WATER POLITICS

A California bill that would stop the “speculation or profiteering” of investment funds, including public and private equity, venture capital, real estate, infrastructure and hedge funds, from water rights on agricultural lands has passed the state Assembly.

The bill, which passed 46-17 on Monday and will move to the state Senate, would make the sale, transfer, or lease of any surface or groundwater right previously used on California agricultural lands a waste or unreasonable use of water, which is barred by the state Constitution.

The bill’s proponents point to news reports that hedge funds and other money managers have been buying up agricultural land in California to sell water rights and use water “at an unsustainable rate to farm permanent crops or grow livestock feed for export,” according to the Assembly floor analysis.

The Growers Association opposes the bill and argues that private capital can help address water scarcity issues in California.