[Water_news] 1. DWR'S CALIFORNIA WATER NEWS - Top Item for 1/23/08

Department of Water Resources

California Water News

A daily compilation for DWR personnel of significant news articles and comment

 

January 23, 2008

 

1.  Top Item

 

County close to water sale to south-state district

Chico Enterprise Record – 1/23/08

By Heather Hacking, staff writer

 

OROVILLE -- Butte County is getting closer to a two-year deal to sell water to Palmdale Water District, northeast of Los Angeles in Southern California.

 

When Lake Oroville was built in the 1960s, Butte County negotiated to be a State Water Contractor and receive 27,500 acre-feet of water a year. Butte County and 29 other State Water Contractors must pay the state for that water regardless of whether or not the water is used, at a rate of about $30 an acre-foot.

 

One acre-foot equals 325,851 gallons, or enough water for two average households for a year.

 

But so far Butte County only can use about 2,500 acre-feet of that water through California Water Service and Oroville and Del Oro Water companies.

 

That would leave 25,000 acre-feet of water, but only during a wet year. Typically, the amount of water delivered to State Water Contractors is considerably less than that full amount.

 

So far this year the state has said State Water Contractors can expect at least 25 percent of that amount, which would typically only be allowed to be used within the county.

 

That percentage may increase if more wet weather occurs.

 

In the past, the state had allowed Butte not to pay for that unused water, and the water would flow through the State Water Project and be available for use elsewhere.

 

But this year the state said Butte County is required to pay for that water, which would amount to $765,172 — money the county does not have budgeted.

 

At the same time this payment is due, the Department of Water Resources is also allowing Butte County to sell the water outside the county for two years.

 

Vickie Newlin, of the county department of Water and Resource Conservation, said the county chose Palmdale, out of other possible buyers, because the water agency said it would buy all of the water the county had to offer. That was easier than negotiating more than one deal with more than one agency, Newlin said.

 

The pricing will be tiered.

 

If Butte receives:

 

- 0-29 percent allocation, Palmdale will pay $230 an acre-foot

- 30-39 percent — $215 an acre-foot

- 40-49 percent — $195

- 50-69 percent — $160

- 70-100 percent — $130.

 

With the current estimate by the state for 25 percent of the allocation, Butte could sell the water to Palmdale for $1,437,500 this year.

 

From that, Butte would still need to pay its tab to the state of $765,172.

 

Butte County Supervisors Bill Connelly and Curt Josiassen, who were on a subcommittee to work through the deal, instructed that the profit from the two-year sale go into a fund to help pay for State Water Project costs in the future.

 

It's unknown whether the state will allow Butte to sell water after this two-year sale, so the money in the bank would help Butte pay for that water in the future.

 

Newlin said that within seven to 10 years Butte County plans to establish ways to use that State Water Project water within the county.

 

Payments negotiated by Palmdale are higher than other rates for water transfers in recent years. One reason is that Butte County's water is within the State Water Project, which means it has priority for delivery over water from other private water deals, Newlin said.

 

Supervisors will be asked Tuesday to move forward with the California Environmental Quality Act Review and accept a letter of intent from Palmdale Water District.  #

http://www.chicoer.com/news/ci_8051797

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