for that overlap," Kelsey said. "I've been told that we have some very strong people that we're looking at."
Despite the fact that taxpayers pay the CEO's six-figure salary, the county's spokeswoman, Katie Albertson, took a stance of nondisclosure about details of the hiring process. She said the county couldn't provide the exact number of candidates who will meet with the board, explaining that county attorneys had deemed the figure confidential. She said she also couldn't disclose whether anyone already employed by the county is among those who will be interviewed.
Officials with CPS Human Resource Services, a Sacramento-based headhunting firm that's assisting the county in its CEO search, also declined to provide information on candidates. The county hired CPS in May, agreeing to pay the company $24,000 to advertise the job nationally, develop a candidate profile, narrow the applicant pool, conduct background checks and help draft the new CEO's contract.
The firm stopped accepting applicants in mid-July. The candidate interviews will be closed to the public, though the board will vote on who to hire in open session.
Whoever is selected will come in at an especially challenging time. Faced with a sharp decline in tax revenues and massive funding cuts handed down from Sacramento, the county last month slashed its budget by $33 million. Included in the local cuts were 89 employee layoffs and measures that drastically scaled back social service programs for the poor, the disabled and the mentally ill.
"We know more cuts are going to be coming down from the state, and we know it's going to be another very difficult year," Kelsey said. "In times like this, the CEO's job can be very stressful, and whoever is chosen is probably going to have to make some very unpleasant decisions."
Besides experience and intelligence, Kelsey said she'll be looking for a candidate with a good sense of humor. "We need someone who can stay positive, even in hard times," she said.
Added Supervisor Hub Walsh: "I think it's going to be especially important to get someone who can engage all the stakeholders who are affected when there have to be cuts, including our department heads, county staff and the community."
The headhunting firm didn't list a salary range in advertising the CEO job, but if Tatum's pay is any indication, his successor's salary will be well into the six-figure range; Tatum earns roughly $230,000 a year.
The next CEO will be the fifth to serve the county in the past 50 years.
Our View: UC wrong to raise tuition again
Children of middle-class families will be the hardest hit by this.
http://www.mercedsunstar.com/181/v-print/story/1057367.html
Another staggering tuition increase being proposed at University of California campuses is wrong-headed, and will damage California for years to come.
We should be investing in our brightest young people and not driving them away from our public universities.
There was a time when California's leadership understood that its first-rate public university system would produce graduates whose skills put the state on the cutting edge of almost every sector of American society.
Now the once-proud UC and California State University campuses are decaying under a leadership philosophy that no longer treats students as assets.
So it's hardly surprising that UC President Mark Yudof is recommending a 15 percent increase in tuition next spring and a second 15 percent increase beginning in fall of 2010.
The Board of Regents will review the proposal Wednesday, and could adopt it in November.
In recent years, the UC administrators have undertaken a philosophy of balancing its budget on the backs of students. They've already asked students to pay almost 10 percent more this year, and have raised fees almost yearly.
Undergraduate tuition at UC will be in excess of $10,000 a year if the increases are approved.
Students at California State University campuses also have been slammed with massive fee increases.
Officials at UC and CSU try to justify the increases by saying one-third of the increases will go to financial aid to offset the impact on students.
This justification has always struck us as silly. They'll raise the fees on all students to give part of it back to those on financial assistance.
It would be more efficient to cut the fee increase by one-third, and not have to go through the redistribution of revenue to various students.
The real impact of these massive fee increases is to limit access of California's middle class to UC and CSU campuses. Children from wealthy families will be able to pay the increases and children from poor families will get financial aid to subsidize their educations.
But no one is looking out for children of middle-class families, which was once the backbone of California. The state will pay for this shortsightedness with fewer productive minds.
This is one more reason that the Golden State has become tarnished.
Modesto Bee
Legislature can't sit by as water plan goes down the drain...Editorial
http://www.modbee.com/editorials/v-print/story/854747.html
The Legislature finished its regular session early Saturday morning without resolving one of California's most critical issues: water.
Some key players, including Sens. Dave Cogdill, R-Modesto, and Darrell Steinberg, D-Sacramento, the president pro tem, said they made serious progress toward a comprehensive water plan. That sounds great, but where's the finished product? There isn't one.
It's imperative that Democrats and Republicans make more compromises to get water solutions moving. The longer they delay, the more serious the consequences and the greater the public sentiment that the Legislature just can't get the job done on large intractable issues.
We acknowledge the many interest groups and elements surrounding a major overhaul. And we know it's impossible to satisfy everyone. But the answer is not perpetual delay. As the adage goes, don't let perfection be the enemy of the good.
We don't want the Legislature to do what Congress has all too often done -- pass a bill that no one had a chance to read, much less study. But these water issues have been on the table for years; as such, the problem isn't with new information or a lack of information, it's an unwillingness and inability to compromise.
That needs to end not sooner, not later, but now, with an overhaul that:
- Promotes conservation by urban, agricultural and industrial users and spreads the conservation mandates equitably across the state;
- Provides additional water storage, in reservoirs and underground;
- Addresses the serious environmental degradation of the Delta;
- Provides a way to pay for the improvements through a water bond. Farmers and businesses that benefit directly should contribute to their construction and upkeep, but a comprehensive water plan must recognize the collective benefit of water for all Californians.
Gov. Schwarzenegger insisted he would not sign a water package without the bond, and in the end, the Democrats pulled back their package of bills. While the governor's threats are getting tiresome, this one was legitimate and well used.
If the lawmakers indeed are closing on a meaningful compromise, they should keep at it. A special legislative session is in order; water is too urgent an issue to put off yet another year.
Fresno Bee 
Appeals court blocks BLM-Asarco land swap...BOB CHRISTIE, Associated Press Writer
http://www.fresnobee.com/559/v-print/story/1637756.html
PHOENIX A federal appeals court ruled Monday that a proposed land exchange between the federal Bureau of Land Management and copper miner Asarco LLC violates environmental laws.
The ruling in the lawsuit filed by three environmental groups in 2001 overturns a lower court decision backing the exchange long sought by Asarco.
