Update to Proposition 1E – Early Implementation Project (EIP) Application and Local Share Reclamation Board Sub-Committee Meeting September 11, 2007

Segment 3 Segment 1 Site 7 (Segment 1) Segment 2 Feather River Early Implementation Project

EIP Status Submitted Application on April 30, 2007 Received DWR EIP preliminary notification letter late August 30, 2007 Met with DWR officials to discuss requirements of letter on September 4 th Anticipated EIP project cost $188.8 million –Proposed state share: $138.5 million –Proposed local share: $50.3 million EIP elements: –Segment 2 and 3 funded, included in total cost –Segment 1 and site 7 not funded, included in total cost –Ecological Restoration not funded and not included in total cost

EIP Agreement Schedule Anticipated schedule: –TRLIA, Yuba County Board of Supervisors, and RD784 approve financial plan required by EIP: September 25 th –TRLIA submit financial plan & supporting documentation to DWR: September 27 th or 28 th –DWR to complete review: mid October –Agreement finalized and signed: early November –Initial funding from DWR: early/mid December

Local Share Status Financial plan is being prepared jointly by: Yuba County, TRLIA, and landowners Key components of Plan: –Funding strategy: Combination of many options are being considered such as: Capital Calls (2 nd funding agreement), Benefit Assessment District, and other government funds –Three year audit of TRLIA financial records is being completed by CPA –Information on current and projected O&M costs

Additional Local Documentation Items to be submitted by end of September: –Provide additional information on strategy to 200 year flood protection –Further define flood risk in affected area and provide Acknowledgement of flood risk via a resolution by Yuba County –Permits and environmental compliance documentation Future items (prior to actually funding): –Emergency response plan –Hydraulic modeling and design information

EIP Concerns Lateness of funding and potential impact on TRLIA 2008 Completion Goal Cost overruns beyond built-in contingency are the responsibility of TRLIA Reimbursable funding vs. upfront funding by State Expenses incurred before Agreement is in place are not guaranteed to be covered – subject to negotiation Ecological restoration funding from other sources

Summary Thankful for opportunity to obtain State funding Preparing to submit Financial Plan and other documentation by end of September Anxious to receive state funding and make major progress towards: –200 year flood protection for South Yuba County –Achieve all the benefits obtained by building the Feather River setback levee