Nestle has chosen to continue its belated flow studies, and the MCSD was choosing a water committee to study the issue (some charge the committee was being stacked with pro-Nestle members).

And while it’s tempting to credit Nestle’s egress entirely to local activists (Concerned Citizens, McCloud Watershed Council, Protect Our Waters and CalTrout chief among them), the market clearly played a strong hand.

After all, Nestle’s bottled water revenues were down 3% the first half of this year, and it’s clear their “premium” spring water brands took a much bigger hit in favor of their tap-water derived, less-expensive Pure Life brand.

With fuel costs running far higher than when the McCloud project was first conceived, and demand shifting to the “value” priced segment of the market, Nestle’s relocation to Sacramento makes a certain sense – as does their interest in building more, smaller plants.

Which raises the obvious question; had Nestle’s original (and astonishingly lopsided) contract with the MCSD been allowed to stand as negotiated, how many of Nestle’s promised jobs would still be extant in the town of McCloud?

On StopNestleWaters.org, we’ve long questioned Nestle’s promises of jobs to communities; the only real data we’ve seen published suggests the promises aren’t always real.

Nestle may not want to admit it, but they can’t have it both ways; if market conditions truly forced the move to a smaller, differently configured production facility in Sacramento, then it’s not hard to extrapolate to a present where McCloud would have been repayed for its water with an even fewer jobs than promised (many of those jobs of the sub-living wage variety).

It’s entirely likely a Nestle factory in McCloud would be running at a fraction of its built-out capacity – and McCloud would be experiencing yet another resource-extraction related economic bust.

Should the bottled water market continue to nosedive, what of the jobs Nestle dangles in front of other communities?

After all, Cascade Locks seems to believe the jobs provided by the company will save their town – and Sacramento seems willing to give up unlimited municipal water in return for only 40-60 jobs.

But what if those jobs are illusory, especially after three more years of a declining bottled water market?

In an effort to air the “truth” he offered up Nestle Waters CEO Kim Jeffries’ letter, and while I agreed that Jeffries’ letter was true as far as it went, I also said that it was far from the whole truth. My response to the gentlemen’s post is below.

I always get a little nervous when I see the word “truth” in relation to anyone’s press materials.

For what it’s worth, I believe that Mr. Jeffries’ letter is largely true – that fuel costs and changing market conditions made the switch to a Sacramento plant largely seamless.

Still, it’s far from the “whole” truth, and I think asking us to accept it as such is a little disingenuous.

I don’t know which of the theories and speculation surprised you, but I’d guess you’re referring to the “locals send Nestle packing” stories and posts.

You might feel that’s not true, but I think it’s an entirely factual statement to say that Nestle would be pumping, bottling and trucking water out of McCloud right now if a group of committed local residents hadn’t challenged Nestle’s first contract with the McCloud Services District in court.

That same group pointed out that Nestle’s first environmental impact report was entirely bereft of flow studies downstream of the water extraction point, and therefore didn’t measure a key environmental impact at all – which largely forced Nestle to abandon the first (and incomplete) EIR.

This is a simple truth.

I appreciate your willingness to entertain comments on your post, and I recognize I can’t know your perspective on this issue. For example, I can’t know if you experienced this whole process from a distance or from ground zero.

I’ve seen it unfold firsthand, and feel there are several other “truths” at work here that aren’t mentioned in Mr. Jeffries’ letter.

First, it’s true that Nestle is leaving the tiny town of McCloud in a divided, polarized state. It’s a painful thing to see neighbors (and even families) pitted against each other over this issue. Mr. Jeffries won’t refer to it as such in his letter (why would he), but I feel it’s part of a lingering reality about Nestle’s impacts on small, rural communities.

For example, it’s true that Nestle’s own representative repeatedly demonized plant opponents by characterizing them as “wealthy, out-of-town (San Francisco) fly fishermen” or as non-contributing newcomers to the area – terms guaranteed to fire up an “us vs them” mentality in a small community.

