By Tim Stroshane, policy analyst for Restore the Delta
Just how realistic is this Delta Conveyance Project in 2020? Will this star-crossed project be another COVID-19 victim?
The Delta Conveyance Project (DCP) appears to have even less support than former Governor Jerry Brown’s California WaterFix. The Sacramento News & Review reported in recent weeks that Kathryn Mallon, the executive director of both the Delta Conveyance Design and Construction Authority and the Delta Construction Finance Authority, earns twice the salary as Governor Gavin Newsom—and Newsom is earning his (by comparison) with having to prepare a new state budget and oversee the state’s response to the pandemic.
The paper also reported that four state water contractors have written to the governor that they would participate in funding neither the DCP nor Mallon’s two agencies. And only ten of 29 state water contractors, said the paper, are actually paying for ongoing planning efforts for the DCP.
There is indication too that DWR is leading the state of California away from coherent climate change response. Early this month, Karla Nemeth, director of the California Department of Water Resources, told the summer conference of the Association of California Water Agencies, that the Newsom Administration is no longer supporting a climate resilience bond in 2020. Instead, she said, officials are looking at ballot initiatives for later elections. They view Proposition 1 from 2014 as a model for future water bonds; its $7.1 billion “will have leveraged $21 billion in investments in water in California. That math is very important to make our case, not only in the Legislature but to the voting public.”
We do not know yet if this means that the DCP will be included in such future bond issues, but more reservoir funding almost certainly will.
While no figures are available, indications are the DCP is parched of funding. There are the state water contractors openly and tacitly not contributing to DCP planning costs. DWR filed a “validation suit” to obtain a judge’s ruling that bond finance rules passed by statewide voters to fund the original Central Valley Project (which DWR never wound up owning) and the State Water Project facilities in 1960 can be used to fund the DCP—a desperate move if there ever was one. How could the voters in 1933 and 1960 give a state water bureaucracy authority to perpetually finance “modifications” to the water system? At what point is a modification an entirely new project that voters should have a say in approving?
And then there is DWR’s long-time State Water Project financing partner, the Metropolitan Water District of Southern California (MWD). This agency contracts with the State Water Project for delivery to southern California reservoirs and then re-sells the water to retail (local) water districts from Ventura to San Diego counties, and inland to Riverside and San Bernardino counties. MWD also was the major state water contractor funding the California WaterFix, and saw that investment of nearly $100 million go belly-up in May 2019 when Governor Newsom cancelled WaterFix. MWD continues to lead efforts to amend state water contracts to fund, construct, and operate the DCP, but it has other bills to juggle now and a shrinking ratepayer base because of the economic impacts of COVID-19.
With property values and water usage decreasing as southern California’s economy absorbs pandemic public health measures, MWD is seeking a property tax rate suspension this year, with hopes of recouping it in subsequent years to help fund future tunnel efforts. MWD is weighing whether to pay for its local resources program or eliminate it to save about $40 million (which strikes us as a pound-foolish action should MWD do that—Restore the Delta is all about local and regional water self-sufficiency, consistent with the Delta Reform Act’s mandate to reduce Delta reliance for meeting California’s future water needs).
MWD also wants to continue funding its share of the Sites Reservoir Project for a 50,000 acre-feet share of this lake. This boondoggle would place an artificial lake in one of the hottest areas of the Sacramento Valley, foretelling high evaporation rates and release of exceedingly warm water direct to the Delta via the Sacramento River.
Long locked in litigation with its largest member agency, San Diego County Water Authority, MWD is literally paying for overcharges that San Diego fought and defeated in court the last several years. According to Authority Board Chair Jim Madaffer, the final judgment last Friday requires MWD to pay the Authority $44.4 million in damages and interest. San Diego also won an increase in its preferential rights to MWD supplies “by approximately 100,000 acre-feet a year,” Madaffer said in an email announcement.
So MWD and DWR, the DCP’s two biggest funders, are apparently both strapped for funds, and tight-lipped about it. They must continue existing services during the pandemic—we in the public must be able to wash our hands with clean fresh water, and have crops grown with irrigation water that help sustain us. And of course, there are all the unresolved water quantity and quality issues in the Delta that have manifested literally in an explosion of harmful algal blooms that operation of the tunnel will only make worse. The DCP has not offered a plan for water quality mitigation. The DCP, however, survived Newsom’s budget cuts this spring. But there appears to be not-so-much left over for the DCP.