The swap would give Asarco nearly 11,000 acres of public land in exchange for 7,300 acres of the company's private holdings. It would allow Asarco to expand its Ray copper mine 50 miles north of Tucson.
A panel of the 9th U.S. Circuit Court of Appeals agreed with the Tucson-based Center for Biological Diversity, the Grand Canyon chapter of the Sierra Club and the Western Land Project that the BLM's environmental reviews of the deal's consequences were inadequate.
The environmental groups argued that Asarco would not be held to the same standards for operations, planning, monitoring environmental impacts and remediation if it owned the land.
The BLM environmental impact report assumed that private or federal ownership of the land made no difference in how the mining would take place.
The three-judge ruled otherwise, with one judge dissenting.
It ruled that federal environmental laws required the BLM to compare in detail the likely environmental consequences that would occur with and without a land swap.
"The BLM has not done this. Indeed, it has not even attempted to do this," Circuit Judge William A. Fletcher wrote.
Christopher Krupp, an attorney with Western Land Project, said he expects either the BLM or Asarco to ask the entire 9th Circuit to review the decision.
Asarco is under bankruptcy protection and the subject of a bidding war between former parent Grupo Mexico, based in Mexico City, and Mumbai-based Sterlite Industries Ltd.
A call to Asarco wasn't immediately returned Monday. A spokeswoman for the Bureau of Land Management wasn't aware of the ruling and couldn't immediately comment.
A Sierra Club official praised the decision and the message it sends to the BLM.
"What frequently happens with land exchanges is that they are driven by whoever wants the public land so they can do what they want with it," said Sandy Bahr, director of the club's Grand Canyon chapter. "These are important lands and an important message to the BLM is that you need to do your jobs - you need to look out for the public interest and not just Asarco's."
The appeals court noted that the BLM ignored "strong objections" by the Environmental Protection Agency about the impacts of mining on the site that could be corrected by modifications to the plan.
Fixes for water problem...Ron Harben, Fresno...Letter to the editor 
http://www.fresnobee.com/277/v-print/story/1638000.html
Re Assembly Member Mike Villines commentary [Sept. 10] “It’s time to fix the state’s water crisis”: Did Assembly Member Villines not read Mark Grossi’s Earth Log article about the Dudley Ridge Water District permanently selling 14,000 acre-feet of water to San Bernardino?
This is not an isolated incident, either. The Berrenda Mesa Water District has also sold water — 16,000 acre-feet — to Southern California. The fallowing of land Villines decries is true, but only because the landowner in the Dudley Ridge water sale voluntarily fallowed the land so he could sell the “excess” water to the Mojave Water District.
If Villines really wanted to help solve the Valley’s ag water problem, he could do two things. One, break up the sweetheart relationship between the State Water Project, the Kern Water Bank, the Kern County Water Agency, Paramount Farms, and their policies that allow water to be “divvied up” sold “down the river” to Southern California.
Pass legislation that requires all water districts fix leaky delivery systems. According to a USDA study in 1982, the Anderson-Cottonwood Irrigation District in Redding diverts about 130,000 acre-feet of water but looses 92,000 acre-feet from its leaky system. That 92,000 acre-feet could irrigate about 30,000 acres in the Valley.
Stockton Record
Trinitas to be auctioned
But $2.4M in unpaid loans likely to scare off buyers, experts believe...Dana M. Nichols
http://www.recordnet.com/apps/pbcs.dll/article?AID=/20090915/A_NEWS/909150315/-1/A_NEWS#STS=fzmv6iak.1409
SAN ANDREAS - The 280-acre Trinitas golf course south of Wallace is scheduled to be auctioned off at a bank foreclosure sale in front of the Calaveras County Courthouse at 10 a.m. Oct. 9.
Yet neither the golf course's owner nor real estate industry insiders in Calaveras County expect anyone to offer the $2.4 million Community Bank of San Joaquin says it is owed.
"I don't think it will go to sale," said Al Segalla, a longtime real estate broker in Calaveras County. "The loans are so much above what it would sell for in a foreclosure sale."
Part of the problem is that the land is zoned for agriculture. Owners Mike and Michelle Nemee were receiving a Williamson Act tax break intended to encourage them to preserve agricultural land when they began construction on the project.
The Calaveras County Board of Supervisors refused in May to legalize the golf course by changing the land's zoning to recreation. And not long after that, county code enforcers sent the Nemees a letter saying they had to halt the golfing, because it is an illegal use on agricultural land.
The Nemees, meanwhile, have fought back by appealing that letter and by filing several lawsuits. They argue that the county's own regulations allow ranch and farm owners to open golf courses as a way to get the money needed to subsidize otherwise unprofitable agricultural operations.
The scheduled foreclosure sale is documented in notices filed Monday and late last week at the Calaveras County Recorder's Office. Those documents indicate that the loans Community Bank of San Joaquin made on the golf course property date back to 2002 but were modified and increased a number of times.
The Nemees claim the bank extended its largest loan - more than $2 million - only after a former county official reassured the bank in 2007 that the project ultimately would be approved.
Current county officials - and neighbors who oppose the course - say the Nemees should have received all necessary permits before they began construction.
"It was ill-conceived," said Lew Mayhew, a neighbor of the project and one of the leaders of Keep It Rural Calaveras, a neighbor group organized to fight the golf course. "Anytime you start building before you have entitlements, you put whatever you are doing at risk. It is very unfortunate, but that is the reality."
The golf course continues to operate despite opposition by county officials, and Mike Nemee said Monday that he's still optimistic his business will succeed.
"It is our sincere hope that we can resolve the matter between us and the county and the bank soon so we can save our family ranch," Nemee said.
Meanwhile, the Nemees' appeal of the order to halt golfing was rejected Aug. 20 by the Calaveras County Planning Commission and will go next to the Board of Supervisors, where it may be heard as soon as Oct. 6.
Maybe next year...Alex Breitler's blog
http://blogs.recordnet.com/sr-abreitler
While in-Delta interests were thankful a heaping plate of Delta bills didn't make it through the Legislature late Friday, a broad coalition of environmental groups and water agencies -- who, for once, found common ground -- were not so enthusiastic.
