CWA defers capital project amendments

The San Diego County Water Authority has deferred a proposal to defer seven Capital Improvement Program projects including the San Luis Rey Habitat Management Area Restoration.

The specific proposed SDCWA board action was to approve the recommendation of the CWA’s Finance Planning Work Group to defer approximately $13 million in infrastructure projects and to increase the fiscal years 2024 and 2025 Capital Improvement Program appropriation amount from $183.9 million to $190.9 million to support bifurcation structures. The recommendation was discussed during the CWA’s Administrative and Finance Committee meeting Thursday, April 25, and the committee also discussed the potential 2024-2025 budget in which the capital projects deferral was one of eight alternatives. All eight alternatives had proposed rate increases ranging from 16% to 22%, and the desire for a lower rate increase led the committee to defer any budget-related recommendations so that CWA staff could review options which wouldn’t have rate increases that high.

“We need to think about what’s the right size for us in the future,” Joy Lyndes, board member with San Dieguito Water District and the district’s delegate to the CWA board, said.

The eight alternatives cover various levels of financial risk and infrastructure risk. The First Aqueduct Treated Water Bifurcation Structures and the Hubbard Hill Vent Rehabilitation project which includes bifurcation structures both address seismic preparedness and were deemed to be critical in fulfilling the CWA’s mission of maintaining a safe and reliable water supply. Funding flexibility will also be required for repairs of Pipline 4 at Dulin Hill south of the San Luis Rey River; the CWA uses an acoustic fiber optic monitoring system which recently detected an increase of leaks along that part of the pipeline. The proposed two-year capital improvement budget is projected to be $204 million. Even with capital improvement projects being deferred, a reduction in purchases by CWA member agencies – water sales for calendar year 2024 are approximately 36% lower than budgeted – will require a rate increase to cover the CWA’s fixed costs.

“It’s very frustrating,” NEal Meyers, board member with Olivenhain Municipal Water District and representative for Olivenhain on the CWA board, said.

“That’s a bad thing today to make water unaffordable,” Gary Hurst, board member with Ramona Municipal Water District and the CWA board member from Ramona, said.

Hurst noted that deferral of projects might not create true savings.

“What you’re really doing is creating a backlog,” he said. “It’s a financial risk as well.”

The 16%, 20% and 22% proposed rate increases for calendar year 2025 are all part of three-year plans with rates increasing 39% over those three years.

The recommendation was to defer three construction projects totaling $16 million including the San Luis Rey Habitat Management Area Restoration and four design projects totaling $4 million. The San Luis Rey Habitat Management Area Restoration project will create approximately 42 acres of wetlands and other riparian and upland habitat which will provide mitigation for impacts from the CWA's future capital improvement projects or from CWA operations and maintenance activities. The project site is approximately half a mile west of Interstate 15 and south of state Route 76. The CWA's Second Aqueduct crosses the San Luis Rey River in the area, although the Second Aqueduct itself is excluded from the habitat management area. The CWA acquired the habitat management area in 2005 so that it can be developed into the CWA’s North County habitat mitigation site. The San Luis Rey Habitat Management Area Restoration project is part of the CWA's Natural Community Conservation Plan/Habitat Conservation Plan.

The construction work for the San Luis Rey Habitat Management Area Restoration project will include grading, planting and temporary irrigation work. After the construction is completed a multi-year monitoring period will ensure the success of the habitat restoration. In July 2020, the CWA awarded AECOM Technical Services Inc. a contract for the design of the project.

Joe Naiman can be reached by email at [email protected].