Water Authority Defers Three Additional Capital Projects Until July 2014

Short Title
Water Authority Defers Three Additional Capital Projects
Postponement of 14 projects to help moderate rates during next two years

In response to lowered short-term water demand forecasts, the San Diego County Water Authority Board of Directors has deferred three capital projects totaling $68 million until at least July 2014. Thursday’s Board action, combined with 11 projects deferred in January 2011, postpones $150 million in capital expenditures and is projected to reduce wholesale rate increases from capital projects by $17 to $22 per acre-foot during the deferral period.

The action deferred construction of a flow regulatory structure, a pipeline and a control valve facility.  Critical water reliability projects, including the San Vicente Dam Raise, are still moving forward.

The Water Authority plans to evaluate some of the deferred projects to reassess their need, scope and timing. 

Water use in the region has decreased 20 percent since 2007 due to a combination of factors. These include the economy, cooler and wetter conditions over the last 18 months, public response to both voluntary conservation and mandatory water use restrictions and increases in water rates. Current projections indicate water demand will increase gradually over time, though not as much or as quickly as prior estimates expected.

The deferrals are part of a comprehensive effort to manage rising water rates. Other steps the Water Authority is taking include:

  • Reducing Water Authority staff by 12 percent from fiscal year 2008 levels
  • Cutting $6 million from the current two-year operating budget by eliminating, reducing or deferring a range of programs, services, outreach and other costs
  • Reducing the current budget by an additional $1.4 million by not filling vacant positions and deferring equipment replacement purchases

More details on this action can be found at Monthly Board Meeting | San Diego County Water Authority, and clicking on the March 24 board agenda.  The action is under the Administrative and Finance Committee meeting. Information in the January 2011 project deferrals can be found at www.sdcwa.org/news-center/news-releases.