"Ahh, the naivete," came the reply. "Here's how it works:
- An independent operator (and Sacramento is full of them) approaches one, or maybe two, political leaders of some government agency with authority to sell water, and says my principals would like to make a contribution to your political fund, your favorite charity, your favorite offshore bank, you choose. Then they negotiate an amount.
- [Then it gets interesting] The IO says my principals are thinking of planting a zillion acres of crops that need a lot of water next year and they need assurances of plenty of water and the best way is to be able to buy that water now at about X$ AF. The IO says we know that is more than our legal allowance, but here is how we think it can get done, and the crops will be very important to California's economy.
- The legislators go to the head of an important department and say we are getting ready to work on your department's budget for next year and we have a small problem. Some of our friends needs a favor and if you could take care of it, we would be very appreciative. Perhaps your salary will be increased, or maybe your personal travel allowance will be expanded, or maybe your favorite offshore banking account will expand, or maybe your wife's bank account will get larger, your choice.
- The head of the department (who's in on the deal) goes to the employees responsible for making the "exception" happen. He passes around what he judges are best suited rewards for the situation. You can be sure he has a lot of experience doing this and he is very skillful in making sure the "exception" is not too large or blatant, and that each individual involved is happy with his/her reward. He chooses people that know how to "doctor" records to hide what is going on.
- The deal gets done and a few people get richer. And the people of California get poorer."
Bottom Line: Ripoffs in water (and other resources! Oil, anyone?) have happened since Sumerian times. They revolve around the award of valuable "Public" property to a Private individual, who gives a piece of the action to the politician/bureaucrat exercising such "useful discretion."