Trump administration approves plan backed by Newsom to build largest California reservoir in 50 years

The Trump administration on Friday gave its approval for plans to build Sites Reservoir, a vast 13-mile-long off-stream lake north of Sacramento that would provide water to 500,000 acres of Central Valley farmland and 24 million people, including residents of Santa Clara County, parts of the East Bay and Los Angeles.

The U.S. Bureau of Reclamation issued a document called a “record of decision” for the project, signing off on its environmental review process.

“This decision reflects years of analysis, public engagement and coordination, and establishes the foundation for construction through sound partnerships that will ultimately result in additional water supplies for California,” said Andrea Travnicek, assistant secretary of the Department of Interior.

Planned in the sweeping open pasturelands of rural Colusa County, near the town of Maxwell, if completed Sites would be the largest new reservoir built in California since 1979, when the federal government opened New Melones Lake in the Sierra Foothills between Sonora and Angels Camp.

Estimated to cost $6.2 to $6.8 billion, the project is strongly backed by Gov. Gavin Newsom, whose administration has earmarked $1.1 billion in state bond funds for it, along with former President Biden, whose administration approved a $2.2 billion federal loan for it in 2022, and Republican and Democratic members of California’s congressional delegation.

Planners of the project on Friday called the federal approval a significant milestone in a long journey.

“This decision affirms what our extensive analysis has shown — that Sites Reservoir can reliably capture and store water in a way that supports both people and the environment,” said Jerry Brown, executive director of the Sites Project Authority. “With this additional environmental approval, we can now leverage all available construction funding and are focused on moving with intensity and purpose toward construction.”

Brown, who is not related to the former governor, is the former general manager of the Contra Costa Water District and helped build and expand Los Vaqueros Reservoir in Contra Costa County.

Sites is scheduled to begin construction by the end of 2026 or early 2027 with completion by 2033. It would become the eighth-largest reservoir in California, holding 1.5 million acre-feet of water — enough for at least 7.5 million people a year. Crews would build dams in a 13,000-acre area, and fill with the site with water brought in through pipes from the Sacramento River during periods of high flow.

Supporters call Sites Reservoir a critical part of California’s water future that can help capture more water during wet years for use during dry years. California has endured three severe droughts in the past 19 years — from 2007 to 2009; 2012 to 2016; and 2020 to 2022 — all of which involved water restrictions for millions of residents and businesses in cities and cutbacks to farmers.

Brown noted this week that the given California’s recent wet winters, Sites would have filled to the top in 2023 and 2024 if it had been completed.

Critics of the project include some environmental groups, who sued unsuccessfully in 2024 to block the project on the grounds that it would harm fish and wildlife by diverting water from the Sacramento River that otherwise would flow into the already heavily pumped Sacramento-San Joaquin River Delta.

On Friday, they downplayed the federal approval.

“Sites is still a nearly $7 billion gamble that delivers little water at enormous cost, threatens rivers and fisheries, and distracts from real solutions,” said Keiko Mertz, Policy Director of Friends of the River, an environmental group.

The Sites project has shown significant momentum in the past two years.

It has 22 water agencies around the state have committed money for planning and signed up to be partners, and 16 agencies on a waiting list.

Those partner agencies include the Santa Clara Valley Water District in San Jose, Zone 7 Water Agency in Livermore, Metropolitan Water District in Los Angeles, and others.

But significant challenges reman. The State Water Resources Control Board, whose members are appointed by Newsom, has not yet approved the water rights to allow construction to begin.

Last year, the Sites Reservoir Authority  announced that the price tag had jumped from $4.5 billion to at least $6.2 billion, and potentially as much as $6.8 billion.

Brown and others attributed that to inflation for concrete, steel and other construction materials since 2021, when the original estimate was generated. Factory shutdowns during the COVID pandemic caused many construction materials to increase in price, and tariffs imposed by President Trump have led to more cost increases in recent months.

Although most of the costs would be paid by the 22 partner agencies who will get proportional amounts of water storage based on how much money they put in, the federal government has not yet said how much money it will contribute and how much water that would buy.

Further, in the past several weeks, the project has experienced some labor unrest after several unions, led by Northern California carpenters, have complained that the contractor the Sites Project Authority selected for the first parts of the job, Barnard Construction of Montana, has not worked closely on enough major projects with union workers in California. They supported other bidders, such as Kiewit, based in Omaha, which has completed projects such as rebuilding the spillway at Oroville Dam in Butte County.

On Wednesday at a meeting of the California Water Commission, the state agency that is expected to provide $1.1 billion to the project, several commissioners tersely told the Sites planners come back in a month having settled the labor dispute.

“We really want you to succeed,” said Commissioner Alexandre Makler, of Berkeley, who works as an executive vice president for Calpine Corporation. “Fix the labor issue.”