Water Project Funding is as Complex as Water Politics

I was looking for a simple answer to questions about water project funding – it turns out there is no such thing.

Anyone following the proposal for the California Water Fix, originally a $15 billion plan to build two large tunnels to carry fresh water from the Sacramento River under the Delta for statewide distribution, appreciates the complexity of funding water projects even if you could get by the political and environmental issues.

San Benito County Water District has its own funding complexities. Zone 6, covering most of the county population, is subject to a value-based (ad valorem) property tax to help pay for various aspects of the state and local system that services the area.

The tax rate is currently $0.25 per $100 of assessed land value, is independent of water use, and generates about $6 million a year for the water district. Some of the income is being set aside to offset a significant increase in capital repayment requirements coming in 10 years.

The original 1977 ballot measure for one part of the local water service erroneously gave the impression that all the capital costs were only a 40-year obligation. In truth it will most likely be around forever because it also involves a repayment arrangement with the United States Bureau of Reclamation (USBR) for our capital, maintenance and operations share of the major system – the Central Valley Project (CVP) – that feeds the local branch and the cost increases of keeping the system running as it ages.

For example, the Hollister (local) conduit has an impressive 17 miles of pipeline, but the San Felipe Subsystem that feeds it has 150 miles of pipeline and we “own” a share of that as we do the entire CVP.

We don’t “make” much fresh water, we manage it by moving it around, storing and distributing it and that’s an expensive proposition that takes an enormous amount of infrastructure. Another issue is the cost burden of environmental restrictions.

It would take many articles to try and explain the system that the federal, state and local governments have been cobbling together with so many starts and stops conceptually, physically and financially for at least 85 years; even the special laws regarding water are complex.

An interesting place to start is the history of the San Felipe Division, Central Valley Project, through the 1990s that can be found at https://www.usbr.gov/projects/pdf.php?id=106 ; if you thought environmental battles over water are only a recent phenomenon, this will set you straight.

The best way to see the year-over-year overall financial picture is to review the SBC Water District’s Operating Budgets and Comprehensive Annual Financial Reports which can be found at https://www.sbcwd.com/ under Publications – Document Resources.

Marty Richman

Born and raised in Brooklyn, NY, Marty (Martin G.) spent his teen years in northern New Jersey. He served more than 22 years on active military duty, mostly in Europe, and is a retired U.S. Army Chief Warrant Officer 4, Nuclear Weapons Technical Officer. Marty then worked 25 years in various engineering and management positions in the electronics and energetic materials industries supporting the communications, computer, aerospace, defense and automotive sectors. He is a graduate, summa cum laude, from The College of Hard Knocks, among his numerous awards and accomplishments. He was a regular weekly Op/Ed columnist and feature writer for The Hollister Free Lance for seven years and a member of its editorial board for five years. Marty is a frequent commentator and contributor to BenitoLink on a wide variety of local, state, national and international subjects.   Marty was elected to represent the City of Hollister District 4 on the City Council in November, 2018. Marty and his wife, Joyce, have been residents of Hollister since 1996.