Activists Ask for Public Hearings on Newhall Water Deal

The companies planning to buy the Newhall Land & Farming Co. are trying to avoid public hearings on their proposed takeover of a water company that serves many of Newhall’s developments in north Los Angeles County -- a move that has upset activists worried about the deal’s effect on the local water supply.

Gordon LaBedz, conservation chairman of the Sierra Club’s Angeles Chapter, said Wednesday that the Miami-based Lennar Corp. should welcome a public debate on its planned acquisition of the Valencia Water Co., a Newhall Land subsidiary that serves more than 25,000 customers in the Santa Clarita Valley.

“All these bad development decisions are usually done in the dark,” he said. “Usually when the public finds out about it, it’s too late.”

The Lennar Corp. and its partner, LNR Property Corp., announced in July that they plan to purchase Newhall Land, the Santa Clarita Valley’s most powerful developer, for $990 million.

Because Valencia Water is part of the deal, it must be approved by the California Public Utilities Commission, which oversees the state’s privately owned utilities.

Opponents of the deal assumed they would be able to present their concerns in a public meeting. But in its application to the commission in August, Lennar argued that public hearings were unnecessary because the transfer raised no “controversial” issues.

Environmentalists, however, are concerned about an out-of-state entity controlling Valencia Water and the local water supply, which they say is threatened by such proposed developments as Newhall Ranch, a 20,885-home project that would be built near the Ventura County line.

In a formal protest to the commission Sept. 19, the Los Angeles Chapter of the Sierra Club demanded a public hearing on the matter.

“There is substantial community concern that out-of-state ownership of this company may result in financial or ethical decisions that are not in the best interests of the ratepayers and community,” wrote LaBedz.

Environmentalists have long fretted over the fact that the water company was owned by a local developer. Activist Lynne Plambeck has accused Valencia Water of overstating water supplies and underreporting water pollution in an effort to boost Newhall Land’s development at the expense of ratepayers.

Plambeck said the situation could get worse under new owners.

“I think [Lennar] has even less impetus to care for the community than Newhall did, because, if something goes wrong, they just wash their hands and go to another state,” said Plambeck, a Sierra Club member and president of Santa Clarita Organization for Planning the Environment. “For Newhall, it was important, for their own economic interests, to at least keep the [water supply] viable because of their many interests in the area.”

Lennar Vice President Jon Jaffe did not return calls seeking a comment Wednesday.

The Public Utilities Commission has not set a timetable for considering Lennar’s application, in which the company sought a decision on the acquisition of the water company by Dec. 18.