There is a multibillion-dollar hole in the delta tunnels funding plan

By Bettina Boxall, LA Times: The decision by one of the state’s major water players to opt out of California’s $17-billion replumbing project was a surprise to many. The reasons for it were not.

California WaterFix’s financing plans have assumed that the Westlands Water District and other agricultural districts would cover a large funding gap that has hung for years over the proposal to build two massive tunnels under the center of the state’s waterworks.

The Westlands board uttered an emphatic no to that idea last week, voting 7 to 1 not to join a project the district has long supported.

The move by California’s largest irrigation district threw the future of the tunnel proposal into question and placed enormous pressure on proponents to devise another financing plan to lure Westlands back.

It also underscored the degree to which Central Valley growers — who have enjoyed more than half a century of cheap, federally subsidized water deliveries — are loath to jack up their irrigation costs.

Planned for a decade and backed by Gov. Jerry Brown’s administration, WaterFix is intended to halt a decline in southbound deliveries from the Sacramento-San Joaquin Delta east of San Francisco.

From the beginning, planners have said the largely urban customers of the State Water Project and the largely agricultural customers of the federal Central Valley Project that get delta supplies would pay for the tunnels.

But there have always been two exceptions on the CVP side: Wildlife refuges that under the law receive delta deliveries. And a set of irrigation districts — known as the exchange contractors — that hold senior water rights and receive delta water to replace deliveries they lost when the CVP dammed the San Joaquin River in the 1940s.

More than a fifth of the average delta exports go to those two groups, leaving a gaping hole in tunnel funding that a 2015 consultant’s analysis pegged at nearly $4 billion.

The U.S. Reclamation Bureau, which manages the Central Valley Project and delivers water to the refuges and senior contractors, has said it will not cover that tab. Read More Here