Here's a take lifted from the NRDC rep Barry Nelson's blog. NRDC was heavily involved in the negotiations and supportive of the legislative package:
"Unfortunately, the final package failed to pass the legislature on the last day of session on Friday.  That failure was largely due to a lack of time (the final package was released on Friday morning) and disagreements over a $12 billion water bond and proposed subsidies for agricultural water supply dams.  Nevertheless, the developments of the past few days mark an historic moment in California water policy.   Although the failure of that package is disappointing, we believe that it has set the stage for what we hope can be a breakthrough next year."   
NRDC
Horseshoes, Hand Grenades and California Water Policy...Barry Nelson, Western Water Project Director, San Francisco...9-14-09
http://switchboard.nrdc.org/blogs/bnelson/horseshoes_hand_
grenades_and_c.html
Harry Truman once said that "close only counts with horseshoes and hand grenades."  In the coming year, we'll see if close also counts in California water policy. 
Last Friday, in the closing hours of the legislative session for the year, the California legislature was unable to pass an extraordinarily ambitious package of water reform legislation.
The closing day of the legislative session was made more dramatic by the release of a revised package of legislation that was shaped, in part, by discussions among several stakeholders, including NRDC and other environmental groups, the Metropolitan Water District of Southern California, the Westlands Water District and the LA Chamber of Commerce. 
All of these groups, with the exception of Westlands, also supported three additional bills, which together formed the most ambitious package of state water reform legislation in the past quarter century.  The package was a bold attempt to implement the recommendations of the Delta Vision Task Force, which were designed to chart a new course in the Delta and for California water policy. 
The final bill consolidated five separate pieces of legislation, including AB 49, a water conservation bill that is co-sponsored by NRDC.  The package contains a number of measures crucial to using our precious water resources more fairly and efficiently, restoring our iconic salmon fisheries, and providing a more reliable water supply for farms, cities, and ecosystems. In particular, the bills will: 
· Implement the Governor's call to reduce water consumption by 20 percent by 2020
· Reduce reliance on the Sacramento-San Joaquin Delta by increasing water recycling, cost-effective efficiency, and regional self-sufficiency
· Establish performance standards and new public trust flows critical to achieving a healthy and resilient ecosystem
· Ensure that the restoration planning process for the Delta meets the highest standards for species recovery
· Ensure that construction of any new conveyance facility cannot begin until the State Board has issued a permit that includes binding protections for California's beleaguered fisheries
· Substantially increase the State Board's power to enforce water rights and limit illegal diversions
· Expand groundwater management and monitoring efforts
· Restore the Delta ecosystem while addressing water supply and water quality problems
· Require Delta agencies to respond to climate change and the threats it presents to the Delta communities
· Provide for numerous measures to substantially improve the reliability of water supplies statewide
Unfortunately, the final package failed to pass the legislature on the last day of session on Friday.  That failure was largely due to a lack of time (the final package was released on Friday morning) and disagreements over a $12 billion water bond and proposed subsidies for agricultural water supply dams.  Nevertheless, the developments of the past few days mark an historic moment in California water policy.   Although the failure of that package is disappointing, we believe that it has set the stage for what we hope can be a breakthrough next year. . 
Redding Searchlight
Dam removal soon will begin on Battle Creek...Dylan Darling
http://www.redding.com/news/2009/sep/15/dam-removal-will-soom-begin-on-battle-creek/
Spring-run chinook salmon and steelhead soon will have new waters to swim in along Battle Creek near Anderson when a nearly century-old dam is removed.
Workers with Contractor Services Group Inc. of West Sacramento are set to start tearing out Wildcat Dam, about 13 miles upstream from Coleman National Fish Hatchery, in November, said Pete Lucero, a spokesman with the U.S. Bureau of Reclamation in Sacramento.
"It's just another blockade to anadromous fish," Lucero said.
The bureau - along with five other agencies and Pacific Gas and Electric Co., which owns the dam - aims to open 42 miles of spawning and rearing habitat for salmon and steelhead along the upper reaches of Battle Creek, a tributary to the Sacramento River.
"The Wildcat is the first step in that," said Jim Smith, project leader at the U.S. Fish and Wildlife Service's Red Bluff office.
The cost of the overall project is nearly $80 million, with five small dams set to be removed. Along with the removal of Wildcat Dam, the initial phase of the project includes the addition of fish ladders and screens at two other dams along the creek.
Among other agencies working on the project are the California Department of Fish and Game, the California Wildlife Conservation Board, the California Department of Transportation and the U.S. Fish and Wildlife Service.
A temporary diversion at Coleman will still be used to channel winter and fall-run chinook into the hatchery between August and March, Smith said.
The bureau awarded Contractor Services Group the $2 million contract for dam removal earlier this month, Lucero said. The work should take a year to complete.
Built in 1912, Wildcat Dam is part of a cluster of small dams on the north and south forks of Battle Creek. The dams divert water from springs near Lassen Peak to three small powerhouses that produce 28 megawatts, or enough power for 21,000 homes. Once Wildcat and the other dams are removed, the project will produce only about 20 megawatts, or enough for 15,000 homes.
The last dam removed in California was also in the north state, Lucero said. Workers tore out the Saeltzer Dam on Clear Creek in 2000, also to clear the way for ocean-bound fish.
San Francisco Chronicle
Obama administration submits salmon plan...AP
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/09/15/national/a084515D97.DTL&type=printable
Portland, Ore. (AP) -- The Obama administration says it will be more aggressive in protecting declining Pacific Northwest salmon runs and will study breaching some dams as a last resort in a long-awaited management plan.
The administration submitted the plan to a federal judge Tuesday in Portland. called a "biological opinion," it will guide hydroelectric dam operations and fish conservation programs in the Columbia Basin for the next decade.
U.S. District Judge James Redden rejected two earlier plans in 2000 and 2004, threatening at one point to take control of dam management.
The new plan would immediately boost mitigation programs to boost salmon survival, expand research and monitoring, and set specific biological "triggers" for even stronger measures.
But the Obama administration plan supported an earlier version offered by the Bush administration, even though Redden found portions of that plan inadequate.
