Daunting obstacles remain for Gov. Brown’s ‘WaterFix’

Delta TunnelsJust six weeks ago, Gov. Jerry Brown’s hopes for a huge, difficult legacy project to solidify California’s statewide water distribution system – one funded by water districts, not directly by taxpayers – appeared in bad shape.

Years of lobbying for what the Brown administration dubbed the WaterFix project had produced more indifference and outright opposition than support. The $16.7 billion plan would build two 35-mile-long, 40-foot-high tunnels to take water south from the Sacramento River to the State Water Project pumps in the town of Tracy. The governor argued that this would sharply reduce the intermittent heavy pumping that played havoc with endangered species in the fragile Sacramento-San Joaquin River Delta and would firm up supplies both for Central Valley farmers and the 20 million-plus residents of Southern California.

But in September, the board of the Westlands Water District – which serves 600,000 acres of farmland in King and Fresno counties and is the largest U.S. agricultural district – voted 7-1 against providing about $3 billion for the project. Westlands officials trashed claims made for WaterFix, questioning whether it would actually stabilize the Delta ecosystem and predicting cost overruns.

In November, the Trump administration announced that the federal government would not provide any financial assistance to get the project built. While the Interior Department statement was not unexpected, it contributed to the sense the WaterFix proposal was foundering. By February, Brown administration officials had put the word out they would accept building only one tunnel under the delta and adding a second later.

MWD backed scaled-back project, then changed mind

The death of the original plan appeared confirmed on April 2 when officials with the Metropolitan Water District of Southern California – the giant, politically powerful water wholesaler serving 19 million people – issued a memo expressing support for the one-tunnel option. The rationale: a lack of a consensus for the two-tunnel plan among the water districts south of Sacramento that would need to pay for the project.

But after intense lobbying by the Brown administration, on April 10, the MWD board voted by a 3-to-2 margin to endorse the two-tunnels project and to agree to pay for about two-thirds of the tab – about $10.8 billion. The weighted vote, based on the size of individual agencies, came over the objections of the MWD board’s single largest member, the San Diego County Water Authority.

Momentum continued to build last Wednesday when the board of the Santa Clara Valley Water District – the biggest water agency in Silicon Valley – voted 4-3 to commit its 2 million ratepayers to pay up to $650 million for the project, or nearly 4 percent of the total tab. Santa Clara officials had previously narrowly opposed providing funding.

On Thursday, Brown hailed the decision in a speech to a conference of the Association of California Water Agencies in Sacramento. But the governor also warned that the project still had big obstacles that went beyond getting more water districts to agree to share construction costs. He noted that state and federal regulators still had yet to issue required permits.

On this front, WaterFix may face more skepticism in Brown’s backyard than in Washington. As CalWatchdog reported last year, the Trump administration gave a key senior Interior Department post to Colorado lawyer David Bernhardt, a veteran of California water wars and a critic of the federal government’s traditionally high-profile role in land-use decisions in Western states.

Meanwhile, the California Water Resources Control Board has sided with environmentalists in a long list of previous decisions. In filings with the state board, Restore the Delta and several other environmental groups have challenged the governor’s project on its central claim: that it improves the health of the Delta ecosystem.

Even if the state and federal permits are granted, the tunnels plan still faces hurdles. The Bay Area News Group reportedlast week that more than two dozen state and federal lawsuits had been filed against the project.

This article was originally published by CalWatchdog.com

California On Verge of Second Massive Boondoggle

Gov. Jerry Brown, Anne Gust“I’ll gladly pay you Tuesday for a hamburger today.” That was the catchphrase of J. Wellington Wimpy, simply known as just “Wimpy” on the “Popeye” cartoon show. For good reason, the proprietor of the diner rejected Wimpy’s request because of his reputation for not paying on Tuesday.

The inability to repay one’s debts can come with severe consequences, as anyone who has borrowed money from a loan shark can attest. California, despite record revenue coming into the state treasury, has a real problem with debt. High on that list, of course, is the state’s multi-billion-dollar unfunded liabilities for its pension obligations. But we have a problem with bond debt as well.

State-issued bonds can be a legitimate method to finance public projects that have a long useful life. But key to bond financing is a clear and predictable plan to repay those bonds.

California is now on the verge of adopting a second massive boondoggle plagued with financing issues. We are all familiar with the notorious high-speed rail project that was sold to voters as a safe and economical alternative to air travel between Northern and Southern California. A third of the money was to come from the private sector, a third from the feds and the rest from the sale of Proposition 1A bonds. All three of those revenue sources have disappeared in a puff of smoke and, instead, the HSR project is kept on life support through “cap-and-trade” revenue that didn’t even exist when voters approved the original bond.

