May 12, 2004

Landmark Ag-to-Urban Water Transfer Buttresses Southland's Water Supplies

Palo Verde Irrigation District Farmers to Rotate Cropland, Transfer Water to Urban Region

A landmark program, in which farmers in the Palo Verde Irrigation District of Riverside and Imperial counties will rotate a portion of their cropland in and out of production while transferring the unused irrigation water to urban Southern California, was given the final go-ahead by the Board of Directors of the Metropolitan Water District. This action will clear the way for the board of directors of the Palo Verde Irrigation District to approve the agreement.

Approval by both agencies will give the green light to begin signing contracts with farmers around the city of Blythe, and some of their Colorado River irrigation water could begin flowing to the Southland's 18 million people as soon as August.

The result of several years of cooperative negotiations and community involvement, the ag-to-urban water transfer is one of the biggest and friendliest to-date, said Metropolitan's board Chairman Phillip J. Pace.

"This new supply, which ranges from 25,000 to 111,000 acre-feet annually over the next 35 years, will add another investment to Metropolitan's already diverse portfolio of water-supply resources," Pace said.

An acre-foot is about 326,000 gallons, enough to supply two families for a year.

"Together with Metropolitan's allocations from California's State Water Project and the Colorado River, and our conservation, recycling and storage programs, these new supplies will help ensure reliable water for our region for decades to come," said Ronald R. Gastelum, Metropolitan's president and CEO.

"Metropolitan's long-term planning and aggressive supply diversification has put our region in a position to mitigate impacts of the five-year drought in the Colorado River watershed," Gastelum said. "We're also fortunate that our two main sources -- the State Project and the Colorado -- are two separate hydrologies, so when one has a bad year, the other is usually average or above."

"The beauty of this program is that it benefits everyone," said Dennis B. Underwood, Metropolitan vice president for Colorado River resources. "Over 70 percent of your farmland remains in production, there's no change in land ownership or water rights, and farmers are making more money per-acre than they would have if they farmed the lands.

"By providing farmers with a steady cash flow, this type of program will help stabilize farming in the region, benefiting the entire community."

Under today's action, farmers of the 104,500 acres of priority lands in the Palo Verde Irrigation District who sign on to the program will be eligible for one-time payments of $3,170 per acre for up to 29 percent of their irrigated acreage, and annual payments of $602 per acre kept out of production. The local economy will also benefit from an economic development fund of $6 million that will be established when the water transfers begin.

Sign-up and start-up costs will total approximately $100 million, and -- depending on how much water is taken each year -- the transfers could cost more than $1 billion over the life of the program.