You could end up paying for this at tax time. | Photo: Christina Hendricks, some rights reserved
A plan to build two huge tunnels to shunt fresh water around the Sacramento Delta is supposed to be funded entirely by the people who received the water. But taxpayers may end up paying a substantial amount of the tab.
That's according to documents obtained by the Stockton-based environmental group Restore the Delta that discuss the cost of the California WaterFix project, which is projected to cost at least $16 billion to build. According to an unpublished 2015 draft analysis obtained by the group, California WaterFix would require a federal subsidy of nearly $4 billion in order to be cost-effective for agricultural water users.
That runs counter to state promises that the tunnels project would be funded entirely by water users. And even with a federal bailout, most of the project's expenses may end up being paid for primarily by Southern California households.
--
--
I believe that next to Delta people, Southern California people will be the most harmed [by this project], Restore The Delta's executive director Barbara Barrigan-Parrilla told KCET.
California WaterFix's hefty price tag comes as no surprise. The project would involve burying two 30-mile long, 40-foot wide tunnels as much as 150 feet under the Delta, bringing fresh water from intakes near Clarksburg on the Sacramento River to the State Water Project's Banks Pumping Plant near Livermore. There, the water would be pumped into the California Aqueduct for use by farms and cities, most of them in the Central Valley and Southern California.
The tunnels purport to address a significant problem with California's existing water delivery system by bypassing the Delta. At present, the Banks Pumping Plant and its federal counterpart, the Central Valley Project's Jones Pumping Plant, pump water directly from the southern Delta, reversing the flows of some rivers and sloughs, and causing salt water from San Francisco Bay to infiltrate the Delta's freshwater ecosystem.
The revised version of the Peripheral Canal, now an underground project called the California WaterFix, is still on the drawing board.
By shunting Sacramento River water directly to the plants through tunnels instead of through a circuitous network of Delta channels, California WaterFix would, in theory, provide benefits to Delta wildlife and cleaner water for Southern California farms and cities.
But critics charge that the tunnels, capable of diverting the entire flow of the Sacramento in dry years, would provide justification for increased water exports from an ecosystem already reeling from both exports and drought.
And while the state has long pledged that no taxpayer funds would go toward the project's construction costs, the November 2015 cost-benefit analysis obtained by Restore the Delta projects that making water users pay for the whole project could prompt agricultural users to opt out altogether.
The analysis, prepared for the state's Natural Resources Agency by U.C. Berkeley economist David Sunding for the consulting firm the Brattle Group, found that even with a $3.6 billion boost from the federal government or some other source, California WaterFix still didn't make economic sense for agricultural water users. Under the currently negotiated operating criteria, Sunding writes in the report, the WaterFix does not provide benefits in excess of costs for most agricultural water users.
While Sunding did find that the project made economic sense for urban water customers, dissatisfaction from ag water companies could make that a whole lot more complicated. Among the documents Restore the Delta obtained through its Public Records Act request was an April 8, 2016 email from David Sunding to the Hallmark Group, a financial services firm hired to act as program manager for the WaterFix project. In the email, Sunding mentions a draft exit ramp option available to WaterFix customers who choose not to stay with the project, and a discussion of which remaining customers would pick up their financial obligations.
Keeping the California Aqueduct full may not be easy from now on. | Photo: Wikimedia Commons
If disenchanted agricultural water companies merge onto that exit ramp, one company likely to be asked to pick up their share of the expenses is the Metropolitan Water District, the project's largest potential customer. MWD agreed in 2014 to bankroll the project's pre-construction expenses on behalf of other State Water Project customers.
A September 2014 memo detailing a draft agreement between MWD and the California Department of Water Resources (DWR) said that - at least in the draft agreement - MWD would be financing up to $400 million in pre-construction costs by issuing commercial paper, a finance industry term for short-term unsecured promissory notes.
