9-19-09

 
9-19-09

Badlands Journal
Badlands Journal editorial board...Badlands Journal editorial board
http://www.badlandsjournal.com/2009-09-19/007413
The federal Justice Department is looking into the alleged corruption of former Interior Secretary Gale Norton. Under Norton, Interior’s corruption reached baroque proportions, particularly in issues involving California, as stories beneath indicate. For underlying documentation, readers are urged to consult Interior’s Office of Inspector General’s special reports at http://www.doioig.gov/index.php?menuid=2&viewid=-1&viewtype=REPORT&pgid=...
Badlands Journal editorial board
9-17-09
Los Angeles Times
Former Interior Secretary Gale Norton is focus of corruption probe
The Justice Department investigation centers on a 2006 decision to award oil shale leases in Colorado to a Royal Dutch Shell subsidiary. Months later, the oil giant hired Norton as a legal counsel...Jim Tankersley and Josh Meyer
http://www.latimes.com/news/nationworld/nation/la-na-norton17-2009sep17,0,340619,print.story
The Justice Department is investigating whether former Interior Secretary Gale A. Norton illegally used her position to benefit Royal Dutch Shell PLC, the company that later hired her, according to officials in federal law enforcement and the Interior Department.
The criminal investigation centers on the Interior Department's 2006 decision to award three lucrative oil shale leases on federal land in Colorado to a Shell subsidiary. Over the years it would take to extract the oil, according to calculations from Shell and a Rand Corp. expert, the deal could net the company hundreds of billions of dollars.
The investigation's main focus is whether Norton violated a law that prohibits federal employees from discussing employment with a company if they are involved in dealings with the government that could benefit the firm, law enforcement and Interior officials said.
They said investigators also were trying to determine if Norton broke a broader federal "denial of honest services" law, which says a government official can be prosecuted for violating the public trust by, for example, steering government business to favored firms or friends.
The Interior Department's Office of Inspector General began the investigation during the waning months of the George W. Bush administration and more recently made a formal criminal referral to the Justice Department. Norton is the first Bush official at the Cabinet secretary level to be the subject of a formal political corruption investigation.
Shell spokeswoman Kelly C. op de Weegh declined to comment on behalf of both the company and Norton, who did not respond to numerous calls. "Shell has not received an official notification with regard to a government investigation. Consequently, we are not in a position to comment at this time," she said.
The Justice and Interior departments also would not comment.
Interior Department investigators referred the case to the Justice Department after concluding that there was sufficient evidence of potential illegal conduct, according to federal law enforcement and Interior officials. The officials spoke on the condition of anonymity because of the sensitive and confidential nature of the case.
Those officials said the referral was based on an already comprehensive Interior Department investigation that included interviews with numerous Interior employees. The Justice Department has assigned prosecutors from its public integrity section and the U.S. attorney's office in Washington to the case.
Norton, 55, was President Bush's first Interior secretary. She had worked as an Interior Department attorney before being elected Colorado's attorney general. Later, as a private lawyer, she represented mining, timber and oil companies.
As Interior secretary, she embraced an industry-friendly approach to environmental regulation that she called "cooperative conservation" and pushed the department to open more public land for energy production.
Norton also backed commercial development of the oil shale reserves buried in the rocks of the Mountain West. Known as "the rock that burns," oil shale refers to rocks that release liquid petroleum when heated to extreme temperatures. The highly controversial process promises immense fuel production, but environmentalists argue that it contaminates rugged landscapes and drains precious water.
In early 2006 -- following the recommendations of a team representing several federal agencies and states -- the department announced that it planned to award Shell three oil shale leases. Norton resigned two months later, saying that she had no job lined up. In December of that year, Shell announced it had hired Norton as in-house counsel to its unconventional fuels division, which includes oil shale.
The Justice Department, working with Interior Department investigators, is looking into whether Shell received a competitive advantage or other preferential treatment from the Interior Department in the awarding of the leases.
"If [Norton] had feelers out, or was in discussions with Shell in any way, she is absolutely forbidden from participating in any way from doing anything with Shell," a law enforcement official said.
The federal government long has sought a cost-effective way to extract the abundant oil resources from Western shale rock.
Then-Vice President Dick Cheney's energy task force recommended aggressive steps to encourage private industry to develop such technology. In response, the Bureau of Land Management issued six oil shale "research, development and demonstration" leases. The leases, five in Colorado and one in Utah, granted access to up to 160 acres of federal land apiece to develop shale programs -- with an option to increase that to 5,000 acres once a technique proved commercially viable.
On average, each of those 5,000-acre lease tracts holds an estimated $700-billion worth of recoverable oil (at today's $70-per-barrel price), said James T. Bartis, a shale expert at Rand. Shell has estimated the costs of recovering the oil at $30 per barrel, leaving a potential profit of about $1 trillion after royalties if all the oil is extracted.
Shell was the only company to receive more than one tract.
"Shell got some of the best lands" that the government made available, Bartis said.
At the time, critics accused the Interior Department of undermining a central goal of the leases by awarding three of them to Shell. The leases were meant to allow companies to test distinct methods for extracting shale from rock. But each of Shell's tracts was granted for a variation of the same process.
Critics also raised questions about the fairness of the process, given that Shell filed its first lease application just a day after the department issued its call for proposals in June 2005.
That August, Bush signed the Energy Policy Act of 2005, which included a provision that changed federal law to allow companies to hold multiple oil shale leases. Interior Department officials said they did not notify potential bidders that the law had changed. Shell, which had lobbied Congress to allow companies to hold more than one lease, quickly filed two more applications, BLM records show.
No other company applied for more than one lease.
The lease proposals were evaluated in the fall of 2005 by the interdisciplinary team that included representatives of several Western governors and from the Energy and Defense departments. The team's recommendations included awarding three leases to Shell.
The Interior Department investigation initially focused on whether agency officials had improperly assisted Shell and other private-sector companies. Three of the interviewed BLM employees -- who all spoke on condition of anonymity because an investigation was ongoing -- said the questions investigators posed focused on Norton and her role in the lease process.
12-22-08
As Interior Turns
An eight-year soap opera in which federal officials screwed the environment, the taxpayers, and each other …Jonathan Thompson
http://www.hcn.org/issues/40.23/as-interior-turns
There's plenty in Washington for the new administration to clean up, but perhaps the biggest messes can be found in one agency: the Department of Interior. Over the last eight years — mostly between 2001 and 2005 — the agency charged with managing millions of acres of public land has been racked by scandal. During a veritable orgy of ethical lapses, federal coffers were deprived of oil and gas royalties, fragile species denied protection, and industry given yet more power to wreck public land in the name of greed. The questionable behavior was department-wide, but three major spheres of controversy stand out: The corruption around J. Steven Griles; the "Minerals Management Service Gone Wild" scandals; and Julie MacDonald's enthronement of ideology over biology. 
Some may dismiss the incidents as just a few bad apples spoiling the barrel. But the patterns suggest otherwise — in every case, either ideology or money or both were allowed to triumph over common sense. Former lobbyists and industry executives held too many top posts, and links to property-rights and pro-industry organizations were too strong. Interior Secretary Gale Norton was heavily involved in ideologically hard-right causes before she entered public service, and then went to work for the oil industry afterward. Griles was a lobbyist, Rejane Burton the former vice president of an oil and gas exploration company, and so on. In recent weeks, some of these same officials have "burrowed" into — or been shuffled around —- the agency, transformed from political appointees into career employees. That will just make this mess harder to clean up.
Here are some of the stars and other players — in As Interior Turns.
Once upon a time, Jack Abramoff was a very powerful lobbyist. He could raise money for himself (including millions of dollars in fees from his clients), and for others (more than $100,000 for the Bush campaign). He urged his clients — including various Western tribes —- to donate huge chunks of cash to politicians and to political appointees' pet organizations. In exchange, he provided enviable access to government officials. If this sounds corrupt, it's because it was, and Abramoff finally got caught and was convicted of defrauding Indian tribes and corrupting public officials. He brought plenty of folks down with him, including J. Steven Griles, a top dog at Interior, lobbyists and politicians. He never worked directly for the Bush administration (though they seemed to be working for him, at times), but he has become the primary symbol of the corruption by money of politics during the last eight years.
J. Steven Griles was a leading man in As Interior Turns, holding the number-two spot in the agency and ending up in bed with everyone from Jack Abramoff to the coal and electric power industry, to (literally) Italia Federici. He first worked for the feds in the 1980s under James Watt, at the U.S. Office of Surface Mining. In 1995, he founded J. Steven Griles and Associates, a lobbying group that eventually became part of National Environmental Strategies, another lobbying group that worked for the  mining and fossil fuel sectors. In 2001, he became Gale Norton's deputy. At the time, he signed onto a special agreement that allowed him to continue being paid (about $1 million) by his former lobbying firm, as long as he didn't meet with former clients; he did anyway. He hung out with officials from the National Mining Association, and pushed for looser mountaintop-removal mining standards. He met with Edison Electric Institute folks, and tried to ease federal clean air rules on power plants. All the fun came to an end when Griles was caught in Abramoff's sticky web — he helped Abramoff navigate Interior on behalf of his clients. Griles resigned in 2004, and two years later pleaded guilty to obstruction of justice. Though Griles is gone, his legacy remains: Mountaintop removal rules were recently eased up by the Bush administration.
Italia Federici was never a part of the Department of Interior, but her tentacles reached into the agency in more ways than one. Federici and Griles began a relationship in 1998, which continued in some form or another after Griles became Norton's lieutenant. Federici then served as a liaison between Abramoff and Griles; in return, Abramoff funneled at least $500,000 from his clients to Federici's charity, the Council of Republicans for Environmental Advocacy, which Norton helped start in the late 1990s. Federici pleaded guilty in 2007 to obstructing the investigation into Jack Abramoff.
Sue Ellen Wooldridge was Norton's deputy chief of staff and then counselor before being appointed Interior solicitor in 2004. Then in 2005 she became U.S. assistant attorney in charge of environment and natural resources. She also secretly dated Griles while both were working for the feds (they later got married). In 2005, Griles, Wooldridge and ConocoPhillips executive Don Duncan bought a $1 million beach house together. Wooldridge later gave ConocoPhillips extra time to pay millions of dollars in fines. She resigned under the cloud of scandal in 2007.
