Report exposes inaccuracies in benefit-cost analysis of California’s Delta Conveyance Project
A newly published report challenges the financial feasibility of the Delta Conveyance Project (DCP) as outlined by the Benefit Cost Analysis (BCA) released by the Department of Water Resources’ (DWR). The report from Dr. Jeffrey A. Michael, Director of Public Policy Programs at the University of the Pacific, finds that DWR’s BCA is flawed and inflated, with questionable assumptions, overvalued benefits and a failure to consider major project risks and financial implications. At an estimated cost of $20.1 billion, the DCP represents a substantial financial commitment for water agencies amidst growing financial constraints. The DWR’s BCA claims a benefit-cost ratio of 2.2, suggesting the project’s economic viability. However, Dr. Michael’s review concludes that this ratio is inflated and unreliable due to unjustified optimistic assumptions underlying the analysis.