Senate Committee on Natural Resources and Water Update on Delta Plans

by coalitionadmin on March 15, 2012

Senate Committee on Natural Resources and Water Update on Delta Plans
February 28, 2012

Statement of Jeffrey A. Michael, Ph.D.
University of the Pacific
Principal Consultant, Delta Protection Commission Economic Sustainability Plan

The Economic Sustainability Plan (ESP) is a lengthy, peer-reviewed report that touches on many aspects of the Delta.  To be brief, I am going to focus on those aspects of the ESP that are most fundamental to the plans being discussed here today: the Delta levee system and economic sustainability of the Delta; and the potential impacts of the BDCP on economic sustainability of the Delta, public  safety, and protection of critical infrastructure.

First, the ESP concluded that seismic upgrades to most lowland Delta levees are the foundation of the best strategy to further the co-equal goals of water supply reliability and ecosystem restoration while protecting and enhancing the Delta as an evolving place.  Seismic levee upgrades protect export water supplies from earthquake and flood risk at far lower cost than an isolated conveyance facility, and also create an important opportunity to improve habitat by supporting appropriate vegetation on the water side of enlarged levees.  Seismic levee upgrades also generate a host of additional risk reduction benefits for public safety and critical infrastructure that are not created by BDCP alternatives to meet the co-equal goals.  These critical economic assets include highways, inter-regional electricity transmission lines, natural gas production and storage facilities, fuel pipelines, prime farmland, local water facilities, homes and business structures.    Because of these broad based benefits to all stakeholders, the economic analysis for the Department of Water Resources’ Delta Risk Management Strategy Phase 2 reached the same conclusion as the Economic Sustainability Plan: Delta Levees have the highest statewide benefit-cost ratio of any investments being considered in various Delta Plans.

Second, the ESP found that most proposed ecosystem improvements in the BDCP and other plans can be consistent with economic sustainability in the Delta, and that some ecosystem improvements, such as improved fresh water flows, significantly enhance both the Delta’s economy and environment.  Other ecosystem strategies, such as enhanced flood bypasses, have costs on the Delta economy but can fit with a sustainable Delta economy as long as local interests are actively engaged in project planning and mitigation.  However, the ESP recommends against a proposal to create 65,000 acres of tidal marsh in the BDCP because of its many negative impacts on the Delta economy and public health, uncertain environmental benefits, and nearly $2 billion in implementation costs from public funds.

The ESP consultant team included two highly regarded registered professional engineers, Dr. Robert Pyke and Col. Mike Conrad, former commander of the Army Corp. of Engineers Sacramento District, who made an assessment of the current condition of levees and made recommendations on appropriate levee standards.  Our engineers concluded that Delta levees are in better condition than often portrayed, and estimated that only 350 miles, roughly 1/3 of the system, falls short of the PL 84-99 standard.  Like many earlier assessments of the Delta Levee system, they concluded that the PL 84-99 standard is the minimum engineering standard for all Delta levees, in contrast to the current draft of the Delta Plan and a proposed DWR investment strategy that would permanently adopt a lower interim standard already met on all but about 100 miles of Delta levees.  These proposals would make “fragile levees” the goal of state policy, and risk the loss of federal government assistance  in responding and recovering from future levee breaks.

The ESP engineers also emphasized that the Delta levees work as a system, and that the levees protecting lowland islands are among the most important to the structural integrity of the system. In contrast, both the Delta Plan and the BDCP downplay the systemic role of lowland levees because many lowland islands are agricultural and contain few residents and state-owned assets.  This ignores the fact that lowland levees are part of a levee system and enhance protection of urban areas, protect infrastructure critical to the state’s economy, protect water quality and conveyance, provide recreational opportunities, and define the Delta as a Place.

The ESP levee recommendations go beyond attaining PL 84-99 standard for all Delta levees and call for seismic levee upgrades, accurately described by one journalist as “fat” levees, for between 300 and 600 miles of Delta levees.  These “fat” seismically resistant levees would expand existing levees to have a wide, 50 foot crown, would protect export water supplies from seismic risk, allow for  vegetation and habitat enhancements on the water side of levees, and also protect other critical infrastructure, public safety, and prime farmland.  These seismic levee enhancements are estimated to cost $2 to $4 billion, far less than a peripheral canal, and would also substitute for other costly infrastructure protection proposals, such as a proposal in some DWR reports to spend $5 billion putting state highways on piers to protect against Delta floods.

