“In my role and honor of serving as the state’s first Delta watermaster for four years, I talked to a lot of people about this issue,” began Craig Wilson. “I traveled up and down the Delta, talked to the Delta interests, but also spent a lot of time talking with the people that run the State Water Projects and move water from the north to the south. I served on the real time drought operations team and saw the managers engage in some pretty heroic efforts to deal with the drought, so I want to try and bring that perspective to my comments today. I am now retired so I’m not being paid to say anything today. These are my thoughts and ideas about the issues in the Delta.”
Mr. Wilson said that the present conveyance system in the Delta is really the worst of both worlds. “It isn’t very efficient in moving water from the north to the south, and it’s been very destructive to the Delta ecosystem and the Delta community,” he said. “Why is that? Under the natural flow regime with a tidal estuary, you have flow basically going from west to east and from east to west in tidal cycles; with the present project with the massive pumps to the south, that hydrodynamic regime has been largely changed and in many portions of the year, it’s now a north-south type pattern which has had a devastating effect on fisheries. The present system is inefficient in the sense that large amounts of water have to be set up as hydraulic barrier to make sure there’s adequate quality at the export pumps so it’s not a very efficient way of moving water.”
“It’s also not very reliable, both from a physical sense and a regulatory sense,” he continued. “In a physical sense, it is subject to potential catastrophic problems if there’s levee failures and the Delta becomes salty as a result of some type of domino effect with levee destruction, and also because of the problems caused to the fisheries, you have regulatory constraints on the present system to protect the endangered species, so the combination of those things just makes it very clear that the present conveyance system is not adequate. The legislature recognized that in 2009 in the water reform legislation. It’s indicated very clearly that we need to reexamine this issue and made a pathway toward making a decision and trying to get on with some proposals to fix the conveyance system.”
Mr. Wilson noted that the preferred alternative identified in the BDCP/California Water Fix proposal are the tunnels, and he agreed with Assemblyman Frazier that the $15 billion price tag is grossly understated. He then discussed the pros and cons of the project.
“There are some pros to the tunnels project,” he said. “One of the main points to make about that is that most of the benefits and pros of the tunnels accrue to the exporters to the south and don’t accrue to other parts of the state, the Delta and others. There’s no question that by building an isolated facility to the north and having the ability to send good quality Sacramento River water directly to the export pumps, there will be better water quality for the exporters, but not for the Delta, because as you take that water out of the system, it means the Delta has less water in it. So you have that issue.”
“There’s reliability for the export water by having this isolated facility, but there’s no reliability for the Delta, for either the fisheries protection or the agricultural community,” he said. “In fact, if there is some type of levee failure or catastrophic event, there will probably be less incentive on the part of a lot of people to jump in and try and fix that immediately since there’s this isolated facility that protects the export water.”
Mr. Wilson acknowledged that the tunnels do have some benefit as they would partially restore a more east to west, “but not totally you still would be operating the export pumps at times, so you would have potentially a better situation but potentially not because you’d have water taken out north of the Delta, and then you’d still have the pumps operating at times at the south so you’d have potential of less flow and also still have some change in the hydrodynamics, both of which could affect the Delta agriculture and the Delta fisheries.”
Mr. Wilson then noted there were a number of cons to the project. “A lot of the aspects that are protective of the export water through the application of the tunnels project will not accrue to the benefit of either the Delta or that there are areas of the state, the reliability factor isn’t there, the better quality factor isn’t there, and you’ve got issues related to the destructive nature of building the tunnels project with the right of ways and the building of several large diversion works,” he said. “There was an article that came out of the AP yesterday afternoon that there will be something like up to 300 farms that will be perhaps taken by eminent domain through that.”
“So given that many of the benefits of the tunnels project accrue only to the export water and that there are some potential destructive aspects still available, I ask myself, is there a project available that has many of the benefits and pros of the tunnels and avoids some of the negative aspects? And I believe there is,” he said. “I call it the Western Delta Diversion System, and I think that has potential to provide better reliability, good quality water for the export, and reestablishes what seems to me is just a common sense situation. Let the water flow through the Delta as it should naturally, and then pick up that water on the western side of the Delta – the tunnels or canals that would be built there would be much shorter in length so they’d be less expensive.”
