Delta conveyance audit request sparks intense debate; committee discussion continues

Assemblymember Rebecca Ransom presented a broad audit request for the Department of Water Resources’ Delta Conveyance Project (DCP), seeking a detailed accounting of planning and administrative costs, funding sources, projected construction costs and potential impacts on ratepayers and taxpayers.

Why it matters: Supporters said the DCP is one of California’s largest planned infrastructure projects and argued that hundreds of millions have been spent on planning although construction has not begun. They told the committee that escalating construction input costs and uncertain benefits justify independent legislative oversight now, before construction commitments are made.

Audit objectives: The request asked the state auditor to identify DWR’s expenditures and funding sources from July 2022 through June 2025; determine how much funding is unspent and whether DWR intends to return funds to state water contractors; review whether contractors (including the Metropolitan Water District) project rate impacts to repay construction costs; and evaluate whether required environmental and Delta Reform Act analyses have been completed. The auditor estimated the review would require roughly 2,800 hours, with added complexity if environmental or litigation issues arose.

Testimony and positions: Supporters — including county and city officials and water users represented by attorney Roger Moore and others — argued an audit was needed to clarify risks to ratepayers, taxpayers and Delta communities. They said prior audits and litigation do not substitute for a current review of costs and revenue pledges.

The Department of Water Resources (Director Carla Nemeth testified in writing) and the Metropolitan Water District urged the committee not to authorize the audit, saying DWR and contractors already provide oversight, the project is ultimately funded by contractors (not the state general fund), and ongoing regional processes and prior audits addressed many accountability concerns. DWR warned an audit could duplicate existing oversight and incur unnecessary cost and delay.

Committee reaction and status: Members debated whether pending litigation, ongoing contractor governance and existing reporting mechanisms render a state audit duplicative or necessary. Some members cited large potential ratepayer impacts and uncertainty in cost estimates. The hearing record ended without a final committee vote on the request; members expressed differing views about timing and value of an immediate audit.