By Brett Stroud
In September 2026, the California State Water Resources Control Board (State Water Board) will consider adopting a new fee under the Sustainable Groundwater Management Act (SGMA). The fee would apply to Groundwater Sustainability Agencies (GSAs) in probationary groundwater basins that ask the State Water Board to consider whether their updated plan adequately manages their portion of the basin and, therefore, whether their landowners should be exempted from probationary fees.
Background: Probation and Exclusion Requests
Under SGMA, when the State Water Board designates a groundwater basin as “probationary,” all groundwater pumpers in the basin become subject to registration and reporting requirements as well as a volumetric fee on groundwater pumping—intended to fund the cost of the State Water Board’s administration of the probationary basin. In addition, the State Water Board can prepare an interim plan to manage the basin until GSAs establish adequate plans.
However, the State Water Board has the authority to exempt pumpers from these requirements and fees if their extractions “are subject to a local plan or program that adequately manages groundwater within the portion of the basin to which that plan or program applies.” (Wat. Code, § 10735.2, subd. (c)(1).) Some colloquially refer to this as the “good actor” or “good guy” exemption or exclusion. Many GSAs in the two probationary basins have indicated that they believe modifications made to their plans since the probationary hearing justify their receiving this exemption and have requested that the State Water Board reconsider granting those exemptions.
Proposed Fee Structure
The State Water Board staff has proposed that the board impose an application fee for seeking a “good actor” exemption. Several GSAs in the probationary basins have made multiple applications in the past, and State Water Board staff says reviewing those requests is very time-consuming. Therefore, they have proposed a fee that would range from $50,000 to $250,000 for each application, depending on the “groundwater usage tier” of the GSA. The proposal has been discussed at workshops and stakeholder meetings, and it is currently expected to go before the State Water Board for potential adoption on September 15, 2026.
GSA managers in the probationary basins argue that the fee creates the wrong incentives by continuing to penalize landowners in GSAs that are doing the necessary work to manage their portion of the basin. They have also raised questions about the other SGMA fees imposed by the State Water Board and how those funds are being used.
Conclusion and Implications
Joaquin Esquivel, the chairman of the State Water Board, has previously commented at a public meeting that the pursuit of the “good actor” exemption is often a “distraction” from the goal of improving GSPs and getting out of probation. However, as the State Water Board staff prepare interim plans for the probationary basins, many GSAs are likely to want their exemption request considered if they believe that they have made the necessary changes to their plan—even if the other GSAs in the basin have not. If the State Water Board adopts this fee, it will certainly affect the cost-benefit analysis of an application. But it might not actually deter GSAs from applying.
Editors Note: The author represents clients in both of the current probationary basins, including a GSA in the Tulare Lake Subbasin and a water district in the Tule Subbasin.
![Federal District Court Denies Preliminary Injunction Over Shasta Dam Operations, Upholding U.S. Bureau of Reclamation’s Water PlanThe U.S. District Court for the Eastern District of California denied three environmental organizations’ request for a preliminary injunction requiring the U.S. Bureau of Reclamation (Reclamation) to modify its 2026 operations of Shasta Dam and Reservoir. The court classified the requested relief as a mandatory injunction and concluded that the plaintiffs failed to satisfy the heightened standard applicable to such relief. [San Francisco Baykeeper v. U.S. Bureau of Reclamation, ___F.Supp.4th___, Case No. 2:26-cv-00671-JLT-EPG (E.D. Cal. Aug. 3, 2026).] Background On March 2, 2026, San Francisco Baykeeper, the Center for Biological Diversity, and Friends of the River filed suit against Reclamation, the National Marine Fisheries Service, and several federal officials. The broader lawsuit alleges that the federal defendants violated the federal Endangered Species Act and Administrative Procedure Act in connection with Reclamation’s operation of the Central Valley Project. Among other allegations, the plaintiffs contend that Reclamation failed to comply with protective measures and incidental-take limits established by the National Marine Fisheries Service’s (NMFS’s) 2024 Biological Opinion (BiOp) for winter-run chinook salmon, Central Valley steelhead, and North American green sturgeon. The preliminary-injunction motion addressed a narrower issue: Reclamation’s operation of Shasta Dam and Reservoir during the summer and early fall of 2026. Keswick Dam prevents winter-run chinook salmon from reaching their historic upstream spawning habitat. Consequently, the