Lawmakers debate audit of Delta Conveyance Project; supporters cite transparency, agencies urge existing oversight

Assemblymember Randi Ransom requested an audit of the Department of Water Resources— (DWR) Delta Conveyance Project (DCP) to identify planning and administrative expenditures from July 2022 through June 2025, funding sources (including contributions from state water contractors), and whether project budget assumptions remain realistic amid construction inflation and market volatility.

Why it matters: Supporters said hundreds of millions of dollars have been spent on planning and that the public deserves a clear accounting before construction begins on a project that has been controversial in courts and public opinion. They asked the auditor to examine whether DWR and some state water contractors have projected how construction bond costs would be repaid and whether ratepayers would shoulder significant new costs.

Supporters' case

Assemblymember Ransom said the Delta conveys water for 27 million Californians and that planning costs are running at an estimated $1.5 million per day. Attorneys and local agency representatives from districts north of the Delta told the committee they represent ratepayers and counties concerned about potential long-term obligations, including revenue pledges and bond financing that could have no built-in cap or off-ramp.

Agency responses

DWR Director Carla Namath and others told the committee the Delta Conveyance Project is a proposed 45-mile modernized conveyance segment of the State Water Project that serves 27 million Californians and irrigated farmland. DWR argued an immediate audit would duplicate prior work, use committee resources and possibly delay urgent work. DWR said it has provided public materials and a letter to the committee with project documents. Metropolitan Water District (Metropolitan) said it contracts an annual independent audit for the State Water Project, has held many public deliberations and that Metropolitan has not yet committed to construction financing; Metropolitan said its board has funded planning work to inform future decisions.

State auditor—s scope and timing

State Auditor Parks summarized intended objectives: identify expenditures and revenue sources for planning activities (July 2022–June 2025); review whether water contractors project ratepayer impacts to repay construction costs; and assess whether key environmental analyses and consultation required by the Delta Reform Act have been completed. Parks cautioned that components tied to ongoing litigation or validation proceedings may limit review in those areas. He estimated about 2,800 audit hours, accounting for complexity in state water law and environmental requirements.

Committee discussion

Committee members split on the merits. Supporters said an audit would bring clarity about spending and financial risk exposure to ratepayers; opponents, including DWR and Metropolitan, argued existing oversight, audits and statutory processes address the concerns and that an audit now would be premature and possibly duplicative. Some members said they would prefer targeted transparency changes or legislative oversight instead of a full audit at this stage.

Ending note

The committee did not take a final vote on the Delta Conveyance audit request during the hearing. Supporters said they would continue to press for transparency and accounting; agency witnesses reiterated their willingness to provide documentation and urged the committee to rely on existing review processes.