Related
New Sea Level Rise Study Calls Delta Tunnels Into Doubt
You Can Thank Sylvia McLaughlin for a Healthier SF Bay
Californias Passenger Pigeon Wins Protection... For Now
1 of 11
next
And that raises the possibility of another route by which taxpayers might end up footing some of the bill for the project: MWD has the authority to levy property taxes, the proceeds from which the company typically uses to fulfill debt obligations. In the 2014 draft agreement, DWR would collect money from other SWP customers to pay down those companies' share of MWD's debt. But if those companies are unable to pay, MWD property owners could end up shouldering that burden.
Metropolitan water users will pay for the tunnels four ways, Barrigan-Parrilla told KCET. Higher water rates, property taxes, state taxes, and federal taxes.
Unsecured commercial paper is an instrument available only to companies with impeccable credit. That opt
Most recent headlines
06/10/2025
France T l visions, France's leading broadcaster, has received the 2025 EBU ...
04/09/2025
Monumental Sports & Entertainment (MSE), in collaboration with Dalet, has been a...
30/08/2025
WASHINGTON The Federal Communications Commission has adopted its FY 2025 Regulatory Fees Order that establishes the regulatory fee rates for the broadcast stati...
29/08/2025
Australian Red Cross and SBS launch training to help workplaces in the fight aga...
29/08/2025
The National Film and Video Foundation (NFVF), an agency of the Department of Sp...
29/08/2025
L3Harris Technologies has concentrated decades of expertise across the entire enterprise to develop affordable and reliable best-of-breed solutions to rapidly c...
29/08/2025
BURBANK, Calif. The CW Network and the Pac-12 Conference have announced a new media rights deal that will extend their broadcast partnership beginning with the ...
29/08/2025
NEW YORK Gracenote has released a new analysis of its global video dataset showing that the number of FAST channels grew nearly 14% from Q1 2025 and 76% since 2...
29/08/2025
SAN JOSE, Calif. Harmonic has announced a series of improvements to its live sports streaming solution that the company said will improve fan engagement, protec...
29/08/2025
NEW YORK and LOS ANGELES Fox Corp. and YouTube TV last night announced a renewal of the full portfolio of Fox networks, including Fox News Channel, Fox Business...
29/08/2025
Budapest, Hungary, August 2025 - The integration of Microsoft Teams Rooms (MTR) with Lightware's Taurus universal matrix switchers delivers a new level of f...
29/08/2025
Frequency, the engine behind many of the world's best-known streaming television channels, today announced it will launch Studio Live, a next-generation uni...
29/08/2025
In an era when AI and cyber resilience are essential, Scality will mark the 10th anniversary of Scality Day on October 16, 2025 in Paris. This flagship global e...
29/08/2025
Disguise's In-House Creative and Technical Teams Pre-Visualised, Programmed and Delivered Content for the Experience, All Powered by EX 3+
Technology solu...
29/08/2025
Disguise will be demonstrating the latest workflows for TV, film and live events on a number of partner booths at the show
Disguise, the industry-leading tech...
29/08/2025
STOCKHOLM, Sweden Accedo will showcase Accedo Compose, its AI agent-powered modular orchestration layer that assists streaming providers in transitioning client...
29/08/2025
LOS ANGELES Cineverse has announced that it is working with Xperi to bring four of its streaming channels to automobiles for the first time as part of the DTS A...
29/08/2025
DALLAS & ATLANTA Gray Media has announced an agreement with the sports streaming service Victory+ to simulcast 17 Dallas Stars NHL games in 15 television market...
29/08/2025
NEW YORK AND CULVER CITY Comcast NBCUniversal and Amazon have announced new and extended distribution agreements that will expand the content available on their...
29/08/2025
FOOTHILL RANCH, Calif. RED Digital Cinema will feature its Cine-Broadcast Module supporting live broadcast workflows during IBC2025, Sept. 12-15, at the RAI Ams...
29/08/2025
29 Aug 2025
Kyivstar Rings Opening Bell at Nasdaq Marking Landmark Listing and ...
29/08/2025
More than half of all NFL games live on Sky for the first timeFriday 29 August 2025
Sky Sports has announced a new three-year deal with the NFL, extending its ...
29/08/2025
Back to All News
RIV4LRIES: The Trailer of the New Series With Samuele Carrino ...