The Obama administration said it will speed up things like habitat improvement projects because of concerns about uncertainties such as the effect of climate change.
The revised plan also directs the Army Corps of Engineers to begin studying removal of the Snake River dams but warned it was "viewed as an action of last resort."
The biological opinion is required by the federal Endangered Species Act to protect salmon and steelhead in the Columbia River Basin.
It was prepared by the National Oceanic and Atmospheric Administration and the three federal agencies involved in operating dams, the Army Corps, the Bonneville Power Administration and the U.S. Bureau of Reclamation.
Interior Dept. gets ready for global warming...AP
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/09/14/national/w142510D94.DTL&type=printable
WASHINGTON, (AP) -- Interior Secretary Ken Salazar moved Monday to prepare the nation's parks, refuges and endangered species for the onslaught of global warming.
Salazar signed an order setting up a Climate Change Response Council and eight regional response centers to study and respond to such issues as rising sea levels threatening to swamp historic structures and warmer temperatures shifting where wildlife live.
The order also commits the Interior Department to develop a plan to reduce its own greenhouse gas emissions, including setting a firm target.
"The realities of climate change require us to change how we manage...the resources we oversee," the order reads.
Earlier this year, Salazar directed the Interior Department, which manages one-fifth of the nation's landmass, to jumpstart renewable energy development. Monday's action builds on that effort by launching a project to develop ways to store carbon dioxide, the most prevalent greenhouse gas, on park, refuge, and tribal lands.
Carbon dioxide could be stored by pumping it underground, or by conserving or growing more trees and grasses to absorb it.
Environmentalists lauded the action Monday, saying that it sent a signal that climate change was a a top priority.
"Secretary Salazar deserves praise for recognizing that climate change waits for no one, and that the impacts of global warming on our public land and water resources could be very widespread and very serious," said Bill Meadows, president of The Wilderness Society.
EPA tightens limits on power plant water pollution...DINA CAPPIELLO, Associated Press Writer
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/09/15/national/w100010D23.DTL&type=printable
WASHINGTON, (AP) -- For the first time in nearly 30 years, the Environmental Protection Agency plans to strengthen standards for water pollution from coal-fired power plants.
The agency said Tuesday that equipment required to reduce air pollution has increased the harmful contaminants in water discharged by power plants. It also said that existing regulations are not enough to protect water quality and wildlife.
In a study completed earlier this year, the EPA found that only a fraction of the nation's power plants were using the necessary technologies to remove pollutants before they are released into waterways. The announcement comes a day after three environmental groups threatened to sue the EPA for failing to update its regulations, first put in place in 1982.
Marin Co declares ag emergency after low rainfall...Marin Independent Journal
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/09/14/state/n112611D74.DTL&type=printable
Novato, Calif. (AP) -- Marin County officials have declared an agricultural emergency because of drought conditions.
The declaration allows Marin farmers and ranchers to apply for federal disaster relief funds if they are made available.
Officials say rainfall is 28 percent below average and that ranchers — who make up the county's largest agriculture industry — have lost 30 to 40 percent of their pastures.
The loss of pastures can force ranchers to sell livestock earlier or incur larger feed costs.
Still, county officials say federal funds may not be forthcoming because the U.S. Department of Agriculture Farm Service Agency says it might only fund those ranchers or farmers who lose more than half of their pasture or crops.
Los Angeles Times
A nuclear waste solution
Yucca Mountain may never be used, but a physicist lays out his argument favoring repositories over costly reprocessing...Frank von Hippel. Frank von Hippel, a physicist, is a professor of public and international affairs at Princeton University and co-chairs the International Panel on Fissile Materials. Previously, he was assistant director for national security in the White House Office of Science and Technology Policy.
http://www.latimes.com/news/opinion/la-oe-vonhippel15-2009sep15,0,1161470,print.story
The Yucca Mountain nuclear waste repository project is now comatose, if not dead. And that puts us back at square one on a crucial question: What are we going to do with all the radioactive waste being discharged by U.S. nuclear power reactors?
Many conservatives on Capitol Hill favor the French "solution": spent-fuel reprocessing. But reprocessing isn't a solution at all: It's a very expensive and dangerous detour.
Reprocessing takes used or "spent" nuclear fuel and dissolves it to separate the uranium and plutonium from the highly radioactive fission products. The plutonium and uranium are then recycled to make new reactor fuel, thereby reducing the amount of fresh uranium required by about 20%. But based on French and Japanese experience, the cost of producing this recycled fuel is several times that of producing fresh uranium reactor fuel.
In the past, about half of France's reprocessing capacity was used to process spent fuel from foreign reactors. Because of the high cost, however, virtually all of those foreign customers have decided to follow the U.S. example and simply store their used reactor fuel.
The French reprocessing company AREVA claims that its method reduces the volume and longevity of the radioactive waste produced by nuclear power reactors. But when you take into account the additional radioactive waste streams created by reprocessing and plutonium recycling, the volume of the long-lived radioactive waste is not reduced. And most of the recycled plutonium is neither destroyed nor reused. Its isotopic makeup makes it difficult to use in existing reactors, so AREVA simply stores most of it at the reprocessing plant.
All in all, reprocessing as practiced in France amounts to an expensive way to shift France's radioactive waste problem from its reactor sites to the reprocessing plant.
For some of AREVA's customers, that is the point. When I asked the fuel managers of Japan's nuclear utilities why they reprocess, their answer was that they would love to store their spent fuel on site as the U.S. does until an underground radioactive waste repository becomes available. But local governments have vetoed dry-cask storage at their nuclear power plants. The stark choice for the industry, therefore, is to either pay for reprocessing or shut down all of Japan's 53 power reactors.
Reprocessing is enormously dangerous. The amount of radioactivity in the liquid waste stored at France's plant is more than 100 times that released by the Chernobyl accident. That is why France's government set up antiaircraft missile batteries around its reprocessing plant after the 9/11 attacks.
Even more dangerous, however, is the fact that reprocessing provides access to plutonium, a nuclear weapon material. That is why the U.S. turned against it after 1974, the year India used the first plutonium separated with U.S.-provided reprocessing for a nuclear explosion. President Gerald Ford and Henry Kissinger, his secretary of State, managed to intervene before France and Germany sold reprocessing plants to South Korea, Pakistan and Brazil, all of which had secret weapons programs at the time.
