CLWA to Consider Buying Valencia Water Co. from Newhall Land

Castaic Lake Water Agency’s Board of Directors is scheduled Wednesday night (Dec. 12) to consider authorizing Agency staff to initiate the purchase of Valencia Water Company, a move that would bring 84 percent of Santa Clarita Valley retail water connections under CLWA’s umbrella.

“This is an outstanding opportunity to ensure local public ownership of a water company that has always been privately held,” said CLWA General Manager Dan Masnada. “The acquisition would result in future cost savings and enhance water supply reliability for the entire Santa Clarita Valley.”

On the agenda Wednesday night is a “resolution of necessity” that, if approved by an eight-member super-majority of the board, would authorize Agency staff to initiate eminent domain proceedings with the goal of reaching a negotiated settlement with Newhall Land, which owns Valencia Water Company.

Eminent domain is a legal process through which public agencies can acquire private property to be utilized for public benefit. In this case, both parties would enter the proceedings with the intent to reach an agreement for the sale of the private company to the public agency.

“Technically, we would be negotiating a stock acquisition in which CLWA would purchase the Valencia Water Company stock,” Masnada said. “At least initially, Valencia Water Company would continue to operate as a utility regulated by the California Public Utilities Commission.”

Valencia Water Company was established in 1954 to provide retail water service to developments built by Newhall Land, which has developed the master-planned communities of Valencia and plans to develop Newhall Ranch west of Interstate 5. Newhall Land is managed by FivePoint Communities.

The details of a negotiated settlement remain to be determined, but the acquisition would bring Valencia Water Company’s 29,022 service connections under CLWA oversight.

In 1999, CLWA acquired Santa Clarita Water Company and its 21,437 service connections for $63 million. The formerly private company became CLWA’s Santa Clarita Water Division, and represents CLWA’s first foray into operating a retailer. CLWA was established 50 years ago to bring State Water Project water to the Santa Clarita Valley.

If Valencia Water Company is acquired, CLWA would then own two of the SCV’s four water retailers and would be responsible for 59,306 out of 70,327 retail connections valleywide. The other two local retailers are the Newhall County Water District (approximately 9,600 connections) and Los Angeles County Waterworks District No. 36 (approximately 1,300 connections).

Masnada said the potential acquisition of Valencia Water Company is a significant and logical step for CLWA.

“During our public strategic planning workshops in recent years, the concept of ‘One Valley, One Water’ has gathered some steam. It’s viewed as a sensible way to achieve economies of scale that will benefit all ratepayers, and also to enhance the Agency’s ability to effectively manage the valley’s water resources,” Masnada said. “This acquisition, if completed, would bring us significantly closer to realizing that vision.”

The Board’s meeting is scheduled at 6:15 p.m. Wednesday, December 12, 2012 in the Boardroom at the Rio Vista Water Treatment Plant, 27234 Bouquet Canyon Road, Santa Clarita, CA 91350.

 

About the Castaic Lake Water Agency

The Castaic Lake Water Agency is the Santa Clarita Valley’s public water wholesaler. CLWA is one of 29 State Water Project contractors and receives water imported from northern California through the California Aqueduct.  CLWA operates two large treatment plants, three major pump stations, three water storage facilities, and over 45 miles of large diameter transmission pipelines delivering water to four local water retailers. Our mission is to provide reliable, quality water at a reasonable cost to the Santa Clarita Valley.

 

About FivePoint Communities

FivePoint Communities, Inc. is an independent real estate development company jointly owned by Emile Haddad and the Lennar Corporation. FivePoint Communities Management, Inc., a subsidiary of FivePoint Communities, is the development manager of Newhall Land Development, LLC (formerly LandSource) in Los Angeles County; the redevelopment manager of the former Marine Corps Air Station El Toro (known as the Great Park Neighborhoods) in Irvine, California; Treasure Island in San Francisco, California; and The Shipyard at Hunters Point and Candlestick Park in San Francisco, California.

The FivePoint management team of specialized associates has worked together under the leadership of Emile Haddad for over 10 years. Each management associate has on average 25 years of experience in developing large, planned real estate communities. Under Mr. Haddad, the team managed dozens of master-planned communities in California, adding over 100,000 homesites and several million square feet of commercial space. These communities include such high-profile neighborhoods as Valencia in Los Angeles County, Coto de Caza in Orange County, Natomas Park in Sacramento and Windemere in the San Francisco area.

Today, FivePoint Communities is a leader in the design and development of sustainable communities and is responsible for managing development of over 50,000 residential homesites, 10 million square feet of commercial uses, billions of dollars of infrastructure providing tens of thousands of job opportunities, several schools and educational facilities and hundreds of acres of parks and recreation.

Click HERE for the article.

Newhall Land, Judge Trade Salvos

The dispute over environmental effects of the proposed Newhall Ranch development has focused on a fight between the developer and the judge who ruled more environmental studies were required before bulldozers could move in.

Newhall Land Development Inc.’s bid to bar Los Angeles Superior Court Judge Ann I. Jones from hearing further cases on the matter has been assigned to Orange County Superior Court Judge Glenda Sanders, who will rule on the matter.

Frederick Bennett, Jones’ court counsel, said motions to disqualify judges typically take six weeks to resolve.