survival of eggs deposited downstream depends substantially on Reclamation’s release of sufficiently cold water from Shasta Reservoir. The 2024 BiOp established a “Shasta Framework” for managing water temperature and reservoir storage while accounting for fish protection, water-delivery obligations, flood control, and other authorized project purposes. In the framework, Reclamation designated 2026 as a “Bin 2A” year based on projected end-of-April and end-of-September reservoir storage. The plaintiffs argued that the high end-of-April storage level required Reclamation to treat 2026 as a more protective Bin 1 year and preserve at least 2.4 million acre-feet of water through September unless achieving that target was impossible. Reclamation responded that the framework uses both April storage and projected September storage to make the initial classification and that the forecasts therefore supported its Bin 2A designation. The plaintiffs sued Reclamation under sections 7 and 9 of the Endangered Species Act and the Administrative Procedure Act, alleging that Reclamation was operating outside the 2024 biological opinion’s Shasta Framework. The plaintiffs then sought emergency relief requiring Reclamation to reduce releases from Shasta Reservoir, prepare a new operating plan, and operate consistently with the plaintiffs’ interpretation of the Bin 1 requirements. The court denied the plaintiffs’ request for a temporary restraining order on July 9, 2026, and subsequently denied their motion for a preliminary injunction. The District Court’s Ruling Although the order is not a final ruling on the merits, it indicates that the court views Reclamation’s interpretation of the Shasta Framework as better supported by the governing documents. The court expressly stated that the plaintiffs did not appear likely to succeed on the claim advanced in the motion and failed to make the stronger showing required for a mandatory injunction. In its ruling, the District Court first rejected the plaintiffs’ argument that the requested injunction would merely preserve the status quo. The proposed relief would have required Reclamation to conduct new modeling, prepare and implement a new temperature-management plan, and materially change its reservoir operations. Because the requested order would compel affirmative action, the court treated it as a mandatory injunction. The plaintiffs therefore had to demonstrate that the law and facts clearly favored their position, not merely that they were likely to prevail. Second, the court found Reclamation’s interpretation of the 2024 BiOp more persuasive. Although language in Table 25 of the BiOp supported the plaintiffs’ position, the court concluded that the underlying Proposed Action, decision tree, and operational modeling supported using both projected April and September storage to determine the applicable Bin. The court suggested that Table 25 may have inaccurately summarized the end-of-April storage ranges described in the Proposed Action. The court used the interpretive framework from Kisor v. Wilkie as guidance but did not ultimately rely on agency deference. The Court directly addressed the interpretations of the BiOp, and underlying data to support and, in doing so, made clear that the decision was not based on any level of agency-deference but, instead, based on a finding that Reclamation’s position was more factually supported and, therefore, did not assess questions of deference. Conclusion and Implications The ruling leaves Reclamation’s 2026 Shasta operations unchanged by the requested federal injunction. It does not, however, finally approve those operations or resolve the plaintiffs’ broader allegations concerning incidental take, reinitiation of ESA consultation, or the validity and application of the 2024 BiOp. Legally, the decision underscores the high threshold plaintiffs face when seeking mandatory injunction against federal agency operations, particularly when relying on narrow claims regarding BiOp framework, and addresses the importance of a fact-based assessment, while declining to address to questions of agency deference. The court’s order is available here: https://www.courthousenews.com/wp-content/uploads/2026/08/baykeeper-injuction-denied-ruling.pdf (Stephanie Cook, Miles Krieger)](https://argentco.com/wp-content/uploads/2019/09/ARTICLES-Land_Fog-230x100.jpg "Federal District Court Denies Preliminary Injunction Over Shasta Dam Operations, Upholding U.S. Bureau of Reclamation’s Water PlanThe U.S. District Court for the Eastern District of California denied three environmental organizations’ request for a preliminary injunction requiring the U.S. Bureau of Reclamation (Reclamation) to modify its 2026 operations of Shasta Dam and Reservoir. The court classified the requested relief as a mandatory injunction and concluded that the plaintiffs failed to satisfy the heightened standard applicable to such relief. [San Francisco Baykeeper v. U.S. Bureau of Reclamation, ___F.Supp.4th___, Case No. 2:26-cv-00671-JLT-EPG (E.D. Cal. Aug. 3, 2026).] Background On March 2, 2026, San Francisco Baykeeper, the Center for Biological Diversity, and Friends of the River filed