WATER BANK PLAN UPHELD ON APPEAL 2 ENVIRONMENTAL GROUPS FAIL IN BID TO STOP CASTAIC AGENCY.

Byline: Eugene Tong Staff Writer

SANTA CLARITA - A state appellate court Thursday upheld a lower court decision allowing a local water agency to bank of groundwater in Kern County - a plan two environmental groups challenged alleging officials failed to study the project's impacts as required by law.

The 2nd District Court of Appeal decision is a blow to the California Water Network and Friends of the Santa Clara River, who sued Castaic Lake Water Agency over its 2002 Groundwater Banking Program.

The agency had proposed to store 24,000 acre-feet of water for 10 years with the Semitropic Water District in Kern County, which officials said would safeguard supply during drought years.

``It was all about us banking some water for a few years,'' said Dan Masnada, CLWA's general manager. ``They try to say it was a permanent transfer and that it was growth inducing. It was great that the court did not believe any one word they said.''

The two environmental groups sued, claiming the local water wholesaler violated the California Environmental Quality Act because it failed to conduct the necessary studies. The CLWA had skipped the more detailed review when it declared the project would have no significant environmental impacts.

Carolee Krieger, president of California Water Network, referred questions to attorney Stephan Volker, who did not return calls for comment Thursday. It was not known if the plaintiffs are planning another appeal.

The plaintiffs also alleged the state Department of Water Resources, instead of CLWA, should oversee the project; that water quality at Semitropic's facility is suspect due to contamination by the rocket fuel ingredient perchlorate; and that it violated the public trust because it would spur urban growth and impact biological resources and traffic.

The CLWA oversees the Santa Clarita Valley's allocation of State Water Project water, which makes up about half the region's annual supply.

Critics of the water agency contend that much of that water is available only on paper because it rarely gets full entitlement from the California Aqueduct water, which the CLWA does not receive every year. Environmental groups maintain there is inadequate water to support development - some 22,000 homes are proposed for North Los Angeles County in the coming decades.

A Ventura Superior Court judge in 2004 ruled in favor of the CLWA, a decision the Los Angeles appellate court affirmed.

A three-judge panel agreed the the CLWA acted properly when it declared the plan had no problems, citing a 1994 environmental impact report for another Semitropic banking program. That program proposed to store 1 million acre-feet of water for several water purveyors, including Castaic.

``Neither CWN nor any other member of the public submitted factual data supporting assertion that information relied on by Castaic in the 1994 EIR was outdated,'' the judges wrote.

The court also agreed the CLWA was the correct agency for the project; that perchlorate contamination and methods to remove it were addressed in the environmental review process.

The court called the plaintiff's allegations that the project would induce urban growth a ``faulty premise'' because it was stated as a 10-year plan.

``This information is sufficient to support a finding that the Project will not cause significant growth-inducing impacts,'' the judges wrote.

Masnada said the agency spent more than $1.2 million defending against the lawsuit, though CLWA is named in another legal challenge to the Semitropic deal. Friends of the Santa Clara River is suing the state Department of Water Resources over its approval of the project.

``This ruling makes me feel that much better about the suit,'' Masnada said. ``Frankly, I think they should drop it, but I don't expect them to.''

Eugene Tong, [phone]

eugene.tong(at)dailynews.com