San Diego County Water Authority workshop focuses on the governance of the Bay Delta Conservation Plan ~ MAVEN'S NOTEBOOK

On February 13, the San Diego County Water Authority’s Special Imported Water Committee held a workshop in a continuing series on the Bay Delta Conservation Plan in which Glen Farrel, Government Relations Manager for the Water Authority, gave an assessment of the governance structure proposed in the draft BDCP documents.

Glen Farrel began by stating that that the objective of their review is to provide the Board with an assessment of which BDCP proposal alternative is most consistent with the Board’s Bay Delta policy principles and the reliability and diversification goals outlined in the Water Authority’s 2010 Urban Water Management Plan. He noted that the Water Authority Board of Directors has not endorsed a preferred Delta fix solution.

Water Authority staff are evaluating four options: the BDCP preferred alternative with the 9000 cfs twin tunnels, the BDCP plus alternative with a 6000 cfs conveyance, the portfolio alternative advanced by the NRDC with the 3000 cfs single tunnel proposal, and the no action alternative which is essentially the existing conveyance, he said.

The scope of the review is driven largely by the timeline and the availability of resources, he said. “We’re conducting a high-level review based on the water authority’s perspective as a recipient and purchaser of Delta exports, and that review is being based on available published data and our professional judgment,” said Mr. Farrel. “We’re not intending to recreate modeling results and to get to that level of analysis; we’re really largely relying on the published data that is available.”

Today, Mr. Farrel will be discussing the governance structure of the BDCP and the new institutional arrangements that are proposed in the public review draft.

The first key governance point that I wanted to highlight for you today is that BDCP proposes a substantially different institutional arrangement than exists today, he said, presenting a slide of the current governance structure, noting the placement on the left of the chart of the State Water Project and the Department of Water Resources. DWR owns and operates the State Water Project, holds all the water rights and the permits required to operate the State Water Project, and DWR also has contracts with 29 individual state water contractors which provide for payment of all the SWP costs, among other things, he said.

The California Water Commission has an interesting relationship to DWR in the existing governance structure, he said. “The California Water Commission was created at the same time that DWR was created in statute, and when you look at the statutory obligations of the Water Commission, there is a very clear statutory direction that virtually all rules and regulations of DWR, with the exception of those that are exclusively related to DWR’s internal administration and management of its organization must first be presented to the California Water Commission and can only become effective upon approval of the California Water Commission,” said Mr. Farrel. “It’s interesting. It’s become a relic of the statutes because it’s largely been ignored. The California Water Commission was inactive for many, many years and it’s been reconstituted since 2009, but it’s an interesting artifact to see how that existing structure was originally constructed.”

On the right hand side of the graph is the Bureau of Reclamation. The Bureau owns and operates the Central Valley Project and holds all the water rights and all the permits necessary to operate the project, and has individual contracts with water agencies that govern the financing of the CVP, he said.

Because both the SWP and the CVP convey water from the Sacramento River and the Delta, the facility operations are coordinated between the two projects based on what’s called a coordinated operating agreement, he said. “Federal legislation that was authored by Representative George Miller and signed by then president Ronald Reagan in 1986 formalized that coordination of operations between the two projects,” he said, noting how on the graphic the two projects are connected by an Operations Group. “It’s comprised of the Department of Fish and Wildlife, the State Water Board and DWR on the state side, and on the federal side, Fish & Wildlife Service, NMFS, US EPA, and the BOR. This operations group meets monthly to discuss operations issues, and is really the single line of formal coordination between the two water projects today.”

He then presented a slide of the new BDCP governance structure. “Obviously the new proposed BDCP governance structure is significantly different and restructured from the existing institutional arrangements,” he said. “The BDCP public review draft identifies five new organizational entities that together would be responsible for ensuring that BDCP is implemented. Those five new entities are the Implementation Office in the center, the Authorized Entity Group, the Permit Oversight Group, the Adaptive Management Team and a Stakeholder Council.”

“Under the proposed new governance structure, DWR, BOR and the state and federal water contractors that receive species take authorizations for activities covered under the BDCP will have the ultimate responsibility for compliance for the provisions of the BDCP,” he said. “These are called the Authorized Entities under BDCP and it’s really a term of art describing that set of entities that will receive coverage for actions under ESA and the NCCPA.”

The implementation of the BDCP is organized around a newly created BDCP Implementation Office that would be managed by a program manager and governed by the newly formed Authorized Entity Group, Mr. Farrel said. “The state and federal and fish and wildlife agencies will remain having a significant ongoing role in the implementation. You can see they comprise the Permit Oversight Group in this graphic, and their role is to ensure that implementation proceeds in a manner that’s consistent with the BDCP and the regulatory permits.”

My second key point is that the BDCP proposes a centralized governance structure to undertake implementation of the program, he said. “The centerpiece of the proposed new BDCP governance structure is the Implementation Office that I just referred to,” said Mr. Farrel. “I was struck when I looked at this graphic by how the graphic was drawn in such a way that it clearly demonstrates that all oversight and implementation function are housed within this single entity, the Implementation Office.”

“That really struck me as important because when you reflect upon the history of these programs, and you look back at the CalFed program not too many years ago, and think about their organizational structure and their governance structure that they had in place, it was the especially disjointed nature of that structure that really led to some of the issues on how they coordinated and who had authority over what issues, and so that governance structure really struck me as quite different from this new governance structure that’s proposed. … [In CalFed,] there really was no centralized function where one office housed all the activities as this BDCP Implementation Office would propose to.”

The Implementation Office will be led by a Program Manager who is responsible for fulfilling the staffing needs of the Implementation Office, and that person would draw staff from existing personnel at the Department of Water Resources, the Bureau of Reclamation, and the State and Federal Water Contractors Agency, as well as from other sources outside of the agencies, he said.

