Modesto Irrigation District's irrigators haven't paid a fair share

May 6, 2013 

— In its April 26 editorial "MID committee doing excellent job," The Bee asked, "Who paid to build the Don Pedro powerhouse?"

Much of that information can be found by researching the Modesto Irrigation District's historical information in its 1987 history book, "The Greening of Paradise Valley," which is available on the MID website.

It is a good reflection of the MID history and was written by Dwight Barnes, a journalist hired by the MID to celebrate its 100th anniversary.

"New Don Pedro Dam and Powerhouse project had cost $115,696,000," it says on page 150, and it "paid with the following funding:

• City and County of San Francisco — $47,465,000

• Turlock Irrigation District — $32,071,000

• Modesto Irrigation District — $14,865,000

• Corps of Engineers — $5,464,000

• State of California (Davis-Grunsky) — $7,630,000

• Earned Interest — $8,293,000"

That means the MID paid approximately 12.8 percent of the total. That cost was financed through the sale of bonds as approved by voters living within the MID's boundaries. According to MID annual reports, New Don Pedro funding was converted into revenue bonds in 1974. That means electric ratepayers paid the bonds for New Don Pedro Dam and powerhouse. Irrigators made up approximately 5 percent of the total ratepayers within the district at that time, in accordance with MID annual reports. (In 2013, they make up less than 3 percent.)

On Page 105 of "The Greening of Paradise Valley":

"At the same time that retail power revenues were retiring electrical and irrigation system bonds, even larger amounts of the electrical profits were subsidizing irrigation operations and maintenance.

"Starting in 1938, power revenues were transferred annually to the irrigation department. Sixteen years later when the district celebrated its freedom from bonded indebtedness, $5,367,229 from this source had been invested in irrigation development and operation. The policy continues to this day (1987)."

Since irrigation ratepayers have relied on electric ratepayers to subsidize their budgets, the electric ratepayers have provided 100 percent of the funding for the payment of bonds for New Don Pedro. Using MID annual reports, it can be seen that less than 5 percent of the electric ratepayers are also irrigators. Therefore, more than 95 percent of the MID's New Don Pedro was paid by the nonirrigating electric ratepayers.

In 1989, the Modesto and Turlock irrigation districts completed the installation of a fourth turbine at New Don Pedro. Additionally, the TID and the MID are in the process of relicensing New Don Pedro with the Federal Energy Regulating Commission (FERC) at an estimated cost of $25 million. Annual budget allocations for legal defense of MID water rights are not included as part of the irrigation department. All of these expenses are funded through revenues generated by electric ratepayers.

In considering the information above, I suggest a modification to "The Greening of Paradise Valley" slogan "Where the Land Owns the Water and the Power" to read more correctly: "The Electric Ratepayers Own the Water and Power at MID."

Another obvious conclusion is that the FERC licensing efforts and legal defense of water rights of the MID will be funded by the electric ratepayers, not the irrigators, even though they have the most to lose. It would seem appropriate that the irrigators would want to step forward and protect their water lifeline.

DeLano is a consulting engineer who worked for the MID from 1972 to 1989, leaving as water operations division chief. He is a Modesto resident.

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