Mr. Wilson said there are three aspects to the Western Delta Diversion System. “The first is the diversion works on the western side of the Delta, located on an island called Sherman Island, which is right above the confluence of the Sacramento and San Joaquin River,” he said. “Sherman Island is owned by the state, so you have a lot of savings and less disruption, and the fact that a lot of the diversion works in the beginning of the project diverted to the south would be on public lands, you wouldn’t have the eminent domain issue and taking land away from private citizens against their will.”
A tunnel constructed on the western side would be much less longer in length and require less excavation, and can be built along the existing public right of away so there isn’t any eminent domain issue, he said. “But perhaps the biggest benefit of having this western diversion point is just to reestablish this natural flow from east to west,” he said. “With the water flowing into the Delta, you get two uses for the price of one. It goes to the Delta, protects the Delta for both the fish and the agricultural community, and then that same water can be used to be exported to the south.”
The second aspect of the system that would address reliability is to consider building an operable gate at Chipps Island which is below the confluence of the Sacramento and San Joaquin river and where the river gets narrow, said Mr. Wilson. “I’m talking about an operable gate that would act much like a flapper on the bottom of a pinball machine,” he said. “It would be open 99% of the time, but if there was a problem – if there was a levee issue, if the Delta got too salty, you could close these gates in the matter of an hour so and protect the reliability of the diversion point and the entire Delta,” he said. “It would be reliability for both the export water and the Delta itself. There have been similar type projects built in Europe for flood protection larger in scale than what would be built at Chipps Island, so it’s definitely doable and it would provide that insurance policy, not only for the export water but also for the Delta itself.”
The third aspect of Mr. Wilson’s proposed system is a ‘treatment polishing’ facility. “One concern that people would have with a western diversion is that sometimes the water may be too salty for suitable use to the south,” he said. “Most of the time, it is of adequate quality. It’s above the confluence of the two rivers, and at least the Sacramento side is pretty good quality, even in the western Delta at Sherman Island, but you could build a polishing type facility to treat this slightly too salty water. I’m talking about water that has 2000 parts per million salt as opposed to seawater which has 35,000 parts per million. You could use some sort of sand filtration system, there’s a lot of emerging technology about the use of conductive electrodes to separate salt from water, and you could even build a reverse osmosis plant … so there are alternatives.”
The Western Delta Diversion system has all the pros of the tunnel project with almost none of the negatives, Mr. Wilson said. “You would restore the east west flow system, take the water after that takes place, you would have the reliability aspect with the operable gates, and you assure adequate quality through a polishing type facility.” He noted that other people have studied this, including a company called SolAgra.
“I think there is a system that’s viable,” he said. “I don’t think BDCP ever studied a western diversion system that has the three elements that I suggest: a diversion point in the west, a gate system to protect reliability, and a polishing facility to assure adequate quality, so I think there is a proposal that’s there, and with that I’ll close … “
DR. JEFF MICHAEL, University of the Pacific
Dr. Jeff Michael began by noting that his comments today come from an economist’s perspective. “When the questions of finance come up regarding the tunnels when the new Water Fix was announced, the statement was that the cost is $5 a month for Southern California households, so $60 a year per household served by Metropolitan Water District,” he said. “That’s presented as affordable; I don’t know whether all those households would be excited about that $60 a year, but it’s certainly a financial lift that they are capable of doing.”
“The problem is that $60 a year for Metropolitan rate payers only pays 25% of the tunnels costs, so it’s sort of an incomplete answer,” he continued. “The reason why that doesn’t pay all the tunnels cost is that the majority of the costs, at least as currently envisioned, would be paid by agricultural users. So the question about whether the project is financially viable, at least in the current discussion, really has nothing to do with the $5 a month and has everything to do with whether agriculture can bear these costs. And beyond that, is it in their interest to bear those costs? Even if they can bear them, they may be made worse off by doing so.”
