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IID Board of Directors Approves Updated On-Farm Conservation Project

-Editorial

The Imperial Irrigation District Board of Directors approved the On-Farm Efficiency Conservation Program true up at their Feb. 2nd regular meeting.

The board discussed this as an informational item two weeks ago and with no further discussion on this item, it was approved 3-0 having directors Alex Cardenas and Norma Galindo absent.

On July 19, 2019, the IID Board of Directors took action to revise the On-Farm Efficiency Conservation Program payment rate from $285 acre-feet, establishing a revised budget of $30 million and utilizing an initial payment rate of $ 125-acre feet with a potential true-up, depending on various financial considerations including the board’s stated guiding principle of no deficit spending.

At the time, staff estimated $7 million of the 2019 OFECP budget would be necessary to fund the 2018-19 OFECP conservation contracts (for crops planted in 2018 and harvested approximately $23 million budget available for the 2019 OFECP (crops planted/harvest in 2019 or calendar year perennials). With an initial $ 125-acre feet payment rate for the 2019 OFECP contracts, the budget balance was estimated to fund approximately 185,000 acre-feet of conservation; conservation less than this estimate would allow for a secondary payment rate for the 2019 OFECP participants.

Unfortunately, in order to determine 2019 conservation estimates and calculate a final true-up payment if any, all contracts needed to be finalized and fully executed. In 2020, staff continued to perform the analysis and issue contracts associated with 1,372 fields applying to the 2018-19 OFECP and 3,171 fields submitting for the 2019 OFECP, totaling 4,543 fields resulting in just under 2,400 contracts with documented conservation.

In late fall 2020, staff identified a subset of contracts issued to participants that had been outstanding for more than a year and received direction from the board to implement a final contracting deadline of Dec. 1, 2020, in order to close out all programs up to and including the 2019 OFECP. This deadline was effective, and outside of a handful of fully executed contracts involved in grower/landowner litigation, these programs are now closed. This allowed staff to determine the final program conservation yields and, utilizing the unspent but budgeted monies in 2020, calculate a secondary true-up payment rate consistent with the board’s July 2019 action.

The true-up calculations utilize a $30 million budget, allocate $7 million for the 18-19 OFECP participants as estimated in July 2019, and take into account 2020 OFECP expenditures of $14,151,770. This leaves a balance of $8,848,230 remaining in 2019 the current year $30 million budget to redistribute for secondary payments to the 113,214-acre feet of conservation attributed to the 2019 OFECP, or $ 78-acre feet.

To fund the secondary true-up payment, $4,525,338 million was previously accrued for this purpose with the remaining $4,322,892 million anticipated to be paid from the 2020 Water Transfer Reserves.

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