The Arrowhead Water War: Bottled Water, Drought & NEPA

Administrative permit reviews are costly and difficult. But should the Forest Service just leave well enough alone?

The San Bernardino National Forest has many special use permits.  One in particular made the news in 2015.  The Arrowhead Water bottling operation, currently owned by Nestlé, stood out for its water-a-plenty during a crippling drought.  You see the Arrowhead permit to take the water (said by Nestlé to amount to 68,000 gallons a year and costing just $524 annually) expired in 1988.  arrowhead truckThe permit has been “administratively continued” ever since through a gaping loophole in the law of administrative permits.   (As long as Nestlé applied for a renewal, their expired permit is continued automatically per 5 U.S.C. § 558(c)(2) (“When the [permitee] has made timely and sufficient application for a renewal . . . in accordance with agency rules, a [permit] with reference to an activity of a continuing nature does not expire until the application has been finally determined by the agency.”))

The Forest Service (USFS) was sued in October 2015 by a band of environmental nonprofits who alleged that the operation was illegal.  But Arrowhead’s right to the water is likely secure and the Forest Service’s policy of administratively continuing permits is grounded in the Administrative Procedure Act.

According to Nestlé Waters North America, the SBNF water right is a “pre-1914” appropriation, something that, in California law, means it’s as good as gold.

With retired Forest Service employees and other locals in tow, the local press kept this story active throughout the drought and now promises to keep it hot as the Forest Service finally undertakes a long-awaited environmental assessment (EA).

This review by the Desert Sun collects the documents recording the long USFS lapse on this permit and its underlying causes.  SBNF

The conspiracy theorists even get a nod from those documents: Gene Zimmerman, a retired supervisor of the SBNF, is now a paid consultant to Nestlé.

But the real story here is about budgeting for the ownership and administration of public lands like the SBNF.  As the Forest Service has seen its non-fire-management budget cut, cut again, and cut yet again over the last few decades, it simply doesn’t have the resources to administer all the lands in its charge.  Can Nestlé safely remove the ground water it’s collecting out of the SBNF and bottling in Ontario without imperiling the native flora and fauna on the forest?  Without a fairly sophisticated examination, it’s impossible to say.  Before the Forest Service could undertake a review and renewal (or cancellation) of Nestlé’s permit, NEPA requires it to undertake at least some version of that examination.  And it won’t do to urge the agency simply to “err on the side of caution” and deny the permit without evidence: that would beg a lawsuit from Nestlé.

The situation on the SBNF is not unique.  In fact, it’s being played out all over national forests in California.  Hundreds of such permits are sitting in a massive USFS backlog that is rooted, ultimately, in a lack of administrative capacity.  Without a change there, the status quo will be “administratively continued” seemingly without end.

NEPA Proce$$ Costs: At the Base of the Arrowhead Water War?

Many national forests, like the SBNF, were established because they are the watersheds protecting the vital headwaters of critically important surface water sources.  Strawberry Creek, the tributary in the SBNF that would otherwise be recharged by Nestlé’s water, has been at critically low levels throughout the California drought.  That means that native flora and fauna have been stressed and will continue to be stressed.

For its part, taking clean water and “upselling” it to Californians at a premium is something Nestlé does proudly.  {See this video including an interview with Nestlé North America’s CEO.}.  So what is the Forest Service’s play here?

As mentioned, the operation in the San Bernardino Mountains isn’t alone.  The Morongo Band of Mission Indians’ reservation in Cabazon also plays host to a bottling operation for Arrowhead.  (Many locals there have wondered aloud and more insistently why a multinational enterprise like Nestlé should be allowed to bottle “their” spring water in the desert and sell it at a profit.)

And there’s reason to believe that the public is growing more and more alert to the absurdity of bottled water economics in a land of extreme and seemingly permanent drought.  U.S. News just ran a story about the commencement of the SBNF EA on the ridiculous headline: “Feds Investigate Nestle in California.”

If USFS was thinking clearly about this issue, it would be looking for a way to triangulate pressure onto the U.S. Congress.  Congress, after all, is the source of these essentially budgetary woes.  Congress has starved the USFS, Bureau of Land Management and other land-managing agencies of the resources they need to superintend the public lands.  If a NEPA assessment and this lawsuit on the SBNF prompts that pressure, some good may yet come from this story.  If USFS instead just issues a limp, conclusory “finding of no significant impact” (FONSI) premised on the long history of this water withdrawal and the surrounding environment’s “baseline” which has adapted to drought, it will have squandered that opportunity.

No one could be happier than Nestlé—at least if their public comments are to be believed—that the permit review and EA are finally underway.

“We are pleased the USFS review process is underway,” said Jane Lazgin, spokeswoman for Nestle Waters North America. “We are working with the U.S. Forest Service through the permit renewal process, recognizing the permit remains in effect because the company took the proper steps to request the permit renewal before it became due.”

We will see if they like the results.

{Image: Big Bear Lake in the San Bernardino National Forest}

I teach environmental, natural resources, and administrative law at Penn State Law. Before teaching I was an enforcement lawyer at U.S. EPA. Along the way I've done work for environmental nonprofits and written a fair bit about NEPA.
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