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Most of the Board, including their esteemed Chairwoman, seem displeased with the ever-growing public attention to their actions regarding Poseidon.
I remember my first OC Water District meeting, maybe six months ago, which I attended at the urging of John Earl who invoked the blessed name of Gus Ayer. I’d opposed the Poseidon project from the beginning, but not enough to go to a Water Board meeting! Apparently though, this agency, this OCWD, had become the key group rolling out the red carpet for these Connecticut hedge fund pirates, so that’s where the action was/is.
And the thing is, some people spoke out at that meeting, eloquently and in great detail, against the Poseidon deal and also for transparency, except it was only half a dozen people and I knew them all – John, Debbie Cook, Merle Moshiri, folks from Surfrider, Coastkeeper and R4RD (Residents for Responsible Desalination.)

Poseidon VP Scott Maloni, as well, poco miffed at the crowd turnout. [pic Amelia]
Well, they can’t say that any more – for some reason a real groundswell has grown against Poseidon, and at the last couple meetings where it was discussed, the hall was overflowing with HUNDREDS of angry citizens, many of them making very good and original points against the proposed deal, and causing obvious discomfort to the secretive Board. What can we credit for all the new public interest, skepticism, and knowledge? Well…
- Partly the excellent R4RD townhall event with Irvine’s Peer Swan, discussed here;
- Probably a recent, excellent OC Weekly cover story by Charles Lam;
- Doubtless the three big Huntington Beach Facebook forums which discuss Poseidon voraciously and whose members are well-represented at meetings now;
- And possibly even the efforts of this humble blog.

Poseidon dead-ender Shawn “Jersey Shore” Dewane makes one of his “Oh, did you just say something?” faces. [Pic Amelia.]
There were two main interconnected issues, both relating to Poseidon, under consideration at that March 18 meeting (which you can hear here): the TERM SHEET detailing the terms under which the OCWD proposes to buy Poseidon’s water and sell it to us, and the CITIZENS’ ADVISORY COMMITTEE (CAC) which will purport to advise the Board on this term sheet. Let’s talk first about:
The Citizens’ Advisory Committee.
There’s this thing, if you look at it cynically as you should, where when the majority of an elected body wants to take an action they know is unpopular, they’ll set up an advisory committee of some sort, so that it looks like the public has been consulted. Except, it’s totally safe, because each of the members of the body gets to pick, say, two appointees, so you can be pretty much sure that the conclusion reached by the advisory committee will mirror what the body already wants to do.
And JUST IN CASE things don’t go as planned – if a couple members go rogue once they hear new info and follow their consciences (as happened hilariously in 2013 with the CAC on District Elections that the anti-districting Anaheim Council appointed) there’s the added level of safety that the committee is only ADVISORY, the body can still do what the hell ever it wants. But preferably all the appointees stick to their agreed script – that way the whole charade can be used as a fig leaf later allowing the body to say “Hey, this is what the public wants – look at how our advisory committee voted!”
And some of us Poseidon opponents saw this CAC, cynically, that way… until some of the pro-Poseidon Board members started fighting its creation so hard, we started to think maybe it WOULD be worth something. Sheldon in particular, the plump and ruddy preacher’s son who is just barely allowed to vote on Poseidon matters after years of being employed by the firm, spent a couple meetings trying to convince his colleagues that nobody should be allowed on the committee who had ever criticized Poseidon OR who lives near the proposed plant, because somehow THAT would be a conflict. Such comic desperation made us wonder if maybe the committee would be worthwhile after all.
Here, in case you were wondering, is who has ended up on the Committee, generally as far as I can tell mirroring their sponsor’s predisposition:
One of the first Board disagreements that came up March 18 was over the scope of the Committee’s work. The startlingly sensible Jan Flory expressed dissatisfaction with limiting the committee’s responsibility to “providing comments and feedback on the proposed project and term sheet.” How can this project really be evaluated, she asked, if the committee is not allowed to discuss ALTERNATIVES to the project? (Alternatives to Poseidon understood as conservation, expanded groundwater replenishment, rainwater capture, possibly building a desal plant ourselves – she mentioned specifically the ideas of Peer Swan.) She hushed the audience’s thunderous applause: “Seriously, ladies and gentlemen, I’m not saying this for applause, this is input the Board really needs to have.” And then Jan continued by suggesting that, on such a huge and important matter, the committee should not be limited to three meetings, but allowed to continue “until their work is completed.”
The staff spokesman began to agree that Jan’s ideas made great sense and they’d be glad to add them, but Chairwoman Green stopped them in their tracks: “No, that is up to the Board!”

On this matter at least, Director Sheldon is an enthusiast for “representative” rather than “direct” democracy.
