The funding for Well #8 comes from Calleguas. Under that contract, Crestview must deliver 3 cubic feet per second (“cfs”) for six months if Calleguas suffers an “outage of imported water.” That would be 1,086 acre-feet, which exceeds the 717 acre-feet Crestview is allowed to pump in a whole year.
“Outage” is not defined. Crestview has given the example of physical damage by an earthquake to a major aqueduct, but outage is not limited to physical interruptions. The failure of the State Water Project (“SWP”) to deliver any water because of drought may also be an “outage.” In 2022, Calleguas is getting only 5% of its requirements from the SWP. If that is not an “outage,” then zero percent delivery, which could happen next year, probably is.
Maybe the Crestview board assumed it would not have to deliver water to Calleguas until Well #8 was completed and on line, but there is no such limitation in the contract. Crestview’s delivery obligation exists even if Well #8 does not exist or is unable to deliver some or all of the 3 cfs 24/7.
Would Crestview impose water use restrictions on shareholders in order to send water to Calleguas instead? Water Crestview delivers to Calleguas can physically get only to customers of Cal-American, the City of Camarillo, and the City of Oxnard. Crestview customers will not be able to get any of that and, of course, will not be getting any normal deliveries from Calleguas. Crestview can prioritize its own customers’ needs, but has to pay Calleguas $316 per acre-foot for under-deliveries. If none can be delivered, that would be a $343,176 penalty on Crestview shareholders.
The contract provides that Calleguas will return to Crestview the same amount of water it “borrowed,” but only after the “outages” have ended, which in a continuing drought could be years later.
The only value Well #8 would have to Crestview is as a backup to Well #6. That is what Crestview told the County when it was trying to get a permit for Well #7. Why are we taking on such big costs and risks for such a small benefit? We are forwarding this post to Crestview with a request for a response.
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