Matthew McKeown was yet another private-property-rights ideologue who moved into Interior in 2001, at the beginning of the Bush reign. As one of Interior's top legal eagles, he played a large — if unseen — role in getting the Bush agenda implemented on the ground. (He later moved to the Justice Department along with Wooldridge.) He had a primary role in the Healthy Forests Initiative, publicly bashed the Endangered Species Act, negotiated settlements that gutted the Northwest forest plan, and negotiated an agreement between Interior and the state of Utah making it easier for the state to control roads that cross federal land. As Bush prepared to leave office, McKeown was converted from a political appointee to a civil service post, meaning he'll remain in Interior under Obama.
­­Rejane "Johnnie" Burton was the director of the Minerals Management Services, the agency responsible for collecting billions of dollars of royalty payments from oil companies that operate on federal land. She oversaw MMS during a time when staff members were cavorting with one another and oil industry officials, and as energy companies skirted some $1 billion in royalties that should have gone into federal coffers. She resigned in 2007.
Donald Howard, Jimmy Mayberry and Milton Dial were all MMS officials during the Bush administration, and they all pleaded guilty. Howard accepted a hunting trip from an oil industry contractor, and Mayberry and Dial violated conflict-of-interest laws.
Greg Smith directed MMS's Royalty in Kind Program, which accepts oil and gas from energy companies in lieu of royalties for drilling on public land. The program was expanded in the late 1990s at industry's behest, after the straight cash royalty program was tightened up to prevent chronic under-collection from oil companies. The program is set up to have very little oversight. (The Government Accountability Office characterized it as operating under an "honors system.") Which was good for Smith, because he apparently had other things on his mind. A federal investigation revealed this year that during his tenure, Smith took drugs with and coerced subordinates into having sex with him. On one occasion, he pestered an employee for cocaine, settling finally for methamphetamines, which he snorted off a toaster oven. Smith also accepted golf outings, drinks and meals from employees of Shell, Chevron and Gary Williams Energy Corp. Meanwhile, he was moonlighting as a salesman for Geomatrix, an environmental services company that sometimes works for oil companies. From his MMS office, he made sales pitches to various energy companies — some of which he was supposed to be collecting royalties from — on behalf of Geomatrix, according to federal investigators.
Smith wasn't the only one with dirty hands in the Royalty in Kind branch of the Minerals Management Service. Federal investigators found that at least 1/3 of the staff were hanging out with and accepting gifts from oil industry folks between 2002 and 2006. At least one RIK staffer had a one-night stand with a Shell employee. During that same time, according to the GAO, the MMS could not account for the cost or benefits of the RIK program. Apparently staff was so busy taking ski trips and going to parties on the oil industry's dime that they forgot to keep track of whether those same oil companies were paying adequate royalties. In spite of these problems, Interior has tried to expand the program.
By the time she resigned in 2007, Julie MacDonald had become one of the most notorious of the many notorious Interior officials. MacDonald first came to Interior in 2002 as an advisor. Then, in 2004, Norton promoted her to the powerful post of deputy assistant secretary for fish, wildlife and parks. In just a few years, she did more to tinker with her own scientists' findings, and thereby derail protections on endangered species, than anyone in the history of Interior. MacDonald's subordinates suffered under her — she "bullied, insulted and harassed the professional staff," according to a federal investigative report — and she did the same to wildlife. The arroyo toad, white-tailed prairie dog, Preble's jumping mouse, Canada lynx, southwestern willow flycatcher and other species lost protection or critical habitat thanks to MacDonald. (The agency later reconsidered some of MacDonald's decisions.) She was also in cahoots with the conservative Pacific Legal Foundation and the California Farm Bureau, to whom she disclosed confidential info while at Interior.
E-mails reveal that MacDonald was working closely with Steven Quarles, a prominent lobbyist for forest, mining, agricultural and development interests, and former Interior official. One message from Quarles to MacDonald requested a meeting to "secure easy ‘yeses' to outrageous requests." Quarles continues to work with the Crowell and Moring lobbying firm, with clients such as the Village at Wolf Creek, Plum Creek, Anglogold and Rio Tinto.
A Government Accountability Office investigator testified to Congress that other Interior officials should have been examined as part of the MacDonald investigation, including Craig Manson, Brian Waidmann, Todd Willens and Randal Bowman. Though the three were never actually accused of wrongdoing, some did their part aboveboard to stick it to endangered species. Willens was once senior staff advisor to Richard Pombo, the notorious California congressman who attempted to gut the Endangered Species Act. While at Interior, he pushed to remove the Florida manatee and other species from endangered species protection. Willens left Interior in 2008 and — you don't say!? — became a lobbyist.
In spite of the fact that the most salacious scandals happened on her watch, former Interior Secretary Gale Norton has stayed above the fray. Bush appointed Norton, a one-time libertarian, protegee of James Watt and member of various right-wing think tanks, in 2001. During her years in Interior, the BLM issued drilling permits at a record pace. Norton favored drilling in the Arctic National Wildlife Refuge, voided critical habitat on millions of acres, increased the number of snowmobiles in Yellowstone, and so on and so forth. She resigned in 2006, just as the Abramoff/Griles connections were coming to light. Abramoff never directly rubbed off on her, but there are many links: Federici, for example, tried to arrange a 2001 meeting between Norton and Lovelin Poncho (Abramoff client and Coushatta tribal chairman). Eventually, the two met at a Council of Republicans for Environmental Advocacy fund-raising dinner that Abramoff helped coordinate. After leaving Interior, Norton went to work for Shell, and Dirk Kempthorne took her place. Most of the dirtiest scandals stopped after she left, but Interior has continued its questionable approach to the environment, stripping protection from endangered species, opening up 1.9 million acres to oil shale development, pushing through last-minute rules that favor industry, trying to lease thousands of acres for energy development -- even right next to national parks -- and blocking a congressional attempt to stop uranium mining next to the Grand Canyon.
9-14-06
New York Times
Interior Dept. blasted for ethics breaches
Agency officials accused of ignoring cover-ups, cronyism…Edmund L. Andrews
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/09/14/MNG31L58Q21....
 (09-14) 04:00 PDT Washington -- The Interior Department's chief official responsible for investigating abuses and overseeing operations accused the top officials at the agency on Wednesday of tolerating widespread ethical failures, from cronyism to cover-ups of incompetence.
"Simply stated, short of a crime, anything goes at the highest levels of the Department of the Interior," charged Earl Devaney, the Interior Department's inspector general, at a hearing of the House Government Reform subcommittee on energy.
"I have observed one instance after another when the good work of my office has been disregarded by the department," he continued. "Ethics failures on the part of senior department officials -- taking the form of appearances of impropriety, favoritism and bias -- have been routinely dismissed with a promise 'not to do it again.' ''
The blistering attack was part of Devaney's report on what he called the Interior Department's "bureaucratic bungling" of oil and gas leases signed in the late 1990s, mistakes that are now expected to cost the government billions of dollars but were covered up for six years. While these leases were the specific focus of the hearing, Devaney directed most of his criticism at what he called a broader organizational culture at the Interior Department of denial and "defending the indefensible."
He expressed particular fury at the willingness to dismiss two dozen potential ethical lapses by J. Steven Griles, a former industry lobbyist who served as deputy secretary of the interior during President Bush's first term.
Griles resigned after allegations surfaced that he pushed policy decisions that favored some of his former oil and gas industry clients and that he tried to steer a $2 million contract to a technology firm that had also been one of his clients.
In a 145-page report in 2004, the inspector general described Griles as a "train wreck waiting to happen." But on Wednesday, Devaney said he was appalled that the Interior Department's office of ethics dismissed 23 out of 25 potential ethical breaches against Griles and that Gale Norton, then secretary of the interior, decided not to act on the two remaining allegations.
Phone calls to Griles' office seeking comment were not returned.
Devaney said that case was typical of a much broader "culture of managerial irresponsibility and lack of accountability" in the top reaches of the Interior Department.
"I have unfortunately watched a number of high-level Interior officials leave the department under the cloud of OIG investigations," Devaney said, referring to the Office of Inspector General. "Absent criminal charges, however, they are sent off in the usual fashion, with a party paying tribute to their good service and the secretary wishing them well, to spend more time with their family or seek new opportunities."
That was almost exactly what happened to Griles, who was never charged with any formal violations and is once again a lobbyist in Washington.
Dirk Kempthorne, who succeeded Norton as secretary of the interior earlier this year, said on Wednesday that he took the inspector general's allegations "very seriously" and had sent a letter to all employees on his first day at the department on the need to follow ethical guidelines.
Kempthorne declined to say what additional actions he might take until he saw Devaney's final report.
Three years ago, Devaney scathingly criticized the Interior Department's auditing program for oil and gas royalties. Beyond finding that investigators had missed millions of dollars in underpayments, his office uncovered evidence that agency auditors had lost key files and then tried to fool investigators by forging and backdating the missing documents. In an acid rebuke of the agency, Devaney noted that the agency gave a bonus to the official who came up with the false papers.
Devaney's broadside against the Interior Department's culture dovetailed with his tentative conclusions in his most recent investigation: how the department had managed to sign 1,100 leases for offshore drilling that inadvertently let energy companies escape billions of dollars in royalties on gas and oil produced in the Gulf of Mexico.
The leases, signed in 1998 and 1999 during the Clinton administration, allow companies to escape normal federal royalties -- usually 12.5 percent of sales -- on the tens of millions of barrels of oil on each lease.
The royalty break was intended as an incentive for deepwater drilling, but it was also supposed to end if oil prices climbed above a "threshold" level of about $34 per barrel. The leases at issue omitted that restriction, and Interior Department officials kept quiet about their mistake for six years after they discovered it.
The problem was first disclosed by the New York Times in March, and government officials now estimate that the mistake could cost the Treasury as much as $10 billion over the next decade.
6-28-07
Rep. Miller News
MEMO
To: Interested Parties
From: The office of Congressman George Miller
Date: 6/28/07
Re: New "Revolving Door" concern at Interior Department
http://www.badlandsjournal.com/2007-07-12/00329
Senior members of the House Natural Resources Committee wrote to the Interior Department today to request information on Administration officials' use of the "revolving door" and its possible impact on federal policymaking. The letter follows below.
