Brackpool in the horse race
Posted on | September 24, 2009 | No Comments
THE LOS ANGELES TIMES reports today that California Governor Arnold Schwarzenegger has appointed British-born water speculator Keith Brackpool to the state horse-racing board.
Brackpool, a horse-racing aficionado and country club owner, is better known for pursuit of a controversial groundwater project in the Mojave, which was rejected by the Metropolitan Water District of Southern California in 2002 as economically and environmentally unfeasible.
Since then, Brackpool has been pursuing other backers for his groundwater pumping operation in the Cadiz basin in San Bernardino County. On June 5th, 2009, Brackpool’s company, Cadiz Inc, released an endorsement by Governor Schwarzenegger for the project.
Months later, a spokesman for the governor confirmed that the endorsement was genuine, although its release by Brackpool’s company direct to the business wires with no trace of it from the governor’s office raised questions in this website, the Los Angeles Times and Aguanomics, the blog of UC Berkeley water economist David Zetland. Zetland estimated that soaring stock prices after the governor’s endorsement had positioned Brackpool, who had taken stock options only weeks earlier, for a $350,000 gain.
“Bottom Line,” Zetland wrote, “It’s fine to buy and sell water to make a profit. It’s not fine to use political influence to change the value of your water trading company. I would not be surprised if Cadiz has crossed that line.”
The governor’s chief of staff, Susan Kennedy, used to work for Brackpool in 2005, reportedly receiving $120,000. The Times reports today, “As Schwarzenegger’s highest-ranking aide since 2006, Kennedy approves all appointment recommendations made to the governor for state boards and commissions and is deeply involved with his water policy. In 2006, after her income from Cadiz was disclosed, the governor’s office said she would recuse herself from matters connected to its water project.”
While Cadiz’s general counsel told KPCC’s Larry Mantle recently that the company has yet to formally request environmental review for the latest incarnation of its water project, the governor is engaged in an escalating game of chicken with the California legislature over whether or not he will get the big ticket projects such as dams and reservoirs that he wants from the water bills. Among the governor’s demands for new storage projects is one for groundwater. A spokesman for the governor told this reporter in August that while the governor “likes” the Cadiz project, he will not insist on it to pass a package of much needed water bills for California.
The Times reports that Kennedy was involved in Brackpool’s appointment to the horse-racing board. To read the story, click here.
For more on the June run on Cadiz shares and the source of the governor’s endorsement, click here.
This post has been updated.
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