suit against Reclamation, the National Marine Fisheries Service, and several federal officials. The broader lawsuit alleges that the federal defendants violated the federal Endangered Species Act and Administrative Procedure Act in connection with Reclamation’s operation of the Central Valley Project. Among other allegations, the plaintiffs contend that Reclamation failed to comply with protective measures and incidental-take limits established by the National Marine Fisheries Service’s (NMFS’s) 2024 Biological Opinion (BiOp) for winter-run chinook salmon, Central Valley steelhead, and North American green sturgeon. The preliminary-injunction motion addressed a narrower issue: Reclamation’s operation of Shasta Dam and Reservoir during the summer and early fall of 2026. Keswick Dam prevents winter-run chinook salmon from reaching their historic upstream spawning habitat. Consequently, the survival of eggs deposited downstream depends substantially on Reclamation’s release of sufficiently cold water from Shasta Reservoir. The 2024 BiOp established a “Shasta Framework” for managing water temperature and reservoir storage while accounting for fish protection, water-delivery obligations, flood control, and other authorized project purposes. In the framework, Reclamation designated 2026 as a “Bin 2A” year based on projected end-of-April and end-of-September reservoir storage. The plaintiffs argued that the high end-of-April storage level required Reclamation to treat 2026 as a more protective Bin 1 year and preserve at least 2.4 million acre-feet of water through September unless achieving that target was impossible. Reclamation responded that the framework uses both April storage and projected September storage to make the initial classification and that the forecasts therefore supported its Bin 2A designation. The plaintiffs sued Reclamation under sections 7 and 9 of the Endangered Species Act and the Administrative Procedure Act, alleging that Reclamation was operating outside the 2024 biological opinion’s Shasta Framework. The plaintiffs then sought emergency relief requiring Reclamation to reduce releases from Shasta Reservoir, prepare a new operating plan, and operate consistently with the plaintiffs’ interpretation of the Bin 1 requirements. The court denied the plaintiffs’ request for a temporary restraining order on July 9, 2026, and subsequently denied their motion for a preliminary injunction. The District Court’s Ruling Although the order is not a final ruling on the merits, it indicates that the court views Reclamation’s interpretation of the Shasta Framework as better supported by the governing documents. The court expressly stated that the plaintiffs did not appear likely to succeed on the claim advanced in the motion and failed to make the stronger showing required for a mandatory injunction. In its ruling, the District Court first rejected the plaintiffs’ argument that the requested injunction would merely preserve the status quo. The proposed relief would have required Reclamation to conduct new modeling, prepare and implement a new temperature-management plan, and materially change its reservoir operations. Because the requested order would compel affirmative action, the court treated it as a mandatory injunction. The plaintiffs therefore had to demonstrate that the law and facts clearly favored their position, not merely that they were likely to prevail. Second, the court found Reclamation’s interpretation of the 2024 BiOp more persuasive. Although language in Table 25 of the BiOp supported the plaintiffs’ position, the court concluded that the underlying Proposed Action, decision tree, and operational modeling supported using both projected April and September storage to determine the applicable Bin. The court suggested that Table 25 may have inaccurately summarized the end-of-April storage ranges described in the Proposed Action. The court used the interpretive framework from Kisor v. Wilkie as guidance but did not ultimately rely on agency deference. The Court directly addressed the interpretations of the BiOp, and underlying data to support and, in doing so, made clear that the decision was not based on any level of agency-deference but, instead, based on a finding that Reclamation’s position was more factually supported and, therefore, did not assess questions of deference. Conclusion and Implications The ruling leaves Reclamation’s 2026 Shasta operations unchanged by the requested federal injunction. It does not, however, finally approve those operations or resolve the plaintiffs’ broader allegations concerning incidental take, reinitiation of ESA consultation, or the validity and application of the 2024 BiOp. Legally, the decision underscores the high threshold plaintiffs face when seeking mandatory injunction against federal agency operations, particularly when relying on narrow claims regarding BiOp framework, and addresses the importance of a fact-based assessment, while declining to address to questions of agency deference. The court’s order is available here: https://www.courthousenews.com/wp-content/uploads/2026/08/baykeeper-injuction-denied-ruling.pdf (Stephanie Cook, Miles Krieger)")
