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MWD Told Mojave Plan Is All Wet

Resources: Committee recommends killing the Cadiz storage project for Colorado River water.


In a surprise development, a key committee of the Metropolitan Water District board recommended Monday that the district kill the controversial Cadiz water project, a $150-million plan to store surplus Colorado River water under the Mojave Desert.

The MWD's Water Planning, Quality and Resources Committee voted 6 to 3 to recommend that the district's full board "not proceed with the project." The vote went further than a recommendation from the MWD staff, which had only proposed that the district indefinitely defer the project.

The full board, made up of 37 members representing more than 26 local and regional water districts, will take up the question at its regular monthly meeting today.

Whether the board will follow the committee's recommendation is unclear. The board is not obligated to accept the committee's recommendation. Moreover, while each board member has a single vote on the committee, their votes on the full board are weighted according to their districts' original investment in the MWD infrastructure. Two of the committee votes to kill the project, however, came from representatives of Los Angeles County, which has the largest weighted vote on the full board.

A board rejection would deal a mortal blow to the project, which has been under consideration for five years but has generated fierce opposition on environmental and fiscal grounds.

After the vote, Santa Monica-based Cadiz Inc. urged the board to continue considering the project.

"Given the need for reliable water supplies and given that the program has received all federal approvals, we respectfully suggest that the public interest is best served by an open, public review of the environmental documentation prepared by MWD staff and consultants," the company said in a prepared statement.

"A great deal of public and private resources have been expended. To not complete the evaluation and review would not best serve the public interest."

Cancellation of the project would be a serious defeat for Cadiz's chief executive, Keith Brackpool, a key financial supporter of Gov. Gray Davis and an advisor to the governor on state water policy. Brackpool conceived the water project and ushered it through five years of state and federal environmental reviews.

Under the project's original plans, Cadiz and the MWD would share the cost of constructing a 35-mile pipeline to carry water between the MWD's Colorado River Aqueduct and Cadiz's storage site in the Mojave Desert north of Palm Springs.

Under the tentative partnership terms, the MWD was to deliver an upfront payment of more than $54 million to Cadiz upon final approval of the project.

The plan called for the MWD to store as much as 1.5 million acre-feet of surplus Colorado River water in an aquifer under the site and would have given the district the right to buy from Cadiz another 1.5 million acre-feet of naturally occurring groundwater from the aquifer. Cadiz stood to earn $500 million to $1 billion from the plan over 50 years. One acre-foot is roughly enough water to serve two average households for a year.

On Aug. 29, the Interior Department gave environmental approval for the sale to the MWD of the 35-mile right of way needed to build the pipeline.

But opponents have raised numerous questions about it. Water district sources have said that cost estimates for the project have risen, which would require further negotiations with the company.

Environmental critics contend that extraction of groundwater on the scale that Cadiz projects could subject the delicate Mojave Desert ecosystem to irreversible damage. Among those who have called on the MWD to cancel the program are U.S. Sen. Dianne Feinstein (D-Calif.) and Rep. Jerry Lewis (R-Redlands), whose district includes the site.

The most potent argument against the project recently has been that the continuing drought has rendered the availability of sufficient surplus water to fill the storage site doubtful. That was one of the main reasons that MWD Chief Executive Ronald R. Gastelum cited last month when he recommended that the board indefinitely defer the project.

Because of the drought, MWD officials say their expectations of available surplus over the next 15 years--even under average rainfall conditions--have been cut to 4 million acre-feet from as much as 9 million. That's not enough to justify the construction of major storage project, MWD officials say.

Gastelum also said that Cadiz's uncertain financial condition increased the financial risks that would be borne by the MWD.

District officials have long been concerned that the funds that MWD paid to Cadiz could be attached by the company's creditors, leaving the company without the wherewithal to meet its partnership obligations.

When Gastelum recommended to the board that the project be deferred, he said that one of the unresolved issues in the district's negotiations with the company is "the difficulty of fully insulating Metropolitan from a Cadiz default."

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