For more information, please contact Daniel Weiss at (202)225-2095.
Background
Jason Peltier once ran the Central Valley Project Water Association, an organization that lobbies on behalf of federal water contractors in California. He then became one of the Bush Administration's lead officials on Western water policy, apparently overseeing projects and policy decisions that directly affected his former clients. He most recently served as the Interior Department's Principal Deputy Assistant Secretary for Water and Science.
This week, he accepted a job with the largest irrigation provider in the country and one of the largest water customers of the Interior Department, the Westlands Water District, despite having been directly involved in a number of federal decisions that may impact Westlands.
Mr. Peltier was profiled last year in an article in the New York Times ("For Thirsty Farmers, Old Friends at Interior Dept."), questioning his role in influencing water policy decisions. The Westlands Water District recently revived a lawsuit against the United States charging that the government should be using less water to restore the environment under the Central Valley Project Improvement Act.
The congressional letter comes at a time when the Bush administration's Interior Department faces increased scrutiny. Yesterday, the Washington Post revealed that Vice President Dick Cheney's political interference led to a decision to withhold water from salmon, leading to a massive fish kill with devastating consequences for the Pacific Northwest ("Leaving No Tracks"). Earlier this week, the former second-ranking official at the Interior Department, J. Steven Griles, was sentenced to 10 months in prison for his role in the Jack Abramoff scandal.
Today's letter
The congressional letter sent today calls for an accounting of the decisions Mr. Peltier made as an Interior official that would affect his new employer, and requests an explanation for, and documentation of, the steps taken by the Department of the Interior to screen for and prevent conflicts-of-interest in the case, as well as in a similar earlier case.
The request was sent by Congressman George Miller (D-CA), a senior member of the House Natural Resources Committee, and Congressman Nick Rahall (D-WV), chairman of the Committee.
The full text of the letter to Dirk Kempthorne, Secretary of the Interior, is below. The letter was copied to Earl Devany, the Department's Inspector General.
< <20070628MillerRahallDOILetter.pdf>>
***
The Honorable Dirk Kempthorne
Secretary
Department of the Interior
1849 C Street, N.W.
Washington, DC 20240
Dear Secretary Kempthorne:
We write today expressing great concern over the imminent departure of the Department of Interior's Principal Deputy Assistant Secretary for Water and Science-Mr. Jason Peltier-who is leaving the Department to become the Chief Deputy General Manager of the Westlands Water District, the largest irrigation district in the country and one of the largest customers of the Bureau of Reclamation. While serving at the Department for the past six years, Mr. Peltier has played a major role in a number of California-related water issues that impact his prospective employer.
As members of Congress and Committees with oversight of the Department of Interior and its stewardship of the nation's natural resources, we are deeply troubled by the potential impact Mr. Peltier's use of
the "revolving door" will have on the Department's policymaking.
Although we have been advised that Mr. Peltier may have removed himself from decisions on some California-related water issues, former Secretary Gale Norton once described Principal Deputy Assistant Secretary Peltier as dealing "frequently with California water issues" on behalf of the Department. Accordingly, we respectfully request that you provide us with the documentation and communications addressing Mr. Peltier's involvement with California water, the San Luis Unit of the Central Valley Project, and the Westlands Water District, including Mr. Peltier's:
* role in implementing the Central Valley Project Improvement Act and the CALFED program;
* participation in the development of the Bay-Delta Conservation Plan;
* policymaking role regarding the Central Valley Project, including the renewal and awarding of contracts for Westlands and other CVP water users; and
* involvement in Trinity River matters.
In addition, it is our understanding that Mr. Peltier is actually the second official from the Department of the Interior to have joined the Westlands Water District within the last year. We have learned that Ms. Susan Ramos, the former Assistant Regional Director of the Bureau of Reclamation, presently represents the interests of Westlands in negotiations with her former office, the Bureau of Reclamation.
In light of these facts, we request that you provide us with the documentation and communications addressing steps taken by the Department of the Interior to screen for and prevent conflicts-of-interest in these two cases, especially regarding litigation between Westlands Water District and the United States. Specifically, we request:
1 a full-accounting of Mr. Peltier's and Ms. Ramos' efforts to negotiate their new employment, and an explanation of the actions taken to ensure that their exit plans did not and will not impact federal policymaking;
1 information demonstrating that these former government employees' new positions with Westlands Water District will not violate federal statutes prohibiting conflict of interest or "switching sides," including 18 USC §207; and
* any advice, counsel, or opinions the Department prepared on this matter.
We appreciate your prompt attention to our request, and would appreciate your response by July 27 of this year. Please coordinate the production of the requested information with Jeff Petrich, Chief Counsel, Committee on Natural Resources at (202) 225-XXXX.
Sincerely,
GEORGE MILLER NICK J. RAHALL, II
Member, Natural Resources Committee Chairman, Natural Resources Committee
CC: The Honorable Earl Devany, Inspector General, Department of the Interior
5-20-07
Contra Costa Times
Decision on splittail raises suspicions
<!--subtitle-->· Official who had hand in getting fish removed from protected list may have had personal interests in mind … Mike Taugher
<!--byline-->
In an apparent conflict of interest, a former high-ranking Bush administration official helped remove a fish from the list of threatened and endangered species in a decision that eased an economic threat to her farm near Dixon.
Julie MacDonald resigned April 30 as deputy assistant secretary of the Department of Interior, a month after the department's office of inspector general issued a scathing report that accused her of altering scientific reports in the U.S. Fish and Wildlife Service's endangered species programs and improperly leaking internal reports to industry groups and friends.
The report said nothing about MacDonald's participation in the decision to remove the Sacramento splittail from protection under the Endangered Species Act.
But documents show she edited the decision on the fish, at one point softening scientists' conclusion that the species "is likely" experiencing a population decline to say it "may be" in such a decline.
The Sacramento splittail, which was classified as a threatened species from 1999 to 2003, appears to be the only fish -- other than those that have gone extinct -- ever removed from the list of threatened and endangered species.
Documents show MacDonald was deeply involved in crafting the language used to justify the final decision.
The decision to withdraw the protective status of the fish was first made in the Fish and Wildlife Service's Sacramento office, leaving the extent of MacDonald's involvement in
earlier stages unclear.
But her participation in the decisionmaking at any stage of the process may have violated conflict of interest rules because MacDonald owns an 80-acre farm in the Yolo Bypass, a floodplain of wetlands, pastures and row crops north of the Delta that is key habitat for the fish.
In almost all circumstances, federal law prohibits federal employees from participating in decisions in which they have a personal interest.
MacDonald did not return repeated phone calls seeking comment to her Washington and Dixon homes. Her husband, who answered the door at the Dixon farm this week, said she was in Washington.
In response to Times inquiries, the Department of Interior issued a written statement.
"To our knowledge, senior departmental officials were unaware of these issues," the statement read. "The Department of the Interior Inspector General investigated former Deputy Assistant Secretary MacDonald's role in administering the Endangered Species Act and issued a report. We rely upon the Inspector General's investigation and counsel. If it turns out that former Deputy Assistant Secretary MacDonald acted inappropriately regarding the Sacramento splittail, we will conduct an appropriate review of the regulatory process that led to the final decision."
The splittail is more dependent on floodplains than any other fish in the Delta. And the Yolo Bypass is the last big floodplain in the Central Valley.
That's why landowners in the bypass have been concerned about the splittail's status: A mandate to boost the splittail's population could lead to more flooding in the bypass, which could inundate crops and equipment. Farmers also worry that measures to enhance splittail populations could force them to install costly fish screens at water intakes and submit to stricter regulations on their use of pesticides.
"In the Sacramento drainage, the most important spawning areas appear to be the Yolo and Sutter bypasses, which are extensively flooded during wet years," according to a 2004 white paper on splittail biology.
According to financial disclosure reports, MacDonald's farm is worth more than $1 million, and she receives $100,000 to $1 million a year in income from it.
"At the very least, this certainly has the appearance of a conflict of interest," said Mary Boyles, spokeswoman for Common Cause in Washington.
"The government ethics rules clearly state that you're not supposed to participate" in decisions that affect you personally, Boyles said. "We need enforcement of these rules that are on the books."
In addition to influencing the agency's decision on the splittail, MacDonald has come under fire for meddling with scientific reports on other endangered species, including the California tiger salamander.
The March 23 inspector general's report concluded that MacDonald, an engineer with no background in biology, "has been heavily involved with editing, commenting on, and reshaping the Endangered Species Program's scientific reports from the field."
The wildlife agency's deputy director, Marshall Jones, described MacDonald to the inspector general's investigator as a Bush administration "attack dog."
Though the report found no evidence of a crime, it said she broke rules against granting preferential treatment and distributing internal agency information.
The report said MacDonald:
· Released an internal draft of regulations on designating critical habitat for endangered species to the Pacific Legal Foundation, a Sacramento-based law firm that regularly sues to weaken endangered species rules.
· Asked subordinates to gather internal information about Delta smelt that was requested by a California Farm Bureau lobbyist and then passed that information to the lobbyist.
· Forwarded to a California Farm Bureau attorney an e-mail she had sent to the Sacramento field office complaining about biologists' determination to keep Delta smelt on the list of protected species. MacDonald opposed that conclusion, and the Farm Bureau attorney immediately filed the e-mail in an ongoing lawsuit as evidence that the government was in disarray. Although MacDonald did not know it, Delta smelt populations were plummeting to perilously low levels at the time of her e-mail in 2004.
· E-mailed large internal files from the U.S. Environmental Protection Agency, including one on plans for water quality regulations, to e-mail accounts ending in chevrontexaco.com.
· Sent an internal document on Delta smelt to a friend she met during online role-playing games, through the e-mail address of the friend's father.
The report noted that the director of the Fish and Wildlife Service, Dale Hall, said MacDonald was particularly interested in endangered species issues in her home state of California. But the report did not draw direct connections between endangered species and her farm.
Before MacDonald went to work in Washington, she participated in development of a "Yolo Bypass Management Strategy." She is listed as a "landowner" in the report's list of participants.
Several of the other participants were contacted for this story, but none could recall much, if anything, about her involvement.
But the strategy document, completed in 2001, reflects a number of concerns that landowners in the bypass had regarding ecosystem restoration projects to benefit fish, including splittail.
