Wines & Vines

September 2014 Wine Industry Finance Issue

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W i n e s & V i n e s s e P T e M B e R 2 0 1 4 17 S E P T E M B E R N E W S S E P T E M B E R N E W S Better management of California's ground- water would help the state endure future droughts, just as an improved system for stor- ing and transporting surface water would help prevent excessive groundwater pumping. On Aug. 13, state lawmakers in Sacra- mento, Calif., agreed to swap an $11 billion bond on the November ballot with a $7.5 billion measure that will address the state's water needs while minimizing new debt. Under the proposal, the state would take out $7.1 billion in new debt, drawing the re- mainder from unused proceeds of an earlier bond. If approved, nearly $3 billion of the bond proceeds would be used to bolster the state's system of dams and reservoirs. The proposal won the support of lawmakers from the Central Valley and Southern California, but elected leaders from Northern Califor- nia—especially those from districts in the Sacramento-San Joaquin Delta region—were adamant the bond be "tunnel-neutral." Gov. Jerry Brown has pro- posed an ambitious plan to build two huge tunnels to send water from the Delta down to Southern California, raising the ire of politicians, environ- mentalists and farmers in the northern half of the state. State Sen. Lois Wolk, whose district includes several Northern California grapegrowing coun- ties and overlaps the Delta, applauded the mea- sure, which she said addresses critical water infrastructure needs while protecting the inter- ests of the Delta. "This is a very different bond than the pork-laden one currently on the ballot, which helped some regions of this state but hurt others. This bond is good for the Delta and all of California, and it's affordable," she said. Increased water storage will help long-term water supplies, but California really needs a string of wet winters to help pull the state out of drought. Unfortunately, a report issued by the National Weather Service Climate Predic- tion Center on Aug. 7 said the chance of an El Niño weather pattern on the West Coast has fallen to 65%. An El Niño is triggered by warm ocean temperatures and can result in increased rainfall in California and the rest of the west. According to the report, current ocean tem- perature and wind data indicate the chance of a strong and wet El Niño is declining. "A strong El Niño is not favored in any of the ensemble averages, and slightly more models call for a weak event rather than a moderate event." So far, the drought appears to have had little significant effect on California's 2014 wine grape crop, which estimates put at 3.8 million to 4 million tons—not record size, but still im- pressive, especially after the record harvests of 2012 and 2013. The real worrying will begin if the drought persists into 2015 and 2016. —Andrew Adams TRY BEFORE YOU BUY – CONTACT YOUR LOCAL REP TODAY Take advantage of this risk-free offer to try our new TankJet 55A barrel cleaner in your winery. You'll experience benefts like these: • Powerful cleaning using low fow rates to prevent toast removal and reduce water and chemical use • Fast cycle times enable cleaning of multiple barrels in minutes • Durable construction and use of wear-resistant materials extend service life • Easy to use – compatible with most pumps and pressure washers Try the TankJet 55A today! Call 1.800.95.SPRAY or visit TankJet.com. TankJet 55A barrel cleaner for cleaning barrels up to 5' (1.5 m) in dia. FREE T R I A L O F O U R N E W TANKJET ® 55A BARREL CLEANER SUPERIOR SPRAY. SERIOUS RESULTS. Moderate drought Severe drought Extreme drought Exceptional drought RICHARD TINKER / CPC/NOAA/NWS/NCEP Nearly 100% of California met parameters for severe drought when the Climate Precipitation Center released its Drought Monitor on Aug. 12.

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