MWD Rejection Threatens Historic Colorado River Accord

Short Title
MWD Rejection Threatens Historic Colorado River Accord
Three other water agencies to pursue deal without MWD
August 21, 2003

The last-minute rejection of a historic Colorado River accord Wednesday by the Metropolitan Water District of Southern California threatens to end hopes for lasting peace and certainty over Colorado River water reliability for millions of Californians and reignite water wars throughout the west, officials from other water agencies said today.

Officials with the Coachella Valley Water District, Imperial Irrigation District and the San Diego County Water Authority – said Thursday that they were evaluating all options available to move forward with a Quantification Settlement Agreement that achieves the conservation and water supply objectives without Metropolitan’s participation.

“Water is too precious to Southern California’s economy to walk away,” said Maureen Stapleton, general manager of the San Diego County Water Authority. “Although Metropolitan apparently doesn’t see value in the deal, everyone else does.”

Stapleton’s comments were echoed by leaders of the Coachella Valley Water District and Imperial Irrigation District.

“Our three agencies have forged a strong relationship dedicated to the proposition that we can all improve our communities’ water reliability through a voluntary, compromise accord that will last generations,” said Steve Robbins, general manager of the Coachella Valley Water District. “Coachella remains committed to the path of lasting peace and greater reliability made possible through an agreement.”

“The people of Imperial Valley want peace and protection of their water rights,” said Lloyd Allen, president of the IID board of directors. “We believe we can still achieve these important goals by working with Coachella and San Diego.

“If Metropolitan wants to be left out in the cold, so be it,” Allen said.

Officials from other Colorado River basin states also expressed outrage and dismay over Metropolitan’s actions.

“Metropolitan’s obsession with protecting its stranglehold over California water supplies will cost urban Southern California tens of millions of acre-feet of reliable water, pit water agency against water agency, and potentially, state against state,” said Pat Mulroy, general manager of the Southern Nevada Water Authority. “That one rogue water agency can utterly upend nearly a decade of work to establish lasting peace and reliability on the Colorado River is beyond comprehension.”



“We have all worked so hard on this agreement and relied upon Metropolitan’s representations that a deal on the Colorado River was in the best interests of Metropolitan,” said Thomas Carr, manager of the Colorado River Branch of the Arizona Department of Water Resources. “The surpluses in the QSA represented a fraction of the water that Metropolitan stood to gain through the QSA. We are profoundly disappointed by Metropolitan’s actions,” Carr said.

Under the deal rejected by Metropolitan, IID offered to make an additional 800,000 acre-feet available (over the first 15 years) to the state at $175 an acre-foot (in 2003 dollars). The state would then sell that water to the San Diego County Water Authority and/or Metropolitan at the IID contract price. The net proceeds – the difference between the $175 and the contract price of $258 – would generate more than $66 million in 2003 dollars.

The deal included an additional offer by IID to provide to the state all Salton Sea mitigation water that would not be needed for the QSA because the Salton Sea restoration would not require that water.

The 800,000 acre-feet of “make-up” water that would have been required under the QSA would be given to the state of California. The state, in turn, would sell that water to Metropolitan. At $258 an acre-foot, the sales would generate $206 million in 2003 dollars to help fund Salton Sea restoration.

The deal also included a provision under which the QSA parties would provide any mitigation funds that are not needed due to a Salton Sea restoration and dedicate the funds to the restoration program.

The estimated amount of saved mitigation funds is approximately $60 million. All totaled, the deal would have provided $332 million in 2003 dollars to help fund the restoration of the Salton Sea.

“Our community is greatly concerned over the future of the Salton Sea,” said Steve Robbins of Coachella. “The water agencies, the state and the environmental community worked very hard to develop an innovative plan that would infuse more than $300 million into the restoration effort. Now that Metropolitan has flatly rejected this deal, Salton Sea Restoration may be seriously delayed.”