Then Jan’s opposite, the scarlet developer Steve Sheldon, spoke up in strenuous opposition to any further empowerment of the committee. To begin to consider alternatives, the paternalistic Sheldon fretted, would drown the poor committee in overwhelming information, which they are not qualified to evaluate. He continued emotionally, “I don’t know if it’s intentional, but we’re considering abdicating our responsibility to a panel of, um, uh, um, uh, well-intentioned, um, individuals, who may not have the expertise or the wherewithal to make these evaluations and recommendations.” (Hear the exchange from 31:50 to 37:00.)
And then as it turned out, at the first of the committee’s three meetings eight days later (yeah I write slow) committee member Diana Lee Carey attempted to convince the rest of the committee to vote to expand their own scope in the manner Jan had suggested, but she was rebuffed by the obedient majority who were more than happy to have their power circumscribed. So there you have it – two more meetings, just to give “input and comments” on the term sheet.
That Term Sheet and its Discontents
So, here is the meat of things, the terms of your servitude and mine for the next 50 years if the Board gets its way: You can read the “draft term sheet” for yourself right here. Staff is very proud of what they’ve “negotiated” with the Connecticut water pirates, they believe it’s “just about perfect” except for maybe a few “minor details,” and it’s hard to picture a majority of this Board not approving it when it comes back in a few weeks with the approval of their committee. It’s DIFFERENT from what we were expecting, but just as bad. Let us count the ways:
“At the fence…”
That’s one big change we weren’t expecting: Poseidon will be solely responsible for building and operating the plant and producing the fresh water, while OCWD will purchase that water “at the fence” (staff’s new favorite catchphrase) and be solely responsible for distributing it, and creating the huge system of pipelines to get it down to South County which is where it’s really needed. That should allay our concern that us taxpayers will be on the hook for whatever failures the plant has – or our OCWD with its triple-A credit rating having to finance the plant for Poseidon with its junk-bond rating.
Or should it? Our friend Sean Paden sped down once more from Fullerton to point out some very lawyerly language he spied in the term sheet: Page 10, under #5, “Financing Plan”, specifies “Seller will be solely responsible for the financing of the Plant…” and then two sentences later: “Notwithstanding the above, the Parties will work together to find the most cost-effective sources of financing, based on the desired allocation of performance and finance responsibilities to be undertaken by each Party.” Said Paden to the Board, “Every lawyer here knows what ‘notwithstanding’ means – it means ‘Ignore the above.'” (Or something to that effect.) Sean later explained to me:
I read the latter part to mean that, despite the legal niceties that Poseidon will be “solely responsible” for financing the plan, the OCWD would assist in securing financing through county bonds. It doesn’t say it directly, but in light of what was discussed in the last meeting, it seems a reasonable assumption. Here’s my point: its not so much that the two provisions of the term sheet contradict each other, it is that as a practical matter it is IMPOSSIBLE for the OCWD to have genuine assurance that they will not be responsible for any cost overruns if they finance construction. If they are the ultimate guarantor and will be left holding the bag if Poseidon goes over budget and/or belly up the County will have to front any overruns to protect their billion dollar “investment” in Poseidon.
So there’s that, which seemed like maybe an improvement, and is possibly not. More certainly, there’s:
The “Reliability Premium”
It had been hard to compute how much more expensive Poseidon’s water would be than the water we have now, both because of Poseidon’s secrecy and countless other unpredictable variables, but we knew it would be a LOT more expensive due to the energy-intensive process and the necessity of building the plant. Well, now we have a formula that they’re calling the “reliability premium” – no matter how much (or how little) our imported water we get through MWD costs, Poseidon’s water will cost us 20% more – kind of a ripoff if imported water rates rise, Poseidon’s costs do not, and their profits skyrocket, no? The Weekly’s Charles Lam explains it better than I can:
…the latest sheet ties the price of desalinated water directly to the price of water imported from the Metropolitan Water District of Southern California (MWD), the agency that purchases imported water for all of Southern California. Under the proposed terms, Poseidon would charge the OCWD the MWD’s imported-water rate (currently $923 per acre-foot), plus any avoided MWD fees (about $80 per acre-foot), with an additional “reliability premium.” The premium would start at 20 percent for the first 10 years of the deal, then slide down in 5 percent chunks every 10 years, ending at nothing for the deal’s last decade. [yada yada… read more here if you want]…
…While this pricing scheme alleviates much of the cost worries initially present in the project (that desal water was far more expensive than imported water), it removes one of the oft-repeated benefits of desalinated water–that it might eventually become cheaper than imported water, with more efficient technologies and increased water demand. In 2014, OCWD forecast that desalinated water might become cheaper than imported water after one or two decades of operation. Under the new rate sheet, though, desalinated water will always be more expensive or the same price as imported water no matter what, even three decades after when it should become cheaper.