The second mega-project destined to adopt the boondoggle label is Gov. Jerry Brown’s “twin tunnels” project, intended to transport water from the Sacramento River to the pumping stations at the south end of the delta. Bear in mind that the project will not provide a new water source but would be built ostensibly for environmental reasons.

However, like the high-speed rail project, the financing for the twin tunnels is illusory. Virtually all the potential major wholesale customers of water from the twin tunnels are highly skeptical of its viability and balk at paying for it. The one exception is the Metropolitan Water District in the greater L.A. area, which is considering the adoption of a plan to finance a scaled-down version of the project — meaning one tunnel instead of two.

To read the entire column, please click here.

This article was originally published by the Orange County Register

State closer to downsizing Delta tunnels project

California officials have moved closer to scaling back the troubled Delta tunnels project, officially notifying potential construction contractors that they’re considering limiting the project to one tunnel.

In a memo to engineering firms and other contract bidders last Friday, the Department of Water Resources said it is considering building the tunnels project in phases, with the first phase consisting of “one main tunnel instead of two.”

Gov. Jerry Brown’s administration has been floating the idea of a downsized tunnels proposal since October, when funding problems became increasingly evident. Major farm irrigator Westlands Water District refused to help pay for the $17.1 billion project. Then the Santa Clara Valley Water District said it would only consider investing in a lower-cost, phased-in project that starts with a single tunnel.

California officials have moved closer to scaling back the troubled Delta tunnels project, officially notifying potential construction contractors that they’re considering limiting the project to one tunnel.

In a memo to engineering firms and other contract bidders last Friday, the Department of Water Resources said it is considering building the tunnels project in phases, with the first phase consisting of “one main tunnel instead of two.”

Gov. Jerry Brown’s administration has been floating the idea of a downsized tunnels proposal since October, when funding problems became increasingly evident. Major farm irrigator Westlands Water District refused to help pay for the $17.1 billion project. Then the Santa Clara Valley Water District said it would only consider investing in a lower-cost, phased-in project that starts with a single tunnel. …

Click here to read the full article from the Sacramento Bee

$17 billion Delta water tunnels project faces critical MWD vote

After 11 years of planning, a massive tunnels project touted as a solution to the state’s vulnerable water supply faces its biggest test  Tuesday.

The 38-member board of the Metropolitan Water District of Southern California — the largest supplier of treated water in the United States delivering water to agencies serving 19 million people — is scheduled to vote on the $17 billion California WaterFix.

Metropolitan’s staff has waged a campaign in favor of the project for years and is recommending its board ratify the environmental review and also pay 26 percent of the cost, amounting to $4.3 billion. MWD’s wholesale water rates charged to 26 Southern California retail water districts and cities would rise 4.5 percent annually during the 18-year construction period, but the agency says WaterFix only accounts for 1 percent of the increase, with inflation accounting for the rest.

Gov. Jerry Brown and the state Department of Water Resources say the project will make water supplies more reliable, stabilize water flow and protect endangered fish species. The project would include installing three intakes north of the Sacramento-San Joaquin Delta and building two, 35-mile concrete diversion tunnels that would move water more efficiently into the State Water Project for cities and the federal Central Valley Project used by farmers. …

Read the full article from the Press-Enterprise

Jerry Brown’s Delta tunnels would triple water rates

Delta TunnelsGov. Jerry Brown’s $17 billion California Delta WaterFix tunnels are in trouble over a threat to triple water costs and a federal probe of $84.8 million in illegal payments.

The board of the Fresno-based Westlands Water District, America’s largest water supplier, voted 7 to 1 on September 19 to pull out their $4.5 billion, 26 percent participation in the $17 billion WaterFix, which planned to build two 40-foot wide tunnels stretching for 35 miles to protect fish and divert water from the Sacramento River to the California aqueducts that service the San Joaquin Valley farmers and Southern California cities.

The move followed a July 17 presentation by Goldman Sachs to the Westlands Water District titled, “California WaterFix Financing Strategies.” Goldman apparently estimated that to finance the project, the average cost of water exports from the Delta could rise by $260 per acre foot by 2033. That is two to three times the price paid to the Bureau of Reclamation this year.

The U.S. Department of Interior Inspector General also issued an audit that found that during the Obama administration, federal Bureau of Reclamation financial assistance agreements with the State of California’s Bay Delta Conservation Plan (BDCP) did not “fully disclose to Congress and other stakeholders the $84.8 million cost of its participation in the BDCP efforts, including its subsidizing of the Federal Central Valley Project (CVP) water contractors’ share of BDCP costs.”

The Inspector General also found the Bureau of Reclamation was never reimbursed for $50 million of advanced payments and improperly paid $34.8 million of the contractors’ costs through June 30, 2016. The IG stated that the Bureau of Reclamation submitted “inaccurate annual Calfed Bay-Delta certified financial reports” and “the actions it took to fund BDCP planning costs were neither transparent nor consistent with the ‘beneficiaries pay’ principle underlying Reclamation Law.”

