Study Commissioned by Grape Industry Flawed

The article accurately reflects the fact that the State Water Board does not buy the report’s assumptions. Flawed assumptions automatically lead to flawed conclusions.
I must correct one quote in the story: “We specifically avoided saying that is how it must be done,’ he [Rukeyser] said. ‘We [the Water Board] left it to the stakeholders to figure out.’” The second part of the quote gives the impression that the stakeholders will decide. The Water Board is certainly interested in hearing the opinions of all those concerned, but is not conceding the authority to anyone else to administer the state’s water right laws. That is the job of the Water Board and the state’s courts. On this topic in general, the study appears to miss or misstate several items:
– The purpose of State Water Board action would be to coordinate, not halt, frost protection pumping

– Napa wine-grape growers have lived with coordinated frost protection pumping for decades and Napa’s industry is thriving.

– The rule making process is in its early stages. No one can say for sure what potential regulation will look like.

– The Water Board’s Chair has publicly stated his intent is to protect both wine-grape growers and the endangered fish in the Russian River watershed.

– Frost protection diversions depend on weather and geographical conditions, and are short-term events in the Russian River watershed. Some growers are located where frost protection is not necessary. Information provided by growers is that years may elapse between events. A serious frost event in 2008 prompted the National Marine Fisheries Service to ask the State Water Board for emergency regulations. (A request the Board considered and rejected.

– Water Board staff is considering a number of options including the vineyards building off-stream ponds in order to have water available at necessary instantaneous rates for frost diversions.

– The cost estimates in the study appear to be based on assumptions that are very unlikely to occur. They include assuming that frost diversions will be banned, that frost events will occur on an annual basis and that winery tourists travel to the Russian River area to look at those portions of vineyards prone to frost damage.
The State Water Board will continue to work with and solicit input from stakeholders while it administers California water right laws and protects the environment. More information is available at

William L. Rukeyser, North Bay Business Journal

Study estimates impact of proposed frost rules to top $2B
November 1, 2010
A report on a study done by economist, Robert Eyler

