After reading the California Debt and Investment Advisory Commission’s study (“CDAIC Study”) on Bay Delta Conservation Plan (“BDCP”) financing considerations and risk, State Water Project (“SWP”) contractors and (especially) Central Valley Project (“CVP”) contractors should take a fresh look at the financial realities of relying on the BDCP. Unlike the study’s discussion of BDCP affordability, which was marred by economic flaws, the study offers a useful discussion of financing and risk that water agency board members should consider as part of their fiduciary duty in making BDCP decisions.
What happens when the impossible happens? Does prudence dictate that one revisit expectations? The existing drought in California has understandably distracted the water industry. With multi-billion infrastructure investments on the horizon and the foundation of the California economy hanging in the balance, responsible decision-making must reconsider analyses of California’s water supply availability. Continue reading
In the last week, President Barrack Obama and Jerry Brown have rolled out drought relief packages. Pundits have expressed their opinions both for and against these packages, and they have also used these proposals as a venue to opine on everything from the Bay Delta Conservation Plan to Climate Change. Both packages try to address both short-term and long-term issues related to the drought, but will they be successful towards these goals? In this piece I will address the details of both of these measures and how effective I believe they will be towards curbing the drought that California faces. Let’s start first with the President’s proposal. Continue reading
In a move that seemed to surprise many interested parties, the California State Department of Water Resources (DWR) decided on an initial allocation of 5% of maximum deliveries to the 29 water contractors using the State Water Project. The initial allocation, while not unprecedented (the lowest initial allocation, also at 5% came in 2010 after the three year drought between 2007 and 2009) has raised concerns about long-term water supplies, storage, and a host of other issues. While DWR will likely raise the final allocation above 5%, California still faces tough challenges in managing drought conditions and economic growth in the long term. In this piece, I would like to address some of the reactions to the initial allocation and how California can plan for prolonged drought in the future. Continue reading