Since that time, the U.S. government's argument that "we don't reprocess, you don't need to either," has been extremely successful. Japan is the only non-nuclear weapon state that still does today. If the U.S. began to reprocess again, that would legitimize another route to the bomb for nuclear weapon wannabes.
The U.S. made the mistake with Yucca Mountain of trying to force a repository on an unwilling state. One alternative would be to follow the path of Finland and Sweden, which have placed their underground repositories in communities that already host nuclear power plants. They have found that once people in a community have accepted a nuclear facility, they view the addition of an underground repository as a relatively minor issue.
In the meantime, spent fuel can be safely stored on site in dry casks for decades. It is not a permanent solution, but there is no reason to panic until we can build more permanent facilities. Reprocessing would be a panic solution.
Foes in Montebello project dispute find common ground: City Hall turmoil
Developers and environmentalists, at odds over housing proposed for the last unbuilt area, agree that little can be decided until City Hall drama calms down. Caught in the middle: gnatcatcher habitat...Louis Sahagun
http://www.latimes.com/news/local/la-me-montebello14-2009sep14,0,7870334,print.story
Developers and environmentalists at odds over a plan to transform Montebello's last stretch of undeveloped highlands into a $500-million housing project have found common ground in at least one area: the instability at Montebello City Hall.
At stake is the future of 488 acres of rugged open space in the Eastside suburb. Today, the land is an active oil field and refuge for the largest population of threatened California gnatcatchers in Los Angeles County.
But political turmoil at City Hall has complicated matters for both camps as they strive to strike a balance between stoking the local economy and protecting open space that features a rare swath of coastal sage scrub habitat.
Two Montebello City Council members -- both of whom favor the development -- are the targets of a bitter recall campaign related to a legal dispute over trash hauling rights. The other three council members are up for reelection in November. In addition, conflict of interest issues involving the housing project have arisen with several other key city officials.
"Until there is political stability in Montebello," said Byron de Arakal, a spokesman for the developer, Cook Hill Properties of Newport Beach, "they will have a difficult time moving forward and improving their city."
Linda Strong of the Sierra Club's Save the Montebello Hills Task Force agreed. "Montebello is a political mess," she said. "We're very concerned with the process as the city deals with the environmental impact report on this project."
The project has been under discussion by the city for four years. As the environmental impact report nears completion, it is unclear who will be in office to approve or reject it, with all five council members' seats in question.
The development plan calls for adding housing for 4,000 in a city struggling with aging sewers and roads, a stagnant economy and a dearth of parkland for its 62,000 residents.
It also calls for shaving nearly 100 feet off the top of a 540-foot hill and filling in land to create plateaus on which to build a 166-acre neighborhood with panoramic views of the San Gabriel Valley. Housing would range from 900-square-foot residences to 4,000-square-foot luxury homes.
The rest of the property would be used for public trails, oil production and a doughnut-shaped gnatcatcher habitat between the new homes and existing residences below. Once completed, the project would generate about $7 million in property tax revenue each year, according to a fiscal analysis paid for by the developer.
The developer, environmentalists and a city councilman have said that deliberations on such a significant project have been stymied by the City Hall turmoil.
The city attorney -- the city's fifth in as many years -- has recused himself from discussing the project because he lives within 500 feet of the Montebello Hills. On Wednesday, an interim city manager was installed to handle civic issues pending the retirement of the current city manager.
Opponents have questioned the chairman of the city Planning Commission over his work as a paid consultant for the San Gabriel Valley Water Co., which would supply the development with more than 800 acre-feet of water annually. Tom Calderon, the chairman, has denied any conflict of interest.
"Montebello City Hall right now is a train wreck," said Councilman William Molinari. "That's very troubling. This is not the appropriate way to handle a proposal of this magnitude."
Opponents are particularly concerned about the project's environmental effects.
A decade ago, there were about 35 pairs of California gnatcatchers in the Montebello Hills. Since then, the population has grown to about 76 pairs and the birds' range has expanded to the nearby Puente Hills, said Kimball Garrett, ornithology collections manager at the Los Angeles County Museum of Natural History.
Cook Hill officials said roughly half of the existing gnatcatchers could be lost during construction. "But we believe the population will recover nicely to 70 pairs or so," project manager Norm Witt said.
Sierra Club conservation coordinator Jennifer Robinson is not so sure.
"The Sierra Club has never had a problem with the ongoing oil production in Montebello Hills," Robinson said. "But we'd like to see that land remain open space with low-impact park opportunities: hiking, picnicking, flying kites."
Cook Hill officials said they had already compromised.
"We've squeezed the project down as far as we can," Witt said. "What we've designed is a very sensitive plan for the city and the habitat."
Strong, of the Save our Montebello Hills task force, disagreed.
"Montebello Hills may not be a great pristine wilderness, but it's the closest thing to one we have," she said. "So we must proceed with care because once they start grading, the hills this city was named after -- Montebello means beautiful hills in Italian -- will be gone forever.
"It sure would help," she added, "if Montebello City Hall would get better organized."
DWP outmaneuvered on Kern County land purchase
A business venture led by a friend and advisor to L.A.'s mayor beat the DWP to Onyx Ranch, a 68,000-acre parcel east of Bakersfield that the utility wanted for a wind farm...David Zahniser
http://www.latimes.com/news/local/la-me-wind15-2009sep15,0,2415736,print.story
A business venture led by a friend and advisor to Los Angeles Mayor Antonio Villaraigosa outmaneuvered the city last year to buy land in Kern County that the Department of Water and Power wanted for a wind farm.
The purchase of Onyx Ranch, which covers nearly 68,000 acres east of Bakersfield, highlights the dual roles played by J. Ari Swiller, an entrepreneur whose field, renewable energy, has received a significant boost from the mayor's pledge to make Los Angeles "the greenest big city in America."
