California’s New Localized Water Controls a Step Forward

With higher levels of rain and snowfall over the winter, California’s water situation has eased in some areas, prompting the state to initiate new water conservation rules, adopted on May 18 and in effect June 1 through January 2017. The regulations give control over water usage to local communities, which means more restrictions in some areas than in others. In Northern California, winter precipitation has filled some reservoirs, while drought conditions persist in Southern California.

The previous rule—enacted in April 2015 by Gov. Jerry Brown, who issued an Executive Order mandating a 25% reduction of urban water usage from 2013 levels over a nine-month period—saw a savings of about 424 billion gallons. That followed a failed year-long effort to achieve a voluntary 20% reduction in water usage, with statewide conservation results averaging between just 7% and 12%.

The State Water Resources Control Board explained that the new approach replaces the percentage reduction-based water conservation standard with a localized approach. The emergency regulation requires that urban water suppliers ensure that at least a three year supply of water would be available to their customers in case of drought conditions. Suppliers that would face shortages under three additional dry years are now required to meet a conservation standard equal to the amount of a shortage. A water agency that projects it would have a 10% supply shortfall, for example, would have a mandatory conservation standard of 10%. The regulation also makes previously passed water-wasting rules permanent, including no hosing of sidewalks, washing cars without a hose nozzle, or watering lawns within 48 hours of measurable rainfall.

“El Nino didn’t save us, but this winter gave us some relief,” Water Board Chair Felicia Marcus said in a statement. “It’s a reprieve though, not a hall pass, for much if not all of California. We need to keep conserving, and work on more efficient practices, like keeping lawns on a water diet or transitioning away from them. We don’t want to cry wolf, but we can’t put our heads in the sand either.”

Will Sarni, director and practice leader of water strategy at Deloitte, agrees with the direction the state is taking on conservation.

While it may appear that restrictions are being eased, which could send the message that things are going back to business as usual, “It’s not business as usual, but local entities are being given more control,” Sarni said. “My view is that water is ultimately a local issue, so providing greater flexibility and decision-making at the local level that aligns with an overall strategy within the state, or nation, makes sense.”

The model of local management actions that roll up to a regional entity have successfully been adopted in other parts of the country, he said, explaining that states do work together. One example is the Delaware River Basin Commission, which is an entity that has a say in how water is managed in the Delaware River. Other examples include the Great Lakes Commission and the Colorado River Compact. “So cooperating on water is actually more common than not,” Sarni said.


Drought 2

October 2015 the Warmest Ever Recorded

It isn’t just your imagination: October 2015 was the warmest on record worldwide, and saw the greatest above-average deviation for any month. According to the National Oceanic and Atmospheric Administration, the average temperature across global land and ocean surfaces was 1.76 °F above the 20th century average, surpassing the previous record set last year by 0.36 °F. The globally-averaged land surface temperature was 2.39°F above the 20th century average—the highest for October in 136 years of NOAA records.

NOAA land and ocean temp percentiles

October was also the warmest month ever compared to average, out of a total of 1,630 months. What’s more, NOAA reports, eight of the first 10 months of the year have been record warm for their respective months—also a record number of broken records. Globally-averaged land surface and sea surface temperatures have been 1.55 °F and 2.30 °F above average, respectively, surpassing all previous records. With many months setting record high temperatures by unprecedented margins, NOAA said in August that there was a 97% chance that 2015 would secure the title of the warmest year on record, and it remains solidly on track.

In early November, the Met Office, Britain’s national weather service, and NASA both reported that the Earth’s average temperature is likely to rise 1 °C above pre-industrial levels for the first time by the end of 2015. This milestone is significant since it marks the halfway point to two degrees Celsius, the internationally accepted limit for avoiding the worst consequences of climate change, the Washington Post reported. Since 2000, global monthly heat records have been broken 32 times, yet the last time a monthly cold record was set was in 1916, according to CBS News.

Some of the heat is likely due to a strong El Nino event in the Eastern Pacific that continues to gather strength. This year’s El Nino is already one of the three strongest ever seen, CNN reports, but cannot account for all of the year’s warmth, as 13 of the 15 warmest years on record have occurred since 2000. Rather, it is the combination of long-term warming and the strong El Nino pushing Earth toward its second consecutive warmest year on record.

According to Aon Benfield’s October 2015 Catastrophe Report, there were three billion-dollar weather-related disasters in October: flooding in South Carolina with economic losses of at least $2 billion, $4.2 billion in damage from Typhoon Mujigae in China, and $1 billion in damage from flash flooding in France. The firm estimates worldwide economic losses from October to total more than $10 billion. There have been 21 billion-dollar weather events through October 2015, Aon reported, on pace for a lower total than the annual average of 28.