That “reliability premium” became one of the major sticking points for the crowd during the March 18 meeting. “I don’t see why we’re paying Poseidon a 20 percent reliability premium over and above what the MWD is paying for water,” said Huntington Beach resident Clem Dominguez, earning applause from the crowd. “They’re building the plant; they’re running the plant; they have a cost. Once it’s up and running, if the MWD has to pay more for water from Colorado, what difference should that make? Why should we pay more to Poseidon? That makes no sense at all. . . . The bottom line is why does Poseidon get 20 percent more for doing nothing?”
Then there’s the other major change in the term sheet–the sheer length of the deal. While the term for both the 2013 term sheet and Poseidon’s water-purchase agreement with the SDCWA is 30 years, the deal outlined at the meeting lengthens the contract to a full half-century, an additional 20 years of more-expensive-than-necessary water and bad-for-the-environment intakes and outflows if the current design of the plant is approved.
But one thing Charles didn’t mention in his article:
Don’t forget the Distribution Costs!
Following are a few photographs of the pipeline construction going on around Poseidon’s new Carlsbad plant; as part of this term sheet agreement, OCWD (you and me) is going to be taking on the responsibility of doing this kind of construction through the streets of Huntington Beach, Newport / Costa Mesa, and Irvine, to get Poseidon’s desalinated water to where it is actually needed/wanted – to South County developers:
Yep, the 20% reliability fee on top of MWD imported water prices will NOT the be full the cost of our Poseidon water – staff conveniently left out the little matter of DISTRIBUTION COSTS, which, on questioning from Director Phil Anthony (the longest-serving OCWD director, and one of possibly only TWO skeptical directors along with Flory) they blithely admitted to having not the foggiest notion what those might be. (Since nobody is exactly sure who-all is going to really want or need the water.)

Lovable Phil Anthony. [Pic Amelia.]
“So then, COST is just one of those minor little issues that’ll be figured out later.”
Before I let you-all go, let me also point out IF YOU HADN’T HEARD:
- North Orange County doesn’t need this water.
- This proposed plant will slaughter countless fish larvae in its open intakes.
- This proposed plant will create a dead zone on Huntington Beach’s coast with all the hypersalinated brine it will emit.
- This proposed plant with its extreme energy-intensive process will add to our pollution and greenhouse gas problem.
- The MORAL HAZARD – these Connecticut hedge-fund investors, who have spent twelve years buying off our politicians and water officials and wooing our labor unions, aim to make UNTOLD BILLIONS off our water needs over the next five decades, and they don’t deserve it. WE CAN TAKE CARE OF IT OURSELVES.
Keep up the good fight, brothers and sisters!
very very good. One thing that might be added regarding the 50 yr. $1.00 deal. According to sea level rise experts at the Pacfific Institute….Poseidon could well be sitting in water in 50 years not just from above ground, but it is well known that both the proposed plant and AES sit on land with a very high water table. The water table rising from below is a much, maybe more, than sea level rise.
Merle is referring to a detail of the term sheet where, after the 50 years are up, we can buy the desal plant for one dollar. Woo-hoo! It’s ALREADY obsolete technology, imagine what a relic it’ll seem by 2070.
Ten years ago, would we have jumped at such a “deal” for San Onofre ? Can anyone even speculate what future responsibilities might tag along with future $1.00 ownership?
governor brown issues executive order today. item 19: expedite approval of desalination.
We really need to get him reading our blog.
P.S. He can be wrong sometimes. And even if he is right about the best desal proposals, he’d still be dead wrong about this turkey.
As Harry Sidhu would (did and will) say: jobs, jobs, jobs!
I’ve rarely seen a hero’s welcome like the one both Harry Sidhu and Cathy Green got at the 2010 Labor celebration at the Santa Ana Zoo.
Nobody gets more loving than a Labor Repuglican!
Yeah: whack jobs, giving ____ jobs to taxpayers and ____ jobs to kleptocrats.
(I’ll let our commenters fill in the blanks.)
Project suffers from a Vitamin C deficiency. No Cash No Capital No Contracts. Poseidon cannot fund this project so they are using the backs of the rate paying taxpayers to pay and pay for 50 years. Poseidon went to Wall Street and came back with their bonds being rated JUNK bonds. No water district or pumpers has signed a contract to purchase the water. OCWD wants to play a substitution game. Reduce the amount of water purchased from MWD and replace it with Poseidon desal water at 3 times the cost. And you dare ask why we are against the project while the politicos with Poseidon campaign contributions are for it.
