February 24, 2017

Bill would provide oversight on Gila diversion spending

Laura Paskus

The Gila River downstream of the proposed diversion area.

When it comes to New Mexico’s proposed diversion on the Gila River, even discussions about routine financial reporting elicit passionate disagreements.

Sens. Howie Morales, D-Silver City, and Sander Rue, R-Albuquerque, introduced a bill that would increase oversight of spending by the New Mexico Interstate Stream Commission on the diversion.

During his presentation to the Senate Conservation Committee Thursday, Rue explained that the bill focuses on the process of how ISC spends federal money.

“We are not here to make a judgement about the diversion,” he said.

Instead, he said the bill would require the ISC to answer certain questions about the project before it could continue spending federal funds on it.

Related story: After U.S. Senator’s request, ISC releases previously-withheld data

Senate Bill 340 would require ISC’s spending on the Gila River diversion to go through the normal legislative budget process. Before spending more, officials would need to show that the project is technically feasible, explain how much water is available from the river and who would use it, estimate the project’s price tag and determine how New Mexico will cover the difference between the federal subsidy and the project’s actual cost.

New Mexico has already spent more than $11 million of an estimated $90 million in federal money it plans to receive. The state also has more than $6 million in outstanding contracts and $1.7 million in ISC’s operating budget. Based on funding requests in other bills this legislative session, it appears as though the state plans to spend another $15.2 million on the project in Fiscal Year 2018, which begins July 1.

Last year, officials directed its engineering contractors to study only those projects priced between $80-100 million. Just weeks later, however, the state was considering plans in the hundreds of millions of dollars.

State officials oppose the bill, saying it will defeat the water project and prevent millions of federal dollars from flowing into New Mexico.

The committee ran out of time before voting on the bill, but is expected to make a decision at its next meeting.

Officials say bill would kill diversion project

In 2004, Congress gave the state of New Mexico “new” water rights from the Gila River. The complicated deal is related to decades’ worth of lawsuits and involves a water trade with the Gila River Indian Community in Arizona.

As part of 2004 Arizona Water Settlements Act, New Mexico had 10 years to decide how it would use millions in federal money to meet water needs in four rural counties in southwestern New Mexico. The state could pursue efficiency and restoration projects or receive additional funding and build a diversion on the Gila River.

In 2014, the ISC chose the diversion alternative. Since then, the state has spent millions on studies, salaries, attorneys, small project grants and engineering plans. Yet, the ISC and a newly formed group, the New Mexico Central Arizona Project Entity (CAP Entity) have yet to solidify engineering plans, locations or customers nor identify the full costs of building a diversion.

Now, there’s another deadline looming: To receive the full federal subsidy, all the environmental studies must be completed and approved by the federal government before December 2019.

At the committee meeting, Rue said that the ISC’s actions to date “do not inspire confidence.”

“They have created controversy with the secret discussions and undisclosed multimillion dollar contracts,” he said.

Rue noted that a district judge had ruled the ISC violated the Open Meetings Act while discussing contracts for the diversions and the New Mexico Attorney General determined that the CAP Entity had violated OMA when discussing plans for the diversion and reservoir in closed meetings.

“This bill requires they answer basic questions answered during the development of any normal water development projects,” Rue said. “What is the project? What is the yield of the water, and for what uses? And at what cost?”

The Republican senator reiterated that the bill was not about stopping the diversion. “The ISC can move forward after addressing basic matters in the bill,” Rue said.

Both ISC and CAP Entity officials see things differently.

CAP Entity director Howard Hutchinson, chair of the San Francisco Soil and Water Conservation District, pointed out specific problems with SB 340.

“In essence, what we’re really talking about here is a bill to prohibit the CAP Entity’s process to determine whether or not we want to construct diversion projects and deliver water to the southwestern part of NM,” he said.

Hutchinson also noted that if the same restrictions had been placed on other diversions, including the San-Juan Chama project that delivers water to cities like Albuquerque and Santa Fe, those cities “would have already ceased their growth.”

Laura Paskus

CAP Entity Chair Darr Shannon, attorney Pete Domenici, Jr and director Frank Madrid at a meeting last June

New Mexico CAP Entity Chair Darr Shannon gave an impassioned presentation to the senators, citing her family’s 127-year history in the state. She said many of the board’s directors are hard-working public officials who pay their own way to meetings. Shannon is a Hidalgo County commissioner and vice-chair of the Hidalgo Soil and Water Conservation District.

“I love this state, I love everything that every one of you stand for, but I do believe this river diversion will be thrown out,” she said. “I am so sorry senators, but I do believe this is a bill they are doing in order to get rid of what we’re trying to do.”

The CAP Entity’s attorney, Pete Domenici, Jr. slammed the bill, calling sections of it “incomprehensible.”

He said it would prevent the state from completing an environmental study of the diversion before the federally-mandated deadline of December 2019—and cause the state to lose tens of millions of dollars in construction funding “forever.”

Those problems, he said, “should give [senators] pause about calling this a process bill.”

Interstate Stream Commissioner Deborah Dixon also spoke at the meeting.

“It is difficult to accept that this is one of the opportunities where we know we have ‘new’ water to develop in New Mexico,” Dixon said, and to see a bill that would prevent that from happen. Requiring the ISC to manage and administer the funds, she said, would “absolutely delay the project” and the federal funding.

“Elementary water planning questions”

During the meeting, more than a dozen citizens and representatives of environmental and sportsmen’s groups, as well as the New Mexico Foundation for Open Government, spoke in support of the bill, calling it a “good government bill.”

Laura Paskus

Former ISC Director Norm Gaume opposes the state’s planned diversion

“It’s just not possible that the ISC conceives that it can’t meet the simple tests that are in this bill,” said former ISC director and vocal diversion opponent Norm Gaume. “These are the most simple things, elementary water planning questions.”

Gaume said that these sorts of questions are typically answered at the beginning of a water planning process, “not answered through a $20 million environmental impact statement process after the ISC has spent 20 staff professional years and over $6 million in studies.”

After the meeting, Allyson Siwik, executive director of the Gila Resources Information Project disagreed with opponents’ arguments that the bill would cause the ISC to miss deadlines. Instead, she said, that appears to concede that the agency is incapable of answering those questions, including how much water will the river actually yield, who will purchase the water and what the diversion and reservoir plans will be.

Although in the past he carried a bill that would have required the ISC to use federal funds for conservation projects instead of a diversion, Morales told NM Political Report that SB 340 isn’t about the diversion itself.

“It’s to ensure that taxpayer dollars are going toward a feasible project,” he said. “Basically, to show the legislature the feasibility of what they’re trying to do.”