Forbes, Nov. 4, 2015
By Chloe Sorvino
For over four years a record-breaking drought has scorched central California with Old Testament cruelty. Drive west of Bakersfield into the heart of the San Joaquin Valley and soon you will be engulfed by sloping brown hills broken up by dusty, slate-colored fields. Desolate little towns off the highway dot the parched landscape. Lost Hills (pop. 2,412) consists largely of a tamale shack, a mostly empty James Dean-themed shop, a dilapidated tire store and a rundown pool hall.
Yet there is an Eden. It’s a little to the west of Lost Hills, off Route 33. Here there are rows upon rows of green–some 70,000 lush acres of water-hungry pistachio and almond trees. Come at the right time of year and you’ll see the almond trees blossoming, covering the valley in a blanket of light pink petals. This land belongs to the billionaire Resnicks, Stewart, 77, and Lynda, 72. It’s the most valuable part of their $4.3 billion fortune. Those crops and the land are worth more than ever before, about $3 billion.
Their oasis has plenty of water, the result of relentless opportunism that has given their orchards access to more water than nearly any other farm during the worst drought on record in California’s history. The Resnicks use at least 120 billion gallons a year, two-thirds on nuts, enough to supply San Francisco’s 852,000 residents for a decade. They own a majority stake in the Kern Water Bank, one of California’s largest underground water storage facilities, which they got fairly but sagely from the government 20 years ago. It is capable of storing 500 billion gallons of water. They have also spent at least $35 million in recent years buying up more water from nearby districts to replenish their supplies.
The Resnicks, who live in a nine-bedroom mansion in Beverly Hills and fly into the valley about once or twice a month, are crafty dealmakers and even finer marketers. In addition to the pistachios and almonds, their company, renamed Wonderful in June, owns 32,000 acres of California citrus, flower-delivery service Teleflora, POM Wonderful pomegranate juice and Fiji Water, which collectively brought in $3.8 billion in sales last year. By their own estimates almost half of American households buy their products.
Not everyone is eager to fill their pantry with a Resnick brand. Agriculture’s king and queen have a history of commandeering natural resources in pursuit of profit, and their actions in Fiji – where they annually fill millions of plastic bottles with water and then ship them thousands of miles across the world while residents haven’t always had access to potable water themselves – have already infuriated environmentalists. Now they are being vilified in California for their water use in the ongoing drought. “Ninety-nine percent of us are being asked to take cuts for the 1%: Stewart Resnick,” says Barbara Barrigan-Parrilla, executive director of Restore the Delta, a Stockton, Calif.-based nonprofit working to protect fisheries and farms in the Sacramento-San Joaquin Delta.
Several anti-Resnick forces allege the couple’s immense water supply is ill gotten. The Kern Water Bank and Westside Mutual Water, a company set up to control the Resnicks’ water, have been sued three times since 2010. The water lawsuits – one reached an interim settlement, one led to environmental review and one is on appeal – have alleged that the Resnicks had no ownership right to the water bank and that the bank is dipping into their neighbors’ water supply.
The Resnicks deny the allegations and say they are legally and morally in the right. “I don’t even know what these are about, because my view is we’re going to win,” says Stewart Resnick. “We’ve been sued over the same thing over and over and continue to win. If I had a son who, God forbid, should go to law school, I would say go into water law. You get one lawsuit that lasts 20 years.” He says that he simply invested in the storage facility at an opportune time and also cites the $25 million the company has spent on irrigation systems that reduce the use of water by dripping it directly on the roots rather than using sprinklers to flood the fields. Even with these water-saving measures, he says, Wonderful expects production of the superthirsty almond trees to drop 20% and pistachios to drop 60% this year. (It takes one gallon to produce just one almond or one pistachio.)