At a joint oversight hearing in the Capitol on Tuesday, the non-partisan Legislative Analyst’s Office (LAO) revealed some troubling news about the status of last year’s water policy package and accompanying $11 billion bond.

Although the complex package called for an array of new activities, funding hasn’t yet materialized, and some sources in the Governor’s Administration are now suggesting that the bond should be used to cover these costs. As the LAO’s Catherine Freeman noted, “The bond was not designed to be a financing mechanism for the whole package.” (Even if it were, the bond is so unpopular with voters that no one should be relying on it for anything.)

In addition, while legislators last year had approved the formation of a Delta Stewardship Council to chart the course for the future management of California water, the seven member body has not yet been selected. However, LAO staff revealed that the Governor’s administration has authorized the hiring of 27 current CALFED staff to assist the council – giving the strong impression that the council will be locked into the old CALFED paradigm. Both Republicans and Democrats acknowledge that CALFED was a failed government process. And while there are mixed feelings about this new bureaucratic initiative, everyone agreed it was at least supposed to offer a fresh start.

With the level of scrutiny displayed on Tuesday, we can expect more legislative oversight hearings on the Delta Stewardship Council and other elements of the water package later this year.