The Interior Department's lead water regulator provided $50 million in improperly managed subsidies to California contractors under the Obama administration as part of a major conservation program in the Golden State, the agency's Inspector General reported on Friday.
The agency's Bureau of Reclamation, which oversees water management activities in the West, did not disclose to Congress the cost of its Bay Delta Conservation Plan, nor could it explain why contractors had not paid back $50 million in federal funds related to the project.
The bureau had decided that the $50 million in appropriated funds "was used for a nonreimbursable purpose, meaning the cost was absorbed by the federal government rather than being repaid by ... water contractors," the report said. "Had [the bureau] used the appropriated funds for reimbursable [conservation plan] operation and maintenance, the purpose for which the funds were originally requested, the costs would have been repaid by [the] ... water contractors."
The watchdog said the bureau was "unable to provide documentation or analysis supporting its determination that these funds were nonreimbursable, and we question [its] interpretation of this legal authority." That is the closest the inspector comes to saying the bureau acted illegally.
Overall, the inspector found the agency guilty of not fully disclosing "to Congress and other stakeholders" the $84.8 million cost of participating in the California conservation program, which includes "its subsidizing of the Federal Central Valley Project water contractors' share of [the Bay Delta Conservation Plan] costs."
Under state law and a memorandum of agreement between federal and nonfederal parties involved in the conservation project, contractors were responsible for paying 50 percent of the cost of implementing the Bay Delta plan. In reality, the contractors only paid 18 percent. The Interior Department Bureau of Reclamation, however, paid 64 percent of the contractors' contributions. Overall, the bureau paid for 33 percent of the project's activities through June 30, 2016.
As of June 30, 2016, total funding provided for the Bay Delta project by all parties equaled approximately $257.3 million, and the Interior Department contributed $84.8 million.
The Washington Post reported that internal documents it reviewed showed the Westlands Water District, formerly represented by Trump Interior Department appointee David Bernhardt, was the largest beneficiary of the funding.
Between 2009 and 2015, Westlands received the largest share of funding among five California water districts, amounts totaling tens of millions of dollars for Westlands. The inspector general made only one passing reference to the district in the report.