29/08/2025
Get ready for an inspiring and emotional insight into the world of competitive Irish dancing with My Story: Tomi Champion of the World airing on RT 2 this monda...
29/08/2025
RT has today announced that David McCullagh is to be the new presenter of RT Radio 1's flagship Today programme, which airs every weekday at 10am, replaci...
28/08/2025
By Kristin Feeley, Director, Documentary Film & Artist Programs
If you want to tell untold stories, if you want to give voice to the voiceless, you've got ...
28/08/2025
Directed by Steven Bognar and Julia Reichert, Sundance Institute-supported Amer...
28/08/2025
Corridos have been a cornerstone of M sica Mexicana for generations, telling stories rooted in everyday life. Now, a new chapter is taking shape: motivational c...
28/08/2025
Los corridos han sido un pilar de la M sica Mexicana durante generaciones, contando historias enraizadas en la vida cotidiana. Ahora, un nuevo cap tulo est tom...
28/08/2025
Earlier this month, we promised our Verano Forever party would bring the heat, a...
28/08/2025
L3Harris will provide the Polish F-16V fleet with the Viper Shield electronic warfare system as part of an upgrade program....
28/08/2025
Bilbao, August 26, 2025 - AgileTV, an international television and video technol...
28/08/2025
Ken Wilkinson is an Emmy Awards nominated New York audio engineer who specialises in production sound mixing for film, commercial, episodic and documentary work...
28/08/2025
NEW YORK FuboTV today announced that it will launch Fubo Sports, a skinny bundle that focuses on sports with a subscription price of $56 monthly....
28/08/2025
NEVADA City, Calif. At IBC2025, Sept. 12-15 at the RAI Amsterdam, Telestream will debut its new Global Ingest strategy, introducing a next-generation ingest arc...
28/08/2025
Dr. Rhoda Bernard Releases Groundbreaking Debut Book on Accessible Arts Educatio...
28/08/2025
TAG Video Systems, the leader in software-based IP end-to-end workflow monitoring, deep probing, and real-time visualization, has named Oliver Gappa as Sales Di...
28/08/2025
AI-based voice enhancement will be among a series of innovations making their IBC 2025 debut on the DHD stand B46 in Hall 8 at the RAI Amsterdam Convention Cent...
28/08/2025
Telef nica Servicios Audiovisuales (TSA), the leading system integrator and service provider in the media sector in Spain, with the support of Appear, the globa...
28/08/2025
To fully immerse sailing fans in the world's biggest offshore yacht race, production company, Optical Media turned to LiveU's On-site Production solutio...
28/08/2025
Working with Calrec on its most recent overhaul, radio and television broadcaster, WNED has migrated to a fully IP infrastructure with multiple Type R consoles,...
28/08/2025
Cleeng, the Subscriber Retention Management (SRM ) inventor, has unveiled Cleeng Pro, the first-ever direct-to-consumer (D2C) subscription management platform t...
28/08/2025
Zixi, the industry leader in live broadcast-quality video over IP, today announced that French media distribution platform OKAST has selected Zixi to enable rel...
28/08/2025
Solution offers a streamlined, speaker-free architecture to optimize integration with premium external loudspeakers and advanced loudness metering
Nixer Pro Au...
28/08/2025
Cinegy, the premier provider of software-defined television technology, has announced a strategic partnership with Vision One Touch Film Production Services L.L...
28/08/2025
Telestream, a global leader in media workflow technologies, will debut its new Global Ingest strategy at IBC2025, introducing a next-generation ingest architect...
28/08/2025
Tier 1 operator selects Broadpeak to power high-performance, unified CDN solution across Norway, Sweden and Finland
Broadpeak, a leader in streaming and moneti...
28/08/2025
Leading video software provider, Synamedia, today announced that 24 Frames Digital, one of India's leading live event streaming service providers, has chose...
28/08/2025
Meet VisualOn at IBC2025: See What's Next in AI-Powered Video Streaming Join VisualOn at IBC2025 and discover how our AI-driven Optimizer and advanced media...
You could end up paying for this at tax time. | Photo: Christina Hendricks, some rights reserved 