It’s also 100% true that Nestle repeatedly maintained they weren’t going to interfere in the local election process (I’m referring to the 2006 elections), but then wrote a check for $2500 to the pro-Nestle slate of candidates the day before the election – in one fell swoop dwarfing the amount of money raised by all other candidates (both pro and con). This largely put the sword to Nestle’s contention that it wasn’t going to “interfere” in the election.

It’s also “true” that Nestle’s legal council did attempt to gain access to the private financial records of opponents of Nestle’s bottling plant (some of whom were friends of mine). We can argue about the “truth” behind Nestle’s motives in that instance, but from here, it looked a lot like legal intimidation.

The above are all verifiable facts, and all led to my decision to found a Web site that attempts to hold Nestle accountable for its actions in small, rural towns.

In the twilight between verifiable “fact” and what is “probably” true lies a whole raft of messiness on both sides. This hasn’t been a pretty process, and while I hold Nestle 100% accountable for a fair amount of unsavory behavior, I also cringed at some of the wilder accusations leveled by opponents.

Nestle’s CEO says the company is leaving because of market conditions and fuel costs. Opponents claim a victory, and suggest Nestle was sent packing by a ragtag group of citizens. And just to muddy things further, I’ve read press releases from national organizations suggesting greater involvement than seemed to be the case.

Where is the truth here?

Like always, the truth lies somewhere in the middle, but I know for a fact that Mr. Jeffries’ letter – likely the product of a gifted PR department – is hardly a complete vision of the truth – especially once you consider the simple fact that a new contract with the town of McCloud had become a very, very uncertain thing.

Did local citizens send Nestle packing? Is the bottled water market taking a plunge (and affecting capacity decisions)? Are transportation costs up? Does Nestle have a long, long ways to go to actually become the “good” neighbor it says it is?

I believe all the above are true.

If anyone has anything add, perhaps you could do so on his blog. After all, I didn’t delve into less “provable” concepts – like McCloud’s becoming a PR nightmare for Nestle, who at one point wanted to know what it would take to make the opposition “stop.”

Again, he created a simple post and seems like a nice guy, so any comments should be respectful. After all, if you worked for Nestle – and found yourself located a continent away from McCloud – your perspective on this would be very different from mine.

I would suggest that the remote perspective is a flawed one, especially if it’s informed largely by Nestle’s own official flow of information, but there it is.

Nestlé Waters North America has decided to withdraw its proposal to build a bottling facility in McCloud.

Ever since Nestle negotiated its rapacious contract with the McCloud Services District in 2003 (largely behind closed doors), then pressured the board to approve it at the end of the first public input meeting, Nestle’s McCloud project has become one of the company’s biggest public relations liabilities.

First there were the string of lawsuits, and as the specifics of the contract came to light, outright indignation at the lopsided nature of the deal.

Here was a predatory multinational preying on a small rural town – as it had in other locations – but this time, not all the local residents were willing to shrug it off and walk away.

Instead, they rallied, formed groups, gained a small amount of financial backing, garnered a significant amount of international media attention, and ultimately forced Nestle to abandon its hugely one-sided contract.

Instead, in 2008, Nestle began the flow monitoring studies it should have begun in 2003, but the process was made redundant when Nestle negotiated a fast-track deal in Sacramento that better reflected the realities of rising fuel costs and pissed-off, distrustful McCloud residents.

Unfortunately for Nestle, the damage was already done to their normally behind-the-scenes work in rural areas; now almost every Nestle extraction or bottling project finds itself opposed by citizens who have learned what Nestle’s truly capable due to their actions in McCloud, Fryeburg, Mecosta, and others.

And yes – due to activists and the informational power of the Internet – Nestle’s been forced to address questions about its predatory behavior in rural areas.

Whether Nestle has turned over a less-predatory leaf in its pursuit of spring water from rural sources remains to be seen, and yes – significant questions about the environmental impacts and privatization of a critical resource are far from answered.

