IID uses the interest generated from a fund of $12.5 million to pay for the Dahlia and other undergrounding projects. The fund's principal is a portion of the money paid by the Metropolitan Water District of Southern California from a 1988 water conservation deal.
Director Bruce Kuhn told Jernigan, IUSD Trustee Sandy Finnell and IUSD Superintendent Barbara Layaye on Tuesday that there probably is $45,000 worth of interest in the fund, but the money is committed to other projects.
IID board President Andy Horne said he did not know if the board is allowed by policy to dip into the $12.5 million principal to pay the Dahlia or any other project costs.
If it is IID policy to spend only the interest, Horne requested the item's wording on next meeting's agenda allow directors to change the policy.
Two years ago, the school district entered into the project with IID, Imperial County and the city of Imperial and agreed to share the costs of putting the Dahlia Canal in Imperial underground.
The school district budgeted $49,819 to the project, consistent with IID's preliminary estimates. This April, almost a year after the project's completion, the school district was notified that final project costs had almost doubled because of poor cost estimates.
Original estimates stood at $1.8 million, but increases in construction and material costs resulted in a $2.43 million final price tag.
Mike King, IID water department manager, explained IID failed to inform the other parties about the rising costs. A computer error, which has since been corrected, was to blame for the delay, King said.
The city of Imperial, unlike the school district, agreed in its contract to pay only the estimated costs, not the final price, and is therefore not contractually obligated to pay beyond the original estimate.
Imperial County was asked to pay $350,267.59, up from a $60,000 estimate. The county Board of Supervisors has yet to take action on the issue.
Layaye said she hopes the IID will understand the financial impact paying the extra money would have on the school district. She and the board are hopeful the IID will grant them an exemption from the payment.
The IID board next meets May 22.
Staff Writer Kelly Grant can be reached at 337-3441.