SDCWA approves Conjunctive Use Project subsidy

The Metropolitan Water District of Southern California has a subsidy program for projects which produce local supply, and if MWD approves the agreement Sept. 10 the Fallbrook Public Utility District will receive a subsidy for the Santa Margarita River Conjunctive Use Project.

FPUD's board approved the agreement on a 5-0 vote July 22 and the San Diego County Water Authority board approved the agreement July 25.

"It will help further reduce the cost of water for the project, which will help further reduce the cost of water for our ratepayers," said FPUD general manager Jack Bebee.

MWD's Local Resources Program includes financial incentives to MWD agencies, which can pass through those incentives to their own member agencies, for the development of local supplies which increase supply reliability and reduce imported water demands.

The Local Resources Program has three options: sliding scale incentives subsidizing up to $340 per acre-foot over 25 years, sliding scale incentives providing up to $475 per acre-foot over 15 years, or fixed incentives of up to $305 per acre-foot for 25 years with the fixed incentive amount being negotiated so that MWD's financial obligation does not exceed 90% of what the first sliding scale option would subsidize.

"We're finalizing what the total rebate numbers are," Bebee said.

The agreement with MWD includes performance provisions. Construction must begin within two years of the agreement and operation must begin within four years. The agreement also includes a project yield schedule which must be met for the MWD payments to continue.

The amount of water obtained will depend on weather conditions. In a normal hydrological year, based on the average over the past 50 years, FPUD will receive 3,100 acre-feet.