The fish is also of deep concern to water users elsewhere in the state because it could add a new layer of complexity to the increasingly difficult task of maintaining the state's water supply for farms and cities, and protecting its ecosystems.
That is because splittail's dependence on floodplains is unique in the Delta, and that opens up a new set of potential impacts on water supply.
Splittail are large minnows that can grow to more than 12 inches long and live five to seven years. Their populations tend to drop substantially during long droughts and rebound dramatically in response to wet weather.
There is an honest disagreement among scientists about whether the fish belongs on the list of protected species, with some arguing that splittail are well-suited to bounce back from depressed population numbers and others contending the population is on a worrisome downward trend.
In response to concerns that splittail were in decline, the wildlife service added it to the list of threatened species in 1999.
Central Valley farmers sued to overturn the listing and, in June 2000, they won a court order that required government scientists to review their decision in light of new data.
When the court ordered the listing decision redone, it set off a highly unusual series of reports in which biologists in the wildlife service's Sacramento field office concluded repeatedly that splittail should be kept on the list of threatened species.
But none of those reports was sent to Washington for final approval.
Then, in January 2003, the head of the Sacramento office, Steve Thompson, called a meeting to hear the latest presentation from the splittail team. After hearing a report from Jason Douglas, the lead biologist, every scientist in the room except Thompson agreed that splittail should remain on the list, according to notes from that meeting.
Shortly thereafter, Douglas was replaced as the lead biologist.
"I thought it was clear we weren't going to be able to list it. In the face of uncertainty, you err on the side of the species," said Douglas, who now works in the agency's Tucson, Ariz., office.
The splittail report -- concluding that the fish be taken off the list of threatened species -- was then sent to the agency's Washington headquarters.
The rest of the roughly 100-page report, however, was largely intact, and that inconsistency angered MacDonald, according to a participant on a conference call with MacDonald at the time.
"She's hopping mad and saying this thing reads like a listing package," said the participant, a wildlife service official in Washington who requested anonymity out of fear of retaliation. "She said something to the effect that she would just have to do this herself."
The official added that although the recommendation to take the fish off the list was made in Sacramento, "without a doubt the decision was made the way it was because of pressure from Julie MacDonald. She was the one that forced the decision."
Thompson, the head of the Sacramento office who made the recommendation, said he did not specifically recall speaking with MacDonald about the splittail listing but added that he was sure the issue came up.
"Certainly, Julie MacDonald called me on a regular basis, and I'm sure she talked to me about it," Thompson said.
On Sept. 15, 2003, eight days before the decision to take splittail off the threatened species list was made final, the Washington office faxed to Sacramento six marked-up pages of the new rule with the cover page notation, "re: Julie MacD's latest comments/edits."
In it, MacDonald made numerous changes and comments, most of which appear to have been aimed at softening the language of the rule. In addition to changing the conclusion that splittail "are likely" declining to "may be" declining, she wrote that, "At this point, none of the threats individually or collectively rise to a level of concern that warrants listing."
That sentence does not appear in the final report.
MacDonald also took issue with the statistical methods employed by her agency's biologists.
At the time of the decision, there was a debate about how to perform statistical calculations to determine whether the splittail population was declining. The stricter method favored by some scientists, including biologists working for the state of California, did not offer a clear picture of a fish in decline.
But the relaxed method preferred by federal biologists did.
That dispute might have been rendered moot by a third statistical method that appeared to conclusively show that splittail was in decline.
The wildlife agency ignored the third method in its final rule, however.
In a memo filed in June 2003, former agency field supervisor Wayne White wrote that the new statistics reinforced what agency biologists had been saying since 1994: that the fish was in decline.
But, he noted, the new statistics had not been subject to public comment, and the officials who made the decision to take splittail off the list of threatened species were aware of the new data.
In the end, the agency concluded that even if the fish were in decline, new programs were in place to improve the fish's habitat.
Rep. George Miller, D-Martinez, a senior member of the House Committee on Natural Resources, said MacDonald's actions regarding the splittail listing were very serious and cast doubt on every endangered species decision she touched.
"This is like a police department where they tamper with evidence. You have to go back" and re-examine decisions that might be compromised, he said.
"It's clearly worthy of a criminal investigation," said Miller. "This was not an accident. She knowingly did this. She aggressively did this."
8-26-02
Natural Resources Defense Council
NRDC Condemns Bush Administration Abandonment of California Water Plan
Environmentalists Question Role of Former Water Industry Lobbyist
http://www.nrdc.org/media/pressreleases/020826.asp
SAN FRANCISCO (August 26, 2002) - Environmentalists are charging Interior Secretary Gale Norton with abandoning a widely supported California water plan. And they are calling on the Department of Interior to explain the role played by a former water industry lobbyist who now advises Norton on California water issues. At issue is the administration's controversial decision last week to quietly drop its appeal of a court ruling involving a critical component of the state's CalFed water plan.
At stake is the state-federal CalFed plan, which is designed to restore the San Francisco Bay-Delta and improve water supply reliability for California. Congress currently is considering legislation to authorize funding for the CalFed plan. However, a federal judge in Fresno ruled in February that federal regulators improperly allocated water to fish and wildlife. If upheld, the decision will reduce the amount of water available for protecting the environment. Environmentalists say that by withdrawing the government's appeal in the case, Secretary Norton is undermining the very cornerstone of the plan. The appeal was filed by the Department of Interior in May in a suit filed by Central Valley agribusiness interests in an attempt to weaken the CalFed plan.
"Secretary Norton is walking away from CalFed, even though she had pledged to support it," said Barry Nelson, senior policy analyst for NRDC (Natural Resources Defense Council). "This is another environmental rollback by the Bush administration, and it has serious consequences for California."
Norton's key staffer on CalFed issues is Jason Peltier, previously a longtime lobbyist for Central Valley agricultural interests. For over a decade, as the head of the Central Valley Project Water Association, Peltier led efforts to oppose federal water reform. Despite Peltier's efforts, President George Bush Sr. signed into law the Central Valley Project Improvement Act (CVPIA) in 1992. The CVPIA was a major overhaul of the federal project that delivers water to farmers and other California water users. It guaranteed that water would be made available for environmental protection. The Department of Interior wrote rules to implement the CVPIA, which serve as the foundation of the CalFed plan.
On October 31, 1992, the day after CVPIA became law, Peltier pledged in the San Francisco Chronicle, "We'll do anything and everything to keep from being harmed. If that means obstructing implementation [of the bill] so be it."
"We call on Secretary Norton to explain the role of former water lobbyist Jason Peltier in this decision to capitulate to his former clients," said Nelson. "If Peltier is behind this, then it means he is finally delivering on his decade-old promise to block implementation of the Central Valley Project Improvement Act. Industry special interests should not be charged with protecting the environment."
The lawsuit in question was brought by the Westlands Water District, the largest and most powerful member of Peltier's former employer. It challenged complex water accounting rules that enable the Bureau of Reclamation, a Department of Interior agency, to track 800,000 acre-feet of water dedicated by the CVPIA to the restoration of the bay-delta and its fisheries. The rules were developed as part of the CalFed plan to protect fish from getting sucked into the massive state and federal water pumps in the delta. The Westlands lawsuit sought to force the bureau to count water that is delivered to farmers as water delivered to fish and wildlife.
If upheld, the decision by U.S. District Judge Oliver W. Wanger in Fresno will dramatically reduce the amount of water available for bay-delta restoration. But environmentalists say the damage could go beyond fish and wildlife; the ruling threatens no less than to bring down the carefully balanced CalFed program and its promise of reliable water supplies for the rest of the state. Under CalFed, urban and agricultural users get legal guarantees, which reduce the likelihood that unexpected fisheries problems in the delta will interrupt water supplies as they have in the past. The only reason that state and federal agencies can provide these guarantees in the first place is because CalFed allocates enough water for the environment. Without the environmental allocation, the whole deal unravels.
"Secretary Norton is risking a return of California's water wars, which would damage the state's economy and environment - exactly what CalFed was designed to avoid," said Nelson.
During the past eight years, the Bureau of Reclamation and the Fish and Wildlife Service jointly defended the implementation of the CVPIA from legal attacks from the Westlands Water District. However, in another clear indication of the new attitude of the Department of Interior, the Fish and Wildlife Service was not allowed to testify in court to defend the allocation of water for the environment. As a result, environmentalists say, this made it more likely that Judge Wanger would rule against the Department of Interior and throw out the accounting rules. The department has since announced that it will rewrite its rules to allocate more water to farmers and less to fish and wildlife.
NRDC and other environmental groups are appealing the ruling to the Ninth Circuit court of appeals.
Merced Sun-Star
Merced County's jobless rate continues to drift downward
16.7 percent unemployment in August is higher than a year ago...CORINNE REILLY
http://www.mercedsunstar.com/167/v-print/story/1066044.html
Merced County's unemployment rate dipped slightly in August, to 16.7 percent, according to data released Friday by the state's Employment Development Department.
That figure is down from July's 17.6 percent, but still far higher than the year-ago Merced County jobless rate, which was 11.4 percent.
This year's local unemployment peak was 20.2 percent in March.
Joblessness remains far higher in Merced compared to many other parts of the state and nation.
Unemployment hit 12.2 percent across California in August. Only two California counties reported higher jobless rates than Merced last month: Imperial and Yuba.
Nationally, unemployment stood at 9.6 percent in August.
Merced's jobless rate rose steadily between September 2008 and this April.
Since then it's slowly been declining, even though many local employers are still cutting back. Ninety Merced County employees are slated to lose their jobs next week because of massive cuts approved last month by the Board of Supervisors. Arvin Sango announced last week that it will soon close its Merced plant, which manufactures engine exhaust components and employs 55 people.
Most of the jobs gained locally in August were in the government and farming sectors, the Employment Development Department data show.
The highest unemployment rate ever recorded in Merced County was 21.7 percent in February 1996.
For information on how to file for unemployment benefits, go to www.edd.ca.gov.
Grant will help UC Merced reach energy goals...DANIELLE GAINES
http://www.mercedsunstar.com/167/v-print/story/1066063.html
Look out, unharnessed renewable energy. UC Merced is coming for you.
The campus has received a three-year, $1 million grant from the California Energy Commission's Public Interest Energy Research program.
