California State University, San Marcos THE HISTORY OF A FLUID RELATIONSHIP: THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA AND THE SAN DIEGO COUNTY WATER AUTHORITY TO 1995 A thesis submitted in partial satisfaction of the Requirements for the degree Master of Arts in History by James J. Taylor Thesis Committtee: Professor Jeffrey Charles, Chairman Professor Anne Lombard Professor Theodore Andrew Strathman Copyright © 2012 James J. Taylor All rights reserved Contents Acknowledgements i Abstract iv Introduction 1 Chapter 1 Securing Imported Water for Southern California: The Genesis of the Metropolitan Water District and San Diego County Water Authority 10 Historical Roots 11 The Progressive Era and Early Twentieth Century Water Development 13 The Quest for Colorado River Water 17 San Diego Water Politics in the 1920s 24 Creation of the Metropolitan Water District of Southern California 27 Metropolitan Water District Organization 31 Special Districts – Good Government or Anti-Democratic? 34 Passage of the Boulder Canyon Project Act and Agreement on River Allocations in California 38 The Colorado River Aqueduct: MWD Determines a Route and Secures Funding 44 Attempts to Reroute the Aqueduct through San Diego County 45 San Diego Signs Its Colorado River Contracts 48 San Diego Inaction in the 1930s 49 World War II and the San Diego’s Water Crisis 53 Creation of the San Diego County Water Authority 55 San Diego’s Pursuit of Imported Water Escalates 59 President Roosevelt Orders Construction of the San Diego Aqueduct 63 SDCWA Retains its Options 65 SDCWA Annexation to MWD 72 Contrasting Los Angeles Activism and San Diego Indecision 77 Did SDCWA Make the Right Decision? 79 The Stage is Set 81 Chapter 2 The Uncertain Path of Expansion 1947-1955 83 Fred Heilbron and Joseph Jensen Take Charge 84 Completing the San Diego Aqueduct 87 SDCWA Consolidates its Position at MWD 89 New Concerns Over Water Supply Reliability: MWD’s Short- lived Annexation Moratorium 92 Joseph Jensen Becomes Chairman of the MWD Board of Directors 99 SDCWA Campaigns for the Second Pipeline 102 Heilbron Defies the City of San Diego 106 Other Obstacles to the Second Barrel 109 The Korean War Intervenes 112 A Second Barrel Retrospective 116 The Laguna Declaration 118 Expansion of MWD and SDCWA in the 1950s; Joe Jensen Prods SDCWA into Annexing Rural Areas 124 The Laguna Declaration Sets the Stage for the Pursuit of More Water and Accompanying Internal Conflict at MWD 130 Chapter 3 The State Water Project and Battles Over Allocation of Costs 1955-1964 132 MWD’s Reservations Concerning the Feather River Project 135 MWD and SDCWA Disagree on Feather River Project Funding 138 SDCWA Uses the Feather River Project as Leverage to Obtain the Second Aqueduct 143 Controversy Over Expansion of the Colorado River Aqueduct 146 SDCWA Annexations Continue Despite Water Supply Uncertainties 148 The Feather River Project Stalls 149 Governor Brown Pushes the State Water Project 156 Dissension Appears Among Los Angeles Officials 158 The State Water Project Controversy Propels a Fundamental Change in the MWD Revenue Structure 161 MWD and the State Wrangle Over Contract Terms 167 Jensen Is Overwhelmed 174 MWD Lobbies the Legislature Not to Modify the Water Contract; the Los Angeles Department of Water and Power Renews the Effort to Revise the MWD Revenue Structure 180 MWD Renews Its Attack on the East Branch Canal 185 State Water Project Postscript 192 Chapter 4 Agencies in Transition 1964-1975 194 Jensen and Heilbron Still in Control 197 MWD Changes Policy on Annexation Charges 200 SDCWA and MWD Agree on a New Pipeline for the San Diego Aqueduct 204 The Federal Government Proposes the Greatest Water Project of Them All 210 MWD Pushes a Desalination Project, but SDCWA Objects 220 SDCWA Frustration over Preferential Rights Continues 232 The Environmental Movement Challenges Water Developers 233 Reevaluating Population Growth and Water Requirements 247 Fred Heilbron and Joseph Jensen Bow to the Inevitable 249 Endings and Beginnings 253 Chapter 5 Consensus and Conflict: Adjusting to a Limited Water Supply 1975-1985 256 Hans Doe and Harry Griffen Carry SDCWA Interests at MWD 258 Los Angeles Sues to Lower Taxes and Raise the Water Rate 260 The Drought of 1976-1977 Threatens Water Supplies 264 The Showdown Comes for the Peripheral Canal 269 The Peripheral Canal Failure Reorders the Universe of MWD and SDCWA 276 Doe and Griffen Test the Merits of “Getting Along” at MWD 281 Los Angeles Renews Its Fight to Reduce Taxes 286 The Old Battle Between Taxes and the Water Rate Is Rekindled 292 MWD and SDCWA Pick New General Managers, and SDCWA Raises the Stakes 298 Boronkay Mediates a Resolution of the SDCWA-Los Angeles Standoff 301 SDCWA Campaigns for a Change in Preferential Rights 