Jones ruled Oct. 15 that Newhall Ranch — which proposes to add 20,000 homes in a planned development west of Santa Clarita — needs further study. The project has been in the works for more than a decade and won the approval of Los Angeles County supervisors.

Jones is due to rule next year on two other cases involving Newhall Ranch. Newhall Land filed a petition in November to remove Jones from those cases.

Jones specializes in cases involving the California Environmental Quality Act, known as CEQA.

Alleged Conflict

In court documents obtained by The Signal, Mark Dillon, an attorney for Newhall Land, said the attempt to have Jones remove herself from subsequent Newhall Ranch cases is in part because she failed to disclose a potential conflict of interest.

Jones attempted to halt a proposed lot split and development project in her Placerita Canyon neighborhood. Both that case and the Newhall Ranch challenges involve debate over CEQA.

Newhall Land says her actions during her involvement in the lot-split dispute constitute a conflict of interest.

Jones denies that she has any kind of conflict of interest or that she acted improperly in any fashion when contesting the lot split.

Santa Clarita Planning Commission members voted in October to deny the planned lot split in Placerita Canyon. City Council members recently reversed that decision and are due to take a final vote on the matter Tuesday.

According to court documents, Newhall Land was unaware of Jones’ involvement in the lot-split dispute until it was reported in the Oct. 21 edition of The Signal.

But Bennett, Jones’ court counsel, wrote in a court document that Newhall Land should have known about the alleged conflict long before that.

Reassigned case

Attorney Dillon was also involved in another CEQA case filed over Vista Canyon, a planned development near Sand Canyon that is unrelated to Newhall Ranch.

On May 2, Jones told those involved in the Vista Canyon case about the lot-split dispute with her neighbor Curtis Hairell.

“I can tell you my neighbor had placed an application and it’s being circulated, and I’m not happy about it,” Jones said in a court transcript. “So those facts are current and on the ground.”

Amy Hoyt, an attorney representing Santa Clarita in the Vista Canyon case, asked Jones to reassign the case to another judge on May 8, citing potential conflict of interest concerns arising from Jones’ involvement in the lot-split dispute.

Jones agreed to reassign the case.

Dillon could not be reached for comment for this story, but in transcripts from the Vista Canyon case he discussed the dispute with Jones.

“Your honor, it sounds like you need a land use judge,” Dillon said, according to the transcript.

Responsibility to inform

Bennett argues it was Dillon’s responsibility to tell Newhall Land about the potential conflict.

Since Newhall Land did not move to disqualify Jones until more than five months after Dillon first learned of Jones’ involvement in the lot-split dispute, Newhall Land effectively waived its right to disqualify Jones on those grounds, Bennett argues.

“Disclosure is not the factor that triggers the duty to timely assert grounds for disqualification,” Bennett wrote in a court document. “Knowledge is.”

Bennett said Thursday he cannot comment on the specifics of the proceedings outside of what is written in court documents.

Newhall Land rejects Bennett’s claim, citing a provision of the Code of Judicial Ethics that states, “In all court proceedings, a judge shall disclose on the record information that is reasonably relevant to the question of disqualification.”

Jones cannot comment to the media on any ongoing proceedings, according to Los Angeles County Superior Court spokeswoman Mary Hearn.

Sierra Club issue

Newhall Land’s case against Jones hinges on Jones’ solicitation of Sierra Club members in her attempt to contest the Hairell lot-split proposal.

According to documents filed with the city Planning Commission, two Sierra Club members — Sandra Cattell and Linda Tarnoff — signed a petition Jones circulated to oppose the lot split.

Cattell also testified against the lot split at the Planning Commission’s Sept. 18 meeting and again at the City Council’s Nov. 27 meeting, each time as a private citizen.

The Sierra Club is involved in one of the Newhall Ranch cases still pending before Jones.

Newhall Land claims Jones never said she was involved with Sierra Club members in opposing the lot split.

In two statement, filed Nov. 6 and Nov. 28, Jones said she was unaware either Cattell or Tarnoff was involved with the Sierra Club until it was brought to her attention by Newhall Land.

“I did not seek nor did I obtain the support of the Sierra Club or its members in opposition to the lot split.” Jones wrote on Nov. 6. “My neighbors’ membership in that organization was entirely coincidental and not the basis upon which I solicited their support.”

Reached by phone Saturday, Cattell said she met Jones by chance while inspecting the area of the planned lot split before the September Planning Commission meeting.

“All of a sudden I am connected with a judge I hardly know who lives down the street from me,” Cattell said. “We had maybe a 10-minute conversation.” She said she never told Jones of her Sierra Club involvement.

Arthur Scotland, a Newhall Land attorney, said Cattell had testified during a 2009 hearing on Newhall Ranch. Her testimony is included in the materials Jones would have reviewed, Scotland said.

Jones’ Oct. 15 ruling involved the same case.

Cattell confirmed she spoke at the hearing as a member of the Sierra Club but said her testimony was primarily suggestions about the project’s effects on endangered species or the Santa Clara River.

Disqualification

Speaking in general terms, Bennett said motions to disqualify judges are fairly common and estimated he sees at least one a day in his role as court counsel.

Many are not rooted in the facts of law but rather a party’s dissatisfaction with the outcome of a case, he said.

“Most people don’t understand what’s required to seek disqualification,” he said.

Click HERE for the article.

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