Check out the infographic below for more of the major climate anomalies and events from October 2015:

NOAA october climate anomalies

Risk Link Roundup

Here are a few articles that caught my attention during the past week highlighting some interesting issues impacting the world of risk and insurance. They include tips on handling cyber disputes, news about the coming El Niño, Department of Labor remote work policies, how students at Butler University are establishing a captive insurer and an interesting look at potential FCPA lessons learned from the July death of Cecil the Lion.

5 Tips for Success in Cyber Litigation

Insurance Thought Leadership: Many insurance coverage disputes can be, should be and are settled without the need for litigation and its attendant costs and distractions. However, some disputes cannot be settled, and organizations are compelled to resort to courts or other tribunals to obtain the coverage they paid for, or, with increasing frequency, they are pulled into proceedings by insurers seeking to preemptively avoid coverage. – See more at:

El Niño and La Niña: Weather Patterns that Could Impact Your Business

Interstate Restoration: “…the Godzilla El Niño.”“All Signs Indicate a New Monster El Niño is Coming.” These quotes aren’t from a new action movie. They are just a couple of examples of the dramatic headlines and descriptions about the potential of this year’s El Niño. Since most of the stories hearken back to the El Niño of 1997 – 98—the strongest on record—it’s understandable if you’re concerned about the potential impact that of this year’s El Niño on your business. But depending on where you’re located, you may or may not need to worry.

DOL Forcing Everyone to Change Remote Work Policies: Pitfalls to Avoid

HR Morning: If the DOL’s new overtime regs go through as written — and there’s every indication to believe they will — employers of all stripes will have much more than just classification issues to contend with.

Grant Helps Butler Create Student-Run Insurance Company

Butler University Newsroom: The Butler University College of Business will establish a student-run insurance company with the goal of having the company fully operational by the 2019–2020 academic year, thanks to a $250,000 gift from MJ Insurance and Michael M. Bill.

On the Death of Cecil the Lion and the FCPA

Compliance Week: Cecil the Lion was shot and killed in July. What does the death of this well-known and well-beloved lion in Zimbabwe have to do with the Foreign Corrupt Practices Act? More importantly, what are the lessons to be learned by any chief compliance officer or compliance professional from this event? Much more than you would first think, actually.

NOAA Releases 2014 Hurricane Season Outlook

hurricane season

In a press conference this morning, the Climate Prediction Center of the National Oceanic and Atmospheric Administration (NOAA) released its official 2014 outlook for the Atlantic and Eastern Pacific hurricane seasons.

The East Coast may see below-average activity this year, thanks, in part, to the anticipated development of El Nino this summer. According to NOAA, “El Niño causes stronger wind shear, which reduces the number and intensity of tropical storms and hurricanes. El Niño can also strengthen the trade winds and increase the atmospheric stability across the tropical Atlantic, making it more difficult for cloud systems coming off of Africa to intensify into tropical storms.”

There is a 50% chance for a below-average season, a 40% chance of a near-normal season, and only a 10% chance of an above-average season, the center predicts. “For the six-month hurricane season, which begins June 1, NOAA predicts a 70 percent likelihood of 8 to 13 named storms (winds of 39 mph or higher), of which three to six could become hurricanes (winds of 74 mph or higher), including one to two major hurricanes (Category 3, 4 or 5; winds of 111 mph or higher),” they announced.

2014 Atlantic Hurricane OutlookBut the forecast is no reason to take preparations lightly. “Thanks to the environmental intelligence from NOAA’s network of earth observations, our scientists and meteorologists can provide life-saving products like our new storm surge threat map and our hurricane forecasts,” said Kathryn Sullivan, Ph.D., NOAA administrator. “And even though we expect El Niño to suppress the number of storms this season, it’s important to remember it takes only one land-falling storm to cause a disaster.”

On the West Coast, it may be a more tumultuous summer. The outlook calls for a 50% chance of an above-normal season, a 40% chance of a near-normal season, and a 10% chance of a below-normal season. The center predicts there is a 70% chance of 14 to 20 named storms, which includes 7 to 11 hurricanes, of which 3 to 6 are expected to become major hurricanes (Category 3, 4 or 5 on the Saffir-Simpson Hurricane Wind Scale).

“The key climate factor behind the outlook is the likely development of El Niño this summer. El Niño decreases the vertical wind shear over the eastern tropical Pacific, favoring more and stronger tropical storms and hurricanes,” said Gerry Bell, Ph.D., lead seasonal hurricane forecaster with NOAA’s Climate Prediction Center. “The eastern Pacific has been in an era of low activity for hurricanes since 1995, but this pattern will be offset in 2014 by the impacts of El Niño.”

Next week (May 25-31) is National Hurricane Preparedness Week, and NOAA and FEMA will be offering additional tips and insight on their websites ahead of the official start of hurricane season on June 1.