305 SDCWA Pursues a New Water Supply 310 SDCWA Loses its Allies on the MWD Board as Galloway Wanes 316 Repercussions of the Galloway Proposal 317 SDCWA Waves an Olive Branch 321 Los Angeles Nixes Another Preferential Rights Compromise 323 SDCWA Gives In 324 The Seeds of Dissension are Sown 325 Chapter 6 Diversification, Drought, and a New Path 1986-1995 328 The Role of the General Manager and Staff Broadens 330 SDCWA Prepares for an Expanded Role, But Encounters More Frustration 332 The Preferential Rights Controversy Never Goes Away 336 MWD Finally Closes a Deal with IID 340 Long-term Drought Highlights SDCWA Vulnerability 343 MWD Attempts to Mollify SDCWA Fears Over Preferential Rights 351 Opportunity Knocks and SDCWA Answers 353 The QSA as a Culmination and a Fundamental Change of Relationship 356 Common Threads 359 The Progressive Experiment a Century Later 361 The Future 363 Bibliography 365 i Acknowledgements I would not have started and could not have completed this thesis without the mentoring and friendship of my colleagues at the San Diego County Water Authority (SDCWA), where I worked from 1995 to 2007 as assistant general counsel. The same goes for my colleagues at the Metropolitan Water District of Southern California (MWD), with whom I cooperated on and contested various issues over those years. I hope in some small part this history repays their kindnesses and provides us all additional perspective on the relationship between the two water agencies. I am grateful to SDCWA General Manager Maureen Stapleton, who gave me access to files at the water authority that had not heretofore been used in scholarly research. I am also grateful to the mostly unknown employees at SDCWA who through half a century collected and retained newspaper clippings, reports, correspondence, brochures, and other assorted documents that added clarity and color to the thesis in so many instances. MWD facilitated my work and the work of other researchers by putting its meeting minutes and associated letters and reports online, beginning with the organization of the district in 1928. Professor Jeff Charles at CSU San Marcos provided essential insights, recommendations, and encouragement throughout the long drafting process. Professor Andy Strathman generously contributed his expertise on the history of Southern California water development, providing valuable feedback on topics that appear from the beginning to the end of the thesis. Professor Anne Lombard’s reading ii yielded a fresh look at the project and certain of its elements that deserved more attention. I am grateful for the love and support of my wife, Adriana, whose unrelenting faith in me and my endeavors is not always fully deserved, but is always and forever appreciated. iii This thesis is dedicated to John and Lois. iv Abstract This thesis documents as a historical continuum the relationship between the Metropolitan Water District of Southern California (MWD), the nation’s largest water district by population served, and the San Diego County Water Authority (SDCWA), MWD’s largest water purchaser among its 26 member agencies. That association has been marked over the years by alternating cooperation and conflict driven by perceived self-interest. As single purpose special districts with appointed directors and the power to raise their own revenues, MWD and SDCWA operate under less public scrutiny than general jurisdiction governments and have largely ignored competing societal interests in the pursuit of their mission to provide an adequate water supply for a growing population. Although they are united by a common goal, the differing positions of SDCWA and other MWD member agencies, particularly the city of Los Angeles, have led to decades-long battles over the need for and means of acquiring new water supplies and transmission facilities, the allocation of existing supplies, and the apportionment of costs. Those issues intensified beginning in the 1960s as environmentalism and growing water demands throughout the West made the water districts’ job more difficult and complex. As complexity and contentiousness increased, so did the role of agency staff, which assumed policy roles that had heretofore been the sole purview of part-time boards of directors. After drought curtailed water supplies in the early 1990s, a dissatisfied SDCWA began an ultimately successful effort to acquire a large additional water supply outside the MWD sphere, fundamentally altering the relationship between the two agencies. Keywords: special district, water district, bureaucracy, Metropolitan Water District of Southern California, San Diego County Water Authority 1 Introduction In 1995, the San Diego County Water Authority (SDCWA) began a determined effort to purchase Colorado River water