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April 1996
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Sierra Headwaters: Water Banks or Home Sites?

Kathleen Garr, a rancher who is now in her 90s, remembers walking across Indian Creek, in Plumas County not far from Taylorsville, when she was a girl. She followed a path made of logs that spanned the shallow creek, which meandered through two valleysand a steep canyon before flowing into the Feather River.

Today Indian Creek is a study in erosion. The Army Corps of Engineers has dredged it. Logging, grazing, and mining have all taken their toll. Instead of the stream lined by meadowgrass and sedges that Garr remembers as 60 feet wide and only six feet deep, Indian Creek is a downcut, straightened channel hundreds of feet wide and 20 feet deep. The sandy loam from its exposed banks melts down into the riverbed, making Indian Creek one of the major sediment-producing reaches of the Bay-Delta's upper watershed. Restoration of Indian Creek was on the drawing board three years ago, according to Jim Wilcox of the Plumas Corporation. "We thought it was all set in 1993," he says. "We had landowner support. We had a strong expectation of federal support. PG&E was supporting it for sediment reduction; their dams were full with our soil."

The first to go was direct federal funding. With that money out of the picture, landowners began to lose interest. Then PG & E withdrew its cash, because of a scheme that allowed them to pass sediment further down the watershed. After that, the U.S. Forest Service, which was going to provide rock to restore the creek, told Wilcox that their office had run so low on money it couldn't open a quarry.

The restoration of Indian Creek is only one of many environmental projects that has languished due to federal and state funding cuts over the past two years. Increasingly, policy makers and environmentalists are looking to innovative methods to protect and restore land - both private and public. Today, Garr and other local landowners are supporting efforts by the Plumas Corporation, an economic development agency, to restore Bay-Delta headwaters using non-traditional funding mechanisms that borrow from the latest in environmental thinking. In his groundbreaking 1989 book, For the Common Good, former World Bank economist Herman Daly came up with the idea that conventional economics fails to account for the real costsof environmental degradation. Since then, other economists have proposed an "environmental GNP" to address the problem.

These abstract-sounding ideas are being brought down to earth by the Plumas Corporation and the Regional Council of Rural Counties in a gutsy proposal that may not win them many friends in the state water wars. The 24 northern counties recently proposed to the State Water Board that if it wants them to give up water and restore habitat for fish in the Bay-Delta's upper watershed, then southern water users picking up the surplus flows downstream for free should help pay the price.

"For some reason, water users don't consider it a cost of doing business to maintain the natural water collection areas above the dams," says Leah Wills of the Plumas Corporation. "They're used to maintaining the man-made parts of the state's water delivery system but not the God-given parts." According to Wills, there's a notion in the headwater counties - where there's a lot of federal land but few people and where the economy has always been based on natural resources - that they would like to be watershed stewards. "But there's no economic framework for this stewardship," she says. "Our resources are eroding and counties going broke. People are fighting the fish. Maybe if we were being paid for preserving water for the fish, then we'd have an incentive."

The counties went into what Wills call "defense mode" when the State Board gave notice earlier this year that it was preparing a draft EIR on the impacts of a water rights reallocation necessary to implement its 1995 Bay-Delta Water Quality Control Plan. The third alternative in the EIR notice seeks to "balance the public trust and reasonable use" by shaving northern water rights, according to Wills.

"You can't define the trust as taking water from the north for free and giving it to the south," she says. "This is the tragedy of the commons. This is the biggest takings issue of the century. All the notion of reinvestment is downstream." The counties will present their own proposal for "balancing the trust" to the State Board soon.

Steve Macaulay of the State Water Contractors, a nonprofit representing 27 water districts, says that the needs of northern counties like Plumas are definitely on the radar screen these days. This wasn't always the case, both Macaulay and Wills agree. She says the first time she showed up a Bay-Delta meeting everyone thought she'd gotten the wrong room. "We've encouraged Plumas and other counties who have not been engaged up until now to get involved in the CALFED Bay-Delta planning process," Macaulay says.

This process goes further than the State Board reallocation and serves to balance Bay-Delta water needs and restoration in the long-term (see page 3). Whatever final solution CALFED settles on, it might take from 5-15 years and cost $5-10 billion to implement, says Macaulay.

Long-term funding is likely to come from about a dozen sources, including water users up and down the state and a $500 million bond issue (SB900-Costa) proposed for the November ballot. One possibly contentious issue is whether restoration funds will be used north of the state and federal water projects or downstream. Northern counties are pushing for reinvestment in both areas. "You're not doing ecosystem management if you cut the ecosystem off at the dams," says Wills.

The Plumas Corporation already has a coherent, ecologically sound restoration plan in which 25% of any new funds would go to counties and 75% to restoration including forest health, road rehabilitation, erosion control and riparian enhancement.

Wills and others hope that new jobs that are created by reinvestment will help shape the county's future. Like other resource-dependent rural areas in the West, Plumas County has been encouraging housing development to stem the economic decline caused by timber market globalization and forest degradation. But Wills thinks the highest and best use of the headwaters is as watershed not subdivision, and that an economy based on land and water stewardship could help Plumas retain its rural character. "Why urbanize the state's water banks so they then withdraw water from the rest of the state?" she says.

Wills is looking now at how a stewardship approach would "lay out in the land." One proposed sustainable development project is a facility to make ethanol fuel out of the small trees, mostly white fir, that grow in forests where fire has been suppressed. In contrast to the clearcutting of 1,000-year-old trees now going on under the auspices of the controversial timber salvage rider, the county's plan is to find a use for the smaller trees that must be taken out if the forest is to approach pre-settlement conditions, says Wills. She points out that an ethanol facility would not only protect northern watersheds for the dry and smoggy southern state, but also improve air quality down the road.

If it works, economic conversion in Plumas County could provide a model for other resource dependent communities, according to EPA's Tim Vendlinski. The region also has the Quincy Library group, a nationally recognized consensus coalition of citizen activists, timber industry officials, U.S. Forest Service staff and local government officials, which has been working to solve the region's timber problems.

"There are these disaffected people, loggers and miners out of work, and ranchers concerned with regulation. The resources have been plundered and a Wise Use ethic is emerging," says Vendlinski. "Then there's the Quincy Library Group and the Plumas Corporation saying the government is not necessarily our enemy, here's what we can do together."

Contact: Leah Wills (916)283-3739

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