The IG referred the matter to the “Assistant Secretary for Policy, Management and Budget for resolution,” a step that may lead to a U.S. Justice Department civil or criminal referral.

The Associated Press obtained documents on September 18 that reveal that the legal language governing California’s biggest water project in half a century has been tweaked so that the tunnels are now just an “update,” rather than a new project. That way every one of the 29 water districts that receive water from the existing California State Water Project will be jointly responsible to pay for the tunnels.

A Harris Farms’ Executive Vice President and Westlands board member told AP that there is no guarantee that the project will consistently increase future water supplies and that “obligating hundreds of family farms” to pay for the tunnels doesn’t make economic sense.

The Los Angeles Metropolitan Water District will vote on continuing as a $4 billion WaterFix investor, and the Santa Clara Valley Water District will also vote on its $2 billion participation. It is estimated that the project will cost residential water users about $3 to $4 a month. But that assumes an on-time completion, and that the project performs as advertised.

This article was originally published by Brietbart.com/california

Delta Tunnels Water Plan Builds in Wrong Spot

As reported by the San Jose Mercury News:

A half century after building the largest water-delivery system in America, California officials say they now realize they put their giant straws to capture Delta water in the wrong place.

Last week, state and federal water project operators opened the case to win permission for a fix — construction of three diversion points near Sacramento tied to twin underground tunnels to shunt Delta water for 25 million people throughout the state.

Not surprisingly, the hearing before the state water board rekindled old wounds and produced two sharply different portrayals of what the proposed $17 billion California WaterFix would do for the state’s deeply troubled plumbing system.

Critics in Northern California call the plan a water grab destined to harm the Delta environment, fish and farmers. The 700-square-mile mile region of rivers and sloughs will end up with dirtier, saltier water with more toxic algae, while very little will be done to improve overall water supplies, they say. …

Click here to read the full story

Decision Time for Brown’s Big Water Project

As reported by U.S. New and World Report:

CLARKSBURG, Calif. (AP) — Atop a dirt levee his great-grandfather built in the 1800s to hold back California’s mightiest river, Northern California farmer Russell van Loben Sels looks out over the site of a new water project, one that would be the state’s most ambitious in a half-century.

Promoted by Gov. Jerry Brown, the $15.7 billion project would run giant twin pipes, each four stories high, underground for 35 miles and eventually pull thousands of gallons of water a second from the stretch along the Sacramento River where van Loben Sels farms to cities and farms to the south.

In what all agree will be the decisive year for the project, Brown’s plan — which is facing obstacles to environmental approval in the Sacramento-San Joaquin River Delta and mounting uncertainty over the financing — is splitting farmers and political leaders.

In the delta, a land of tree-lined river banks, pear orchards and Gold Rush-era Victorian homes, signs saying …

Click here to read the full story

Gov. Brown’s Delta tunnel plan draws outrage

Delta TunnelsTo his cherished high-speed rail project, Gov. Jerry Brown can now add his ambitious Delta tunnel project to the list of big plans arousing strong opposition.

Especially in the Delta region itself, public opinion has turned sharply against the scheme, which would cost over $15 billion dollars and reshape the area with massive infrastructure construction. “In recent weeks, opponents protested at the state Capitol and submitted volumes of critical comments to state and federal officials on the environmental impact of the plan,” the Sacramento Bee reported. “A wealthy Stockton-area farmer and food processor, Dean Cortopassi, qualified for the November 2016 ballot a measure that could complicate the project, if not stop it altogether.”

On the other hand, according to the Bee, the upheaval “didn’t appear to tilt controversy surrounding the project beyond its traditional bearings. Delta landowners, Northern Californians and many environmentalists have for years opposed a conveyance, while labor unions and building trades groups that stand to benefit from a project support it.”

But over the course of a public comment period on the proposal, Brown’s plan was subjected to withering criticism from a vocal minority of Californians. “By midday Friday, 2,340 unique letters had been submitted, along with 6,665 form letters and 19,047 letters that were the result of online petitions, a spokeswoman with the California Natural Resources Agency said. That’s in addition to about 2,000 unique letters and 10,000 form letters received last year in response to an earlier version of the tunnels plan,” Recordnet reported.

Big blowback

One such comment came from Rep. John Garamendi, D-Calif., who called the tunnel project a “multi-billion boondoggle,”according to the Appeal Democrat. “If we allow the Delta to be drained by a massive new plumbing system, it will put at risk many Delta jobs and forever change the Delta’s culture and quality of life,” he wrote.

