Cry Me a River or At Least an Aquifer: Western Water Threatened by Private Scoundrels...
There's a water grab going on in East Texas, which is just one of many thanks to the fucked up way we deal with water...
A couple days ago, I was clearing my email inbox, scanning through newsletters I subscribe to, when I found an interesting story rereported by Circle of Blue, an excellent source of news on the world’s water. This news nugget comes out of East Texas and it goes like this:
[Early June, an LLC called] Redtown Ranch Holdings submitted a permit to the Neches and Trinity Valleys Groundwater Conservation District (NTVGWCD) requesting [water] volumes that would account for 98.9% of the aquifer’s modeled available groundwater, according to local officials.
Amber Stelly, General Manager of Consolidated Water Supply of Houston County, said the scope of the request is unprecedented and potentially devastating.
“Just looking at the volumes listed on the application — and that’s not even including 11 additional wells they’re requesting — the request significantly exceeds the modeled available groundwater in both Anderson and Henderson Counties,” Stelly told The Messenger. “Satisfying the permit request would mean the district is authorizing more withdrawal from the aquifer than what the aquifer could sustainably produce, according to the district’s own management plan and their own numbers.”
A single entity trying to drain most, if not all, of an aquifer that thousands of people rely on is disturbing enough. Nerves get another shock when you learn that no one except for the applicant knows exactly what Redtown Ranch Holdings want the water for.
“The application essentially states that it’s for ‘all beneficial uses’ subject to Texas Water Code rules,” Stelly said. “And so I would say ‘all beneficial uses’ is not a specific use.”
With no detailed end-use identified, officials are left speculating: Is the water meant for agriculture? Industrial resale? Urban pipeline export? Environmental impact assessments are nearly impossible to calculate without this information, Stelly said.
“Where is the water going? Because we don’t have a specified beneficial use, we don’t know,” she added. “Is it going to affect watersheds? Is it going to go into the Trinity River and affect anything downstream? Is it going to create groundwater-to-surface-water interactions? We don’t know.”
Things get even more unnerving when you see that Redtown Ranch Holdings (RRH) is a limited liability company, a legal entity that business use to not just limit their financial and legal liabilities, but to also cloak ownership of the LLC. Oh, and in this case, we aren’t talking just one LLC but two. The second is called Pine Bliss.
Digging around, I found that RRH is controlled by another LLC with the rather opaque name Conservation Holdings (CH). CH is also linked to at least five more LLCs, one called Conservation Equity Fund I, which is managed by Conservation Equity Management (CEM). (Pine Bliss also has connections to CEM.)
CEM is a private equity firm which, it says:
[identifies] conservation and environmental mitigation assets while applying value-driven ecosystem enhancement techniques to capture step-up valuations…CEM’s unique investment perspective centers around the rapidly expanding market of ecosystem services… facilitating conservation investments that benefit the natural world, surrounding communities, and our investors. CEM creates value by developing sustainable water resources, mitigating environmental impacts, raising the value of ecosystems, and employing various levels of conservation in Texas and other high-growth and environmentally sensitive states.
If you are thinking, “CEM say whaaaaat?” You are not alone. CEM’s combo of buzz words, smarties, and jargon is meant to sound good while being incomprehensible. It is the kind of statement that keeps people from asking questions lest they come off as stupid when challenging expertese, vocabulary and sentence structure that denotes expertise.
The CEM “origin story” tells us that the equity firm was started by Karl Bass and Terry Anderson. Anderson is identified as “renowned conservationist, biologist, and forester,” which gives CEM an “environmentalist” gloss. Karl Bass? For info on J. Karl Bass, you have to look at CEM “team” page. There you will learn that, among other things, Bass founded Hayman Capital Management. (Many on CEM’s management team do or did time with Hayman.)
Hayman is a hedge fund, whose big moment came when Bass noticed that the early 2000s housing market was built on sand. Seeing that the market was due to failure, Bass did what any self-respecting hedge fund manager would do, he kept quiet while figuring out a way to make a killing off of other people’s misery. And that he did. By playing the credit default swap game (see The Big Short), Hayman made over $700 million.
Using the same “contrarian”/debt strategy, Bass’ Hayman bet against the economies of Europe, Japan, China, and Latin America (specifically targeting their debts). He’s challenged major drug companies on drug patents, hoping to short their stock. For this he is regarded as a “maverick.” He is considered an expert on China and foreign affairs and is a constant presence on TV business news. He’s a Texan with ties to the Bush family, and his politics seem to align with that crowd rather than MAGA (he has tenuous public ties to Trump). His net worth is pegged at $3 billion. He considers himself a conservationist.
At this point, it is important to make a distinction between conservationism and environmentalism – as many people think them one in the same.
In basic terms, environmentalism is a holistic view of the environment that centers the environment around the environment and not humans. Humans are an important part of the environment, but no more important than trees or rain or beavers. Because humans do more than exist in the world as part of the world, we must take a hand-on approach to lessen our impact and repair what we’ve damaged.
Conservationism rejects environmentalism’s insistence that human’s role in the world is as just another participant, albeit a respectful one. Conservationists believe that humankind is nature’s stewards and that our responsibility is to conserve or manage our resources in ways that both benefit the environment and ourselves. What form this management takes and who it benefits is up to the conservationist to decide, which means that what makes a “conservationist” can be as opaque as who is behind an LLC or why “Redtown Ranch Holdings” wants 98.9% (or more) of Neches and Trinity Valleys Texas’ water (RRH says it merely wants to drill “experimental” wells and is not looking to export water…right now).
Besides the specific questions directly related to East Texas water, equity firms, and the hedge funds behind them, there’s one huge question that is not being asked (and that impacts all of us):
Why do private entities have a right to request (or buy and sell) a resource as important to the public (and life on Earth) as water?
Arizona is in a contentious fight against a Saudi firm gobbling up water to grow alfalfa to feed cattle for Saudi consumption. Trump’s LA fire/water release con last year was more than just a stunt. It was a gift to Central Valley Big Ag in their fight to privately control California water resources.
Trump’s plan to sell off public lands is about way more than “our national heritage,” public access or how it impacts ranchers – the three main objections to privatization, according to the mainstream media. The biggest impact the sell off would have is on public resources – land, minerals, oil, trees, and water – and out west, where most of the proposed sell off will happen, its water that is the most valuable of all those “commodities” – water which would find its way into private ownership.
There are many things that are fucked up in the United States. Chief among them is how we define and distribute our resources. We look at things such as oil and water as resources to be distributed to the benefit of both the private and public sectors, which is problematic. We also refuse to see energy, shelter, food, and information as public resources…or even serious resources that are essential to survival.
And that is today’s installment of The World’s A Mess…