Water rights questions sink September Ranch development project for now.

With the Monterey County Planning Commission voting Aug. 26 not to approve the proposed September Ranch subdivision, it will now be up to the county board of supervisors this fall to decide whether developer Jim Morgens should proceed with his plan to construct 100 upscale homes, 17 inclusionary housing units, and an equestrian center on his 900-acre parcel on Carmel Valley Road.

Citing inconclusive evidence of sufficient water or the necessary water rights to pump the 61 acre-feet of water needed for the project, the planning commission recommended that September Ranch be scaled back to approximately half its original size and limit its water use to approximately 26 acre-feet of water instead.

"I think water was the central issue, and statements made by the water district and state water board, as well as the possibility of rationing, tells you the proposed water usage by September Ranch doesn''t operate in a vacuum, and that there is a resource constraint," says Planning Commissioner Scott Hennessy of the board''s decision to reject the project.

"While it seems pretty clear a water right exists and that transfer of water credits has been done, we have not seen information on whether there is a proven water supply, and we don''t understand the long-term impacts [of the proposal] on the aquifer and other water users," adds Hennessy. "It''s time for the county to come forward with a policy so the planning commission doesn''t have to handle this type of issue on a case by case basis."

The complexity of the September Ranch water issue is tied partly to Morgens'' proposal to pump the 61 acre-feet of water for his project by exercising his "right" to 45 acre-feet from on-site wells, and an additional 16 acre-feet that would also be pumped on-site, but which would represent an offset from water rights from a separate parcel of land.

That property, located about a mile east of September Ranch, was acquired by Morgens through a complex set of real estate negotiations and legal transactions as part of a larger subdivision of four lots that are listed on the State Water Resources Control Board''s (SWRCB) Table 13 list of appropriative water rights applicants.

Questions concerning Morgens'' legal right to the 61 acre-feet of water, and the potential environmental impacts and precedent-setting nature of the offset proposal, caused planning commissioners to balk at approving the project.

"In my personal opinion the water right is not established," says Planning Commissioner Carol Lacy, "and the only one who can establish that right is the [SWRCB]. For the county to make a decision based on a perceived water right would be premature."

What confusion does exist over whether September Ranch has a sufficient, legal water right to pump from the Carmel River is indicative of the Monterey Peninsula''s ongoing water supply and regulatory crisis involving Cal-Am, the Monterey Peninsula Water Management District (MPWMD), and the SWRCB.

Much of the uncertainty expressed by the commission has less to do with the commissioners'' "incomplete understanding" of water issues alluded to by Morgens in recent newspaper reports than the legal maneuvering on the part of project developers and their attorney Tony Lombardo to secure sufficient water for the project.

Central to the commission''s rejection of September Ranch was official correspondence from the MPWMD and the state water board insisting that September Ranch has not demonstrated the water right or level of historic water use they claim they are entitled to have. Commissioners also cited a letter from the SWRCB to Table 13 applicants that said the SWRCB may not be able to affirm those assigned water rights if the proposed Carmel River Dam is not approved. Of additional concern to the commission was the absence of any environmental analysis of September Ranch''s proposal for offset pumping as required under state guidelines.

"September Ranch has not proved they have riparian rights, and prior to 1992 there was no reported water usage to us," says MPWMD General Manager Darby Fuerst. "In the last reporting year [1997], they used just over 20 acre-feet of water for pasture, and that was the basis for what was recommended for the environmentally superior project."

According to Fuerst, the need for September Ranch to establish a solid riparian right is critical given the SWRCB''s 1995 decision that there are no more appropriative water rights available in the Carmel River basin. Notwithstanding a 1985 Superior Court decision that project attorney Lombardo says establishes September Ranch''s riparian right, Fuerst says September Ranch needs to reaffirm both its riparian right in court and its appropriative right with the SWRCB in order to pump water as proposed using a water offset.

"It does matter what type of right they have, and it has to be an appropriative right because the place of use changed," says Fuerst. "A riparian right is tied to the other property on Table 13, and is in the process of being converted from a riparian to an appropriative right like Clint Eastwood did with the Williams property, but the right has not yet been granted."

Fuerst confirmed what an official July letter from the SWRCB warned Table 13 applicants that water quantities reserved for future appropriation won''t be processed until there is comprehensive environmental documentation on the impact of approving those rights, and an approved dam to assure sufficient year-round water supplies.

"These rights are contingent on a completed EIR and a developed project," says Fuerst. "The [SWRCB] said there is the possibility water amounts reserved for Table 13 applicants could be reduced if there is no storage project to allow for summer flows in the Carmel River."

Even if the SWRCB affirms the amount of water September Ranch needs for its project, Fuerst says the developer must then assess the impacts of its proposal to offset and increase pumping from the September Ranch site alone.

