The Sacramento-San Joaquin Delta’s economic impact has been evaluated in detail in the latest draft of the Economic Sustainability Plan (ESP) released by the Delta Protection Commission.
It points out that agriculture is the primary driving force for the Delta economy now, and in the future.
According to former state senator and chair of the Delta Protection Commission Mike Machado, the factual elements must be integrated with the “unavoidable political realities in the application of the plan.”
The Economic Sustainability Plan will be integrated into the larger Delta Plan – along with elements of the Bay Delta Conservation Plan by the Delta Stewardship Council chaired by Phil Isenberg.
Isenberg said, “The dilemma here is considering all the recommendations we receive within the time frame available.” He added, “We [Delta Stewardship Council] have the ability to propose changes to the Delta Plan at any time.”
Unlike other plans, the Delta Protection Commission has been an incredible advocate for the Delta, said Katie Patterson, Program Director for the San Joaquin Farm Bureau Federation. “This economic sustainability plan contains good, sound data supporting agriculture’s importance to the Delta. The commission represents those who stand to lose the most with the Bay Delta Conservation Plan.”
Patterson said agriculture must continue to make its voice known. “This economic analysis is the first step of legitimizing the role of the Delta in California’s economy and agriculture’s part in it. It validates the Delta’s economic influence and importance with hard numbers derived by using accepted tools of economic analysis.”
She also pointed out that the council “doesn’t have to adopt what the Delta Protection Commission recommends.”
Agriculture Delta’s lifeblood
Five counties rely on Delta agriculture for significant job numbers and valuable crops: San Joaquin, Sacramento, Yolo, Solano and Contra Costa.
Delta agriculture comprises about two-thirds of the Delta’s area, and nearly 80 percent of the farmland is classified as Prime Farmland, the highest quality designation given by the California Farmland Mapping and Monitoring Program. Prime Farmland is scarce in California with less than 20 percent of all farmland in the state designated as such.
The Delta’s total agricultural acreage as of 2010 was 461,380, with the top five crops by acreage being corn (105,362 acres; $92.9 million value), alfalfa (91,978 acres; $66.1 million), processing tomatoes (38,123; $117.1 million) wheat (34,151; $17.5 million) and wine grapes (30,148; $104.9 million).
Proposals in the Bay Delta Conservation Plan – floodplain restoration, creating 65,000 acres of tidal marsh and agricultural easements – would cause total annual agricultural losses estimated to be $20 million (floodplain restoration), $18 million to $77 million (tidal marsh creation), and $5 million to $43 million (converting to lower-value “wildlife friendly” crops).
The majority of the 65,000 acres lost would be Prime Farmland.
Total ag revenues in the Delta are estimated at $775 million, including $662 million in crop revenue and $93 million from animals and animal products.
Milk production in the Delta generated about 12 percent of Delta farm revenue; high-value vineyards, truck and deciduous crops generate nearly 70 percent of crop revenue in the Delta “on about 20 percent of the Delta’s farmland, and account for 80 percent of the economic impact due to value-added manufacturing such as wineries and canneries,” noted the study.
“Delta agriculture is expected to continue to trend toward higher-value crops over time” said the plan
The analysis estimates Delta crop and animal production have an economic impact throughout California of more than 25,000 jobs, $2.135 billion in value added and over $5.372 billion in output.
In the five Delta counties, Delta agriculture supported more than 13,000 jobs, $1.059 billion in value-added, and $2.647 billion in output from all sectors affected by agriculture.
“Agriculture is the main economic driver in the Delta, generating five to six times the regional economic impact of recreation and tourism,” noted the analysis. Research revealed that a dollar of crop production in the Delta has nearly double the regional employment and income impacts of a dollar of recreation and tourism spending in the Delta.
“The economic sustainability of the Delta is dependent on agriculture and it needs both water quality and quantity,” said Dante Nomellini, water expert, attorney and spokesman for the Central Delta Water Agency. “A shift to recreation to make up for economic losses in agriculture is not supportable.”
Supporting high-value crops critical
Supporting high-value processing tomato and wine grape crops is “critically important to the regional economy because of the local value-added manufacturing industries associated with these crops and the potential growth in local winery capacity and direct sale of the product,” noted the plan, which also predicts an additional 20 percent of Delta agricultural land will shift toward these higher-value crops over the next few decades
The plan states unambiguously that the pair of water conveyance tunnels proposed by the BDCP to divert 15,000 cubic feet per second from the Sacramento River and convey it around the Delta to the state and federal export pumps near Tracy “is inconsistent with economic sustainability” and would have “significant negative effects on all aspects of the Delta economy.”
“There are unacceptably high risks surrounding the financial feasibility, environmental impacts, and operations” of such a water conveyance system and the plan also states, “there are many alternative options for increasing water supply reliability.”
The analysis continues, noting, “…the isolated conveyance imposes the largest cost and the most risk for the Delta economy” due to reducing freshwater flows that would increase crop damaging salinity, the elimination of high-value farmland and the disruption of the rural character of the North Delta with large industrial development.
Salinity and crop shifts
Modeling used for the study indicated that higher salinity would cause a large shift from high-value crops to lower-value grain and pasture crops and could result in a 25 to 50 percent increase in South Delta salinity, causing a potential reduction in crop value of $24 million to $45 million. An additional $10 million to $15 million in annual ag losses would occur mostly in the North Delta.
“The Economic Sustainability Plan has put issues on the table,” said Robert Ferguson, a Delta farmer and member of the Delta Protection Commission. “And these issues needed to be addressed because agriculture is the driving engine in the five Delta counties.”
Ferguson said he was “Very, very satisfied to know UOP [Business Forecasting Center] contributed to the study.”
In addition to Jeffery Michael, Ph.D., Director of UOP’s Business Forecasting Center, primary contributors included Dr. Robert Pike, a prominent engineering and levee consultant; Mike Conrad, former Commander of the U.S. Army Corps of Engineers Sacramento District; the Dangermond Group’s Pete Dangermond, former director of the state park system and Karin Winters, a Dangermond Group partner; and Ben Sigman and David Zehnder of the consulting firm Economics and Planning Systems.
The Economic Sustainability Plan recommends methods to maintain the Delta’s economy and also notes that creating a tidal marsh in the South Delta “is inconsistent with economic sustainability
But what effect will the plan have on the Delta Plan created by the Delta Stewardship Council?
Water expert and South Delta Water Agency attorney John Herrick, said, “The export needs of a large portion of California takes precedence over local needs. I don’t think there is any chance the Economic Sustainability Plan will sway those seeking water exports, …and I’m not optimistic that we’re on the brink of a solution to the Delta situation.”
The Delta Protection Commission’s plan for economic sustainability shows it is possible to sustain and enhance the Delta’s economy while moving toward the coequal goals of increased water supply reliability and ecosystem restoration.
Next installment: Solutions for sustaining the Delta’s economy