On August 12, negotiators for the four water agencies reached agreement on a contribution formula that would have generated $193 million to fund QSA environmental mitigation requirements. IID, the Water Authority and the Coachella Valley Water District agreed to pay $111 million – or nearly 58 percent – of the mitigation expenses. Metropolitan’s negotiators agreed to have Metropolitan pay approximately $82 million, based upon its total Colorado River water use over the next 35 years. Metropolitan retracted its $82 million participation Wednesday.

The $82 million that Metropolitan had previously agreed to pay, would amount to about $3 million per year over the first 35 years.



“Given the millions of acre-feet of water that Metropolitan would receive from the Quantification Settlement Agreement, and given that Metropolitan spends hundreds of millions of dollars for water supplies annually, it is astounding that Metropolitan would walk away from this deal for $3 million,” said John Carter, general counsel of the Imperial Irrigation District.

The deal Metropolitan rejected resolved every issue Metropolitan asserted last May had to be resolved for it to approve the QSA:

  • No Proposition 50 funds would be used;
  • All potential off-ramps that could have caused an early termination of the QSA were eliminated;

  • The agencies were relieved of any potential liability for Salton Sea restoration and for any expenses beyond the $193 million agencies’ contribution;
  • 
All issues with the Department of the Interior – including settlement and dismissal of the IID vs. the United States lawsuit and resolution of the Part 417 process – were resolved;

  • All issues raised by the other six Colorado River basin states were resolved and assurances were made that the Interim Surplus Guidelines would be restored;

  • The deal provided consent of the parties to the Metropolitan Water District to pursue water transfers that extend beyond the term of QSA.

The Quantification Settlement Agreement is a set of water conservation, transfer and supply agreements among California water agencies that would help California reduce its over-reliance on the Colorado River. California has historically drawn more than its 4.4 million acre-foot basic annual apportionment of Colorado River water.



Under the QSA, the agencies would implement eight core, long-term water transfer and supply agreements that would shift nearly 34 million acre-feet from agricultural use to urban use over the life of the agreement:
The Imperial Irrigation District-San Diego County Water Authority water transfer of 200,000 acre-feet per year for up to 75 years, totaling up to 13 million acre-feet over the life of the agreement;
A 15-year extension of the 1988 Imperial Irrigation District-Metropolitan Water District of Southern California water transfer agreement, yielding Metropolitan an additional 110,000 acre-feet annually, for a total of 1.7 million acre-feet;

Water transfers from IID to Coachella Valley Water District of up to 100,000 annually, for a total of 3.2 million acre-feet;

Water transfers from Palo Verde Irrigation District (PVID) to Metropolitan averaging 78,600 acre-feet a year (and up to 110,000 acre-feet annually), for a total of 2.75 million acre-feet, subject to finalization with the PVID farmers;

State-funded lining of the All American and Coachella canals that would provide Metropolitan 77,700 acre-feet annually for 110 years, for a total of 8.5 million acre-feet;

Elimination of Coachella’s call rights on half of Metropolitan’s water from the 1988 IID-MWD water transfer, yielding Metropolitan 30,000 acre-feet a year, for a total of 750,000 acre-feet;

Final resolution of the San Luis Rey Indian Settlement under which the tribes would receive 16,000 acre-feet annually from the All-American and Coachella Canal lining project, for a total of 1.2 million acre-feet;

Reduction in Metropolitan’s obligations to miscellaneous Colorado River rights holders (Present Perfected Rights holders), yielding Metropolitan 14,500 acre-feet annually, for a total of 1.1 million acre-feet.

An additional 1.6 million acre-feet over the first 15 to 20 years were made available to Metropolitan by IID as part of the deal Metropolitan rejected on Wednesday.

In its board resolution Tuesday, Metropolitan stated that “…currently, there is no real surplus of Colorado River water….” Furthermore, Met expects “…none is expected to be available for the foreseeable future.”

“Now that Metropolitan has expressly stated that it is perfectly willing to live with a half-full Colorado River Aqueduct, it must rely on other supplies within California,” said John Carter. “Metropolitan has already demonstrated exactly where they must go to replace these lost Colorado River supplies: the fragile Bay-Delta and the Central Valley.”


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