DRAFT BUSINESS PRACTICE GUIDELINE FOR

SECTION 215 WATER

NUMBER: Mid-Pacific Region Business Practice Guideline 

DATE: August 12, 2014 

SUBJECT: Section 215 Revenue Application. 

PURPOSE 

To document procedure for the application of Central Valley Project (CVP) Sec 215 (215) water revenue 

for irrigation and Municipal and Industrial (M&I) water. 

APPLICABILITY

These instructions are effective until amended or resinded. 

SOURCE OF RATES 

http://www.usbr.gov/mp/cvpwaterrates/ratebooks/index.html

Definitions/Procedures

Sec 215 Section 215 water is a temporary (not to exceed one year) supply of CVP water made 

possible as a result of an annually large water supply not otherwise storable for project 

purposes, or infrequent and otherwise unmanaged flood flows of short duration. 

Sec 215 Water Rate The 215 water rates are established annually and published in the CVP special ratebook. 

The rates include operation and maintenance (O&M) costs, and construction costs. 

The rates exclude storage O&M costs and storage construction costs, since this water is, by 

definition, un-storable. 

The O&M component of the water rate includes water marketing costs, direct pumping costs, 

and any other O&M costs that are required to make delivery. 

The construction component of the water rate is charged since 215 water is additional project 

water that flows through CVP facilities; therefore, the construction component of the water 

rate is applicable even if a contractor has fully repaid their construction obligation under their 

water service contract, or has entered into a repayment contract under 9(d) of the 1939 Act. 

For Friant division contractors, 215 water can be taken as class 2 water and O&M and 

construction costs will be allocated to the contractor as class 2. 

Area Office Managers have been delegated the authority to reduce the 215 water rate from 

what is calculated and published in the CVP Special ratebook 
Central Valley Mitigation and Restoration Fund charges and Friant surcharges are contractor obligations 

Project Improvement upon delivery, and are payable no later than one month following the delivery of water. 

Act (CVPIA) Please refer to the irrigation or M&I rate books, Schedule A-1, for the appropriate per acre 

Charges foot charge. 

Trinity Public Utility TPUD assessments are contractor obligations upon delivery, and are payable no later than 

District (TPUD) one month following the delivery of water. Please refer to the irrigation or M&I rate books, 

Assessment Schedule A-1, for the per acre foot assessment. 

Application of Sec When 215 water is paid at the rate identified in the CVP Special ratebook, the revenue is 

215 Water Revenue applied as described in Section B. If an Area Office Manager authorizes a reduced rate for 

the sale of 215 water, the water revenue will be applied on a project level to offset total Water 

Marketing costs that are allocated to all CVP contractors for repayment. 

Section A Calculation of CVP 215 Water Rate

For illustration purposes, if a contractor took 1,000 acre-feet of 215 water at the rate 

identified in the CVP Special ratebook, the per acre foot rate is $21.11. The construction 

component of the rate is $11.56 per acre foot and the O&M component of the rate is $9.55 

per acre foot. These components are determined using the following information: 

Rate Components Water Rate

Water Marketing $ 6.53 

Direct Pumping $ 3.02 

Total O&M $ 9.55 

Conveyance $ 5.31 

Jones PP $ 1.74 

O’Neil PP $ 0.73 

Dos Amigos PP $ 1.23 

Direct Pumping $ 2.55 

Total Construction Cost $11.56 

Total 215 Water Rate $21.11 

Section B illustrates how Sec 215 revenues are applied. 
Section B Application of 215 Water Revenue 

If a contractor takes 1,000 acre feet of 215 water at the rate of $21.11 per acre foot, the 

contractor’s revenue of $21,110 is applied as follows: 

A B C D E F G H 

Description 

Rate per AF 

(Special 

Rate) 

Rate per AF 

(Regular 

Rate) 

Rate 

Difference 

Total 

Revenue 

@1,000 af @ 

Special Rate

Total 

Revenue 

@1,000 af 

@Ratebook 

Rate Difference 

Revenue 

Application 

 2012 2012 (B-C) (B*1,000 af)

(C*1,000 af)

Step 1

(D-E) 

Step 2

ater W

Marketing 

$ 6.53 $6.53 $ - $ 6,530.00 $6,530.00 $ - Water Marketing 

O&M 

Direct Pumping $ 3.03 $3.03 $ - $3,030.00 $ - Direct Pumping 

O&M 

Total O&M $ 9.56 $9.56 $ - $ 9,560.00 $9,560.00 $ - 

C onveyance $ 5.31 $3.06 $2.25 $ 5,310.00 $3,060.00 $2,250.00 

Jones PP $ 1.74 $0.93 $0.81 $ 1,740.00 $ 930.00 $ 810.00 

’Neill PP O $ 0.73 $0.42 $0.31 $ 730.00 $ 420.00 $ 310.00 

Dos Amigos PP $ 1.23 $0.69 $0.54 $ 1,230.00 $ 690.00 $ 540.00 

Direct Pumping $ 2.55 $1.45 $1.10 $ 2,550.00 $1,450.00 $1,100.00 

otal T

Construction 

Cost 

$11.56 $6.55 $5.01 $11,560.00 $6,550.99 $5,010.00 Contractor’s 

unpaid 

construction 

Step 1 

Construction revenue is applied on a project level to reduce the total construction costs that are distributed 

to contractors for repayment. For example, the Jones PP revenue of $930 ($0.93 x 1,000 AF) is applied 

toward the total construction costs for Jones PP to reduce the total construction obligation. An exception 

to this rule is the application of revenue for direct pumping, which is applied to reduce the construction 

obligation of the individual contractor, rather than total construction costs on a project level. O&M 

revenue is applied in a similar way as construction revenue. For example, Water Marketing revenue is 

also applied on a project level to reduce the total O&M costs that are distributed to contractors for 

repayment. 

Step 2 

Any construction revenue that exceeds the annual cost of service rate, is applied on an individual 

contactor level to reduce the contractor’s repayment obligation. For example, the Jones PP construction 

cost of service rate is $0.93 per acre foot, but for 215 water the rate is $1.74 per acre foot, which is $0.81 

more per acre foot. This revenue of $810 ($0.81 x 1,000 AF) is applied to the individual contractor’s 

outstanding construction obligation.