These findings were controversial when initially released over the summer in early drafts of the ESP, but have been affirmed by multiple reports and a peer review organized by the Delta Science Program.  New draft maps of the Delta levees have been released by DWR that document the improvements in Delta levees made in recent decades, and estimated 326 miles were below the PL 84-99 standard, about the same as the ESP.  A technical, background memorandum supporting the DWR investment strategy that has just been released also emphasized the systemic value of the ESP.  Finally, the peer review team organized by the Delta Science Program, praised the ESP for calling out the importance of lowland levees, concurred that PL 84-99 is a minimum standard while recommending higher standards in many locations, and agreed that “fat” levees were a potentially viable strategy that needed more technical development to support costs and performance.

In addition to the ESP advocating for seismically improved levees, recently released results from the Delta Risk Management Strategy (DRMS) Phase 2 analysis show that seismically improved levees were identified by the Department of Water Resources as a promising risk reduction strategy in 2007, when BDCP was in early stages of planning that narrowed its focus to isolated conveyance.  In a January 2008 report to the California Legislature required by AB 1200, the Department of Water Resources and the Department of Fish and Game identified seismic levee upgrades as the lowest cost of the three most promising risk reduction alternatives including isolated conveyance facility that was estimated to cost less than $5 billion at that time, one-third of the current cost estimate of isolated tunnel conveyance.

The ESP also details the contribution of agriculture, recreation, and critical energy, transportation and water infrastructure in the Delta to the regional and state economy, and estimates the long-term economic impacts of ecosystem improvement proposals.  The ESP estimated direct Delta farm revenues were $795 million in 2009, and the five most valuable crops were tomatoes, wine grapes, corn, alfalfa, and asparagus. Including related food and beverage manufacturing enterprises such as wineries and canneries, the ESP found Delta agriculture supports over 25,000 jobs across California and over $2.1 billion in income (value added), and shares the strong economic prospects of agricultural regions around the state.  The Science Program peer review panel commended the economic modeling of Delta agriculture in the ESP.

The ESP found that the ecosystem proposals in the BDCP would result in a 10-30% loss in Delta agricultural output with the wide range depending upon the extent of tidal habitat in the Delta and water quality impacts from isolated conveyance.  Although costly for the struggling economies in the Delta region, a 10% decline in the agriculture economy could potentially fit with economic sustainability, but would require substantial reductions in tidal habitat and water quality requirements that are unlikely with a 15,000 cfs isolated conveyance.

The ESP estimates Delta recreation and tourism attracts 12 million visitor days per year, generating roughly $250 million in visitor spending in the Delta. Delta recreation and tourism supports more than 5,000 jobs and $350 million in income (value added) across California. The ESP also found that Delta recreation and tourism has shown little growth despite rapid population growth in the region, and developed strategies to encourage growth in Delta recreation by developing focal points that enhance recreation and the Delta’s historical legacy towns.  BDCP and other habitat proposals were found to have a mix of positive and negative effects for recreation.  Potential fishing and wildlife viewing enhancements were positives, but negative impacts on recreation could occur from reductions in Delta water quality changes, a possible open water area in the Central Delta, increased regulations on private investment, and industrialization of a scenic, rural stretch of the Sacramento River by construction of new water intakes.

The ESP identified Delta infrastructure systems, and the closely related transportation, warehousing and utilities economic sector, as the third critical economic cluster affected by Delta planning efforts. The report finds that the Delta’s roles as a center for regional and statewide energy and transportation infrastructure and local water supplies is at least as economically important as its role in the state water system.  BDCP proposals that could impact water quality are a concern for in-Delta municipal and industrial water supplies, but the biggest risk to in-Delta infrastructure are plans that could result in lower investment in the Delta levee system.  The Department of Water Resources’ DRMS studies found economic losses from non-water Delta infrastructure were greater than water export losses in all Delta flood scenarios, including an earthquake event that floods 20 to 30 islands.  That is why levee improvements that help all economic interests have the highest benefit per dollar of investment of all Delta options.

As a final note, I would like to thank the Delta Stewardship Council for their positive and professional engagement throughout the process.  They have challenged us, reminding us of the co-equal goals and organizing a peer review panel.  They have also listened to us, most notably by dedicating significant hours of DSC meetings to substantive discussions of the ESP.  Both plans have been strengthened as a result of this dialogue.

This concludes my remarks and I welcome your questions.

Thank you

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