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How Corporations Drain Our Aquifers for Profit (Part 1)

Wednesday, June 11, 2008 by: Heidi Stevenson
Tags: aquifers, water supply, health news

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(NewsTarget) A modern water war is raging in the tiny town of McCloud, California, snuggled at the base of Mt. Shasta. The enormous conglomerate, Nestlé, managed to extort a contract with the financially strapped town's board members. They were so broke that they couldn't afford an attorney to help guide them through the process.

McCloud, a town in a picture-perfect location, was luck after the lumber industry had gone bust. In 2003, unemployment was 14.5% when Dave Palais, a Nestlé water finder and negotiator, showed up. McCloud's delicious and pure water comes from glacier-fed springs on Mt. Shasta. Local tales claim that the water is virtually a fountain of youth, giving the townsfolk an unusually young appearance.

Palais took two of the service district's board members and the town manager to see two of its water plants near Palm Springs. They looked beautiful. As Doris Dragspeth, a board member said, "They had beautiful break rooms for their employees and anything else they wanted. It was a beautiful plant." Nestlé promised jobs for the locals and ongoing revenue for the town.

The board members were sold. They signed Nestlé's contract without opening the process up to the rest of the town. In fact, the townspeople were unaware of anything until a notice was posted in the local post office to announce the plan. Richard McFarland, owner of a local reclaimed-lumber business, was troubled. He and 100 other residents -- close to one-tenth of the town's population -- showed up for the Nestlé-McCloud town meeting, at which a television showed an ongoing video of Nestlé's CEO talking about how wonderful their environmental standards were.

McFarlane went through the signed contract and was horrified. Nestlé had been granted nearly exclusive rights to the water for 100 years. McFarland said, "The contract read like nobody on the services district knew what they were doing. It read like Nestlé lawyers wrote it." Of course, that's not surprising, since they did. Certainly, no one looking out for the interests of McCloud's residents or anyone affected by the same watershed area was taken into account.

Implications of the McCloud-Nestlé Contract

A study produced by EcoNorthwest of Portland, Oregon made clear that McCloud's service district board members made a bad bargain. They hadn't considered costs to the town, including the plant's wastewater, massive truck traffic, air pollution, or a host of other significant factors. The study found that Nestlé's claims for jobs and money in other towns that had signed water contracts were not met by reality. The costs of the plant would likely be greater than the benefits. Further points brought out were:

* The contract gives Nestlé priority over the townspeople for the water. In the event of a water shortage, a likely event with lessening rainfall from climate change, Nestlé can continue to draw water, while the locals have to draw less or even none. This has already happened in other communities where Nestlé has done business.

* Though the water will become Nestlé's property, the town would carry responsibility for maintaining the springs and the infrastructure needed to support the massive water bottling plant.

* Nestlé will have an unlimited right to drill boreholes.

* Nestlé will pay less than locals for the water.

* The claim of jobs is dishonest, as most will not pay a living wage or will be part time. The town will become completely dependent on a single employer. Shades of the company town!

* Water downstream of McCloud will be affected adversely. Water levels throughout the extent of the aquifer, an area that is not known, will be lowered.

* Because the aquifer consists of lava tubes, the bore holes Nestlé plans to drill puts the townspeople at risk.

* Fisheries will be placed at risk.

* Local tourism, a major source of income for the area, will be damaged.

* There are no payment increases over the hundred-year contract term. As inflation devalues the money Nestlé pays to McCloud, its costs in providing the infrastructure required by the contract will increase.

* Nestlé can run up to 600 truck trips per day, and they can run them 24 hours a day.

* Nestlé has exclusive rights to the water. Other businesses requiring water, such as microbreweries, would not be able to operate in McCloud.

Nestlé intends to take 1,250 gallons of water per minute -- 520 million gallons per year. A constant line of trucks would lumber to and from a one million square foot facility, the size of five Walmart superstores. This could be only the beginning, as there is no limit to the amount of water that Nestlé would be able to take. Try to picture a plant of that size in the center of a town with a population about about 1,300 people. Obviously, the quality of life will be devastated.

