Aanestad: 'Every resident of the state' should pay for new storage

By WES SANDER

Capital Press

As the debate over water-infrastructure financing has played out in Sacramento in recent days, agricultural water interests have resisted a fee structure that could target them as a major funding source.

A traditional financing mechanism for water infrastructure has long been the "beneficiary pays" principal, whereby water users are assessed fees to pay back significant portions of the bonds that fund projects.

A 14-member legislative conference committee worked last week and through the Labor Day weekend to shape a package of water bills aimed at fixing the Sacramento-San Joaquin Delta, spending a chunk of that time mulling the question of who would pay for new water storage.

Assemblywoman Anna Caballero, D-Salinas, has introduced a water bond of $12.3 billion, of which $3.5 billion would fund new infrastructure. At least half of the total bond would need to be serviced by beneficiary fees, said Caballero, whose measure would come before voters in November 2010, with the state likely lingering in tough fiscal straits.

"We can't put a bond of this size on a ballot," Caballero told the conference committee.

The legislative analyst's office, testifying at several hearings during the process, has likewise advocated for the beneficiary-pays principal.

Water planners have developed a handful of options for new water storage. Among them is Sites Reservoir, a proposed off-stream facility on the west side of the Sacramento Valley.

The Sites plan enjoys wide support, even among some environmental groups, as part of a solution to the Delta's woes. It could help to stabilize the estuary's flows by capturing more winter runoff upstream.

The project would benefit roughly two-thirds of Californians who depend on the Delta for water supplies, said Donn Zea, president of the Northern California Water Association, which represents Sacramento Valley agricultural users.

"It's the benefit to the environment that is most pressing there, and therefore we believe it's a worthy public investment," Zea sad. "The only fees that we feel are justified are fees that are directly linked to the benefits that we would receive from a surface storage project."

Sen. Dave Cogdill, R-Modesto, who has authored a competing bond measure of about $10 billion, agreed with Caballero on the beneficiary-pays principal.

"We believe there are significant public benefits to these items of infrastructure that we're talking about building," Cogdill told the conference committee on Sept. 4. "(But the beneficiaries) have to step up and commit themselves and prove that they're capable of providing the half or so, or maybe more, of the resources necessary to actually build the improvements."

Sen. Sam Aanestad, R-Grass Valley, who represents much of the Sacramento Valley, argued that the state should shift its perspective to view all water projects as having a general public benefit -- meaning that funding should fall to taxpayers.

"We could spend 10 years debating who finances what, and that's why projects don't get done," Aanestad said during the committee's Sept. 4 hearing.

"Maybe we should start ... getting away from the archaic system of who pays for what, and just stipulate as a legislature that this has now, in the year 2009, become a general obligation of every resident of the state," Aanestad said.

Staff writer Wes Sander is based in Sacramento. E-mail: wsander@capitalpress.com.