Hostage-taking in economic development doesn’t require masks or weapons. It requires a credible litigation threat, an organization with nothing to lose from filing it, and a developer with enough at stake to consider paying to make the threat go away. That is greenmail — and it is operating in Imperial Valley against the two largest economic development opportunities the region has seen in a generation.
The $83 million demand on Controlled Thermal Resources was not an isolated event. According to the IVCM federal lawsuit, the same model was being deployed against the data center — organized CEQA exposure designed to create settlement leverage, coordinated between city officials and a non-profit organization with a documented history of making settlement demands. The mechanism was disrupted by the February 10 Superior Court ruling, which eliminated the CUP theory that would have created the CEQA hook. But the attempt tells you something about the operating environment for large-scale investment in Imperial Valley.
The Cumulative Effect
Individual greenmail events are visible and documentable. Their cumulative effect is harder to see but more consequential: a reputation effect that makes the region a higher-risk, higher-cost location for exactly the kind of investment it needs most.
Site selectors and development finance professionals maintain institutional memory about the regulatory and political environments in regions they evaluate. A region where major projects face coordinated CEQA opposition with documented settlement demands is a region that gets a risk premium in every financial model that evaluates it. That risk premium raises the required return on investment, which raises the cost threshold that projects must clear to get financed, which reduces the number of projects that get built, which reduces the jobs and tax revenue the community receives.
The settlement payments that greenmail extracts are not born by the developers. They are ultimately born by the workers who would have been employed by projects that instead relocated to friendlier jurisdictions, and by the communities that depended on the tax revenue those projects would have generated.
What Breaking the Pattern Requires
Breaking the greenmail pattern requires making the pattern expensive for the organizations that run it. The Desert Sun investigation is part of that — public accountability for documented settlement demands. The IVCM federal lawsuit is part of that — legal accountability for the organizations and officials alleged to have coordinated the campaign. Community pressure — constituents asking their council members and non-profit boards hard questions — is part of that.
None of these mechanisms works quickly. The federal litigation will take years. The reputational consequences of the Desert Sun investigation take time to fully materialize. Community accountability depends on community awareness of facts that are not always surfaced in the same forums as the opposition’s talking points.
But the alternative — accepting greenmail as a feature of Imperial Valley’s development environment — is not sustainable. A region that taxes its own economic development through organized litigation extortion is a region that will eventually stop being a destination for the investment it needs. The time to establish different norms is before that reputation becomes entrenched, not after.
The IVDC as a Test Case
The Imperial Valley Data Center is, among other things, a test case for whether the region’s institutions can resist greenmail when the stakes are high enough. The courts have ruled for the project. The law supports the project. The economic case for the project is overwhelming. The only remaining question is whether the coordinated obstruction campaign can be sustained long enough to outlast the developer’s financing.
The community has an interest in that question’s outcome that extends far beyond this project. What happens to the IVDC tells the next developer evaluating Imperial Valley what the operating environment is. Getting this right matters for every project that comes after it.