Swiller and the mayor have long-standing ties. Both were employed by supermarket billionaire Ron Burkle at the start of the decade, after Villaraigosa lost his first run for mayor. When Villaraigosa announced his second mayoral bid in 2004, Swiller served as a campaign fundraiser. And after Villaraigosa won, Swiller helped him decide who should be appointed to various city commissions.
Since 2004, Swiller also has been a co-owner of Renewable Resources Group, a Los Angeles-based firm that develops and invests in clean energy.
In the case of Onyx Ranch, the venture headed by Swiller beat the DWP to the land, bought it for $48 million and, before the transaction was completed, offered to sell less than half of it to the utility for $65 million.
H. David Nahai, the DWP's general manager, rejected the offer. Swiller's venture, a partnership between his and another firm, then sold the portion sought by Los Angeles for $42 million to the city of Vernon, a neighboring industrial community with its own electric utility.
Since then, Los Angeles officials have been weighing whether to wage a potentially costly and lengthy legal battle against Vernon to gain ownership of the land, considered prime territory for towering turbines that would generate electricity from the winds that blow across the Tehachapi Mountains.
Villaraigosa's appointees at the DWP met behind closed doors two weeks ago to discuss a possible purchase from Vernon, a move that would help the mayor keep his promise to bring wind, solar and geothermal to the nation's largest municipally owned utility.
The man monitoring the DWP's progress on that promise is Deputy Mayor S. David Freeman, who was appointed in April to handle environmental issues for Villaraigosa. Freeman also knows Swiller, having helped him found Renewable Resources Group in 2004. He left the firm in 2005 to become one of the mayor's harbor commissioners.
Swiller has repeatedly declined requests from The Times to say whether he has other business activities that intersect with the mayor's policy priorities. He also declined to be interviewed directly, asking that questions be sent to his lawyer.
In her written responses, attorney Lynda B. Goldman said Swiller did not know that the DWP wanted control of Onyx Ranch until early 2008. A private wind developer who was party to the negotiations, however, said that he believes Swiller knew of the DWP's involvement months earlier.
Nick Patsaouras, a former DWP commissioner, said he believes that the Swiller venture's purchase and resale of the valuable terrain has probably delayed the DWP's plan for developing a wind farm on the site by at least three years. Patsaouras, a onetime Villaraigosa appointee, also warned that the DWP would probably be forced to pay a higher price than it had anticipated.
"Now they are in a situation where they will have to pay a premium," he said.
Villaraigosa spokesman Matt Szabo said the mayor would not comment on whether the city utility should complete such a purchase -- or whether the transactions at Onyx Ranch have complicated the DWP's wind farm plans. Szabo said Villaraigosa was unaware of the situation and "does not discuss his friends' private business matters with them." He added: "It's not part of the mayor's agenda to worry about people's private business dealings."
Swiller's attorney said her client had no conversations about Onyx Ranch with the mayor or any of his representatives. She called Patsaouras' assertions about the effect on the DWP "highly questionable" and said Swiller and his partners made "numerous attempts to purchase the property." One of Swiller's business partners made an offer in 2001. Three years later, Swiller's firm made another attempt, she said.
"For more than a decade, it has been common knowledge among renewable-energy professionals active in Southern California that Onyx Ranch could produce wind power," she wrote.
Goldman said Swiller's venture had hoped to develop a wind farm on the southern portion of Onyx Ranch but changed plans once the DWP threatened to go to court to force a sale of the property. Given the risks associated with an eminent domain action, Swiller's venture concluded it was best to sell 30,000 acres of Onyx Ranch and "remove itself from the future development of the site," Goldman said.
The DWP's Nahai said he was not troubled that someone close to Villaraigosa had bought and resold property sought by his agency.
Swiller "has this friendship to the mayor. He's an advisor to the mayor. But at the same time, he's a business person," Nahai said. "So if nothing untoward occurred here, he'd be as free as anybody else to try to do a business deal."
Ranch transactions
To reconstruct the transactions involving Onyx Ranch, The Times reviewed public records from agencies that include the DWP, the Kern County Planning Department and the city of Vernon. Details also come from a court challenge filed when three members of the fractious family that owned the property unsuccessfully sued to stop the sale to Swiller's venture.
Onyx Ranch had been owned for generations by a trust controlled by the Rudnick family, descendants of a Russian Jewish immigrant who came to America in the early 1900s and parlayed a business as a traveling salesman into a cattle-ranching empire.
The DWP spent years working to gain control of the ranch, hoping to make it the site of the utility's third wind farm in Kern County. As recently as last fall, utility managers included a wind farm at Onyx Ranch in its plan to meet Villaraigosa's 2010 deadline for ensuring that 20% of the city's power comes from renewable sources.
To accomplish that goal, the DWP turned to a La Jolla-based company, Padoma Wind Power. Padoma responded to the department's request for renewable energy proposals in 2004, the same year it signed a letter of intent with the Rudnicks to negotiate in good faith, according to Jan Paulin, the company's president and chief executive.
Padoma hoped to lease roughly 9,300 acres from the Rudnicks and develop a wind farm on the site. It then planned to sell the electricity to L.A. over nearby DWP transmission lines. Although the DWP identified Padoma as a potential developer of wind energy in 2005, two years passed before the utility and the company signed a limited agreement and began negotiations.
In June 2007, DWP executive Randy Howard met with Padoma officials and the Rudnicks at the L.A. Convention Center to restate the city's interest in pursuing the project, Paulin said in a recent interview.
"He said the DWP was very committed to this project and wanted it in the ground ASAP," Paulin said. "He encouraged us, and the Rudnicks, to get together as soon as possible to negotiate the land lease."
One month later, Padoma entered into an exclusive 90-day agreement to negotiate with the Rudnicks, who had been haggling among themselves for years over how to dispose of their holdings. The family's trust had already received offers from the Nature Conservancy and Florida Power & Light and taken no action.
In September 2007, Paulin met with three members of the Rudnick family in Century City. The family's trustee, Oscar Rudnick, was accompanied by Swiller, Paulin said.
According to Paulin, Swiller told him at the meeting that his firm wanted to purchase Onyx Ranch. Paulin also said he told Swiller that the DWP was "very interested" in using the property to create a wind farm and was already in negotiations with Padoma to buy the power. "None of that was news to him, at least as far I could judge," Paulin said.
