CALFED Finance Planning
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Transcript of CALFED Finance Planning
![Page 1: CALFED Finance Planning](https://reader036.fdocuments.net/reader036/viewer/2022070401/56813686550346895d9e0fc2/html5/thumbnails/1.jpg)
CALFED Finance Planning
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Need for Finance Planning
• Status quo approach to rely so heavily on State bond funds unlikely in the future
• Existing funding significantly declining• Legislative direction on new water user fee • Benefits-based financing principle in ROD • Avoid piecemeal finance planning
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California Bay-Delta ProgramYears 1-4 Program Funding
$0
$100
$200
$300
$400
$500
$600
$700
$800
$900
Yr 1 Yr 2 Yr 3 Yr 4
Program Years
$ i
n m
illi
on
s
Water User
Local
Federal
State
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California Bay-Delta ProgramYears 1-5 Cumulative Funding
Federal7%
Water User7%
Local Grant Match22%
State Bond Funds55%
StateGeneral Fund
& Other9%
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California Bay-Delta ProgramYears 5-8 Estimated Funding
$0
$100
$200
$300
$400
$500
$600
$700
Yr 5 Yr 6 Yr 7 Yr 8Program Years
$ i
n M
illi
on
s
Water User
Local
Federal
State
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Finance PlanningReports
Finance Options Report–Expand understanding of benefits and
costs –Develop financing options
Ten Year Finance Plan –Develop specific funding targets–ID unmet needs–ID financing strategy
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Finance PlanningReports
Draft Finance Options Report provides Foundation for 10 year plan discussion:
• Annual funding targets for each element and task/project
• Schedule and readiness of projects • Potential benefits and beneficiaries • Possible finance strategies for each element
and task/project
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Finance Planning Outreach
• Stakeholder and agency workgroups & informal meetings
• Legislative hearings & meetings• Public meetings and workshops • Independent Review Panel
– 8 member panel of academics and practitioners
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Analysis For Developing Finance Plan
1. What are the reasonable funding
needs/targets?
2. What are the benefits?
3. Who are the beneficiaries?
4. How should costs be allocated?
5. What are the finance tools?
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10 Year Finance PlanFunding Targets & Unmet
NeedsProgram Element Funding Targets Available Funding Unmet Needs
Ecosystem Restoration $1,701.3 $701.7 $999.6Environmental Water Account $416.1 $122.9 $293.2Water Use Efficiency $2,236.3 $1,348.2 $888.1Water Transfers $6.0 $6.0 $0.0Watershed $123.0 $51.6 $71.4Drinking Water Quality $264.4 $4.5 $259.9Levees $489.8 $61.4 $428.4Storage $1,034.5 $952.6 $81.9Conveyance $338.9 $143.6 $195.3Science $368.9 $22.5 $346.4Oversight & Coordination $123.0 $73.6 $49.4
Subtotal $7,102.1 $3,488.6 $3,613.4
Potential Capital ProjectsSurface Storage Construction $5,358.9 $0.0 $5,658.9Conveyance Construction $2,408.4 $149.5 $2,258.9Susiun Marsh Levees $101.0 $0.0 $101.0
TOTAL (including Potential Capital Projects) $15,270.4 $3,638.2 $11,632.2
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What are the Benefits?
– Water supply (yield & reliability)
– Drinking Water Quality
– Ecosystem Improvement
– Flood Protection
– Hydropower
– Recreation
![Page 12: CALFED Finance Planning](https://reader036.fdocuments.net/reader036/viewer/2022070401/56813686550346895d9e0fc2/html5/thumbnails/12.jpg)
Measuring “Economic” Benefits
• More Easily Measured: Water supply,
water quality and flood protection
• More Difficult to Measure: ecosystem
improvements
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Finance Tools For the Public Share
– State General Obligation Bonds– General Funds– Federal appropriations
For the User Share – Self Liquidating GO Bonds– State Revenue Bonds– SWP & CVP contractor charges– JPA Revenue Bonds– Local matching contributions– New State Administered Fees
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New State Administered Fees
Fee versus Tax:• Need a Nexus between level of benefits and
amount paid in fees
• Each program in CALFED has different set of beneficiaries that would result in varying fee levels among water users
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New Benefits Based Water User Fee
Finance Options Report suggests that a water user fee is best suited to programs with diffuse water user benefits & not able to identify individual beneficiaries such as:
• Ecosystem Restoration• Environmental Water Account• Drinking Water Quality• Delta Levees• Watershed
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Example Finance Strategies
• Surface Storage Construction
• Groundwater Storage
• WUE (Conservation, Recycling, & Desalination)
• Ecosystem Restoration Program
Financing negotiated project by project based on willing beneficiaries
GW and WUE Grant Programs – Primarily local funding, Public share for broader statewide benefits
Public share - Future State bonds & Fed appropriations, Water User share - fee possible, Local cost shares
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10 Year Finance PlanNext Steps
Before mid-October
• Refine funding targets and available funds
• Develop proposed cost sharing plan
• Continue outreach with agencies and stakeholders
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Finance Planning Issues /Challenges
• Measuring or understanding benefits to support cost sharing
• Philosophical differences--property right vs. public trust
• Ensuring balance & linkages across Programs
• Large gap, no easy money, numerous interest groups & timeframe condensed