"There is a California Environmental Quality Act issue over where the water is withdrawn," says Fuerst. "[The developers] are saying they will reduce pumping at the other site and increase it at September Ranch. Well, if an offset is to go through, you need to evaluate local impacts of more pumping at September Ranch."

Beyond questions over whether September Ranch has sufficient aggregate water for the project is the more problematic issue of the impacts of pumping excess water at one location over another.

Critics of the proposal to offset pumping say that at minimum, an Environmental Impact Report (EIR) should be required in order to better assess both the environmental impacts of pumping and the impacts to other water users both adjacent to and down river from the September Ranch property.

"Even if they actually have a legitimate claim to water, the Monterey County Health Department said there has to be a full analysis of the precedent-setting impact of offset pumping throughout the Valley," says Gillian Taylor, chair of the Ventana Chapter of the Sierra Club.

"The long-term impact is unknown and the project EIR didn''t discuss the impact of offset pumping and allowing people to buy water rights to grow houses," adds Taylor.

What project opponents like Taylor fear if September Ranch is allowed to offset water pumping is the establishment of a precedent that would allow other developers to buy up land throughout the county and transfer the water rights anywhere they wish.

"What scares me is if we take ground water out of agriculture for houses and sell water rights, we''ll create a desert," says Commissioner Lou Calcagno, who is running for District 3 supervisor. "We need an EIR and public hearings if people want to handle water in this manner. I don''t think planning or legal counsel should touch this issue, and what matters is if this is in [area] land-use plans, not what a water agency says."

Despite the insistence of attorney Tony Lombardo that a 1985 Monterey County Superior Court ruling establishes that the original property, forming the basis for September Ranch, never lost claim to its riparian water right, such rights were apparently deeded to developer and railroad magnate C.P. Huntington in 1882 and 1906 for construction of the old Del Monte Hotel. As late as this June, there were questions by the county over the validity of that right.

In a July 1998 letter from SWRCB Division of Water Rights Chairman John P. Caffrey to project planner Andrew Harris, who is overseeing the September Ranch project for the county, Caffrey refers to a telephone conversation between himself and Harris concerning discussions over "...whether there is a valid riparian right for development of the September Ranch subdivision."

Caffrey reiterated that the courts, and not the SWRCB makes the determination of riparian rights, and that "...the riparian right is lost when parcels are severed from contiguity with the source, unless the right is specifically reserved in the deed for the parcel. Once the right is lost, it cannot be reestablished through combining a parcel of land with another parcel for which the riparian right still exists."

In addition, Caffrey goes on to say that, "A riparian right is a shared right and, therefore, a riparian has a right to the use of the watercourse in common with the equal and correlative rights of other riparians."

For critics of September Ranch, Caffrey''s comments call into question the underlying basis by which September Ranch proposes to meet its water needs by offsetting pumping from a non-contiguous parcel of land which has yet to have its water rights affirmed.

And, despite a claim by Lombardo that SWRCB''s former water rights division chief Ed Anton validated the right for offset pumping, critics say some kind of environmental analysis is required to determine the effect of pumping on other riparian users.

A request for an interview with Tony Lombardo''s office went unreturned by Coast Weekly''s press deadline.

"September Ranch and the property [east of the project] are not contiguous parcels for offset," says Planning Commissioner Maryn Pitt-Derdavanis, "and I don''t know if the [SWRCB board] would necessarily agree with Ed Anton''s opinion."

"If you pump in a particular area and increase the amount of take from that area, you''ll have a greater impact on that particular section," argues Pat Bernardi, a former MPWMD board member. "Just because you lay off pumping upstream doesn''t mean you have no impact downstream. I think what the Planning Commission decision signals is a discomfort with the whole idea of doing water swaps and the implication that has for setting a precedent. None of the general plans allow for this."

Like the Rancho Chualar II project, which was shot down by the commissioners last winter over water concerns, September Ranch will be a key test this fall of whether the Board of Supervisors will be able to set politics aside and analyze the particular merits of a development project within the context of regional planning documents and the precedent-setting, cumulative impacts of the project over the long term.

In the matter of Rancho Chualar II, the supervisors overrode the planning commissioners and approved the project on a 3-2 vote. It was only after nearby residents of Chualar succeeded in getting voter approval for a ballot referendum on Chualar II that the developer Priske-Jones pulled the plug on the project.

When the supervisors finally take up the September Ranch project later this fall, nothing less than the board''s credibility will be on the line. For supervisor Judy Pennycook in particular, who voted against Chualar II and won re-election to the board last June by positioning herself as a concerned environmentalist, the September Ranch vote will be especially critical.

If the supervisors approve the project over the objections of the planning commission and the ongoing questions and concerns with the project''s water supply, opponents warn the project will likely wind up before the voters themselves.

"If we need to do another Rancho Chualar II, we will," says Bernardi. "So be it."