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Thirsty growers bid sky-high for available water

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Bids for a chunk of water being sold by a local agricultural water district came in so high Wednesday that one district pulled its bid in the middle of the process figuring "why bother?"

In response to California's devastating drought, the Buena Vista Water Storage District announced last month it would sell 12,000 acre feet of its stored water to local growers by auction as part of a larger water conservation program. The minimum bid was set at $600 per acre foot.

Out of a total of 50 bids, nearly 20 were $1,000 per acre foot or higher. Only four bids were less than $700 an acre foot.

The highest bid was $1,350 per acre foot for 300 acre feet, or $405,000 from Harris Ranch.

The lowest was $650 per acre foot for the full 12,000 acre feet up for auction, at a total cost of $7.8 million. That came from Kern Westside, made up of several water districts in western Kern County.

The biggest bid, though, was from Paramount Farming, which pledged to buy 10,000 acre feet of water for $1,100 per acre foot, or a total of $11 million.

In all, the bid requests reflected a need for more than 63,000 acre feet of water.

"The water we're offering is just a drop in the bucket" compared to overall need, said Buena Vista's general manager Maurice Etchechury.

Buena Vista plans to use proceeds from the auction to pay for a land fallowing program within its district. It has offered to pay farmers $400 per acre not to farm this year to reduce demand on the aquifer. It hopes to fallow 4,000 to 5,000 acres through the program.

Announcement of the sale created a great deal of interest locally and throughout the Central Valley, which is still reeling from news that the state has cut water allocations to zero this year.

On top of that, water contractors learned last week that water they had stored in San Luis Reservoir, commonly referred to as "carry over water," may be cut by as much as two-thirds, Etchechury said.

Though no bid winners were announced Wednesday, Sheridan Nicholas, water resources manger for Wheeler-Ridge Maricopa Water Storage District, wasn't hopeful that his district would get the water it bid for.

Wheeler Ridge bid $1,000 per acre foot for a block of 3,000 acre feet and $800 per acre foot for another block of 2,000 acre feet. It was also one of the water districts in the Kern Westside group that bid for all the water at $650 per acre foot.

"I thought we'd be in the running," he said. But he wasn't surprised by the high prices the water was fetching.

Wheeler Ridge typically received about 120,000 acre feet of state water. It had 30,000 acre feet of carry over water, but Nicholas had no idea how much of that the district would actually get this year.

"Keep looking," he said when asked what the district's next step would be.

As the bids were opened and read in Buena Vista's Buttonwillow offices, Steve Dalke, general manager for Kern-Tulare Water District, pulled his district's bid. He ultimately put it back in, but at $802 per acre foot for 3,000 acres, it was on the low side.

"They were all coming in higher, so I thought why bother?" he said of pulling the bid. "But I was here, so why not?"

Etchechury said Buena Vista will now work through the bids and vet them to make sure they adhere to one of the requirements, which was that the water stay in Kern County for agricultural use.

He didn't expect to announce bid winners before next week.

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