McCloud will get $350,000 per year from Nestlé. However, this will not cover its costs in terms of the infrastructure it will be required to provide for the operation.

McCloud's service district board members sold its water for a mere $26.40 per acre-feet. Another profitable plant in Twinsburg, Ohio pays $107,531 per acre-feet.

Nestlé's cost for each gallon of spring water will be a mere 1/64 of a cent. In today's dollars, the bottled water will bring anywhere from five to ten dollars per gallon -- an obscene profit, even after overhead, one that makes the pharmaceutical industry's 25-33% profits look paltry in comparison.

The lava tube structure of the aquifer consists of many large cracks. People who have tried to extend their wells have often found that disaster results with deeper drilling. The chairwoman of the McCloud Watershed Council, Debra Anderson, has said, "You really don't know what large-scale drilling will do. People around here have sunk their wells too deep and they lost all their water. It disappeared like it was going down the bathtub drain." Clearly, Nestlé's plans to drill bore holes carries the potential for serious disruptions in the townspeople's access to water.

This will take place around California's "most pristine river", according to the San Francisco Chronicle. As the water is drained from Mt. Shasta and the aquifer, its future looks dim.

All of this begs the question of how a single town that draws its water from an aquifer that serves a far larger area even has the right to sell it. There is also the consideration of global climate change. Most of this water is the product of glacier melt, something that is already becoming scarce as the glaciers shrink. In the McCloud area, the warming trend has been producing dryer weather. All of this threatens the entire watershed of northern California and southern Oregon -- source of the famous blue-green algae nutrients from environmentally sensitive Klamath Lake -- putting everyone, from the Oregon border and northwards, down to the Sacramento River and the estuary it forms with other rivers, including the San Francisco Bay, at risk.

The Last Gasp of the Northern California Watershed

The McCloud Watershed Council battled Nestlé through the courts. Initially, they won. In 2005, Superior Court Judge Roger Kosel ruled that Nestlé had violated the California Environmental Quality Act by not producing an environmental review before the contract was signed.

Nestlé agreed to do an Environmental Impact Report (EIR). So, they did a thoroughly unscientific report that effectively whitewashed their plans. The effects on communities downstream were not even considered. What might happen to the aquifer was not addressed. Neither were climate change, effects on fish and fishing, effects of diesel fumes from the huge number of trucks to transport the bottled water, or hazardous waste that might be produced by the million square foot plant.

Finally, though, in January 2007 the California Supreme Court overturned Judge Roger Kosel's ruling. Nestlé won the ability to steal Mt. Shasta's water.

The fight goes on, though the likelihood of success is probably slender. In April 2008, the Protect Our Waters Coalition enlisted the services of the law firm Manatt, Phelps & Phillips, LLP. However, Nestlé has gone through and pressed legal battles many times. Their usual approach is to keep filing lawsuits.

Part 2 discusses other methods of water theft, both in the United States and worldwide.


"A Town Torn Apart by Nestlé", Business Week, (http://www.businessweek.com/magazine/content...)

"Nestlé Attempts to Privatize N. California Headwaters", Socialist Action website, (http://www.socialistaction.org/newman1.htm)

McCloud Watershed Council, (http://mccloudwatershedcouncil.org/nestle/in...)

"Bottled water war heats up election", SFGate (website of the San Francisco Chronicle), (http://www.sfgate.com/cgi-bin/article.cgi?f=...)

"Tide Turning on McCloud Nestle Plant? Not Yet, But...", The Trout Underground, (http://troutunderground.com)

"Nestlé's Thirst for Water Splits Small U.S. Town", redOrbit, (http://www.redorbit.com/news/science/1306375...)

About the author

* Heidi Stevenson, BSc, DIHom, FBIH
* Fellow, British Institute of Homeopathy
* Gaia Health (http://www.gaia-health.com)
* The author is a homeopath who became concerned with medically-induced harm as a result of her own experiences and those of family members. She says that allopathic medicine is the arena that best describes the motto, "Buyer beware."
* Heidi Stevenson provides information about medically-induced disease and disability, along with incisive well-researched articles on major issues in the modern world, so members of the public can protect themselves.
She can be reached through her website: www.gaia-health.com

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