Dr. Michael said that in the latest documents for the Water Fix, the water supply yields in the EIR are about 250,000 acre-feet of water. “With two-thirds or so of that to agriculture, you may have enough additional water to irrigate 60,000 acres in the San Joaquin Valley,” he said. “We’re concerned that San Joaquin Valley agriculture certainly is constrained and pressured by water availability, and there is concern about the acreage shrinking in the future. If you want to keep it simple, just sort of think about how much agricultural land would the tunnels help keep in production in the San Joaquin Valley, and the answer is that about three feet per acre to irrigate crops, so you’re at about 60,000 acres. The upfront price tag allocated to farmers is about $10 billion, so simple division shows about $160,000 per acre would be the cost. That’s multiples above the value of farmland in the San Joaquin Valley – even great almond orchard with reliable water supply doesn’t trade for anywhere near that amount.”
During extended droughts such as what we’re in, the tunnels wouldn’t be producing any additional water, the farmers are already financially constrained, he said. “They are paying more for the supplies that are available, or they’ve had to fallow some fields, yet they’ll have to come up with $1 billion a year or more in debt service payments, even in a drought like today,” he said. “So that is not only a huge economic hardship on the Central Valley and those farmers, but it raises serious questions about the financial viability of the project and that’s one of the key areas where you can expect taxpayers to have to step in and back the project.”
“In my view, the costs really don’t make sense for farmers at all,” he said. “That’s why we haven’t seen a complete financial plan for the project after 9 years. I don’t see any way how it’s viable without some sort of taxpayer subsidy or backing. Maybe they will be created with a financial plan, but I don’t think that you can achieve that goal.”
Getting to the question, are the tunnels good for California, the tunnels are bad for the Delta region, maybe a little less bad under the revisions in the Water Fix, but still not a good thing, Dr. Michael said. “They carry a lot of risk for the environment; they also carry risks for upstream water users,” he said. “Sometimes it can still make sense for a state to move forward on a project like that, if the project has enormous overwhelming economic benefits for the state as a whole and for the beneficiaries of it. There’s an objective policy analysis process for looking at that question, and it’s called benefit-cost analysis, it’s something that is taught in both policy schools and economics, it’s something that’s elaborated fairly well in the Department of Water Resources own guideline that they’ve issued. And it’s something that has been very late to arrive in the tunnels debate.”
The California Water Fix process has not looked at an appropriate range of alternatives, Dr. Michael said. “I believe there are 15 alternatives in the EIR plan: 14 of them are different sizes and configurations of the isolated conveyance, and there was one alternative of enhanced through Delta conveyance,” he said. “There are a lot of alternatives out there. I’ve heard a number of iterations of the west Delta intakes diversion concept from a number of reputable people; that is an example of something like the tunnels that you could come up with 14 different versions of and optimize the configuration and the technology used. Similar efforts should be placed towards those sorts of alternatives, as well as others.”
Dr. Michael said he was aware of two not highly publicized cases where the state has looked at benefits and costs of alternatives to an isolated conveyance facility. The first one was called the Delta Corridors Plan, and one version of the Delta Corridors plan actually had a higher benefit cost ratio than the tunnels in the BDCP documents, he said.
In the late 2000s as part of the Delta Risk Management Strategy effort, DWR did receive a consultant’s report that looked at a seismic levee investment strategy and compared to what at that time was an isolated surface conveyance that only cost under $5 billion, he said. “That analysis which was not released in the late 2000s also showed that the seismic levee upgrade had higher benefits and lower costs than the tunnels, but no effort was made to optimize configurations of that scenario like has been made for the tunnels.”
“There are a lot of other alternatives that haven’t received any analysis at all, and what little analysis we do have shows that it’s likely that other alternatives are better,” Dr. Michael added.
“A common thing that you hear is that we have big problems in the Delta, we have to do something, and it would be good to do something,” he said. “The formal analysis does compare things to ‘No Action’ or the status quo, and economically there’s not even strong evidence that building tunnels is better than the status quo if we look at the benefits to the exporters. In fact when I’ve looked at it, using its documentation, I see just from the standpoint of the exporters, about 30 cents of benefits to them for every dollar in costs that they are going to pay.”
“Their reports show that the water quality benefits are worth a little bit less than $2 billion a year to the exporters so that’s a sizeable benefit, but not enough to justify a $15 billion project,” he said. “The much talked about earthquake scenario, the BDCP consultants valued that benefit at about $400 million because it’s a fairly low probability scenario and a temporary interruption to water exports.”
