San Diego County Water Authority unanimously approves historic Colorado River deal

Short Title
San Diego County Water Authority unanimously approves historic Colorado River deal
Board of Directors chooses option to receive additional water from canal lining projects
September 25, 2003

In a historic action culminating more than a decade of planning and years of negotiations, the San Diego County Water Authority board of directors today unanimously approved the Quantification Settlement Agreement, an accord that fundamentally changes the way Colorado River water is distributed and used in California.

“The action by the board clears the way for San Diego County to receive new, highly reliable water supplies of nearly 280,000 acre-feet a year for decades to come,” said Bernie Rhinerson, chairman of the Water Authority’s board of directors. “Our $126 billion regional economy and the quality of life of 3 million residents depend upon a reliable water supply.

“These vital new supplies dramatically reshape the county’s water supply portfolio and vastly improve its reliability, not just for today, but for many generations to come,” Rhinerson said.

Before the QSA can be implemented, it must be approved by all four water districts and all documents must be signed no later than October 12. On Tuesday, the Metropolitan Water District of Southern California approved the QSA. On Wednesday, the Coachella Valley Water District approved the agreement. The Imperial Irrigation District is scheduled to consider approval on October 7. Also required before implementation is approval of state legislation that now awaits Governor Gray Davis’ signature.

The QSA quantifies water entitlements, implements long-term water transfer and supply programs and ensures California up to 75 years of stability in its Colorado River water supplies. Importantly for San Diego, the accord clears the way for the annual transfer of up to 200,000 acre-feet of water from the Imperial Irrigation District to the San Diego County Water Authority. The Water Authority board also selected an option that will bring an additional 77,700 acre-feet annually to the San Diego County Water Authority for 110 years through the lining of the All American and Coachella canals.

When the deliveries of the water ramp up, San Diego County will receive 277,700 acre-feet of new water supplies each year.

Under the IID-San Diego County Water Authority water transfer agreement, IID will transfer 200,000 acre-feet of water annually to the Water Authority for up to 75 years. The water transfer ramps up from 10,000 acre-feet in the first year to 200,000 acre-feet annually in year 19 and thereafter. It has an initial term of 45 years and a renewal term of 30 years at the mutual consent of the Water Authority and IID. This represents a new supply of 12.9 million acre-feet of water over the 75-year term of the agreement.

Payments for the transferred water start at $258 per acre-foot and increase each year according to a set price schedule. After the fifth year, either IID or the Water Authority has an option to reset the cost under the price terms of the 1998 IID-Water Authority Agreement. The Water Authority will pay IID upfront payments of $20 million, including $10 million to offset socioeconomic impacts associated with temporary land fallowing. At the end of the fifth year of the agreement, the Water Authority will prepay IID $10 million for future deliveries of water. IID will credit the Water Authority for its upfront payments during years 16-45.

In addition to the Water Authority-IID water transfer, the Water Authority board voted to accept assignment of the Metropolitan Water District’s water rights to 77,700 acre-feet per year for 110 years from projects that will line the All-American and Coachella canals. The project will stop the loss of water that currently occurs through seepage, and that conserved water will go to the Water Authority. This will provide the San Diego region with an additional 8.5 million acre-feet of water over the 110-year life of the agreement. The State Legislature has previously authorized $200 million from the state to help pay for construction of the canal-lining projects. The projects are also eligible for $20 million in Proposition 50 funding.

“The board had the option of accepting or rejecting the canal lining project,” said Maureen Stapleton, Water Authority general manager. “By taking on this responsibility, the board made a visionary decision that secures for this region a major, new, 110-year water supply that is highly reliable, drought-proof and cost competitive.”

The QSA will also provide California a transition period to implement water transfers and supply programs by restoring surplus water available to California under the Colorado River Interim Surplus Guidelines.

California has historically drawn more than its 4.4 million acre-foot basic annual apportionment of Colorado River water. Under the QSA, the agencies will implement a series of core, long-term water transfer and supply agreements that will shift more than 30 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 nearly 13 million acre-feet over the life of the agreement;
  • State-funded lining of the All American and Coachella canals that would provide 77,700 acre-feet annually to the Water Authority for 110 years, for a total of 8.5 million acre-feet;
  • 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;
  • 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 approximately 15 years made available by IID to the state of California, which would resell the water to Metropolitan.

The QSA also commits the state to a restoration path for the environmentally sensitive Salton Sea and provides for full environmental mitigation for the water supply programs it contains.

Funding for restoration of the Salton Sea will be accomplished through a series of transactions. IID will make up to 1.6 million acre-feet of additional conserved water available for sale to the state, which the state will sell to MWD at $250 per acre-foot. The proceeds will be deposited into the Salton Sea Restoration Fund. Further, MWD will pay $20 per acre-foot for any special surplus water it receives into the restoration fund. No further funding obligations or in-kind contributions for restoration will be required of CVWD, IID, MWD or the Water Authority.

IID, CVWD and the Water Authority will pay $163 million in costs to satisfy environmental mitigation requirements of the QSA, from which $30 million will be contributed to the Salton Sea Restoration Fund. The Water Authority’s share of the $163 million is $64 million.

The San Diego County Water Authority is a public agency serving the San Diego region as a wholesale supplier of water from the Colorado River and Northern California. The Water Authority works through its 23 member agencies to provide a safe, reliable water supply to support the region’s $126 billion economy and the quality of life of 3 million residents.

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