You are here

Science Panel Provides Analysis of Key Delta Economic Plan

January 2012

An independent Science Review Panel discussed strengths and weaknesses of the Delta Protection Commission’s (DPC) draft Economic Sustainability Plan (ESP) during the December meeting of the Delta Stewardship Council.

The Delta Reform Act of 2009 – the same legislation that created the Council – requires the DPC to both adopt the study and make recommendations that inform the Council's Delta Plan regarding the socioeconomic sustainability of the Delta region. These recommendations include areas of public safety, flood protection and management, agricultural sustainability and recreational investment opportunities along key corridors of the Delta.

Among the strengths of the plan, the panel concluded, is that the draft describes the intrinsic value of the Delta and its economy, offers creative ideas for improving the Delta economy and substantiates the importance of lowland levees for protecting people, property and the environment. The revised ESP, which will reflect the panel’s comments, will be completed in January, 2012.

The panel also listed a number of weaknesses. For instance, the panel pointed out that the ESP does not offer a clear or viable definition of economic sustainability. The ESP’s definition of sustainability implies that the only sustainable economy is one with no diminution of economic output or activity from any of the key economic sectors. This status quo situation does not allow for tradeoffs that are likely to be needed in the Delta and would appear to be of limited use in policy decisions, the panel said.

The panel continued saying the plan is not a benefit-cost analysis of alternatives for improving water supply reliability and enhancing the ecosystem. The panel also said the draft includes an unrealistic cost for upgrading lowland levees, an inadequate evacuation plan during a disaster, and that an upgraded levee system will not necessarily improve Delta water supply reliability in the face of an earthquake - a surprise even to the panel.

“The seismic risk to the water supply is not that significant,” said Robert Gilbert, chair of the peer review panel and a civil engineering professor at the University of Texas. “[An earthquake] will not be the Armageddon people thought it was in terms of water supply.”

Gilbert explained that the panel’s findings on water supply reliability came from its interpretation of the Department of Water Resources’ Delta Risk Management Strategy (DRMS) Phase 2 report.

Jeff Michael, the ESP principal investigator, agreed with most of the findings by the panel, but departed with the panel on this issue.

“On the idea that improving levees won’t improve water supply reliability, this is the one comment where we respectfully disagree with the panel,” Michael said.

Michael added that the DRMS report used a different model than the ESP to diagnose any potential threats. Michael said the reports cited by the review panel did not consider the kind of seismically resistant and repairable upgrade to the existing levee system described in the ESP.

“Nothing in DRMS 2 resembles actually what we’re talking about [in the report],” Michael said. Comparing the potential levee work and cost in the Delta to the activity that has already occurred in New Orleans in the wake of Hurricane Katrina, Gilbert said the plan falls short.

“Estimating costs of upgrades needs to go into more detail,” Gilbert said regarding the $3 to 4 billion price tag the ESP estimates. “We don’t believe that work has been done. This cost estimate of upgrading levees is optimistic.”

Gilbert also pointed out that there are about 800 more miles of levees in the Delta than New Orleans, and what has been spent in New Orleans, so far, is four times the amount the ESP estimates.

“To give some context…in New Orleans after Katrina, the cost estimate to repair the system and bring it back to the 100-year protection level was on the order of $3 to 5 billion in 2005,” Gilbert said. “In 2007, it was up to $8 billion and as of today, it is $16 billion that we’ve spent doing that.”

Of paramount concern, of course, is public safety. The need for evacuation planning is not emphasized in the ESP, which the ESP authors acknowledge and plan to address in the future. This becomes even more important as the danger in the Delta is significant and levee repairs will only go so far in saving lives.

“The risk in the Delta to public safety is orders of magnitude, a thousand times greater than the risk due to dams in the United States we have said is acceptable,” Gilbert said, referring to a slide during his presentation (view slide here).

“You’ll note that as of 2011, for fatalities on the order of 10 to 100 in a flood event, you actually have a greater risk here than there is New Orleans as of today.”

But Gilbert cautioned that levee improvement is only one piece of the safety puzzle, putting a premium on outreach and education.

“Thinking in terms of levees as the only way of helping these [Delta] communities is narrow. I think we really need to look at broader ways of helping…you can spend a lot less money by working with the public [before a disaster] and have a much bigger impact.”

In its recommendations to the Council, the panel also encouraged the Council to develop strategies to implement a user-fee system to address the public-goods nature of the Delta and to conduct a comprehensive and credible cost-benefit analysis to look at alternatives for improving water supply reliability and enhancing the ecosystem.

The panel says that ultimately an agency needs the authority to assign and assess everyone’s fair share of costs.

In spite of the differences, Michael said the ESP and the panel found quite a bit of common ground. “For the most part, the review panel has actually validated the economic analysis in the ESP.”

To view the most recent draft of the ESP, click here.

For more information about the panel review, click here.

Coequal goals

The Delta Stewardship Council was created in legislation to achieve the state mandated coequal goals for the Delta. "'Coequal goals' means the two goals of providing a more reliable water supply for California and protecting, restoring, and enhancing the Delta ecosystem. The coequal goals shall be achieved in a manner that protects and enhances the unique cultural, recreational, natural resource, and agricultural values of the Delta as an evolving place." (CA Water Code §85054)