The Commission approved a $268.9M supplemental funding determination for Sites, raising the conditional ceiling to $1.36B for inflation and a new emergency drought response benefit (no funds disbursed). Sites said draft water-right conditions could reduce performance ~12–15% (project-specific) or ~30–50% if broader Bay-Delta plan conditions apply; a final order could come in September. Draft public benefit contracts were presented; comments due July 6, 2026.
The SWP allocation was raised to 45% for Water Year 2026, while groundwater storage declined by ~1.5 million acre-feet in WY2025. DWR is implementing its Subsidence BMP through local GSA meetings focused on avoiding irreversible subsidence. WSIP updates covered Sites Reservoir and Chino Basin progress; a draft water-rights decision may limit Sites diversions and affect project economics, with Sites final award hearing scheduled in the future.
The Commission approved $52.1M in supplemental inflation-adjusted funding for the Harvest Water recycled water program, on track for full o peration by mid-2027. Economists said they used the Bureau of Reclamation Construction Cost Trends index here and would recommend the same approach for other WSIP projects for future Commission consideration. Sites draft water right comments are due May 22; a Sites supplemental funding request may be considered as early as June.
The Sites Reservoir project's ~$3B reservoir package faces potential delays after major labor unions raised concerns about PLA negotiations, with the Sites board seeking significant progress within about 30 days. California's Water Plan update under SB 72 targets 9 million acre-feet in new supply by 2040 across 138 watersheds. The Kern Fan Project was reclassified as conjunctive use and received $5.6M in early funding, both approved unanimously.
The Commission approved the Kern Fan Groundwater Storage Project's reclassification to conjunctive use and $5.57 million in early funding. Significant controversy emerged over the Sites Reservoir Project's selection of Barnard Construction, with labor organizations objecting and a prior letter from Governor Newsom urging strong labor relations. DWR presented its SB 72 implementation framework with a 9 million acre‑foot additional supply target by 2040.