The Program Manager and the Implementation Office function would report to and be selected by the Authorized Entity Group, said Mr. Farrel. “The Program Manager would ensure that the BDCP is properly implemented over the duration of the project operations, and would also direct, oversee, and select the staff for the Implementation Office, including a science manager that Program Manager would hire,” he said. “The Implementation Office would be responsible for the key functions of overseeing and coordinating administration of program funding – a huge task; overseeing and implementing conservation measures; providing technical and logistical input to the Adaptive Management Team, and then coordinating with the significant number of Delta-wide governance entities that would undoubtedly be involved in the implementation of BDCP along the way.”

My third key point is that the BDCP proposes that significant authority and deference would be granted to water exports interests, Mr. Farrel said, presenting a slide of the organizational structure of the proposed new BDCP Governance Structure. “The Implementation Office is clearly the central lynchpin for all BDCP related activities and is the coordinator and facilitator of the various BDCP implementation groups,” he said, noting that the lines on the chart represent the reporting relationships with the Implementation Office.

“However, I want to draw your attention to one key BDCP implementation group that we want to pay particular attention to within the proposed new governance structure, and that is the Authorized Entity Group that’s highlighted with the red oval,” he said. “As you can see here in the graphic, the Authorized Entity Group is depicted as having a superior or governing role over the Implementation Office, and it’s also depicted on the screen on the graphic as having a peer role with the Permit Oversight Group. It’s important to see that relationship and how the governance structure was drawn by BDCP when they contemplated the development of this.”

The Authorized Entity Group would be comprised of the Director of Department of Water Resources, the regional director of the Bureau of Reclamation, a representative of the state water contractors and a representative of the federal water contractors, and those four people would comprise the group that would have the principle governing role over BDCP implementation, he said. “This Authorized Entity Group would provide program oversight and general guidance to the Implementation Office and to the Program Manager of that Implementation Office, in addition to actually hiring and selecting the Program Manager,” he said. “The Authorized Entity Group would also be responsible to see that the management and implementation of BDCP is carried out consistent with implementing agreement and regulatory permits that are secured. The BDCP public review draft identifies that this Authorized Entity Group would meet in public at least on a quarterly basis, but the BDCP documents are silent on whether the Authorized Entity Group would be subject to California’s public meeting and public records laws in any other regard.”

“The key takeaway here is that the Authorized Entity Group would have significant authority and deference on issues and decision making,” said Mr. Farrel, noting that in Chapter 7, there is a chart that shows 15 specific decision making points within the BDCP implementation and governance arrangement along with identifying who makes the decision, whether the decision is reviewable through a dispute resolution process, and who makes the final decision.

“The Authorized Entity Group has the primary role in the BDCP decision making process,” he said. “Of the 15 identified decision making points, the Authorized Entity Group makes the primary decision 9 times out of 15, and that’s the final decision, so that means there are six remaining decisions where they do not make the primary decision.”

“Even for decisions where the AEG is not identified as the decision making party, the new BDCP governance structure would grant significant deference to this AEG,” said Mr. Farrel. “Of the six identified decision making points where the AEG is not identified as the primary decision maker, the BDCP public draft identifies that the AEG would have a final authority on decisions on matters four out of the six times; the only two decisions where the AEG would not have a final or direct decision making role would be in the selection of a science manager and real time water operations which are made by regional directors of the relevant federal agencies.”

“It’s important to note, we’re not trying to characterize that there’s something amiss here, but the Authorized Entity Group would not have decision making authority over the real time operations changes,” he said. “Those changes are largely going to be made by federal fish and wildlife agency personnel in response to hydrologic conditions.”

Mr. Farrel then summarized his observations of the BDCP’s governance structure. “The public review draft proposes a significant restructuring of the institutional governance model that will be centralized around the implementation office and operated by a Program Manager who would be selected by the Authorized Entity Group, and the AEG would have substantial authority and would be granted significant deference in the BDCP implementation process,” he said.

He noted that the Board memo has much more detail on the proposed new groups, including the Adaptive Management Team, the Stakeholder Council, and the Permit Oversight Group, as well as a comprehensive overview and outline of the dispute resolution process.

“From the staff perspective, there remain many unanswered questions that we will likely bring back to you in March when we identify outstanding or unresolved issues that need to be addressed,” he said. “We believe some work needs to be done to reasonably address the checks and balances of the structure. The BDCP draft is silent regarding whether legislation is needed to formalize the governance structure. You may recall when CalFed was created back in 2002, there was legislation authored by then-Senator Jim Costa and that law went into effect in 2003 and outlined the governance structure for the CalFed program. This BDCP public review draft is silent on whether legislation is necessary or whether this could be accomplished through MOU or some other structure.”

“The BDCP public review draft is also silent with respect to California’s public meetings and records laws,” he said. “There are instances where the document identifies a minimum number of public meetings that need to be held by various groups, but beyond those minimum public meetings, there’s no indication at all whether any supplemental meetings or any meetings that occur in the interim between the scheduled public meetings would also be available to the public or whether they would comply with the public records act.”

“There’s also been discussion about how disputes would be remedied when there’s a conflict between water exporter interests and the fish and wildlife interests,” he said. “The BDCP public review draft does provide a pretty detailed dispute resolution process, but given the imbalance in participation between the Authorized Entity Group and the Permit Oversight Group, and the legal remedies that are afforded those parties irrespective of the outcome, it would appear that the process would need greater attention, and that’s something we’ll continue to evaluate and raise for your attention in March.”

Coming up later this week … Both the San Diego County Water District and the Santa Clara Valley Water District discuss the infrastructure and construction of the Bay Delta Conservation Plan in two very different presentations.