Still, in this one place – in this tiny mountain town – Nestle stumbled badly, tripped up by a small group whose victory will no doubt be noticed by others facing Nestle in their area.

via Nestlé Waters ends pursuit of McCloud facility – Mount Shasta, CA – Mount Shasta Herald.

The movie has already drawn some response from Nestle and the bottled water trade association, and given Nestle’s willingness to (ahem) bend the truth in their video response to the movie Flow, I expect no different here.

From the Mount Shasta Herald:

“In four to six weeks, we will let McCloud know if we will continue with our McCloud plans,” company representative Dave Palais said Monday night, noting that a recent article incorrectly stated that the company would be dropping its McCloud proposal.

Speaking during Monday night’s McCloud Community Services District meeting, Palais told the board that the company would be looking closely at how the Sacramento facility would impact their regional market and ultimately affect their plans to pursue a McCloud water bottling facility. He cited numerous issues as factors that will be explored, including the current lackluster economy and transportation costs.

The timing is more than interesting – announcing they’d be “looking closely” at the effect their own plant will have on another proposed plant seems… well, dumb.

One would assume a mutlinational the size of Nestle would have already have considered the impacts of another plant (I believe the same project manager was responsible for both).

Do we interpret Nestle’s operative’s statement (““In four to six weeks, we will let McCloud know if we will continue with our McCloud plans,”) as “we’re giving you a few weeks to come crawling to us with the deal we want, or we’re leaving”?

Perhaps.

Nestle has used exactly these negotiating tactics with other small towns in other places.

Another subcontext is worth exploring. First Nestle’s bottled water market is shrinking as outlined in this Huffington Post article by Lisa Boyle.

(Amusing note about the HuffPo story – IBWA spokesman Tom Lauria pops up in the comments section (page 2), mouths the bottled water industry line, but never discloses the fact that he’s being paid to shill. Nice work from the man who fronted the Tobacco Institute for nearly a decade.)

Nestle maintains the market will return when the economy does, but that’s guesswork at best, and if it doesn’t, what happens to all the jobs Nestle has promised to rural towns?

Are those towns – many already suffering from the loss of mill/timber jobs – about to experience a second “hard landing” when an industry leaves?

Perhaps it’s time that small communities started focusing on sustainable economic growth solutions instead of looking to heartless corporations in declining to solve their problems.

via Nestlé says it’s reconsidering pursuit of McCloud facility – Mount Shasta, CA – Mount Shasta Herald.

A Paris-based TV crew is in McCloud right now doing a bottled water story, talking to supporters and those who oppose Nestle’s proposed water bottling plant.

Given Nestle’s history in McCloud (secret meetings, divisive statements designed to factionalize the area, etc), even some of Nestle’s supporters are questioning the Swiss multinational’s intent to build here, and international attention probably won’t help.

McCloud – like Fryeburg – has become something of a public relations albatross around Nestle’s neck, and only the prospect of relatively obscene profits can be keeping the company here.

Back in Maine, a Swiss-based film crew made the rounds, but according to local activist Jamilla El-Shafei, Nestle operative Mark DuBois wanted nothing to do with the film crew:

This morning members from SAVE OUR WATER attended a Wells Chamber of Commerce event at 7:00 am called EGGS & ISSUES. This is a monthly breakfast meeting of local business people when the Chamber invites a guest to speak about a pertinent issue.  Today’s presenter was Mark DuBois, the resource manager from  the Nestle label Poland Springs. The tradition at the meeting is to have Q&A after the presentation.

Dubois gave his power point presentation and after his dog& pony show, he said that he would be happy to take questions “outside.” Clearly, with two film crews present he did not want to have to answer any difficult questions. So I went up to him to ask a question  as the camera man followed, and he started moving away from me. Corey Hascall, his pr person (fyi she was my face book friend until I learned that she worked for Nestle’s PR firm–very unethical), blocked the camera with her hands. She positioned herself between DuBois and me.

Then when I got close to DuBois she physically shoved me! She is a big woman and it was quite a push back! It was caught of film by the Swiss Film crew who is in the country making a film about Nestle. However, I managed to follow DuBois out of the door and the film crew followed me. DuBois then walked very fast to his gas sucking, big truck.

