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BREAKING: State Audit Confirms DWR Violated State Contracting Laws when Planning CA WaterFix

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Sacramento, CA – This morning State Auditor Elaine Howle determined that the Department of Water Resources broke state contracting laws when they replaced the program manager for California WaterFix—formerly titled the Bay Delta Conservation Plan (BDCP), and often referred to as the Delta Tunnels project.
 
Howle and staff concluded that due to the size and complexity of the project, the Tunnels’ planning costs alone nearly doubled to date, and resulted in several years of schedule delays.
The report revealed that DWR’s original 2009 cost estimate of $140 million to plan the tunnels project had ballooned to $260 million as of June 2017–with 31 percent of funds coming from the U.S. Bureau of Reclamation, 22 percent from the Metropolitan Water District of Southern California, 12 percent from Kern County Water Authority, and 17 percent from San Luis Delta Mendota Water Authority. DWR only spent 6 percent of its own funding.
 
Moreover, the audit confirms that California WaterFix lacks a financial or economic analysis of its feasibility and that DWR failed to install a governance structure for design and construction of the project, and properly maintain program management documents.
 
A summary of the state audit can be viewed here.
 
The full report be viewed here.
 
Policy Analyst for Restore the Delta, Tim Stroshane said:
“State Auditor Elaine Howle and her crack staff found that DWR mismanaged first the Bay Delta Conservation Plan and more recently the California WaterFix. They failed to foresee the project’s complexity, used sweetheart deals to hire contractors, and failed to apply accountable management practices. Overall, DWR breached the public’s trust in its attempts to plan and implement Governor Jerry Brown’s tunnels vision.”
 
Executive director of Restore the Delta, Barbara Barrigan-Parrilla said:
“Both the state audit and federal audit have confirmed a misuse of taxpayer money and irresponsible financial planning for the Delta Tunnels. With this latest finding from the State Auditor, Westlands Water District’s withdrawal from the project, and Metropolitan Water District’s public staff statements that ‘they won’t have to pay for the tunnels if they don’t take water’ and that ‘the project could now be one or two tunnels,’ California WaterFix is in complete disarray. We cannot see how any public water agency can vote to support any percentage of this project as project planning basics are not in place.
 
“The pressing narrative from project proponents that ‘beneficiaries pay’ no longer carries any weight—both the state and the federal government have acknowledged that not only is there a massive lack of financial transparency clouding the viability of the project, but that the tunnels cannot be built without a significant taxpayer subsidy.”
 
Background:
This audit was made possible through research compiled by Restore the Delta policy analyst Tim Stroshane and by Pacific Advocates’ Patricia Schifferle.
 
On August 10, 2016, the Joint Legislative Audit Committee voted to launch a state audit investigating the funding for the California WaterFix (Delta Tunnels), as requested by Assemblymember Susan Eggman and Senator Lois Wolk.
 
At a State Capitol hearing last year, the legislators said the $17 billion cost, lack of legislative oversight, and murky funding mechanisms all indicated the need for an audit.
 
Just last month, a federal audit completed by the Department of Interior’s Inspector General revealed that the U.S. Government misused $84 million on planning costs for the Delta Tunnels.
 

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For Immediate Release: October 5, 2017
 
Contact:

Nora Kovaleski, 408-806-6470, [email protected]
Barbara Barrigan-Parrilla, Restore the Delta, 209-479-2053, [email protected]
Tim Stroshane, Restore the Delta, 510-847-7556, [email protected]





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