The commission received 51 applications for its Renewable Energy Secure Communities grant. UC Merced was one of 13 organizations to receive funding.
The money will be used on campus to develop a system to predict when renewable energy from solar or wind power will be available and how to make up for shortfalls when such power isn't being generated.
UC Merced's commitment to a "triple zero" goal -- no landfill waste, no greenhouse gas emissions and using only energy from renewable sources -- requires that the campus plan ahead for cloudy or windless days.
"This is a unique collaboration between engineering professors and facilities staff," said Gerardo Diaz, an engineering professor, in a press release. "UC Merced has already built very energy-efficient buildings on campus, and we will be state-of-the-art in actually monitoring and maintaining that energy performance."
For example, researchers will look to improve energy savings at the campus' science and engineering building, which consumes the most power on campus and accounts for 40 percent of the college's electricity bill.
A solar forecasting lab on campus will advance UC Merced's capability to rely on solar energy as a primary source of power. By using data collected from two solar observatories at UC Merced and UC Davis, the lab will identify the best sites for future solar fields throughout the state.
Another lab on campus will look at ways to convert waste to energy through plasma technology. The school will work with Foret Plasma Labs to use waste from the reverse-osmosis water filtering process and turn it into steam power.
"This is a promising and flexible approach that will be used to efficiently generate steam on-demand to supply the campus needs," John Elliott, UC Merced's assistant director of energy and sustainability, said.
A third focus for the grant money will be increased energy efficiency on campus.
"For the time being it is much cheaper to save energy than to generate energy," Elliott said.
Modesto Bee
Central Valley mostly sees improved employment
Seasonal harvests, manufacturing help area outpace state average...Marijke Rowland. The Associated Press contributed to this report.
http://www.modbee.com/business/story/860274.html
As California's August unemployment rate jumped to its highest point in modern record-keeping, most of the Central Valley counties saw dips in their rates buoyed by seasonal farm work.
Agriculture and manufacturing drove Stanislaus and the surroundings counties' drops in unemployment for the month, according to data the state Employment Development Department released Friday.
Stanislaus County's unemployment rate fell by half a percentage point to 15.8 percent for August, the first time it has been under 16 percent since December of 2008.
The seasonal harvest for valley crops like tomatoes and peaches was in full swing last month, so processing plants and manufacturers were at capacity. That helped prop up the otherwise largely stagnant numbers in other job categories.
"(Farming and manufacturing) actually helped us buck the trend of the state in general," said Jeff Rowe, director of the Stanislaus County Alliance Worknet. "The state's unemployment rate increased and ours decreased. That's a product of our strong agriculture industry and food processing."
San Joaquin, Mariposa and Merced counties all saw dips anywhere from 0.3 to nearly a percentage point, respectively. Conversely, foothill counties Tuolumne and Calaveras saw small jobless rate increases by 0.2 percentage points.
"The numbers very much follow the seasonal trends for that month," said Liz Baker, a labor market analyst for the Employment Development Department. "Manufacturing and farming for the month definitely got more people into the labor market and reduced the number of unemployed, which is a good thing."
In California, the unemployment rate broke a modern record with 2.2 million people jobless during August. But in Stanislaus County, some 3,100 more residents found jobs instead.
Still, the valley's overall unemployment rate — which has hovered in the mid-teens since the beginning of the year — continues to outpace the state.
There are signs that the entire state might be emerging from the recession as the rate of job losses slowed.
Statewide, the number of jobs lost from July to August was just 12,000, down from about 35,000 the previous month. From November 2008 until last June, the state lost 65,000 or more jobs each month, said Jerry Nickelsburg, a senior economist with the Anderson Forecast at the University of California at Los Angeles.
"The big story is the continued decline in the rate of job loss in payroll employment," Nickelsburg said. "That's much more significant than the slight uptick in the unemployment rate."
California was one of 42 states to lose jobs last month, when the national jobless rate hit 9.7 percent. The state is tied with Oregon for the fourth-highest unemployment rate nationally, behind Michigan, Nevada and Rhode Island.
For the valley, the next few months will tell whether the area has finally bottomed out from its recession-high unemployment rates. September has historically seen the tail end of the seasonal farming and manufacturing work coupled with the increase of government work from schools going back into session.
October is another story.
"What I really hope is that the unemployment rate doesn't skyrocket, starting in October, like it did last year," Rowe said. "We don't want to see the huge increases that we did last winter."
Still, Baker said area workers should see small encouragement in the August numbers.
"I think the bright spot is whenever you see a decrease in the unemployment rate that gives people hope," she said. "There are jobs being created, albeit seasonal. Hopefully that is encouraging to those job seekers out there who may be discouraged."
Radanovich fields health questions...Sue Nowicki
http://www.modbee.com/local/v-print/story/860336.html
OAKDALE — There were a few boos and yells, but the mood was mostly affirming and civil in Friday afternoon's town hall meeting on health care reform, hosted by Rep. George Radanovich, R-Mariposa.
More than 500 people attended the event at the Oakdale Community Center.
Nearly 100 people, ranging from teenagers to people in their 80s and on both sides of the issue, asked questions or made comments in the 2½-hour session.
Radanovich opened the meeting by explaining proposed bills in the House and Senate, but added that they are changing all the time. He said Democratic-backed bills will lead to large increases in taxes and the federal deficit, eventually eliminate many private insurance plans, and cut Medicare and Medicaid benefits.
Congress instead should focus, he said, on insurance reform, making insurance affordable and portable across state lines, and work on insurance for catastrophic care and the poor.
"Health care is incredibly important," he said. "Your views need to be on the table."
Joel Chase, 43, of Oakdale, said he decided to attend because "I've never been to a town hall meeting before. I thought I'd do my civic duty and come out."
The former cargo plane pilot was jobless for much of this year. Chase said he is a conservative who is concerned about attempts to nationalize health care.
"I want to know what they're going to do to stop government takeover or control of the health care system," he said.
One woman, who identified herself as a college instructor, said one of her students wants to know how her family can financially support their 6-year-old son, who is deaf and unable to receive California's Healthy Families medical care.
A college student asked what impact the cost of national health care will have on rising education costs, which have been coupled with decreasing financial aid.
"Your generation has special challenges not encountered by any other generation since World War II," Radanovich acknowledged.
One man who said he works at a Turlock skilled nursing facility said cuts to Medicare and Medicaid programs already have hurt seniors there, and that further cuts in proposed health care legislation will put more elderly patients at risk.
"What's going to ensure that seniors' needs are going to be cared for when they need it?" he asked.
But one senior citizen in a T-shirt that read "Health care not warfare" told Radanovich, "We can take care of our people here if we're not in these military actions halfway around the world. What can I do to convince you that you're wrong?"
Dr. Delmar Tonge, a Modesto physician, agreed that "there are problems in medical care." But he added, "If a person comes in with a broken leg, don't schedule him for a cardiac transplant," implying that proposed national health care is as dramatic a move.
Radanovich several times answered opponents by saying he favors the free market approach to reducing health care costs.
One woman took issue with that: "Health care profits are outrageous. How can we deal with these outrageous profits caused by the free market?"
Janel Groenewoud, 23, said she "got kicked off of my parents' health insurance policy." But she opposes the proposed plans.
"How can the government tell me, 'You must be on health insurance?' " she asked. "I take vitamins. I exercise. If I have to go to the doctor, I pay, at the most, $100. I choose not to (buy insurance) because it's not economical for me."
She added that her parents immigrated to this country from the Netherlands "where they have universal health care."
With tears, Groenewoud told of an elderly grandmother who is afraid of being euthanized if she is hospitalized and an aunt who has a heart tumor. "She's been told she is too old for treatment — and she's only 50. You think they're not going to do that here, but they will. It will happen. It will," she cried.
Applause broke out several times, as when a man said, "It seems immoral for us to vote for things we like and stick the bill on those who aren't even born."
The biggest burst of applause, and laughter, came when a man complimented Radanovich.
"Thank you for being able to stand up for the last two hours without a teleprompter," the man said.
On the Net: Find more about Rep. George Radanovich's position on health care at www.radanovich. house.gov.
Fresno Bee
Project to place fish-saving gates in delta stalls...The Associated Press
http://www.fresnobee.com/state/v-print/story/1643293.html
FRESNO, Calif. A plan to place two removable gates in California's freshwater estuary to keep threatened fish from getting killed by water pumps has been put off for this year.
San Joaquin Valley farmers favored the "Two Gates" proposal as a temporary solution to the water crisis hitting the state and slowing deliveries from the Sacramento-San Joaquin Delta.
A three-year drought, coupled with environmental restrictions on pumping, have forced farmers to idle thousands of acres and contributed to the collapse of the commercial salmon fishing industry.
Metropolitan Water District officials hope contractors can get the gates installed and permitted by next summer, a critical time for a native fish called the delta smelt.
Sacramento Bee
Swimmers brave dirty Delta for awareness...Ed Fletcher
http://www.sacbee.com/378/v-print/story/2193591.html
Seven swimmers swimming, Sacramento to San Francisco.
Tongue twister though it is, the swimmers and their backers hope a 100-mile weekend relay will become a mind teaser, raising awareness about increasing threats from pollution in the Sacramento-San Joaquin River Delta and San Francisco Bay.
"We want to raise the issue of water quality from Sacramento to San Francisco," said Jeff Russell, a member of the sponsoring organizations, the Dolphin Club and San Francisco Baykeepers.
The tough relay will take swimmers through one of the largest estuary systems in the nation. Along the way, the team will swim past everything from abandoned boats to streams and channels tainted with varying levels of industrial, agricultural and urban pollutants.
"I hope there's no health risks for them," said Craig Wilson, former chief counsel for California's Water Resources Board and now a lawyer with the Stoel Rives firm in Sacramento.
"They're swimming in a stressed environment, in both the Delta and the bay," Wilson said, reflecting on the current state of the estuary, a mix of sea and fresh water critical to millions of Californians and scores of wildlife species.
Pollution and the future of the Delta have long been debated by politicians, environmentalists and business interests in a tussle over California's diminished fresh water supply.
The swimmers – on dry land Friday after testing the Sacramento River water in a photo session for media cameras – dived in for real around 11 a.m.
They'll take one-hour turns in the water through the weekend and plan a 9 a.m. arrival Sunday in San Francisco Bay.
