CalPERS vineyard venture attacked

A $100 million investment in vineyards by the California Public Employees' Retirement System is sour grapes to environmentalists, who claim the project violates the pension plan's own campaign against global warming.

In partnership with Premier Pacific Vineyards of Napa, the nation's largest public pension plan in 2004 purchased a 20,000-acre tract of forest in the coastal mountains of Sonoma County. The venture wants to clear-cut 2,000 acres to plant premium grapes like the popular pinot noir and then sell the land at a profit to winemakers.

Called Preservation Ranch, it would be the largest conversion of forest to vineyards ever in California, according to the the Department of Forestry and Fire Protection. It also symbolizes a growing consumer thirst for premium wine that has driven recent forest-clearing projects along California's North Coast, where conditions are ideal for wine grapes.

Environmentalists say the project will fragment habitat and contribute to climate change by eliminating coastal forest that could absorb carbon dioxide from the atmosphere.

The spectacular and remote Preservation Ranch property lies near the town of Annapolis and covers much of Sonoma County's northwest corner. It includes sweeping ocean views, forested ridges, deeply shaded river canyons and oak woodlands.

John Holland, president of Friends of the Gualala River, said the project conflicts with CalPERS' oft-stated desire to invest in ways that don't cause climate change or environmental harm.

In March, CalPERS joined a coalition of institutional investors to urge the federal government to adopt mandatory greenhouse gas curbs. It also presses corporations to disclose environmental risks posed by their operations, particularly on climate change.

"Why is CalPERS financing one of the largest deforestation projects in California when it's known that deforestation is one of the leading causes of global warming?" asked Holland. "We condemn Brazil and everyone else for deforestation, but what about our own backyard?"

Developers say revenue from vineyards is the only way to pay for forest restoration on the remainder of the property. The result will benefit the environment in the long run, said Bill Hill, co-chairman of Premier Pacific.

"It is first and foremost a conservation and land reclamation project," Hill said. "The land is in a degraded state. As it stands right now, it is not a good timber resource and it's not a healthy natural property by any means."

According to the company's forestry consultant, Nick Kent, existing forest on the property consists mostly of trees less than 18 inches in diameter and dense undergrowth, the result of at least three heavy logging projects over the past century. The land is also etched by some 300 miles of logging roads, which send tons of eroded soil every year into the Gualala River.

As with all its projects, Cal-PERS is a passive investor in the vineyard partnership, said spokeswoman Pat Macht. She said Premier Pacific has "full discretion" to develop the property as long as its activities fit Cal-PERS' investment strategy.

"CalPERS believes this project is consistent with our investment goals," Macht said of Preservation Ranch, "and in fact, we believe this project will complement good environmental practices, not create further harm."

Premier Pacific is finalizing its development application with Sonoma County, which will require an environmental impact report. An initial 25 acres of grapes already has been planted in an area called Evans Ridge, a former orchard that did not require special permits.

The company acknowledges that clearing 2,000 acres for vineyards will have negative consequences for climate change. But introducing sustainable forestry on 15,000 acres is expected to have long-term benefits by growing more and bigger redwood and pine trees.

Premier Pacific also plans to donate about 2,400 acres for a new wildlife preserve, while 300 acres will be added to Soda Springs Reserve, an existing park.

About the writer:

• The Bee's Matt Weiser can be reached at (916) 321-1264 or mweiser@sacbee.com.