Nestle’s tactics remind me of the trend in national political PR, where politicians avoid press conferences, preferring instead to speak in settings where the message can be broadcast without question, and the question that are asked are invariably docile.

That reality is changing fast, and in fact, Nestle’s projects across
the United States are coming under fire from residents are agitating
for more local control (and local benefits) from the extraction of
their resources.

Maine Ordinances

As noted in a recent NPR story, Maine’s small town residents are collecting signatures, forcing special town meetings and saying “yes” to ordinances which retain local control of water:

The Alliance For Democracy – Wells, Maine, residents vote this weekend on local versus corporate power

In a recent story on the Maine Public Broadcasting Network, Defending Water for Life organizer Emily Posner defended the ordinance and the thinking behind it: “This type of approach is reflective of a paradigm change that’s happening in our society and our culture around how we want to interface with the economy and the environment and the future,” she said. “We’re seeing people moving away from big box stores and trying to revitalize their local economy, and this is a similar type of approach that’s happening through the political sphere, where we’re trying to re-localize our political infastructure so that we as communities have the right to decide what will actually happen within our town borders.”

Nestle tries to pretend it’s a “local” company by offering up a refrain of “we’re Poland Spring – a local company,” others have noted that Poland Spring isn’t even a corporation in the state of Maine.

Chaffee County’s Sustainability Group

In Chaffee County (CO), Nestle’s water extraction project – which initially promised nothing more to the community than free bottled water to the school – is now facing determined opposition, and to avoid an embarrassing (and precedent-setting) defeat in their first attempt at an extraction project in Colorado, Nestle’s whipping out the checkbook.

Still smarting from a embarrassing series of “errors” in their 1041 application which grossly overstated the economic benefits to the area, Nestle’s also being confronted by a Chaffee County Sustainability Group, who realize that Nestle’s tapping an important resource, delivers few benefits, and could likely harm the formation of local, sustainable businesses.

Suddenly, the “we’ll do what we please” multinational is making noises about a community endowment and announcing local construction contracts right before meetings, and even if Chaffee County’s residents lose the fight against Nestle’s water extraction project, it’s interesting to note how far Nestle’s willing to go (or needs to) just to stay in the ballgame.

McCloud’s Local First Group

Meanwhile, the long-suffering former timber town of McCloud (CA) is still being intentionally factionalized by Nestle’s attempts to build a water bottling plant there, and in fact, Nestle’s operative Dave Palais marginalized opposition at a nearby Rotary Club meeting by saying “There is a small group that is opposed to the project and many are from out of town.”

The “wealthy San Francisco fly fishermen” refrain has been trotted out numerous times by Nestle’s operative, and it’s a pattern that repeats itself often enough elsewhere (including Maine) that it must be simply considered a divisive part of the Nestle playbook.

Belying that claim is the recent formation of a McCloud Local First group whose goal is:

The McCloud Local First Network is dedicated to strengthening McCloud and the local economy by promoting, preserving, and protecting local, independently owned businesses.

We’d humbly suggest that’s not the manifesto you’d expect from a bunch of “wealthy” out-of-towners.

Sustainable Use of Local Resources

While Nestle’s water bottling operations are under assault on both the economic and environmental fronts, it’s likely their biggest fear is playing out right before their eyes: We’re seeing the formation of local citizens groups dedicated to the development of sustainable businesses.

Multinationals which tap local resources (essentially for free) and send all the profits overseas aren’t exactly a part of that picture, and we can expect Nestle to deny that reality with a wave of PR-driven “community” projects.

Those, sadly, will not alter the fundamentally unsustainable nature of Nestle’s water bottling business (extract, truck, bottle, truck, truck, sell, throw away) – nor the multinationals impacts on local communities.

nestle, nestle water of north america, bottled water, mccloud local first, salida, chaffee county sustainability group

It’s a step forward in terms of talking to the community, though we can’t escape the knowledge that their newfound concern for the residents of McCloud came only after their first (and largely rapacious) contract with the town went belly up.

