In action this week, the California Public Utilities Commission set new levels for the Cost of Capitol that represented a 0.3% decrease. While it may not be significant, it is opposite of the 1% increase that the utilities had originally proposed back in March. Prior to this new decision PG&E had proposed to increase the cost of capital from 10.28% to 11.3% and Edison had proposed to go from 10.33% to 11.75%. Considering the current economic environment, it was a bold request by the utilities that was met with tremendous opposition from industry groups, ratepayers and even legislators who were brave enough to challenge the utilities. Association President/CEO Roger A. Isom commented “We applaud the CPUC for having the courage to do the right thing and not only reject the proposed increase, but to actually decrease the rate of return. Electricity rates in California are astronomical compared to the rest of the country, and it is time for the CPUC to bring these utilities in line. Finally, the state is taking a small step in the right direction.”

Save the Date! The 2026 CCGGA Annual Meeting will be on May 20th in Tulare, CA.

This past week the Bureau of Reclamation signed a Record of Decision adopting an updated long-term operation plan for the Central Valley Project. The decision advances actions designed to maximize water deliveries across California while maintaining protections for endangered fish species. “With the signing of this Record of Decision, we are delivering on the promise of Executive Order 14181 to strengthen California’s water resilience,” said Secretary of the Interior Doug Burgum. “This updated operations plan reflects our commitment to using the best available science to increase water deliveries while safeguarding the environment and honoring the legacy of the Central Valley Project’s 90 years of service.” The revised plan responds to Executive Order 14181, issued Jan. 24, 2025, which directs federal agencies to take all available measures to increase water deliveries from the CVP, including issuing a new Record of Decision consistent with federal law. “Action 5 represents a forward-looking approach to water management that balances the needs of California’s communities, agriculture, and ecosystems,” said Assistant Secretary for Water and Science Andrea Travnicek. “By refining real-time governance and operational flexibility, we are ensuring that every drop of water is managed with precision, accountability, and purpose.” 

Under the updated approach, the CVP may increase annual water deliveries by between 130 to 180 thousand acre-feet, and the State Water Project by 120 to 220 thousand acre-feet, depending on hydrologic conditions and subject to the State’s adoption of Action 5. The updates improve the use of scientific modeling and analysis in operational criteria. Changes remain within the range analyzed in the 2024 Long-Term Operations Final Environmental Impact Statement and consistent with effects analyzed in the 2024 Biological Opinions issued by NOAA Fisheries and the U.S. Fish and Wildlife Service. Key operational changes include adjustments to Delta export operations, removal of the Delta Summer and Fall Habitat Action and removal of early export-reduction concepts from the State of California’s Healthy Rivers and Landscapes Program. Association President/CEO Roger A. Isom stated “this type of action is what we all hoped for, and represents the balance so desperately needed. While it won’t eliminate the devastating impact of SGMA, it will go a long way in helping to mitigate the damaging effects on farmers, agricultural processors and everyone that lives here.”

The California Cotton Ginners and Growers Association is pleased to announce the re-election of the following board members. Re-elected to the board were the following Ginners: Raymond Gomez, J.G. Boswell Company and Kirk Kilkey, Cross Creek II Gin LLC. The following Growers were re-elected: Fresno County: Gary Martin, Wyatt McKean and Renato Serrano; Tulare County, Doug Cardoza.  All board member positions are three-year terms. 

The Department of Water Resources (DWR) has announced an initial State Water Project (SWP) allocation of 10 percent of requested supplies for the new water year. The SWP is contractually required to make an initial allocation forecast by December 1 each year. Since it is so early in the season, the initial allocation typically reflects current hydrological conditions, existing reservoir storage, and an assumption of dry conditions through the rest of the year. So far, the wet season is off to a good start with beneficial rain falling in Northern California and Southern California already seeing significant rainfall following a dry year last year. “Recent history has shown us that anything can happen during a California winter, so it’s important that our early season allocation for the State Water Project is conservative,” said DWR Director Karla Nemeth. “Traditionally our wettest months are yet to come. With improvements to forecasting and science, we are better prepared to capture water supply during wet periods if Mother Nature delivers.” Across the state, California’s water supply starts the season in good shape with statewide reservoir storage just above average at 114 percent. Lake Oroville, the SWP’s largest reservoir, is at 100 percent of average for this time of year, slightly above where it was at last December. Each year, DWR provides the initial SWP allocation based on available water storage, projected water supply and water demands. Allocations are updated monthly as snowpack, rainfall and runoff data is analyzed, with a final allocation typically determined near the end of the season in May or June.