To buy the land, Swiller's firm had teamed up with CIM Group, a Hollywood-based real estate company well-known around Los Angeles City Hall. Over the last seven years, city agencies have agreed to provide CIM with $58 million worth of loans and subsidies. And two city pension boards have agreed to invest up to $115 million in CIM funds on behalf of city retirees.
A few weeks before Swiller met with the Rudnicks in Century City, CIM Group had persuaded the California Public Employees Retirement System to invest up to $200 million in a new infrastructure fund managed by the firm.
A marketing booklet promoting that fund talked up plans to "acquire a 68,000-acre ranch located near Tehachapi" for development of a wind farm. A spokesman for the firm declined to say if any of its investment funds financed the purchase of Onyx Ranch.
Swiller was the "senior executive" of the joint venture between CIM Group and Renewable Resources Group, according to one court document. In his own declaration filed with the court, Swiller identified himself as "the operating member" of the venture, which took on the name ReNu Resources LLC. "He spearheaded the transaction," Paulin said.
CIM, working with Swiller's firm, sent a purchase and sales agreement to the Rudnick family in November 2007. Weeks later, Paulin wrote letters attempting to block the sale to Swiller's venture, saying the Rudnick family had violated the terms of its exclusive negotiating agreement with Padoma, according to court records.
The Rudnicks brushed aside Padoma's complaints, according to correspondence contained in the court file.
By January 2008, DWP officials had become so concerned that Padoma was faltering in its effort to gain control of the ranch that it sent its own letter to the Rudnicks stating that Los Angeles was now interested in buying the land -- not just leasing it.
The DWP told the family it was prepared to pay $50 million, Nahai said. But city officials also notified the trust that they might file an eminent domain lawsuit to get the property through a court-ordered sale -- a fact that disturbed Oscar Rudnick.
"If anybody's wearing a black hat, it's the DWP," he said. "How would you like it if somebody threatened to condemn your land?"
Agree to sell
Weeks later, the Rudnicks rejected the idea of a lease with Padoma and agreed to sell to the Swiller-CIM partnership.
In February 2008, Rudnick family members voted 60% to 40% to sell to the Swiller group. The price was $48 million.
Swiller's lawyer said that was the same month her client "learned that DWP had an interest in purchasing or otherwise gaining site control of the property."
Three of Oscar Rudnick's uncles, led by Philip Rudnick, 77, challenged the sale in court, saying other family members had failed to take the best deal for the trust's beneficiaries. In a declaration filed in court, Philip Rudnick accused Oscar Rudnick of improperly allowing Swiller into the family's negotiations with Padoma.
The elder Rudnick also said in his declaration that during a lunch break at the meeting in Century City -- while Padoma executives were not present -- Swiller had urged the family to abandon its plans with Padoma.
Oscar Rudnick disputed that version of events, saying his uncle wanted to preserve a deal with Padoma because he had an additional piece of property that he planned to develop with that firm. Swiller, for his part, "did not urge family members in one direction or another as it related to Padoma Wind Power's request," his lawyer said.
A judge upheld the sale of Onyx Ranch in May 2008 and said that Philip Rudnick had not filed his lawsuit "in good faith." The losing side filed an appeal.
On May 15, 2008 -- two weeks after Kern County Superior Court Judge Robert S. Tafoya issued the ruling, but before the deal had actually closed -- Swiller's business partner, D. Cole Frates, approached the DWP, Nahai said, and asked if the agency would be interested in paying $65 million for the 30,000-acre southern half of the property.
In a recent interview, Nahai characterized the figure as "not even within the realm of possibility." Nahai said he told Frates that there was no point in negotiating with a company over land that it did not yet own -- and was still embroiled in a lawsuit.
"We'd already made our position clear as to what we'd be willing to pay," Nahai said.
Weeks later, Swiller met personally with a high-level DWP executive about the property on Onyx Ranch.
Paulin said Swiller also continued to talk with Padoma, which was trying to resurrect its proposed wind lease. The company spoke to Swiller from April to October 2008 about jointly developing a wind farm on the Onyx Ranch property, Paulin said.
Paulin said that during that period, he had no idea Swiller's venture was also trying to sell the land to Vernon, a city with more than 1,000 mostly manufacturing business and a municipal utility that has developed and sold energy assets over the past decade.
The Vernon City Council voted in August 2008 to pay $42 million for 30,000 Onyx Ranch acres -- with an option to buy additional acres nearby.
Swiller's lawyer said ReNu had been contacted by Vernon about "alternative energy opportunities." A CIM Group spokeswoman said in a statement to The Times that Vernon was "the most aggressive bidder among several entities that expressed interest in the Kern County land."
Vernon City Atty. Jeffrey Harrison said his city did not seek out ReNu to purchase the land: "I guess it would be best to characterize it as, they found us."
Paulin said the transaction showed that the Rudnicks could have negotiated better. ReNu, the Swiller-led buyer of Onyx Ranch, "sold part of the property to Vernon for almost as much as they paid for the whole thing," he said. "The beneficiaries threw away a lot of money on this deal."
The Swiller-CIM partnership closed escrow on Onyx Ranch in October 2008 and within days sold the portion to Vernon. But it held on to something that one official described as highly valuable: the ability to pump water out of the Oynx Ranch ground and sell it. Lorelei Oviatt, division chief of the Kern County Planning Department, said those rights are "a priceless commodity right now."
In December, DWP officials notified Vernon that it may now be the target of its eminent domain lawsuit.
Nahai said his agency won't buy the land "if the price and terms aren't right."
Washington Post
Obama administration submits salmon plan...WILLIAM McCall, The Associated Press. Associated Press Writer Matthew Daly contributed to this story from Washington, D.C.
http://www.washingtonpost.com/wp-dyn/content/article/2009/09/15/AR2009091501428_pf.html
PORTLAND, Ore. -- The Obama administration says it will be more aggressive in protecting declining Pacific Northwest salmon runs and will study breaching some dams as a last resort in a long-awaited management plan.
