News Release: March 19, 2024
On Monday, March 18, 2024, the Central Coast Blue Regional Recycled Water Authority
(CCBRRWA) Board of Directors received an update on project costs, funding, and financing for the proposed Central Coast Blue Project (Project), a regional water reuse project designed to protect the local groundwater basin from seawater intrusion and create additional water supply for the cities of Pismo Beach, Grover Beach, and Arroyo Grande.
Increases in Project costs, an unexpected loss of state grant funding, and improvements in local water supply conditions have prompted leaders to pause Project design and permitting until the impacts of these recent developments can be evaluated. This decision was made after the Project team announced that the $15 million Water Recycling Funding Program Grant awarded by the State Water Resources Control Board in September 2023 was reduced to $5 million due to the state’s budget deficit. This reduction in grant funding impacted projects throughout California and has created a substantial gap in funding for the Project.
Additionally, estimated Project costs have increased since the last cost estimate was prepared. The range of estimated Project costs increased from $85-$112 million in 2022 to $134-$159 million in 2024, with most of the escalation attributed to inflation. In recent years, the construction industry has experienced extreme material cost volatility due to inflation and post-pandemic supply chain issues. These market conditions have increased costs for the Project and many other water resources projects throughout the state and country, especially those employing advanced treatment technologies.
In response to these funding challenges, the partner agencies will re-evaluate their current water supply needs and consider Project alternatives. Additionally, the program management team is exploring options that would reduce Project costs and leaders are advocating to secure additional grants. Partner agencies are committed to understanding the full impact of these updates before moving forward with the Project. As a result, Project construction – initially planned to break ground in summer 2024 – is expected to be delayed by at least one year.
The partner agencies remain committed to providing much needed water resiliency to the
community, and in the coming months, the cities will work closely with their councils and
communities to determine next steps. The CCBRRWA will also consider options to enhance
community engagement and outreach efforts. The Central Coast Blue team will focus on
connecting with the affected communities, addressing questions and concerns, and collecting
input on a reliable and resilient water supply solution.
About Central Coast Blue
Central Coast Blue is a collaboration between the cities of Grover Beach, Arroyo Grande and
Pismo Beach. The Project includes construction of an Advanced Water Purification Facility,
where water from Pismo Beach’s Wastewater Treatment Plant will be purified using state-of the art technologies before being injected into the groundwater basin. In 2022, the city councils approved a Joint Exercise of Powers Agreement to form the Central Coast Blue Regional Recycled Water Authority (CCBRRWA) to manage and operate the Project. The CCBRRWA is governed by a three-member Board of Directors, consisting of one representative from each city.
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Contact:
Geoff English, General Manager
Central Coast Blue Regional Recycled Water Authority
805-418-6560