There are also some concerns about the impacts of that earthquake and what we need to do in the Delta itself, he said. “This would be a public safety humanitarian tragedy in the Delta, massive death and destruction. Just by my look at history, and I’ve looked at the state’s modeling of the event, it would be the mass casualty event since the 1906 earthquake, according to the state’s study. So if there is a real significant risk of this, we need to think about alternatives like levee upgrades that protect all these interests, both water exporters, lives, health, and safety, and other valuable infrastructure in the Delta which is often lost from energy and transportation perspective.”
“Put the earthquake protection and the water quality benefits together and that justifies maybe 15% of the costs of the tunnels from the standpoint of the water exporters and so those are benefits to them, but really the economic viability of the tunnels has everything to do with water yield and water supply,” he said. “You need a tremendous boost to water supply to justify an investment of this cost. The EIR talks about a range of 0 to 500,000 acre-feet on average; that comes nowhere near what is needed to justify a $15 billion investment, even when you account for the other things.”
Just look at how much water supply you get for a billion dollars of investment, Dr. Michael said. “People talk about alternatives like desalination or dams, which are extremely controversial in large part because of their high costs. They are known as some of the highest cost alternatives per billion dollars investment, you get more water yield out of those projects than the tunnels, so there’s some serious questions to that.”
The cost information was release in 2013 when the state made its proposal, and there were questions about the economic viability then, he said. “The state argued that it was still worth it, or the consultants did, because the 50 year permit locked in this regulatory certainty so that for the water contractors, this would put a cap on how much additional water or money they’d be expected to contribute to the endangered species issue,” he said. “I thought at the time that they had sort of over-estimated the value of that, and so that’s been dropped. It has huge implications on the financial viability of the project and the value it provides to water exporters.”
“So in my view, the state has made some movement in a positive direction but it still hasn’t done really a proper benefit cost analysis from a statewide perspective,” Dr. Michael said. “I don’t believe that there’s evidence that the tunnels are economically justified, even against the status quo. And I don’t’ believe that there’s evidence that the tunnels are better than the alternatives that are out there. From my viewpoint, it looks like the project is not financially feasible without a significant taxpayer subsidy for the financing.”
Senator Wolk asked Dr. Swanson whether there were any particular alternatives that she thought would have a better impact and effect on the fisheries, other than the current proposal.
“According to the best available science that we have on the system, the environmental variable that has the strongest relationship to influence environmental conditions and fisheries populations is flow, both seasonal flows and also inter-annual and within season variability in flows,” she said. “The consensus is very strong that the most likely to be effective approach to improve ecosystem conditions and begin to recover fish populations is to enhance the fresh water flows in a very selective and a very functional way through the Delta and into the estuary. It is by far the strongest variable. That is part of the reason that I think the Delta Reform Act’s requirement that reliance on the Delta as a water supply source should be reduced; it was this recognition that in fact, this is a system that needs more freshwater flow than it is getting. So that’s number one.”
“I certainly realize that that represents a conflict, because of course we are using this system to provide water for other uses,” continued Dr. Swanson. “On the other hand, from a scientific perspective, it’s all a mass balance equation. We only get so much water out of this system on a year to year basis, we can modulate the variation a little bit with dams, but in fact, the supply in the watershed that goes through the Delta is finite and it is variable, and it is most likely going to change in the future. I think that greater analysis should be applied to determine how much water the system needs … and then that becomes the foundation on which you can develop a project to export what is truly surplus to the system.”
Dr. Swanson added that there are water quality improvements that could enhance the ecosystem; there are still big problems and big opportunities with regard to urban and agricultural runoff that could be better controlled. There are also some specific habitat restorations that could be beneficial, and in particular, floodplain restoration.
Senator Wolk noted that Dr. Swanson had spoke of the consensus around more flows to assist fisheries, calling for selective and functional application of those flows, so that brings up the question who decides and how is that decision made?
Dr. Swanson said the first step is to develop a flow regime intended to provide specific ecological conditions and conditions for species at the time they need them and at the levels that the need them. “So the science is at the foundation,” she said. “Certainly one of the places where those flows are managed are with minimum regulatory requirements for flows, and the State Board’s current water quality control plan in fact does have different flow requirements for different seasons for different types of water years. Those standards are being reevaluated right now as they should be, because I think we have pretty good evidence that they are insufficiently effective.”