A sailboat and kayak will accompany the swimmers.
In addition to swimming, members of the six-man, one-woman team will take turns wielding oars in the kayak.
The crew will file regular Internet updates, tweeting and blogging along the way at www.relayforthebay.org.
The swimmers, in true Dolphin Club tradition, are in the cold waters without wetsuits.
They are an experienced bunch. Five have braved the 19 nautical miles of the English Channel. Dolphin Club members routinely swim San Francisco Bay in summer and winter months.
Despite the pollution, Russell said, the bay is "the world's most spectacular swimming pool."
He said that once he started swimming the chilly waters of the bay, he never went back to swimming pools.
Swimmer Duke Dahlin, in the group's early Twitter feeds, reported the water felt great, but he was already running into discarded plastic water bottles and other junk.
He said he's willing to endure some toxins along the route and challenge his body, if it helps raise awareness about pollution in the water.
Manteca Bulletin
Salt: The next sewer rate buster?
State wants less salt in treated water...Dennis Wyatt 
http://www.mantecabulletin.com/news/article/7204/
Salt could do to your monthly sewer bill what ammonia did – raise it considerably.
Manteca is in the process of re-licensing the municipal wastewater treatment plant with the Central Valley Regional Water Control Board. The city is almost through with a $61.3 million treatment plan upgrade and expansion project that started in earnest in December 2003 after six years of struggling to devise a way to deal with a state demand that additional ammonia be removed from treated water before it is returned to the San Joaquin River.
Prior to that, the city had met all state ammonia removal standards. Now tightening standards are threatening to force the city to add more costly treatment to reduce levels of salt before it is returned to the Delta. Manteca isn’t alone in being targeted.  Lodi, Stockton, and Tracy – all with sewer treatment plants that return water to the San Joaquin River and ultimately the Delta – are facing the same tough new standards.
Public Works Director Mark Houghton said the municipal staff is working with state officials to determine if there isn’t a more reasonable approach to addressing the salt issue. Human waste has salt in it but as Houghton notes what the cities add to the river is minuscule compared to what is already flowing downstream. Even so, the state is being driven by concern that salt is damaging aquatic life – both fish and vegetation – in and around the Delta.
While a lot of other areas also contribute to the problem, Manteca and its neighbors are at ground zero.
“We’re the most visible,” Houghton said noting the proximity to the Delta.
While Houghton noted ultimately the city must comply with whatever standard is adopted, they are trying to find ways to “make it more reasonable” to keep costs down.
The current plant expansion was designed to add salt removal to the process so there won’t have to be a massive physical component added. The extremely expensive salt removal process – and the equipment needed for that - would have to be added to the plant.
The re-licensing of the wastewater treatment plant is just one challenge Manteca’s public works staff is facing in the tightest budget year in at least 25 years.
The city is faced with trying to find ways to do more with less staff necessitated by drops in property and sales tax.
“We have a lot of hardworking, dedicated people in public works,” Houghton said. “They are trying to find ways to keep servcie levels up.”
It’s a challenge especially since public works staff faces the prospect of either layoffs or forgoing two back-to-back raises on top of reducing take home pay to cover more retirement costs. That is in addition to a 3.8 percent pay cut they’re taking this year along with other municipal employees through non-paid furlough days.
Water softeners using salt add to the problem
One way ratepayers can help their own cause is to avoid using water softeners that employ salt and instead opt for those that use filters. Houghton believes the state eventually may outlaw water softening systems that use salt. Until then, every pound of salt used in water softeners makes the problem worse.
A single-family household pays $43.10 today for sewer. It will go to $43.30 on Jan. 1, 2010, then go to $46.55 on Jan. 1, 2011, then go to $48.30 on Jan. 1, 2012, and then hit $51.25 per month on Jan. 1, 2013.
The five-step annual jump reflects a rate increase over the five years in excess of 50 percent. The money goes for maintenance, operations, and the cost of paying to replacing aging treatment equipment and put in new ammonia removal facilities at the plant. Growth costs are paid by new developments when they connect to the system and “buy in” with hook-up fees.
Personnel are the top cost. Much of that is dictated by state standards on how they want the plant is operated. Labor costs are about $2 million followed by around $1 million in power.
The city is trying to find ways of generating their own power to reign in electricity costs.
They are hoping a co-generation plant that could be pursued by matching federal stimulus money – should Manteca obtain it – would go a long way toward that goal.
The current rate structures include funding for critical pipeline work including the Central Manteca trunk. Several years ago the pipeline was near collapse. The city made emergency repairs to line the pipe to extend its life. The rate increase allocates money to put in a more permanent solution.
San Francisco Chronicle
Justice targets Bush Cabinet official in probe...JOHN HEILPRIN AND DINA CAPPIELLO, Associated Press Writers. Associated Press writers John Heilprin and Devlin Barrett contributed to this report. Heilprin reported from New York.
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/09/18/national/w103704D90.DTL&type=printable
The Justice Department has launched an investigation into whether former Interior Secretary Gale A. Norton illegally used her position to steer lucrative oil leases to Royal Dutch Shell PLC, the company she works for now, officials with both departments confirmed to The Associated Press.
The criminal investigation is focused on a 2006 decision by the Interior Department to award three oil shale leases on federal land in Colorado to a Shell subsidiary. Oil from the leases could eventually earn the company hundreds of billions dollars.
Investigators are looking into whether Norton, named by President George W. Bush to run the agency in 2001, violated a law that bars federal employees from discussing employment with a company if they are involved in a decision that could benefit that company. Months after granting the leases to Shell, Norton left the agency. Shell later that year hired her as an in-house counsel for its unconventional fuels division, which includes oil shale.
Justice Department and Interior investigators also are trying to determine if Norton violated a broader federal "denial of honest services" law. Under the statute, government officials can be prosecuted for violating the public trust for directing government business to favored firms.
Officials spoke to the AP on the condition of anonymity because they were not authorized to discuss the case.
Norton could not be reached immediately for comment.
"We are aware of an investigation; however, we are not in a position to comment," said Kelly op de Weegh, a Shell spokeswoman.
The Interior Department's Office of Inspector General began the investigation toward the end of Bush's last term, after receiving complaints about the lease process. The IG's office made a formal referral to the Justice Department earlier this year after concluding there was probable cause of a criminal violation.
The investigation was first reported by The Los Angeles Times.
Prior to becoming Bush's first Interior secretary, Norton was Colorado's attorney general and had worked as a private lawyer for timber, oil and mining companies. At Interior, she supported expanded oil and gas drilling on government-owned land.
The development of oil shale largely in the West was one of the technologies that the Bush administration wanted to explore aggressively. In response to a recommendation by then-Vice President Dick Cheney's energy task force, the Interior's Bureau of Land Management issued six demonstration leases in Colorado and Utah.
Shell was the only company to receive more than one lease. Its U.S. operations are based in Houston.
Indybay
Californians React to Sean Hannity's Misinformation on Water Crisis...Ryan Schwartz ( hummingbirdpr [at] gmail.com )...9-17-09
http://www.indybay.org/newsitems/2009/09/17/18622305.php
Conservative talk show host Sean Hannity aired live from the San Joaquin Valley tonight to garner national attention for California’s water crisis. Instead of illustrating how outrageous water speculation and irresponsible agricultural practices are adding to a natural drought, Hannity fueled partisan politics and blamed President Obama for refusing to lift a series of federal mandates and environmental rulings that order a small amount of water to be used to restore regional fisheries and protect the balance of the entire Northern California coastal ecosystem. State water experts counted a total of 10 incorrect statements in Hannity’s broadcast.
FOR IMMEDIATE RELEASE
Media Contact:
Ryan Schwartz
713-446-3736
hummingbirdpr [at] gmail.com
ENVIRONMENTAL GROUPS, WATER ADVOCATES, AND FISHERIES REACT TO SEAN HANNITY SPREADING MISINFORMATION
ON CALIFORNIA WATER CRISIS
Burson-Marsteller PR Firm Hosts ‘Astroturf’ Rally at Expense of Pacific Ecosystem / Economy
September 17, 2009, Fresno, CA...... Conservative talk show host Sean Hannity aired live from the San Joaquin Valley tonight to garner national attention for California’s water crisis. Instead of illustrating how outrageous water speculation and irresponsible agricultural practices are adding to a natural drought, Hannity fueled partisan politics and blamed President Obama for refusing to lift a series of federal mandates and environmental rulings that order a small amount of water to be used to restore regional fisheries and protect the balance of the entire Northern California coastal ecosystem. State water experts counted a total of 10 incorrect statements in Hannity’s broadcast.
In June 2009, The National Marine Fisheries Service (NMFS) ordered 5-7% of water flows into the valley (330,000 acre-feet) to be used to restore creeks and estuaries for chinhook salmon, which are being threatened with extinction. In addition to the salmon, the NMFS order will help boost populations of other threatened species - including sole, crab, herring, smelt, steelhead, sturgeon, bass, and killer whales. Regional commercial and sport fisheries have collapsed over the past 2 years, and an independent economic research firm estimates that recovery of the salmon fishery alone would create $5.7 billion in new economic activity for the state, and the creation of 94,000 new jobs.
“The water needed to save Pacific fisheries is a drop in the bucket compared to what is being lost with irresponsible irrigation techniques and business practices,” says Mike Hudson, President of the Small Boat Commercial Salmon Fishermen’s Association. “Local fisheries have completely collapsed and thousands of our lives have been destroyed, but Hannity ignores our families to promote his politics.”
Hannity made no mention of of a recent Pacific Institute report showing how simple, and cost-effective irrigation techniques could be adopted by valley farmers to save nearly 6 million acre-feet of water per year (over 18 times the amount re-routed by the NMFS order). Nor did he address the growing practice of water speculation, in which rural land owners purchase subsidized water from the federal government and sell it for profit on the open market (Sandridge Partners, a Sunnyvale real estate company, recently sold 14,000 acre-feet of water out of the valley for $77 million). Finally, Hannity failed to explain why the Westlands Water District from which he broadcast from is sitting on nearly 275,000 acre-feet of water that it is not distributing.
Despite the drought and water restrictions, valley farms are full of bumper crops this year. Agricultural surpluses of water-intensive crops such as almonds, tomatoes, walnuts, and pecans are expected.
