The Department of Interior in Washington. (Salwan Georges/The Washington Post)

An Interior Department agency responsible for managing water in the western United States improperly provided millions of dollars in subsidies to contractors in California, according to an inspector general's report, including to a major water district once represented by a lobbyist who is now Interior's second highest-ranking official. 

The Bureau of Reclamation, the Interior Department's top watchdog concluded, didn't fully disclose to Congress and others the $84 million cost of its Bay Delta Conservation Plan in California. It also said the bureau couldn't provide paperwork for why the water contractors didn't have to pay back $50 million in federal funding. 

Though mentioned only once in the report, the Westlands Water District was part of the inspector general's analysis. That district, made up of more than 1,000 square miles of California farmland, was once represented by David Bernhardt, now the Interior Department's deputy secretary.

Interior Department spokeswoman Heather Swift said in an email that Bernhardt played no role in the matter either in forging the initial agreement, which was signed about three months after he left his post in January 2009 as Interior's solicitor, or while working in the private sector.

"Deputy Secretary David Bernhardt never worked in any role on the matter addressed by the IG Report either at the Department or in the private sector," Swift said. "In fact, he had not worked for the Department for several months when the agreement was finalized and neither he nor his firm even representing Westlands at such time. Any attempt to tie him to this are absolutely baseless."

While the discussions about the overall agreement began in 2008, the first agreement for advance payment of the project's operation and maintenance between the Bureau and Westlands is dated April 9, 2009.

Westlands stood to be a major beneficiary of the unusual funding arrangement, according to documents reviewed by The Washington Post, because of its size. Westlands general manager Tom Birmingham told The Post it's too soon to calculate the exact cost because the project is still in the planning stage.

Birmingham added that whether or not water contractors would reimburse the federal government "is a question that will have to be determined later," but added that Obama administration officials "thought this was a project that was critically important to the environment and the people of of California."

The Bureau of Reclamation disputed the inspector general's recommendations, saying in part that it had disclosed funding sources and other information about the arrangement in an October 2013 letter to several members of Congress. The IG's office noted that the agency actually sent the letter on Feb. 26, 2014, nearly five years after it had first instituted the agreement.

The agreement between federal, state and water district authorities grew out of the Bay Delta Conservation Plan, an effort to protect the area's fish and wildlife habitat while also meeting the water needs of a growing population. Under state law, firms conveying water through the system were obligated to pay for the project. But in 2015 the effort split into two different initiatives, EcoRestore and WaterFix, separating issues of restoration from water transport.

The Senate confirmed Bernhardt in late July along a mostly party-line vote, having faced opposition from environmental groups that accused him of being "laden with conflicts of interest that raise serious questions about his ability to act in the public interest." Before rejoining the department, Bernhardt had been a partner at Brownstein Hyatt Farber Schreck, which bills itself as one of the nation's premier water-law practices.

Westlands paid Bernhardt's firm, Brownstein Hyatt Farber Schreck, more than $1 million to lobby for its interests from 2011 to 2016, according to a review of federal data collected by the nonprofit Center for Responsive Politics. That time period is roughly between when Bernhardt left the Interior Department as its solicitor — the No. 3 spot in the agency — under President George W. Bush and re-joined as deputy secretary in the Trump administration. Bernhardt is listed as a Westlands lobbyist in some of those reports.

Bernhardt continued to do some consulting work for Westlands after deregistering as a lobbyist for them in mid-November, according to documents obtained by the environmental group Pacific Advocates, under a public disclosure request.

Westlands is the largest agriculture water district in the country and is made up of prime farmland in California, according to its own reports. Wetlands was formed in 1952 after central California growers petitioned local officials to create a water district, in part to keep pace with the region's growth.