Bay Delta Conservation Plan

Economic Benefits and Financing Strategies

September, 2012

ACWA Workshop Bakersfeld

Sacramento-San Joaquin Delta:

California’s Water Epicenter

Past generations invested in a network of dams, aqueducts and pumps to move water around the state

100-year-old man-made levee system is old and fragile Much of the land has subsided below sea level Future sea level rise and changing weather patterns will

put greater pressure on the levees

A Vulnerable & Incomplete System

“Should the Delta levees fail, the consequences are likely to

be sudden and catastrophic for local residents, landowners,

Delta species, and water exporters.”

-Public Policy Institute of California

A retrofit of the existing system that secures it

from risk of flood,

earthquake and sea level rise in the Delta is the most sensible

approach

Southern California Water CommitteeBDCP Public OutreachEconomic Benefits and Financing Strategies Paper (PFM)

Funding Agencies

Castaic Lake Water AgencyCoachella Valley Water DistrictMojave Water AgencyThe Metropolitan Water District of Southern CaliforniaSan Bernardino Valley MWD

BDCP Capital Costs

CVP/ SWP Water Users

Delta Water Conveyance ($12.7 billion)

Mitigation ($300 million)

Investing In The Seismic Retrofit

Project is prudent, affordable & urgently needed Cost of the water conveyance project would be

covered by public water agencies ~$10 billion Project would be financed over many years No state general fund dollars involved

Broader funding sources, including potentially voter approved bonds, would pay for environmental improvements

Economic Benefits of BDCP Economic impacts due to loss of Delta supplies due to

Seismic, Flood, and Sea Level Rise: Estimated 65,000 to 230,000 jobs lost Billions of dollars of economic activity depending on duration

and timingWater supply reliability and water quality improvements

SalinityDrinking Water QualityAvoid regulatory shortages

Job StimulusConstruction of Delta Water Conveyance (129,000 jobs)Ecosystem restoration (40,000 jobs)

“Significant Economic Benefits”

Water Quality Benefits to So. California

SWP salinity averages about 270 mg/L over past 20 years

BDCP conveyance will reduce to about 100 mg/L

Economic Benefits:Long term salinity reductions worth about $200

million per yearDrinking water benefits of lower bromide, THMs,

will result in lower treatment plant capital and operating costs

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BDCP Debt Financing

• PFM traditional revenue bond financing consistent with DWR practices-Capital costs range from $12-$14 billion

• Four bond issues during construction (10-12 years)

• Total Debt Service: $1.1 billion

An Investment Long Overdue

$$$ ¢

Historical Cost Comparisons

0%

2%

4%

6%

8%

10%

12%

14%

16%

CRA SWP BDCP Project

Perc

ent o

f Ass

esse

d V

alue

Historical Cost Comparisons

Historical Cost Comparisons

$-

$50,000,000.00

$100,000,000.00

$150,000,000.00

$200,000,000.00

$250,000,000.00

CRA CVP Hoover Dam

Historical Cost Comparisons

CRA was funded at market interest rates (4-5%) with no grants / subsidies

•

Report Published in March 2012with Fact Sheet and Power Point

Thank you!

www.socalwater.org