Today’s PR effort? Here’s an excerpt from the Mount Shasta Herald:

“Protecting the water resources in McCloud is a priority for our company and the community and these studies will provide valuable and reliable information to use in evaluating our project and managing water resources for the long-term,” added Palais.

Does Nestle assume we’re so memory challenged that we’ll forget these studies were forced on them through the adroit work of the McCloud Watershed Council, CalTrout & Trout Unlimited?

You don’t have to be a detective to realize that Nestle originally pursued their contract with the town without conducting a single flow monitoring study. Not one.

As we’re seeing in Chaffee County (CO), Nestle’s “concern” for a community’s resources seemingly only appears after they’ve suffered a setback.

In McCloud, they’re finally being forced to do the studies they should have done initially.

In Chaffee County, they’re whipping out their checkbook and suddenly promising the community a $500,000 endowment (though initially with some ominous strings attached).

Initially, they only promised to support the community with free cases of bottled water (giving them their own water??), but after their highly inflated claims of economic benefit to the community were exposed – and began to threaten their water extraction project – they suddenly grew more “concerned” for the area’s economic well being.

This leaves us with two inescapable conclusions:

1. It’s difficult to trust Nestle Waters of North America, who are seemingly a lot better at PR spin than they are real concern for rural towns and water resources
2. The first offer from the company is probably a sucker deal

It also leads us to wonder if the McCloud Services District – if they deal with Nestle at all – should negotiate a similar endowment for the town?

nestle, nestle waters of north america, bottled water, mccloud, chaffee county, water extraction, rural economic development

Rather than waltz in, threaten a few jobs, and then misdirect the conversation towards the evils of sugary drinks, Challinor’s been running into opinion articles like this:

TheSpec.com – Opinions – Nestle protests bottled-water ban

Councillors were unanimous in their enthusiasm for a ban once problems are resolved, and asked staff for a report by fall on how to do it. Some asked, why go after water bottles only? Why not plastic pop and juice bottles? Staff replied, “You can’t turn on a tap and get orange juice or pop. It’s a beginning.”

Less enthusiastic — downright opposed, actually — was former Milton councillor John Challinor, now Nestle Waters Canada’s PR man, who has been travelling the country trying to allay ever-mounting municipal concern. He raised the health and safety issue of disallowing police, fire, and ambulance personnel the use of bottled water. Drinking fountains and refillable bottles aren’t practical or sanitary, he said, and referred to the committee’s stance as “nothing more than greenwashing, environmental symbolism, and bad public policy.” (Nestle’s PTTW cost $3,000 for processing fee, and $3.71 per MILLION litres extracted.)

Challinor said most Canadians would take a dim view in these hard economic times of impacting on industry employees “for no good reason.”

Let’s cite some. How about millions of litres of groundwater pumped from underground aquifers, interfering with groundwater flow. How about huge costs, and greenhouse gas emissions, of producing and shipping to distant store shelves — I’ve seen Ontario water in Arizona.

Councillor Rick Craven cited a figure of 250 times the energy to produce bottled water over municipal water, and Peter Thoem thought staff was being too timid in its recommendation.

It goes on, but suffice it to say that Nestle has suffered significant reversals in Canada, and while they like to pretend that such setbacks are minor, the cumulative effect is becoming significant.

nestle, nestle waters canada, john challinor, bottled water ban

So far, the NHC has been more talking point than successful venture; in 2008, sales of water fell dramatically (via Marketing Magazine UK):

The NHC was set up by Nestle Waters, Danone Waters and Highland Spring last September to protect the declining bottled-water sector.

Last year sales fell by 9%, with Danone’s Evian and Volvic posting drops of 7% and 13% respectively. Nestle Waters’ Vittel recorded a 55% fall in sales, according to Nielsen.

What happens to those rural jobs when sales decline in similar fashion here?

nestle, nestle waters, natural hydration council, bottled water