Garamendi’s constituents have largely agreed. “The project to divert some Sacramento River water before it reaches the estuary is controversial, particularly in San Joaquin County and the rest of the Delta,” as Recordnet observed. “Opponents have relentlessly attacked the project from multiple fronts — questioning its economics, warning about its environmental impacts, and predicting hard times ahead for Delta farmers.”

But Brown has stuck to his guns, blasting the negative comments and vowing that the project would make a decisive and urgently needed difference in California’s distribution and consumption of water. “The delta pipeline is essential to […] protecting fish and water quality. Without this fix, San Joaquin farms, Silicon Valley and other vital centers of the California economy will suffer devastating losses in their water supply,” he said in a prepared statement. “Claims to the contrary are false, shameful and do a profound disservice to California’s future.”

Debating democracy

Instead of dissipating the tension, however, Brown’s words have only added to it, helping ensure that the issue will come to a head at the ballot box, when voters weigh in on Cortopassi’s initiative. He and his wife, the Bee noted, “have bankrolled the No Blank Checks Initiative ballot effort, pumping $4 million into the petition drive, consultants and other expenses since March.”

“Under his proposed ballot measure, any revenue bonds for public works involving the state would have to go to a public vote. That would complicate Brown’s planned strategy to pay for the twin tunnels, which rests on water users financing bonds to help fund the $15 billion project.”

As George Skelton suggested at the Los Angeles Times, some skepticism toward the initiative has centered around the potential problems inherent in turning over the fate of all similar large-scale projects to the whims of voters. “But the tunnel project was purposely set up to avoid the electorate. Politicians and their appointees are making all the decisions,” he noted.

Originally published by CalWatchdog.com

Drought: Many point finger of blame at environmentalists

As California’s potent drought inspired soul searching from analysts worried the Golden State can’t grow without water, politicians and officials focused on a more immediate task: laying blame for the problem.

Gov. Jerry Brown has tried to set a philosophical tone, cautioning that “we are embarked upon an experiment that no one has ever tried: 38 million people, with 32 million vehicles, living at the level of comfort that we all strive to attain. This will require adjustment. This will require learning.” But environmentalists have urged him to add water restrictions to California’s big farmers.

At the same time, environmentalism itself has become caught in the political crossfire.

Assigning blame

In recent radio remarks to The Blaze, likely GOP presidential contender Carly Fiorina castigated “liberal environmentalists” for creating a statewide “tragedy.”

“[D]espite the fact that California has suffered from droughts for millennia, liberal environmentalists have prevented the building of a single new reservoir or a single new water conveyance system over decades during a period in which California’s population has doubled,” she said. “There is a man-made lack of water in California — and Washington manages the water for the farmers.”

california drought, Cagle, Feb. 21, 2014Fiorina has not been alone in teeing up environmentalists for criticism over the Golden State’s dire straits. As The Hill noted, “Republicans in California and in Congress have proposed multiple times to beef up the state’s water storage with more dams and reservoirs. Environmentalists have pushed back and questioned the impact that the projects would have on the state’s water needs.”

In a related spat, Republicans at the federal level blamed environmental interests for President Obama’s threatened veto of a bill that would pump water from California’s Delta region into Southern California. The move drew howls from California’s Republican delegation.

When the president ordered Northern California water withheld to protect the tiny Delta smelt, House Majority Leader Kevin McCarthy, R-Calif., called the act a “culmination of failed federal and state policies that have exacerbated the current drought into a man-made water crisis. Sacramento and Washington have chosen to put the well-being of fish above the well-being of people by refusing to capture millions of acre-feet of water during wet years for use during dry years.”

Recently, faced with questioning on the drought, White House press secretary Josh Earnest rebuffed the matter. According to Politico, Earnest “said the Obama administration does not have any policy changes to share, and he listed steps that President Barack Obama has taken to offer relief to the state, such as sending $60 million to California food banks and $15 million for farmers and ranchers.”

“We’re going to continue to be in touch with California,” he concluded.

Fracking fight

At the same time federal water allocation has become a bone of political contention, the role of fracking in water consumption has also come under scrutiny. In furtherance of a law passed last year that requires oil and gas companies to disclose how much water they use, state officials told Reuters that last year that the figure hit some 70 million gallons’ worth.

But rather than bowing to objections from within his own party, Gov. Jerry Brown declined to crack down on the practice.

“Despite pressure from environmentalists, Brown has not called for a halt to fracking in the state, saying it is not a major drain on water supplies. ‘Hydraulic fracturing uses a relatively small amount of water – the equivalent of 514 households annually’ per well, said Steven Bohlen, the state oil and gas supervisor. About 100,000 gallons of water is used on average per well, he said.”

For environmentalists, who have been at odds with fracking for years, both in California and across the country, the drought’s intensity simply supplied yet another reason that the practice should end.