The administration submitted the plan to a federal judge Tuesday in Portland. Called a "biological opinion," it will guide hydroelectric dam operations and fish conservation programs in the Columbia Basin for the next decade.
U.S. District Judge James Redden rejected two earlier plans in 2003 and 2005, threatening at one point to take control of salmon recovery efforts.
The new plan would immediately boost mitigation programs to help salmon survival, expand research and monitoring, and set specific biological "triggers" for even stronger measures, if numbers of threatened fish fail to reach certain benchmarks.
But the Obama administration plan largely supports an earlier version offered by the Bush administration, even though Redden found portions of that plan inadequate.
The Obama administration said it will speed up things such as habitat improvement projects because of concerns about uncertainties such as the effect of climate change.
The revised plan also directs the U.S. Army Corps of Engineers to begin studying removal of the Snake River dams in Washington state, but warned it was "viewed as an action of last resort." No action would be taken before 2013 at the earliest.
Rep. Doc Hastings, R-Wash., said the Obama administration had unwisely put dam removal "back on the table" among options in the decades-long dispute over how to balance the needs of salmon and people.
"No one should be fooled by talk of dam removal as a last resort when the Obama Administration is immediately launching studies and plans for such action," said Hastings, the top Republican on the House Natural Resources Committee. Hastings represents a central Washington district that includes one of the four dams that could be breached.
Hastings said he was disappointed that the Obama administration apparently did not recognize the "terrible" economic toll that dam removal would have on the Northwest in the form of higher energy prices and thousands of lost jobs - "and all for an extreme action that science hasn't shown would lead to fish recovery."
The new biological opinion was praised by U.S. Sen. Maria Cantwell, a Democrat from Washington state.
In a written statement, she said she is confident the Obama administration plan "meets scientific and legal requirements. This comprehensive salmon plan builds on many years of successful, ground-up collaborative efforts."
The biological opinion is required by the federal Endangered Species Act to protect salmon and steelhead in the Columbia River Basin.
It was prepared by the National Oceanic and Atmospheric Administration and the three federal agencies involved in operating dams, the Army Corps, the Bonneville Power Administration and the U.S. Bureau of Reclamation.
New York Times
EPA to Place Limits on Power Plant Water Pollution...THE ASSOCIATED PRESS
http://www.nytimes.com/aponline/2009/09/15/us/politics/AP-US-Power-Plant-Pollution.html?_r=1&sq=epa&st=cse&scp=8&pagewanted=printWASHINGTON
(AP) -- For the first time in nearly 30 years, the Environmental Protection Agency plans to limit the quantity of toxic metals that coal-fired power plants release into waterways.The agency said Tuesday that equipment required to reduce pollution in the air has increased harmful contaminants in water discharged by power plants, particularly heavy metals such as selenium, cadmium, mercury and lead. Current regulations do nothing to control metals and are not enough to protect water quality and wildlife, the agency said.The agency said the new rules will be unveiled in 2012, but EPA Administrator Lisa Jackson is pushing for an earlier target date.
In a preliminary study released last year, the EPA found that only a fraction of the nation's power plants were using readily available technologies to remove pollutants before they are released into waterways. The water pollution comes from scrubbers that strip gases of acid-raining causing sulfur dioxide and coal ash storage ponds where power plants store the leftovers of burning coal.
A spill at a coal ash pond in Tennessee late last year, which flooded hundreds of acres of land, damaged homes and killed fish in nearby rivers, helped raise awareness about the toxic contents of coal combustion waste and has put increasing pressure on the government to take action.
The announcement comes a day after three environmental groups threatened to sue the EPA for failing to update its regulations, first put in place in 1982. Federal law requires the agency to review regulations annually and revise them if necessary, which the advocates say the agency failed to do.
''EPA should have limited these discharges decades ago as the law requires,'' said Eric Schaeffer, the executive director of the Environmental Integrity Project, which along with the Sierra Club and Defenders of Wildlife, informed the EPA Monday of its plans to file a lawsuit.
Representatives of those groups said Tuesday they had not yet decided whether they would pursue the litigation.
On the Net:  Environmental Protection Agency: www.epa.gov
CNN Money
Foreign buyers avoiding U.S. homes
Almost half of international home buyers pay cash to dodge difficulty of securing a mortgage, survey finds...Hibah Yousuf
http://money.cnn.com/2009/09/15/real_estate/foreign_home_
buyers/index.htm?postversion=2009091512
NEW YORK (CNNMoney.com) -- Despite record U.S. home price affordability, international buyers have been unable to take advantage because of the worldwide recession and credit crunch, a real estate group said Tuesday.
Home sales to foreign clients dropped 9.4% in the year ended in May to 154,000, according to a report from the National Association of Realtors (NAR).
Among international clients who did purchase, almost half paid cash for their property because securing a mortgage was more difficult than before, according to the report.
"It's at least three times more difficult for foreign buyers to get financing than it is for U.S. citizens who have all the right documentation and good credit," said Madison Hildebrand, a Coldwell Banker real estate agent in Malibu, Calif.
The NAR report says more than 30% of international home buyers use their U.S. property as vacation homes, and that triggers banks to assume they pose a higher risk, said Maria McKee, chairwoman of the Orlando International Real Estate Council.
"Banks are thinking people will walk away from their vacation home before they walk away from their primary residence," she said. "We'll continue to see interest from foreign investors, but a lot of them will be cash buyers."
But the NAR expects the latest improvements in the credit market to turn the tide.
"Stock market gains and improving bank balance sheets will permit a greater amount of lending for second home purchases," said NAR chief economist Lawrence Yun, adding that expending foreign economies and favorable exchange rates will give international buyers more purchasing power.
"American real estate has always been a good investment for a long- term hold," Hildebrand said. "It's relatively easy for internationals to hold real estate in the U.S. than in other countries where there are more caveats."
While Canada and the United Kingdom remain the largest international shareholders in U.S. real estate market, the NAR said buyers from those countries dwindled. The percentage of buyers from Mexico and India increased.
Foreign interest grew in California, a popular destination for Asian buyers, and the West Coast state accounted for 13% of international purchases, according to the report.