The other approach would be through adaptive management, Dr. Swanson said. “The BDCP (and I do not know the extent the California Water Fix) espouses adaptive management. But I would suggest to you that actually they are talking what is in fact more like real-time management, which is we see some fish here, we’ll turn down the pumps or we’ll increase flows. That’s different. Adaptive management is where you understand how the system functions, you identify an objective you want to accomplish, you develop an action that you want to implement, you implement that action, and you monitor and see whether that works. … I think this issue of who control the valves and the pumps is certainly a big one, and having worked in the environmental community as a representative of that stakeholder group during the Cal Fed years when in fact we were trying to do real-time management and my impression was that it was minimally effective. There was regularly conflict between the fishery agencies who have one objective, and the water agencies and the exporter stakeholder community who have others. … These past two years, essentially almost many of the most important minimal levels of environmental protection have been waived, so I think this issue of what do we mean by setting environmental standards and attempting to manage this system, supposedly for these coequal goals really needs to be very carefully scrutinized.”
Dr. Swanson then offered the suggestion legislators give greater scrutiny to the extent that the California Water Fix actually addresses improving water supply reliability. “If you look at where we’ve been these past decade or more with two droughts, with these very large fluctuations in Delta water and the amounts of water that are exported from the Delta, those fluctuations are not being limited by conveyance. They are not being driven by environmental protections. The largest component of fluctuations in water exports from the Delta are a function of hydrology, and the fact that we have wet and dry conditions. In particular, we see a large drops in Delta exports in the second and third years of a drought. That’s the big problem that we should be looking to address with the California Water Fix. This is another example from my scientific perspective of essentially mis-identifying what are the causal factors of the problem that we’re trying to address. I just wanted to make sure that that was out there.”
Senator Wolk asks Craig Wilson about his thoughts on mis-identifying the causes the problems in the Delta.
Mr. Wilson offers comments instead on the 50-year permit change, saying that it dramatically affects the reliability question. “The whole premise of the 2009 water reform legislation was that you were going to have this 50 year permit under Section 10 of the Endangered Species Act, and you would have the mitigation, you’d have the whole package there together so there would be certainty of protections for the Delta and there would be certainty on behalf of the water users that if they met certain factors, they would be assured of a water supply. Now that’s changed dramatically. They’ve pulled away from that, which was a major premise of the 2009 reform legislation, and are basically looking at a almost year-by-year reevaluation of the adequacy of the flow regime, and you could end up with the worst of all worlds where you have this isolated facility at great expense and perhaps less water being made available both to the environment and to the exporters, so that’s a big issue.”
“This change in direction, I don’t know what that means for some of the mandates of the Delta Stewardship Council,” Mr. Wilson continued. “I don’t know if the legislature needs to reexamine the mandate of the Stewardship Council and whether they should have some additional approval aspects to whatever proposal comes forward, and that’s why I go back to what I think is more common sense. Why have this situation where you have less reliability from a regulatory standpoint, fixed to the flow regime thing, when you have what I think is a pretty obvious solution of letting the water flow through the Delta naturally and then picking it up on the western side and conveying it at less expense, better reliability, and better quality to all of the state as opposed to just the export waters, and to me that seems to be the way to go.”
Senator Wolk said that it certainly begs the question as to why that kind of alternative was or is not being studied.
“I think there was some fairly cursory analysis of a western Delta diversion,” said Mr. Wilson. “I don’t believe there has been an adequate study of that type of a comprehensive western diversion conveyance facility or system.”
Senator Wolk acknowledged that the 50-year guarantee was critical to the exporters and that was that was valued quite highly in the analysis that was done. “That’s gone, that’s not going to happen, so you’re back to year by year based on the judges – it sort of the worst of worlds for the contractors … it’s not there from a science point of view, from a water quantity point of view, it’s not there from an economic standpoint anymore, so it seems to me we still have a serious problem we haven’t got a very good solution for, and I don’t think people are going to be willing to spend – ratepayers are looking for other things. … Local communities want to diversify their water supplies, stretch them as far as possible, and get the best deal they can, but nobody wants to raise rates to do all that. So that’s the direction we certainly went with Prop 1 to try to encourage the local communities and follow them and the state can play a role in increasing recycling, cleaning up groundwater, recapture, all the things that they want to do at the local level, including storage, that they are willing to pay for because they see the benefits of it directly.”