It’s amazing that this ends up mostly benefiting South County — THE ONE MAJOR PART OF THE COUNTY NOT INCLUDED WITHIN THE OCWD! South County will not have to bear the bill for a project INTENDED TO BENEFIT SOUTH COUNTY!
This is LITERALLY a welfare program for developers.
One other question about that Dead Zone, and I’m being serious here: can one surf in brine? In other words, would the Poseidon plant damage Huntington Beach’s primary tourist attraction?
This is SO going to end up stalled in court FOR YEARS if it passes. How about instead: DON’T DEVELOP MORE OF SOUTH COUNTY IF YOU CAN’T PROVIDE YOUR OWN WATER FOR IT!
*What do you with a drunken sailor? Whad’ya do you do with a drunken sailor….early
in the morning?” How bad is it really? Much worse than you think. The OCWD is directly working in concert with Poseidon. They don’t care about having a say……no, they want their piece of the pie and the ability to manipulate the water rates. Again, please just go
look at the Oceanside Desal Plant for guidance. Like developments and like cost, and if they are not……you know that the big bad Poseidon is not the only turkey on Christmas
Eve.
This is an April Fool article, right? No one would really want to approve such a deal. They’d have their heads on pikes, right? Right?
If you’re talking about the fish, the pikes would be killed by the brine.
you say Poseidon water will always cost us 20% more. wrong.
you say brine discharge will cause a dead zone. wrong.
you say they are going to build pipes to south county: not in the plan but plans do change but for now, wrong.
you say we don’t need the water. wrong. major drought has been going on and no one mentions it. it is the elephant in the room. basin way overdrawn but we worry about asphalt being torn up? please try to keep up and connect Poseidon and the water needs because of the drought. sort of important.
don’t hang your hat on Swan, an outlier if there ever was one. talk to his own board.
*We agree on all counts…….right on!
I didnt say it will always be 20% more; I reprinted the formula where it goes down by 5% each decade. But then I added that it’ll be MORE than 20% more, and nobody has any idea by how much. [PS. I DID thoughtlessly write “always” in one sentence, I got rid of that, thanks]
Who says brine discharge will not cause a dead zone? Where do you get that?
Of course they’re gonna build pipes to the only people who are showing interest in the water right now – the Rancho Santa Margarita District – WAY down south, where the water district is a CREATURE OF the local development firm. I just heard last night that the oil companies / landowners who want to build an “urban colony” on Banning Ranch in west Newport are also pushing for Poseidon water. It makes sense, new development requires new water. And before you start up again, deadwhitemale, just because I don’t think I and my friends should be SUBSIDIZING your friends’ endless developments with much higher water bills, does NOT make me per se “anti-development.”
I am not aware of having any developer friends so let’s be clear , you and I won’t be subsidizing any endless developments of my friends. I don’t think the water bills will be “much higher” with Poseidon water being put into the basin. maybe 8% higher. that would cost me less than forty dollars a year.
Please share your calculations with us. Is that based on a 20% surcharge over MWDOC (1st decade), 10% (average over 50-year contract, or — surely not this — the 0% markup if the final decade? And how much have you figured in for those construction costs to send the water to … south of OCWD territory? Can that really be right?
Swan’s an outlier? Start at paragraph four.
http://blogs.ocweekly.com/navelgazing/2014/11/california_drought_water_jay_famiglietti_uci_nasa_grace.php?page=4
Some highlights for the lazy, incurious, or both:
Far from being an already-picked fruit, as those folks who could not get out of grand jury duty put it, conservation via fixed leaks, better managed underground sources and the replacement of water-sucking landscaping would take this state and nation to water sustainability without having to resort to the horrors of desal, maintains Famiglietti, who also supports incentives rewarding those who curtail water use.
“As for desalination, it “is something we may need to invest in,” especially if we keep sucking water out of the ground at the rate we do, “but that is down the line,” according to Famiglietti. “The first thing we need to do is the cheapest and easiest way, and that is conservation.”
“There are legal issues that come with killing marine life, which you will do,” Famiglietti says of current desal technology. “You will be affecting the whole state’s ocean ecology, not only at your immediate coastline.”
*Yeah, let’s just close our eyes and maybe the water shortage will go away on its own. Maybe Peer Swan will start telling the truth about water rates in IRWD and how much he loves to help the taxpaying public.
So I’m guessing this guy didn’t return your phone call.
*Actually, he calls us all the time and we don’t take his calls….we already
know what he is going to say. So boring…..
With only “Wrong” to support all your assertions, I’m reminded of the Monty Python skit-
“I’m here for an argument”
“No, you’re not!”
etc……..
… which never gets old.