Tuesday, March 3, 2015
YOLO COUNTY NEWS
99 CENTS

Interest payments inflate delta plan’s cost

California Capitol Protest

Patricia Burnham, left, of Fair Oaks and Jim Hard, right, of Sacramento, join a Dec. 9 Capitol protest against the plan to build tunnels under the Sacramento-San Joaquin Delta. “I’m an engineer against the tunnels,” Burnham said. Renee C. Byer, The Sacramento Bee/AP photo

By
From page A2 | December 27, 2013 |

SACRAMENTO (AP) — New figures that factor in long-term financing costs have more than doubled the estimated $25 billion price tag for a plan to restore the Sacramento-San Joaquin Delta, a newspaper reported Thursday.

At the heart of the plan unveiled last summer by Gov. Jerry Brown are two underground tunnels that would replace the delta’s current pumping system, which has proven deadly to salmon and other fish and therefore led the federal government to limit its operation. State officials have pegged the cost of building the tunnel and restoring nearby wetlands at $25 billion, making it one of the costliest public works projects in state history.

But when interest payments on bonds to finance the project are factored in, the estimated cost goes up to between $51 billion and $67 billion, the San Jose Mercury News reported.

The figures were presented at a meeting of a Central Valley water district last month, but their accuracy was confirmed by the state Department of Water Resources, according to the newspaper.

“The numbers are big. There is sticker shock,” said Jason Peltier, chief deputy general manager of the Fresno-based Westlands Water District. “We keep going back to our policy people and saying ‘Yes, this is tough to look at, but consider your other scenarios. How much more groundwater can we pump?’ That kind of thing.”

The revised estimates assume it would cost $18 billion to build the diversion tunnels and another $9 million to restore 147,000 acres of wetlands and other habitat. The rest of the price tag would go toward interest on bonds issued for 30 years at a rate of 5 percent and other financing costs.

California voters will be asked in November to approve a bond measure that would pay for part of the project.

Because the Brown administration is proposing to cover more of the delta project through bond borrowing than is typical even for large public works projects, the new numbers could make it harder to win voter support and fuel further criticism of the politically sensitive project.

Proponents say the tunnels would provide a reliable water supply while reducing the mortality of threatened fish, because water would mostly be diverted from the north portion of the delta, where fish would not be sucked into the deadly pumps.

Farmers, landowners and elected officials in the delta have expressed concern about the proposed path of the tunnel and a related reservoir.

Department of Water Resources director Mark Cowin confirmed the estimates were accurate, but said the state expects public water districts that would benefit most from the project to shoulder 70 percent of the costs. Not building the tunnels, he said, could lead to future water shortages.

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Information from: San Jose (Calif.) Mercury News, http://www.mercurynews.com

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