The transfer of water from the Imperial Valley to coastal urban areas will continue to hold down water rates and subsidize the Imperial Irrigation District’s water department over the next 35 years, according to the district’s financial projections.
The projections were delivered to the public at Tuesday’s IID Board of Directors meeting by district Chief Financial Officer Greg Broeking.
According to the finance department’s cash flow projections, the water transfer will net the district a surplus of about $2.6 billion over the period of 2007 to 2047. Without the transfer, the water department is projected to lose about $2.1 billion over the same period.
“It’s acting as a rate-stabilization fund,” Broeking said, referring to water transfer’s financial impact on the district and rate-payers.
Broeking also compared his department’s financial projections with those of Charles DuMars, the environmental attorney commissioned by the district to study the Quantification Settlement Agreement and propose an alternative plan to the contentious set of contracts that mandate the water transfer.
DuMars’ projections, according to Broeking, have the water department running at a deficit of more than $1 billion over the same period of time. The difference lies in the assumptions that both parties worked with. Among other things, DuMars’ forecast has the IID paying more than $1.1 billion above the QSA-mandated amount that the Joint Powers Authority has to pay for environmental mitigation of the Salton Sea, as well as subsidies for other IID programs, programs that are not related to the water transfer. Ultimately, Broeking said, the finance department’s projections are based on what it knows it is required to do.
“We’re not going to put anything in our (financial) model that we are not (legally) required to do,” Broeking said.
Staff Writer Antoine Abou-Diwan can be reached at 760-337-3454 or firstname.lastname@example.org
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