Stars aligning for California's long-envisioned water storage project

California's plan to build a 1.8 million-acre-feet reservoir to store rainwater may finally be ready for its moment in the sun.

The decades-old Sites Reservoir proposal would add capacity to California's water storage system to see it through its cycle of severe droughts.

It received a turbo boost Monday when Gov. Gavin Newsom certified the project as one that can be accelerated through the California Environmental Quality Act review process. The project is one of the first that will benefit from Senate Bill 149, a law passed this year that sets a 270-day deadline to bring oppositional lawsuits.

photo of Lake Oroville, California, reservoir
Lake Oroville, fed by the Feather River about 80 miles north of Sacramento, was at 100% of its capacity in July, according to the California Department of Water Resources. A much different sight than at the height of the drought when many houseboats were on dry land as the water level fell dramatically. The Sites Reservoir would help store additional water in the region.
Bloomberg News

"We're cutting red tape to build more, faster," Newsom said in a statement. The Sites Reservoir project will ensure Californians have access to clean drinking water and the state "is more resilient against future droughts," he said.

CEQA, passed in 1970, and signed by then-Gov. Ronald Reagan, has often been used to kill projects through a steady stream of lawsuits that postpone start dates indefinitely. Many attempts to reform CEQA through the years have been thwarted by environmental advocates.

SB 149 allows the governor to certify qualifying infrastructure projects for judicial streamlining under CEQA. If the project is certified under SB 149, the courts must decide CEQA challenges within 270 days — saving months or even years of litigation delays after a project has already passed environmental review, while still allowing legal challenges to be heard, according to the governor's office.

"We expect that the governor's certification will expedite completion of the project," said Jerry Brown, the Sites Project Authority director. Prior estimates of certification saving 12-18 months still seem reasonable, he said.

The Sites project had already qualified for funding from the state's $7.5 billion water bond approved by voters in 2014 and from a low interest loan made possible through the federal infrastructure bill to cover the cost of the $4.4 billion project.

The $2.2 billion Water Infrastructure Finance and Innovation Act loan and $875 million from the state's water bond program would cover the brunt of the cost, but the authority also planned to issue $600 million in revenue bonds to cover the remaining costs, Brown told The Bond Buyer for a previous article.

The U.S. Bureau of Reclamation and Sites Project Authority finalized the Environmental Impact Review and Environmental Impact Statement for the project last week.

The Sites Authority will consider project approval and EIR certification at its board meeting on Nov 17, Brown said. "The Bureau of Reclamation is expected to issue its record of decision on the EIS spring 2024 upon release of the biological opinion for the project."

The six-year drought that began in 2011 reinforced the need for the Sites Reservoir Project. The state just saw the close of another multi-year drought earlier this year, when record-breaking rainfall struck the state.

The Sites Reservoir Project had been envisioned for decades, but languished amid protestations from environmental groups that say the project would harm the state's decimated salmon population.

Sites was first proposed in the mid-1980s as the second stage of the State Water Project to follow the Oroville Dam, California Aqueduct and associated hydroelectric plants and pumping stations. The SWP collects water from rivers in northern California and redistributes it to urban areas in the San Francisco Bay area, southern California and farms in the Central Valley through a network of aqueducts, pumping stations and power plants.

Sites, a small community in Colusa County in northern California, is surrounded by rolling hills and set in a basin of grasslands used primarily for cattle grazing. The proposed reservoir, which would flood the basin, has not received opposition from ranchers.

The project involves building two dams to block off the valley, one at the northern end, the Golden Gate Dam, and the Sites Dam, near the Sites community.

A pumping station would straddle a series of smaller dams at the northernmost point of the valley. A 10-mile canal would also be built that would connect to the existing facilities to pump water in and out of the reservoir.

Water would be released in dry years to benefit the environment, farms and businesses downstream.

The project has received support from congressional leaders on both sides of the aisle.

Recently deceased Congresswoman Dianne Feinstein said in her support letter last year that she was pleased the state was finally on the verge of constructing several major storage projects. She added that Sites is the largest and will provide the most significant benefits for California's water system.

The authority is currently involved in early field activities, involving surveys, and geotechnical evaluations are underway and will continue through 2025, Brown said. Heavy construction is slated to start in early 2026, following the sign off by 22 water districts, the state government and the federal government on their commitment to pay for the construction and operation of the project.

Operations are expected to begin by the end of 2032, or seven years after construction begins, Brown said.

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