New Proposed Westlands Water Contracts to Users

New Proposed Westlands Water Contracts to Users

November 21, 2019

Statement from Tom Birmingham, General Manager of Westlands Water District

A response to the U.S. Bureau of Reclamation’s proposed conversion of the Westlands Water District water service contract to a repayment contract

The American West is an arid region. When President Obama signed the Water Infrastructure Improvements for the Nation (WIIN) Act in 2016, it was with the express intent of improving the nation’s water infrastructure, especially in the western United States. As part of this improvement, Section 4011 (a)(1) of Subtitle J of the Act provides that the Secretary of the Interior shall convert water service contracts to repayment contracts at the request of any existing water service contractor.
Section 4011 was included in the WIIN Act to create a source of money that the Bureau of Reclamation could use to construct water storage projects around the west. It was intended by the Act’s co-author, Senator Dianne Feinstein, to help California “prepare for [that] future while providing us with access to more water now.” When President Obama signed the bill into law, he stated that, “This important partnership has helped us achieve a careful balance based on existing state and federal law.”
Converting “temporary” water service contracts to “permanent” repayment contracts is not uncommon. In fact, an underlying principle of federal Reclamation law  that water users who have repaid the construction costs of a project would have a permanent right to the use of water developed by a project  has been reaffirmed by Congress multiple times since it was first laid out in the Reclamation Act of 1902.
In the Central Valley Project, the San Joaquin River Restoration Settlement Act directed the Secretary of the Interior to convert water service contracts in the Friant Division to repayment contracts to generate revenue for the San Joaquin River restoration program, and those water service contracts were in fact converted to repayment contracts. According to the Bureau of Reclamation, as of October 2019 more than 75 agencies that had “temporary” water service contracts to receive Central Valley Project water, including the State of California Department of Fish and Wildlife, have exercised the option provided by the WIIN Act to convert their contracts to “permanent” repayment contracts. The contract terms proposed in the repayment contracts for Westlands and other Central Valley Project contractors under the WIIN Act are nearly identical to those in the Friant Division repayment contracts.
Further, as President Obama also noted, the provisions of Subtitle J of the WIIN Act were intended to help meet California’s long-term water needs, helping to “assure that California is more resilient in the face of growing water demands and drought-based uncertainty.” In the case of Westlands’ contract conversion, like all contract conversions done before or after, it offers a win-win for all parties.
The Westlands contract conversion will accelerate payment of approximately $320 million to the federal government years before payment is due. This money, pursuant to the WIIN Act, will be placed in the Reclamation Water Storage Account to be used for the construction of water storage and supply projects that can benefit all Central Valley Project purposes.