WATER : Lawmaker to Renew Push to Plug Subsidy Loophole

If Rep. George Miller (D-Martinez) gets his way next year, the tap will be turned off on federal water subsidies to large farms in California and several other Western states.

Miller’s efforts to limit the flow were thwarted in the final hours of the 101st Congress, but the fight next year is more likely to go his way, Miller predicts, in part because one of his main opponents--Sen. Pete Wilson (R-Calif.)--will be out of the fray.

BACKGROUND: At issue is a loophole in the 1982 Reclamation Reform Act through which large farms have been able to receive federal water subsidies meant only for small farms. The act, written with the intention of encouraging family farming in the water-scarce West, permitted farms of less than 960 acres to receive irrigation water pumped through federal canals at low, subsidized rates. However, large farms and agribusinesses have been able to receive the subsidies by dividing their holdings into trusts and partnerships composed of multiple 960-acre units.

Branding that a “rip-off of millions and millions of taxpayer dollars,” Miller last year sponsored legislation that would have dissolved such trusts. The measure, attached to a $1.5-billion water projects bill, was overwhelmingly passed by the House, 316 to 97, last June and seemed headed for certain passage in the Senate.

OPPOSING FORCES: But opponents, who argued that, as worded, Miller’s legislation would hurt many small farmers, killed the measure just before adjournment, with the help of Wilson.

Because of a stand-off between Wilson, who refused to let the bill go through with the offending amendment, and Miller, who refused to let it go through without it, the bill, including a grab-bag of pet water projects, went down the congressional drain when lawmakers adjourned in October.

Miller, chairman of the House Interior Committee’s water and power subcommittee, now says he plans to refloat the water reform amendment early next year.

Opponents of Miller’s reforms also are gearing up for the fight, but they will have to wage it without two key allies--Wilson, who is moving on to the governor’s mansion in Sacramento, and Rep. Charles Pashayan Jr. (R-Fresno), who was defeated in his bid for reelection.

“I expect much less opposition this year because the Senate now understands just how serious the House is about this,” Miller said.

OUTLOOK: Although it is not clear what position Wilson’s still-unnamed successor will take, the opposition’s standard is likely to be taken up by Rep. Larry E. Craig (R-Ida.), who moves over to the Senate next year.

Craig, who estimates that more than 300,000 acres of irrigated land in his state will be affected by the reforms, said he remains opposed to Miller’s amendment for the same reason Wilson was. Although the law contains a loophole that needs to be closed, Miller’s language would also affect family farming operations and joint ventures by individual farmers who share equipment or work their land together in order to achieve greater operating efficiencies, Craig said.

“If Congressman Miller will allow for some reasonable accommodation . . . with interests outside the state of California, then I will be happy to work with him for reclamation reform. But, if he attempts to seek only his own counsel, as he did last year, then there will be a lot of opposition . . . . He can either work cooperatively to solve the problem or he can make enemies,” Craig warned.

Miller, not surprisingly, sees it differently. He said he came up with several compromises to break the stalemate last year but that his opponents, bent on defending “big corporate farmers,” rebuffed him.

“That was their mistake,” a Miller aide added, “because this year we know we’ll have the strength to push the reforms through. It’s a sure bet.”