Senator Hancock asks Mr. Wilson about his western conveyance proposal. “As a person who represents part of the San Francisco Bay area is, a concern I keep hearing from my constituents relates to the flow and the flushing of the bay and not ending up with a stagnant pond. Could you comment on your proposal, the impact it would have on the bay?”
Craig Wilson answered, “By allowing natural flow through the Delta and then picking it up on the western side, obviously the $64,000 question is how much is going to be picked up on the western side. There are some proposals that would suggest that by using Sacramento River water as the main vehicle around Sherman Island to divert to the south and having some type of polishing treatment system that you could end up having more water available, not only for export but more water available to flow out the Bay. … My feeling on this thing is that it’s never too late to do the right thing … You can have these situations where there’s been a great deal of study on a solution and momentum behind it, it doesn’t mean that a better idea can’t be created.”
Senator Hancock agreed. “I think the question this raises for me is how do we set up a process for some of these other alternatives to be explored at this point in time.”
Senator Pavley asked about the structural integrity of the Delta’s levee system, and how the project is designed for the impacts of climate change.
Supervisor Nottoli said that the levees are a system; he acknowledged the levees were in some ways fragile, but there is not an imminent threat of collapse. “In the Economic Sustainability Plan that the Delta Protection Commission did as part of the Reform Act, it was identified that for an investment of somewhere between $2 to $4 four billion dollars depending on the levee structure … that investment, over time, working with local landowners, and local communities, could not only armor the system in a way that is environmentally friendly but also with respect to climate change, you can raise levees over time, assuming you do it properly and you have a proper foundation for them. That’s obviously part of the restoration effort, that there is a viable way to do it. It doesn’t happen overnight, but certainly it could happen I think much more quickly than if you were to try to build a tunnel.”
Dr. Swanson added that the analysis of any project should be taking a far more rigorous and aggressive look at the likely effects of climate change on projected supply from the watershed. “The incorporation of climate change into the current modeling is fairly tepid and fairly conservative, and I think it would be far better to take a more aggressive, or at least to bookend it a little bit better than has been done. I also want to point out that the California Water Fix and the twin tunnels is essentially more closely tying our water supply to the supply in the Sacramento basin, and between the two basins, the Sacramento is far bigger than the San Joaquin, but it is going to be the one that is projected to be more affected by climate change with regard to loss of snowpack and volatility of the water supply … so one of the questions you should be asking is, are they building that into the projections and analysis of whatever plans they are proposing, including what effects it has on the year to year reliability of the water supply available for export from the Delta regardless of what kind of conveyance facility you are looking at.”
Dr. Michael then added some comments about levee integrity. He acknowledged that the levees are getting better, and he gave a lot of credit to DWR for the efforts they’ve made over a number decades to improve the levees. “We know that when we invest in levees that we get immediate benefits. We don’t have to wait 15 years to start receiving those flood control benefits; every section every reach that we strengthen yields immediate benefits to everybody that’s dependent upon this system.”
“It’s been over a decade now since there was a serious levee breach in the Delta,” Dr. Michael pointed out. “There’s been a dramatic reduction and it’s a direct result of the investment that’s been made, so I think that can be pointed to as an effective use of, an effective partnership between the state and local agencies to improve them. Having said that, there’s a long way to go in order to achieve this seismic resilient system … The analysis the state has done modeling that scenario has shown that the majority of the economic impacts accrue to the infrastructure and the people and the property within the Delta itself, so there’s a lot of people in the state that have an interest in the integrity of the system, and not just the water exporters. … We know that we can bolster that levee system for a lot less than $15 billion to be – I wouldn’t say earthquake proof, but resilient to be protective of all these interests, and we should look at those very closely as we go forward.”
Assemblymember Frazier asked if anybody looked at a bypass at the pumps so species could just be reintroduced into the Delta instead of being in a cul de sac?
Dr. Swanson agreed that it really is a cul de sac, but there’s insufficient passing flow to utilize that particular approach for getting them by. “As I understand it, that would be the design for the north Delta facilities, but that does require flow, but in terms of the entrainment and the hydrodynamics of fish and small organisms, the location of the south Delta pumps, both in the southern portion and associated with the watershed that provides the least amount of inflow into the system is just about the worst place.”