IG faults Reclamation’s handling of major Calif. project

By Michael Doyle | 09/08/2017 01:18 PM EDT

Interior Department investigators blasted the Bureau of Reclamation today for lack of transparency in its handling of money in a controversial California water project.

In a highly anticipated report issued late this morning, the Office of Inspector General declared the bureau was "not transparent in its participation in the Bay Delta Conservation Plan."

"We found that [the bureau] did not disclose the full cost of its participation in the BDCP, subsidized [Central Valley Project] water contractors, and converted $50 million in federal funds from reimbursable to nonreimbursable without documentation," investigators stated.


In its official response, Reclamation disagreed with the investigators’ conclusions.

"Reclamation will continue efforts to ensure sound written documentation reflecting decisions made are at the appropriate level of authority and are consistent with authorized project purposes," the bureau said in its response.

The 42-page report marked investigators’ efforts to determine whether the bureau "fully disclosed to the U.S. Congress and other stakeholders the cost of its participation" in the BDCP efforts.

BDCP is a state-led effort to address the needs of the environmentally sensitive and crucial Sacramento-San Joaquin River Delta. Water contractors are responsible for arranging for paying the cost of BDCP environmental reviews, planning, design, construction and mitigation.

The plan has evolved into what is now dubbed California WaterFix, which entails the construction of tunnels to convey water around the delta. The cost is currently estimated at $15 billion, to be repaid by participating California State Water Project and Central Valley Project water contractors.

Federal water contractors that receive supplies from the CVP and state water contractors were responsible for splitting the cost of the BDCP.

Investigators, though, concluded that the federal agency "contributed 64 percent of the CVP water contractors’ share, or 33 percent of the total funding for the BDCP through June 30, 2016."

Investigators further concluded that though the bureau "reported the funds it requested and received from Congress under the California Bay-Delta Restoration appropriation for the BDCP, it did not report $50 million derived from another appropriation, available for other general purposes, that it also used for the BDCP."

The bureau obtained this "$50 million over a 7-year span by using a complex, obscure process that was not disclosed," investigators stated.

"The cost was absorbed by the federal government rather than being repaid by CVP water contractors," the report noted.