The Department of the Interior has announced Secretary’s Order 3446, which streamlines federally funded construction projects at Bureau of Reclamation facilities across the 17 Western states. The order reduces administrative burdens, cuts costs for water and power users and supports faster delivery of critical infrastructure across the West. The order directs Reclamation to work with local water and power partners to modify certain contracts and establish new contract terms that allow qualified partners to manage portions of the procurement process on some federally funded projects. This partner-led approach is designed to speed up project delivery and improve efficiency while maintaining federal oversight. “The Trump administration is focused on unleashing American infrastructure, cutting unnecessary red tape and lowering costs for families, farmers and communities,” said Secretary Doug Burgum. “By empowering local partners and simplifying federal processes, we can deliver water and power projects faster to make life more affordable for American families while strengthening economic growth throughout the West.” Reclamation will begin implementing the order immediately. One of the early efforts will be the B. F. Sisk Dam Raise and Reservoir Expansion in partnership with the San Luis and Delta Mendota Water Authority. Under the new model, the authority will conduct procurement for a significant part of the storage raise project during the upcoming construction period. The expansion will add 130,000 acre-feet of storage capacity to the 2 million acre-feet San Luis Reservoir, the largest off-stream reservoir in the United States. In addition, the order directs Reclamation to review key processes and programs, including cost-share programs, Reclamation guidelines, engineering design review procedures and environmental compliance, by engaging with stakeholders to identify process improvements and efficiencies. “In addition to speeding up project timelines and cutting costs for our customers and taxpayers, the order directs the Bureau of Reclamation to review many of its processes, manuals and guidelines to identify further operational efficiencies,” said Assistant Secretary for Water and Science Andrea Travnicek.

This past week, the Association co-hosted a very important meeting on the statewide emissions inventory for agricultural operations at our office in Fresno. The high-level meeting included 17 CARB Staff either in-person or online, and five staff from the San Joaquin Valley Air Pollution Control District. Leading the CARB staff was Air Quality and Planning Division Chief Matthew Lakin, Mobile Source Control Division Chief Michelle Buffington, Special Assessment Branch Chief Yanju Chen, Mobile Source Analysis Branch Chief David Quiros, Research Division Chief Elizabth Scheele, and Atmospheric Sciences Branch Chief Michael Fitzgibbon. The focus of the meeting was on updates to the agricultural operations emission inventory, which will play a major role in what is regulated going forward. Topics included harvesting, particularly tree nuts, unpaved roads, land preparation and mobile sources. A lot of the discussion centered on the change in the agricultural landscape due to the impact of the Sustainable Groundwater Management Act (SGMA) and changes in crop type over the past 20 years and what that looks like going forward. Additional meetings will be held to address specific action items including updates to estimates of vehicle miles traveled for specific commodities as equipment and practices have changed over the past 20 years. Co-hosting the meeting with the Association was the Nisei Farmers League and Milk Producers Council.

This month, the Department of the Interior’s U.S. Fish and Wildlife Service announced four proposed rules to restore Endangered Species Act regulations to their proven 2019 and 2020 framework. The proposals, two of which were issued in coordination with the Department of Commerce’s National Oceanic and Atmospheric Administration’s National Marine Fisheries Service, would revise regulations finalized in 2024 that expanded federal reach, created unnecessary complexity and departed from the statute’s clear language. These actions implement Executive Orders under President Trump, which direct agencies to remove regulatory barriers that hinder responsible resource development and economic growth while maintaining core conservation commitments. “This administration is restoring the Endangered Species Act to its original intent, protecting species through clear, consistent and lawful standards that also respect the livelihoods of Americans who depend on our land and resources,” said Secretary of the Interior Doug Burgum. The four proposed rules are:

• Listing and critical habitat (50 CFR part 424): 
  The services jointly propose to restore the 2019 regulatory text governing listing, delisting and critical habitat determinations. The proposal ensures decisions are based on the best scientific and commercial data available while allowing transparent consideration of economic impacts. It reestablishes the longstanding two-step process for designating unoccupied habitat, restores clarity to the definition of “foreseeable future” and reinstates flexibility to determine when designating critical habitat is not prudent.

• Interagency cooperation (50 CFR part 402): 
  The services jointly propose to return to the 2019 consultation framework by reinstating definitions of “effects of the action” and “environmental baseline,” removing the 2024 “offset” provisions and restoring section 7 procedures consistent with the statutory text. These changes respond directly to the Supreme Court’s decision in Loper Bright Enterprises v. Raimondo, which overturned the Chevron deference standard and reaffirmed that agencies must adhere strictly to the law as written.