Zeke Grader of the Pacific Coast Federation of Fishermen’s Association extended an on-air invitation to Sean Hannity to visit the Pacific Northwest and interview the fishermen who have been without a livelihood for 2 years. “Certainly we can do both,” replied Hannity.
“It is unfortunate that Mr. Hannity has chosen to be a stooge for large land owners making a water grab so they can sell it to southern California for golf courses in the desert,” said Grader.
For complete detail of the misinformation told on Hannity’s broadcast, please see the attached list.
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Mike Hudson and Zeke Grader are experienced spokespeople and are available for both live and recorded interviews through the above media contact.
COMPLETE DETAIL OF MISINFORMATION ON HANNITY’S FRESNO BROADCAST
False. Hundreds of laborers appeared in the background, backed up for miles, holding signs and screaming chants in support of Hannity.
True. These are the same workers with the same signs that have been hired by large farm growers for the past couple of rallies. On April 14, 2009, the same organization sponsoring Hannity’s visit held a march that the United Farm Workers called a “grower-sponsored march, a grower-organized march, for water for growers....not a farmworkers' march." The New York Times reported "many of the protesters were paid by their employers to march in lieu of harvesting crops.”
F. The unemployment rate in the San Joaquin Valley is over 40% because farmers cannot grow crops due to a lack of water.
T. The State of California’s most recent employment data reports that Fresno County, the county in which Hannity filmed, has only 15% unemployment, compared to a 12.1% state average. Furthermore, farm jobs increased by 5.3% in the months immediate following the NMFS environmental ruling. Even before the global recession, the Western region of the county historically had the highest unemployment rate in the state. In 2000, before the drought and environmental restrictions, unemployment in the Western region was 32%.
F. The federal government has shut off the water pumps.
T. Most water is flowing through the valley. The San Francisco Chronicle reports that nearly 80% of the water from the ailing delta continues to flow directly into the valley. The local water district has a surplus of hundreds of thousands of acre-feet of water that it is not distributing.
F. The water restrictions were issued to protect only a 2” smelt.
T. A number of species threatened with extinction in this region are being protected by this regulation, including salmon, sole, crab, herring, steelhead, sturgeon, bass, and killer whales. The collapse of one of these fisheries alone is costing the state $5.7 billion and 94,000 jobs.
F. The federal government is choosing fish over people.
T. Protecting regional fisheries creates numerous jobs. Both fish and agriculture can prosper if growers adopted simple, cost-effective irrigation techniques. More responsible farming practices would save 18 times the amount of water being diverted for salmon.
F. The price of processed tomato goods and almonds are going to skyrocket across the nation.
T. This year is predicted to be a record-breaking harvest of processing tomatoes due to ideal weather conditions. Tomato production is up 15% from last year, with 11% more acres planted. Mike Montna, president and CEO of the California Tomato Growers Association, said this year’s processing-tomato harvest — now at the halfway point — is heading toward a record for the state. Almonds are in record-shattering surpluses as well, and a decrease in production would actually save the industry.
F. The NMFS ruling will require us to import more food from China.
T. Seafood is already the most imported food product in the United States. The NMFS estimates that 83% of all seafood consumed in America last year was imported from another country. Driving fisheries out of business will only increase food imports. On the other hand, 75% of California’s almonds are exported out of the United States.
F. This decision was made by a handful of environmentalists.
T. Restoring water to fisheries has been ordered for over 15 years, beginning in 1992 with a Congressional law (Central Valley Improvement Act). A recent independent review was “flabbergasted” that the law has been ignored. A team of government scientists in the Bush administration ordered for water to be rerouted to save fisheries as well, although that order was shelved by the Secretary of the Interior. An additional report was recently released and approved by the new administration.
F. Local residents are flocking to food banks and waiting all day for food.
T. The local CBS station reported that only ‘dozens of families’ showed up to the food bank.
F. The area of Fresno County in which Hannity reported is a ‘natural breadbasket’ where agriculture flourishes.
T. Huron, CA receives an average of only 6.7 inches of rain a year, far less than what is needed to sustain agriculture.
Contra Costa Times
Delta smelt protection project starts...Rowena Coetsee
http://www.contracostatimes.com/environment/ci_13368689
KNIGHTSEN — Work started this week on a project designed to protect an endangered Delta fish and in the process ensure that people and businesses throughout Contra Costa County have a consistent water supply.
Crews on Wednesday began clearing vegetation from around a river inlet near Delta Road and Tule Lane in Knightsen, where Contra Costa Water District will install a large screen to prevent Delta smelt from being sucked into its pumps.
Delta smelt is considered an "indicator species," meaning its numbers reflect the overall health of other fish species in the San Joaquin and Sacramento rivers. The state's biannual surveys of fish populations show that this native species is in greater peril than ever because of a variety of factors.
Contra Costa Water District pumps water from the southern Delta to approximately 550,000 residential and industrial customers in an area that stretches from Brentwood to Concord and Pleasant Hill, as well as parts of Walnut Creek and Martinez.
Known as the Rock Slough Fish Screen Facility Project, the approximately $20 million undertaking involves setting up a stainless steel screen in Rock Slough with openings so small that even young smelt can't continue up the inlet to CCWD's pumping station in Oakley.
CCWD assistant general manager Kurt Ladensack noted that the pumps act as an efficient blender.
Although the agency's environmental protection measure was mandated with the passage of a federal law in 1992, the money to do it only became available this year through Capitol Hill's economic stimulus package.
Late this year or in early 2010, construction workers will pour the concrete that will hold the screen in place, after which they must bring power lines to the remote location and install the mechanical equipment that periodically will scrape debris off the screen.
Once the project is finished in early 2011, CCWD will have a system that not only spares smelt and other fish but protects it from legal interventions that would slow or interrupt service to its customers, Ladensack said.
He noted that a federal judge has been ordering operators of state and federal pumps near Tracy to reduce the volume of water they're taking from the Delta — and sometimes to stop pumping altogether — when the concentration of smelt killed by their intake pumps reaches a certain threshold.
Those orders haven't yet affected his agency, but Ladensack says at some point they could because the CCWD buys its water from the federal Bureau of Reclamation.
Although these Central Valley pumps pose the biggest threat to Delta smelt because of their sheer size, Contra Costa Water District monitors the numbers of this and other endangered species near each of its three pumping stations in the Delta, Ladensack said.
The other two stations already have fish screens, he added.
Santa Cruz Sentinel
Arboretum had racked up $1.8M debt to UC...J.M. BROWN
http://www.santacruzsentinel.com/localnews/ci_13364444
SANTA CRUZ -- The UC Santa Cruz official who made the controversial decision to pull all campus funding from the Arboretum says the garden is deep in debt to the university, which has covered the organization's deficits for at least a decade.
Alison Galloway, vice provost for academic affairs, said the Arboretum has racked up a $1.8 million debt with UCSC stemming from years of overspending. She said the organization runs up a $225,000 annual deficit, which UCSC has covered as a low-interest loan.
But with the campus facing $50 million in state funding losses with more cuts imminent, UCSC officials have put on notice affiliated organizations that are designed to be self-sustaining, such as Shakespeare Santa Cruz and the now-shuttered UC Extension in Santa Cruz.
Galloway said she does not intend to close the 100-acre garden of rare plants, as some longtime supporters have charged. In fact, she said she purposely avoided forcing the organization to make deep cuts until this year.
But the time for reckoning is now, she said, and the answer is in cuts, not just raising fast cash.
"After 10 years of deficit spending, I'm not seeing the turnaround coming quickly," she said. "We've established a pattern here."
Citing confidentiality rules, Galloway said she could not discuss terminating any employee but acknowledged job cuts have consequences.
"My primary focus is to make sure there is curatorial staff to keep on running the
Arboretum to make sure plants are maintained and healthy," she said. "If it comes to the point of layoffs, it will be a blow to those people who are let go. It's not a good economy. I don't take this lightly."
Rather, Galloway said she intends over the next month to help the staff bring employee costs and other expenses in line with revenue.
"I have laid out to them that it is going to take layoffs of staff to reduce spending," Galloway said.
Just who she will be working with, however, is a touchy situation. Not only has the university insisted on repayment of the Arboretum's debt, but Galloway is cutting the $134,000 contribution UCSC has made annually to cover the director's salary and benefits.
Dan Harder, the prominent horticulturist recruited to manage the Arboretum in 2001, has not been fired. But he said the university cut funding for his salary June 30. Since then, he has been drawing his salary from the organization's general fund while devising a plan to keep the garden going.
Harder acknowledged the Arboretum has operated in the red for years, but said he was only admonished by UCSC about it during the last couple of years. When he was hired, Harder said he was told "I would never have to raise my own salary," but has since been told the university can't keep that verbal agreement because of unprecedented cuts from Sacramento that have led to enrollment cuts, layoffs and furloughs.
Still, Harder said he has trimmed almost $400,000 in expenses in recent years by reducing staff and cutting equipment, acquisition and maintenance costs. He is working on new consulting opportunities for the Arboretum, which last year started charging admission, but also expects the recession will lead to less dividends in coming years for the organization's $6 million endowment.
"Essentially we are on our own now," he said. "Not only is there an expectation to raise revenue, but we now have to raise more with the expectation that we are going to start serving that debt. My interest is to get through this year in the black and deal with the debt as a separate issue."
Harder, who left a job in Missouri and moved here with wife Victoria and two daughters after UCSC conducted an international search, said he was astonished UCSC would just cut off the Arboretum, which was started by the first chancellor a year before the campus opened 45 years ago. Harder said the collection of rare plants from South Africa, New Zealand, Australia and elsewhere is valued at $50 million.
The university only started questioning deficit spending when the state put the squeeze on UC last year, he said. Now, he said, Galloway has recommended five of the Arboretum's 11 positions be eliminated -- which he said would make it difficult to maintain the garden and raise new funds.
He said UCSC exacerbates the debt by charging a quarterly interest, which last year cost $70,000, or about a third of the Arboretum's annual deficit. Although the university provides free land and water, Harder said it also charges the Arboretum a fee to process grants and handle other business matters, which adds expense.
Even though 88 percent of the Arboretum's annual $1 million budget already comes from the community -- through donations, fees and plant sales -- people have to give more or the garden will eventually close, Harder said. Volunteers already provide 800 work hours -- the equivalent of six full-time employees -- every month, but he said more will be needed if employees are laid off.
