preview

Central Valley Project: A Federal Water Project

Good Essays

The Central Valley Project (CVP) is a Federal water project set up and run by the US Bureau of Reclamation to provide water for the Central Valley in California. Through twenty dams and reservoirs the CVP facilitates the collection and delivery of water for irrigation, municipal, and industrial use, as well as producing hydropower, providing flood control and recreational facilities on their reservoirs. The CVP provide a good example of how cost allocation works within a vast organization. I will use this organization to describe the method used by the CVP to allocate cost and whether I agree or disagree with their methods. I will also be identifying situations where common costs are allocated. I will explain the impact of allocating …show more content…

The first one is water supply repayment, which are costs allocated to water supply. These are then sub allocated to the recipients who are municipal, industrial, irrigational and wild life refuge water users. The costs to each are proportional to amounts delivered. The second repayment category is Power repayment. Under this category similar sub allocation are made to project use and commercial power. Project power use allocated costs are then further sub allocated among municipal, industrial, irrigation and wildlife refuge water use functions. The third category is Fish and Wild life repayment, which can either be reimbursable or non-reimbursable. The reimbursable costs are allocated to irrigation, municipal and industrial water users and commercial power users, and non reimbursable costs are paid by the tax payers. The last category for repayment is the recreation repayment. For these costs allocations, there is the legislation that authorized the expenditure that determines repayment. Determining repayment responsibility is the third step in the three step process of allocation. CVP does allocate common costs and there are several examples of this. One example is the handling of costs of multifunction facilities such as the dams and reservoirs. These facilities provide flood control, store and supply water, and produce hydroelectric power, and the costs for these facilities are allocated among the purposes served. Other multi function

Get Access