• Threatened species protections (50 CFR part 17; section 4(d)):  
  The Fish and Wildlife Service proposes to eliminate the “blanket rule” option and require species-specific 4(d) rules tailored to each threatened species. This approach reflects the single best reading of the statute under Loper Bright and ensures that protections are necessary and advisable to conserve each species without imposing unnecessary restrictions on others. It also aligns service policy with the National Marine Fisheries Service’s longstanding species-specific approach.

• Critical habitat exclusions (50 CFR part 17; section 4(b)(2)): 
  The Fish and Wildlife Service proposes to reinstate its 2020 rule clarifying how economic, national security and other relevant impacts are weighed when determining whether to exclude areas from critical habitat. The revised framework provides transparency and predictability for landowners and project proponents while maintaining the service’s authority to ensure that exclusions will not result in species extinction.

“These actions reaffirm our commitment to science-based conservation that works hand in hand with America’s energy, agricultural and infrastructure priorities,” said Fish and Wildlife Service Director Brian Nesvik. “By restoring clarity and predictability, we are giving the regulated community confidence while keeping our focus on recovery outcomes, not paperwork.”

This week U.S. Environmental Protection Agency (EPA) Administrator Lee Zeldin, together with Assistant Secretary of the Army for Civil Works Adam Telle, announced a proposed rule that would establish a clear, durable, common-sense definition of “waters of the United States” (WOTUS) under the Clean Water Act. The proposal follows the Supreme Court decision in Sackett. The agencies developed this proposed rule using input from multiple sources, including a pre-proposal recommendations docket, information from nine public listening sessions, and consultation comments from states, tribes, and local governments. Including comments submitted by the Association in 2022 seeking clarification and appropriate definitions to what is navigable. Key proposed revisions include:

• Defining key terms like “relatively permanent,” “continuous surface connection,” and “tributary” to appropriately delineate the scope of WOTUS consistent with the Clean Water Act and Supreme Court precedent.
• Establishing that jurisdictional tributaries must connect to traditional navigable waters either directly or through other features that provide predictable and consistent flow.
• Reaffirming that wetlands must be indistinguishable from jurisdictional waters through a continuous surface connection, which means that they must touch a jurisdictional water and hold surface water for a requisite duration year after year.
• Strengthening state and tribal decision-making authority by providing clear regulatory guidelines while recognizing their expertise in local land and water resources.
• Preserving and clarifying exclusions for certain ditches, prior converted cropland, and waste treatment systems; Adding a new exclusion for groundwater; and
• Incorporating locally familiar terminology, such as “wet season,” to help determine whether a water body qualifies as WOTUS.
• In addition, the limitation to wetlands that have surface water at least during the wet season and abut a jurisdictional water will further limit the scope of permafrost wetlands that are considered to have a continuous surface connection under the proposed rule. These proposed changes are intended to provide clarity and consistency to the continuous surface connection definition.

When finalized, the rule is intended to cut red tape and provide predictability, consistency, and clarity for permitting under the Clean Water Act. “In recent decades, the regulatory uncertainty caused by changing and complicated definitions of Waters of the United States unduly burdened the American people and undermined our nation’s economic competitiveness,” said Assistant Secretary Telle.  “Now, we are proposing a definition that follows the law as affirmed by the Supreme Court and will deliver the clear and durable regulatory certainty Americans deserve from the federal government.”  The definition of WOTUS influences Clean Water Act implementation, including whether farmers, landowners, and American businesses must secure permits before they can pursue projects that might impact surface water quality. The proposed rule will be published in the Federal Register and open for public comment for 45 days. EPA and the Army will host two hybrid public meetings.

The California Air Resources Board recently notified stakeholders of the upcoming phase out deadline for Tier 3 portable diesel engines on December 31^st, 2025. Please note, this update is for CARB registered equipment. The San Joaquin Valley Air Pollution Control District has a different set of requirements. The model year specifications for the CARB registered equipment are as follows:

• PERP Units owned by small fleets and built prior to 2009, rated at 50 bhp up to 750 bhp
• PERP Units owned by large fleets and built on or after 2009, rated between 50 bhp to 750 bhp

If this equipment was registered under CARB’s Portable Equipment Registration Program (PERP), or otherwise subject to CARB’s Portable Diesel Engine Airborne Toxic Control Measure, they will no longer be able to operate in California after the December 31^st deadline. 

There are phase out exemptions allowed in order to maintain use of the affected equipment. Exemptions are provided to facilities that can provide written documentation that:

• The equipment operates less than 200 hours per calendar year
• Is limited to emergency use only
• Or has been retrofit with level-3 verified emission control technology
   

The first two exemption provisions must be applied for between January 1^st – 31^st, and must include photos of the hour meter read on January 1, 2026. The third exemption option listed must be applied for prior to December 31^st of this year. Stay tuned for more updates.