Galloway said she wants to see the Arboretum thrive, but on its own.
"The longer we delay, the bigger the impact would be," she said.
Los Angeles Times
Homeowners who 'strategically default' on loans a growing problem
A study shows that people who abruptly and intentionally abandon their mortgages often have high credit scores, in stark contrast with most financially distressed borrowers...Kenneth R. Harney
http://www.latimes.com/classified/realestate/news/la-fi-harney20-2009sep20,0,6741264,print.story
Who is more likely to walk away from a house and a mortgage -- a person with super-prime credit scores or someone with lower scores?
Research using a massive sample of 24 million individual credit files has found that homeowners with high scores when they apply for a loan are 50% more likely to "strategically default" -- abruptly and intentionally pull the plug and abandon the mortgage -- compared with lower-scoring borrowers.
National credit bureau Experian teamed with consulting company Oliver Wyman to identify the characteristics and debt management behavior of the growing numbers of homeowners who bail out of their mortgages with none of the expected warning signs, such as nonpayments on other debts.
With foreclosures, delinquencies and loan losses at record levels, strategic defaults and walkaways are among the hottest subjects in residential real estate finance. Unlike in earlier academic studies, Experian and Wyman could tap into credit files over extended periods to identify patterns associated with strategic defaults.
Among researchers' findings are these eye-openers:
* The number of strategic defaults is far beyond most industry estimates -- 588,000 nationwide during 2008, more than double the total in 2007. They represented 18% of all serious delinquencies that extended for more than 60 days in last year's fourth quarter.
* Strategic defaulters often go straight from perfect payment histories to no mortgage payments at all. This is in stark contrast with most financially distressed borrowers, who try to keep paying on their mortgage even after they've fallen behind on other accounts.
* Strategic defaults are heavily concentrated in negative-equity markets where home values zoomed during the boom and have cratered since 2006. In California last year, the number of strategic defaults was 68 times higher than it was in 2005. In Florida it was 46 times higher. In most other parts of the country, defaults were about nine times higher in 2008 than in 2005.
* Two-thirds of strategic defaulters have only one mortgage -- the one they're walking away from on their primary homes. Individuals who have mortgages on multiple houses also have a higher likelihood of strategic default, but researchers believe that many of these walkaways are from investment properties or second homes.
* Homeowners with large mortgage balances generally are more likely to pull the plug than those with lower balances. Similarly, people with credit ratings in the two highest categories measured by VantageScore -- a joint scoring venture created by Experian and the two other national credit bureaus, Equifax and TransUnion -- are far more likely to default strategically than people in lower score categories.
* People who default strategically and lose their houses appear to understand the consequences of what they're doing. Piyush Tantia, an Oliver Wyman partner and a principal researcher on the study, said strategic defaulters "are clearly sophisticated," based on the patterns of selective payments observable in their credit files. For example, they tend not to default on home equity lines of credit until after they bail out on their main mortgages, sometimes to draw down more cash on the equity line.
Strategic defaulters may know that their credit scores will be severely depressed by their mortgage abandonment, Tantia said, but they appear to look at it as a business decision: "Well, I'm $200,000 in the hole on my house, and yes, I'll damage my credit," he said of defaulters. But they see it as the most practical solution under the circumstances.
The Experian-Wyman study does not try to explore the ethical or legal aspects of mortgage walkaways. But it does suggest that lenders and loan servicers take steps to screen and identify strategic defaulters in advance and possibly avoid offering them loan modifications, since they'll probably just re-default on them anyway.
City Council members demand answers, solutions to L.A. water main failures...Jessica Garrison
http://latimesblogs.latimes.com/lanow/2009/09/council-demands-answers-on-cause-of-la-water-main-failures.html
Some L.A. City Council members are pressing the Department of Water and Power to quickly develop solutions amid a rash of major water main failures across the city.
Since Sept. 1, there have been  34 "major blowouts" in L.A.'s water system in which streets have flooded and pavement has buckled. 
The latest occurred Friday afternoon on Myra Avenue in Silver Lake. By contrast, the city had only 21 such ruptures in all of September 2008, 17 in September 2007 and 13 in September 2006.
“These things keep happening and I would like an explanation of what’s going on,” said Councilwoman Jan Perry, who sits on the committee that oversees the agency. “We have to come up with a solution.” 
Mike Eveloff, president of a homeowners association on the Westside, said he was struck by how much water has been wasted in the last few weeks. 
Observing two separate blowouts near his home over the summer, he said:  “Being asked to conserve water and being asked to only water on Mondays and Thursdays and then seeing more water than you could ever save flowing out into the street,  it’s frustrating for people to see.”
City engineers are trying to determine what's causing the water main bursts and have been taking soil samples, sending pipe pieces to labs for testing and performing a statistical analysis on each break.
But some experts said a prime suspect should be the city's recent decision to allow sprinklers to run only on Mondays and Thursdays.
They say that if more water flows through the system on those two days when people water their lawns and then pressure suddenly changes on other days, it could put added stress on already-aging pipes.
"As Sherlock Holmes used to say, when you eliminate everything, whatever is left is the reason.... If the pipe wasn't bad, and it [wasn't seismic activity] and it wasn't a funky contractor, well, what you've changed is this twice-a-week surge flow because of watering restrictions," said Richard Little, director of the Keston Institute for Public Finance and Infrastructure Policy at USC.
Jean-Pierre Bardet, chairman of USC's civil engineering department, who began informally consulting with DWP officials Thursday, concurred that water rationing should be thoroughly investigated, noting that the system's age makes it susceptible to problems.
DWP officials said they are looking into the rationing, among numerous other possible causes. The rationing began in June, shortly before they noticed an uptick in major blowouts. There were 24 blowouts in July and 31 in August, increases from the same months last year.
Jim McDaniel, head of city water operations, refused to speculate on the cause, saying the inquiry is not complete.
Engineers also stressed that the city's 7,200 miles of pipe aren't actually leaking more than usual -- in fact, the number of leaks, about 1,400 a year, is down from the past and represents a lower rate per mile of pipe than in other cities. The problem is with bigger, more destructive leaks that send water shooting through streets.
"We have more breaks which actually have created major destruction," Bardet said.
The problem came to the DWP's attention Sept. 5, after a 5-foot-wide trunk line underneath Coldwater Canyon Avenue in Studio City exploded, sending a 10-foot gusher of water and mud into the air.
Homes and businesses were flooded, and the street, a major thoroughfare connecting the San Fernando Valley and the Westside, was closed for a week. That pipe was 95 years old, and officials suspected that age may have been a factor in its failure.
Less than 72 hours later, another, newer main burst in Valley Village, creating a sinkhole that swallowed half the firetruck that responded to the call about flooding. Firefighters crawled out the window and escaped to safety.
As officials analyzed those problems, they realized they had been seeing an increase in "major blowouts."
In the following days, there was at least one, and often two or three major breaks, snarling traffic, flooding streets and attracting media attention. On Thursday, a break temporarily closed Topanga Canyon Boulevard in Canoga Park. 
At first, officials believed one culprit was the age of the system. The DWP has a $1.3-billion program to replace old pipe, funded by a water rate increase of about $2 per customer that the council authorized last year.
But as the blowouts continued, department officials began reaching out for help, sending data to universities and other experts.
Officials said it remains possible that the blowouts are a statistical anomaly. But experts like Little are somewhat more skeptical. He said the timing of the blowouts -- coming soon after the city imposed a major change in water usage with the restrictions -- is highly curious. This marks the first time the city has restricted water use to two days a week.
"To me that is an 'aha' moment," he said.
Little doubts that seismic activity is to blame and said that if he were investigating, he would study the way the shifting pressure from the rationing is hitting the water mains.
But his USC colleague Bardet raised a question investigators will have to answer: If rationing is to blame, wouldn't other cities like Long Beach with similar programs be seeing a surge in blowouts?
CNN Money
Bank failure toll reaches 94
Regulators close subsidiaries of Irwin Financial Corporation in Kentucky and Indiana at a cost of $850 million to the FDIC...Ben Rooney
http://money.cnn.com/2009/09/18/news/economy/bank_failures/
index.htm?postversion=2009091818
NEW YORK (CNNMoney.com) -- Regulators closed subsidiaries of Irwin Financial Corporation in Kentucky and Indiana Friday, bringing the total number of bank failures this year to 94, according to the Federal Deposit Insurance Corp.
Customers of the bank, however, are protected. The FDIC, which has insured bank deposits since the Great Depression, currently covers customer accounts up to $250,000.
Irwin Union Bank and Trust Company and Irwin Union Bank, F.S.B. operated a combined 27 branches in nine U.S. states. Both banks were run by Columbus, Ind.-based Irwin Financial Corp.
First Financial Bank, NA, which is based in Hamilton, Ohio, will assume all of the deposits of the two banks.
"Since all deposits are being assumed by First Financial Bank, there will be no losses to any depositor," Claude Davis, president and chief executive officer of First Financial, said in a statement.
Irwin Union B&T, of Columbus, Ind., had total assets of $2.7 billion and total deposits of approximately $2.1 billion. Irwin Union, F.S.B., of Louisville, Ky., had total assets of $493 million and total deposits of approximately $441 million.
On Thursday the banks' parent company, Irwin Financial Corp., said in a regulatory filing that it had "no realistic prospect of achieving the required capital levels," required by its regulators.
The FDIC said customers of the failed banks will be able to access their money over the weekend by writing checks or using ATM or debit cards. Checks will continue to be processed, and borrowers should make their payments as usual.
A total of 94 banks have failed so far this year, with an average of about 10 per month. That's nearly four times the number of banks that failed in 2008, and it's the highest tally since 1992, when 181 banks failed.
This year's failures have reduced the FDIC's insurance fund to $10.4 billion from $45 billion a year ago. However, the agency has said it has $42 billion available for bank rescues over the next 12 months.
The cost of Friday's closures to the FDIC is an estimated $850 million.
Earlier Friday, FDIC chairman Sheila Bair said bank regulators will meet at the end of the month to discuss ways to replenish the agency's funds, including the possibility of borrowing from the U.S. Treasury.
Bair also said the FDIC could use some lesser-known methods to raise money, such as requiring banks to prepay assessments or issuing a note.