SONOMA AND MENDOCINO COUNTIES — The impact of proposed state rules controlling the use of Russian River basin water to protect winegrapes and other crops from frost damage could exceed $2.1 billion from lost business income, tax revenue, land values and 8,000-plus jobs in Sonoma and Mendocino counties, according to a new study by a Sonoma State University economist.
The 52-page study was conducted over five months by Robert Eyler, Ph.D., an economist in charge of Sonoma State University’s Center for Regional Economic Analysis but conducting this examination privately for a Russian River vintner.
The finding comes as agriculture groups in Sonoma County prepare to introduce a frost-control ordinance hoped to be a model for Mendocino County and to shape the regulation being considered by the State Water Resources Control Board.
Frost-damaged wine bud and vineyard (photos by U.C. Cooperative Extension)
The study fingered the pending state rulemaking in estimates of what would happen to wine-related businesses if the crop in the two counties were reduced by 10 percent to 30 percent were growers not able to access enough water to coat sensitive vine growth with ice and water for protection against frosty air in situations where sprinklers are most effective.
“This regulation would act like a tax on vineyard farmers, wineries and many allied industries, including tourism,” Dr. Eyler wrote in study. “The economic effects on wine vineyard farmers would include increased costs of frost protection, forcing investment in another frost protection method, such as wind. Wind or other frost-protection methods may be so much less effective that farmers could lose crops or even their livelihoods.”
The economic-impact study was funded by luxury-tier Russian River Valley vintner Williams Selyem and released Tuesday by Dr. Eyler via his new Petaluma-based consulting firm for private-sector projects, Economic Forensics and Analytics.
He used the commonly implemented IMPLAN economic model for estimating the direct, indirect and induced effects of net losses from higher costs of frost protection as a cost of goods sold.
A water board spokesman said the study was “based on a number of assumptions, which range from the improbable to the bizarre.”
The analysis assumed vineyard values in a declining real estate market would be affected by regulations not in final form, annual crop losses can be projected for serious frost damage that historically has been rare and limited to portions of certain vineyards, and impacts of frost damage to vines in isolated locations would have a negligible impact on tourism, according to Bill Rukeyser.
“This guy’s assumptions appear to be that the regulations will be drawn up to ban frost pumping rather than coordinating it,” he said.
The proposed Russian River frost protection regulation would prohibit diversions of surface and connected groundwater for frost protection between March 15 through May 15, unless a water-right holder participates in a board-approved “water demand management program,” according to a notice issued Wednesday about preparation of an environmental impact report for the proposed regulation.
The board’s Division of Water Rights will be holding a scoping meeting for the regulation environmental study at the North Coast regional office in Santa Rosa on Nov. 17 at 3 p.m.
Such a management program would be designed to prevent farmers from tapping the same waterways at once during a frost warning, making the water level in the waterway drop to a “harmful” point for protected fish species, according to the notice.
Such a situation, called “instantaneous cumulative demand,” is blamed for making the river and stream levels drop in certain North Coast watersheds during a monthlong string of frosty nights in March and April 2008, something that hadn’t happened in three decades. Growers that had ponds for frost protection drained them in a few days of continual use.
Other required features of water demand management programs under the proposed frost regulation would be gauges to measure waterway levels, meters on pumps on pipes and wells, and a system for reporting conditions, according to the notice released last week.
Dr. Eyler wrote in his analysis that it’s unknown when there will be more clarity from the water board or its staff on the acceptable water demand management programs and how a frost diversion could be proven to have “negligible” impact.
Assuming that impasse persists, a number of grape growers in both counties would have to install monitoring equipment at the least and possibly convert to wind machines or other frost-control systems, according to the report.
The proposed regulation stemmed from a National Marine Fisheries Service letter to the board early last year, calling for emergency regulation of frost-water use the agency linked to two reported cases of fish stranding in Felta Creek in Sonoma County and on the main stem of the river near Hopland in Mendocino County.
Chinook salmon and steelhead are federally listed as threatened, and Coho salmon are listed by the U.S. and state as endangered. The proposed regulation covers 1,778 miles of Russian River tributaries from Coyote Dam in Ukiah Valley in Mendocino County 110 river miles south to the Pacific Ocean in Sonoma County.
The water board held several workshops on Russian River frost-water regulation between April 2009 and March of this year. Staff of the board has been working under the premise that frost protection is a “beneficial use” of waterways, a critical water-law determination for balancing farming and fishery needs, according to Mr. Rukeyser.
The water board has avoided going in the direction of Napa County, where a court ruling in the 1970s put in place a water master for frost-protection pumping from the Napa River.
“We specifically avoided saying that is how it must be done,” he said. “We left it to the stakeholders to figure out.”
A pumping management system could be governmental, quasigovernmental or cooperative, as long as it had universal buy-in, Mr. Rukeyser said.
Local farming groups have been working for the past several years on alternatives to state and federal regulation on use of North Coast waterways for irrigation and frost protection. Most at risk are winegrowers with fewer than 50 employees, which make up the bulk of operations in Sonoma and Mendocino counties, according to Nick Frey, president of the Sonoma County Winegrape Commission.
“This regulation risks putting many of these people out of business,” he said.
To hopefully prevent that, Sonoma County agriculture groups plan to introduce a frost-protection ordinance at the Nov. 9 Board of Supervisors meeting, according to Mr. Frey. The ordinance would be part of the county code, together with vineyard erosion-control and grading provisions.
“It would require growers who frost-protect to have permits and follow best-management practices,” Mr. Frey said.
Those best-management practices would be largely similar to those that farming groups in Sonoma and Mendocino counties promulgated early last year to prevent frost-protection water supplies from running dry.
These were combined into north and south versions of a Russian River Frost Control Program presented to the water board at a November 2009 workshop to counter calls from the fisheries service and conservation groups to adopt strict rules.
The goal is for the Board of Supervisors to hold a public hearing on the proposed ordinance in December.
There is recent history of cooperative management of North Coast waterways for agricultural uses.
Staff of the State Water Resources Control Board were under a legislative mandate to craft regulations for how much use of North Coast river, stream and related groundwater becomes too much and leaves too little water for protected fish with not enough water. Governor Schwarzenegger signed Assembly Bill 2121 in 2004, mandating the water board set minimum waterway flow rates.
The legislation came about because of accusations in the past two decades that there were hundreds of unauthorized taps in North Coast waterways in the form of dammed instream ponds and wells next to creeks.
Out of AB 2121 came the North Coast Instream Flow Policy, which the water board adopted earlier this year and took effect Sept. 28.
It took farming and conservation groups sitting down earlier this year to hammer out a flow policy that suited both sides.
Comments on the proposed water board frost regulation are due Nov. 30 to Bill Cowan, State Water Resources Control Board, P.O. Box 2000, 1001 I St., 14th floor, Sacramento, CA 95812-2000 or to [1].
Documents related to use of the Russian River watershed frost protection are posted at

Nov. 30: Comments due to the water board on the proposed frost-protection rules.