Editor's Note: This is part 2 of a multi-part series on the first meeting for the New Mexico Central Arizona Project Entity.

By Mary Alice Murphy

During the first meeting of the recently formed New Mexico Central Arizona Project Entity, created to design, construct, operate and maintain a New Mexico Unit, members heard an update from the Interstate Stream Commission.

David Anderson, ISC staff, recapped "how you got to this point. On July 22, the ISC passed a resolution designating the New Mexico CAP Entity. The joint powers agreement was approved by the New Mexico Department of Finance and Administration on July 27."

He explained in order to get the National Environmental Policy Act process going, which involves federal agencies, the New Mexico Unit Agreement must be signed by the entity and approved by the U.S. Secretary of the Interior by Nov. 23, 2015.

"The Department of Interior is responsible for NEPA and the Endangered Species Act compliance," Anderson said. "Reclamation is designated as the lead agency on the NEPA process, and the ISC voted to become joint lead with Reclamation. NEPA cannot begin until the NM Unit agreement is made between the Secretary and the NM CAP Entity. NEPA will likely begin early next year. This body will be the coordinating agency. Reclamation usually has a third-party contractor for NEPA. The contractor will issue the Environmental Impact Statement. We would work with Reclamation for the contractor."

Helen Sobien, ISC staff, said the ISC had issued a request for proposal for the up to 30 percent engineering design for the New Mexico Unit. "Staff issued the RFP to ensure New Mexico and the CAP Entity could move forward expeditiously. The up to 30 percent design is necessary for the NEPA process. Three teams responded to the RFP and are being reviewed. The CAP Entity will be fully involved in scoping the plan of work. We need your input during September and October."

Vance Lee, representing Hidalgo County Soil and Water Conservation District, asked if, once the 30 percent design was reached, any project could be added.

Aaron Sera, city of Deming manager, recommended before the 30 percent engineering design began that everyone should give Reclamation everything "you can think of."

"What if a project is already close to 30 percent design?" Van "Bucky" Allred, Catron County commissioner, asked. "Can it be added?"

Sobien said the ISC team consisting of Anderson, herself, Ali Effati and Craig Roepke, would always be available to hear other project proposals.

Dominique Work, ISC staff counsel, noted that Kim Abeyta-Martinez and Deborah Dixon are the ISC non-voting representatives on the CAP Entity. "If we find we need more expertise, we will hire a consultant."

"This entity is charged with the design and construction," Grant County Commission Chair Brett Kasten said. "You said you expedited the process. What happens if we are not happy with the engineering firm already hired or the direction you are going? How much of this 30 percent design is set in stone? The entity may be thinking differently from what the ISC is thinking."

Effati said the New Mexico CAP Entity could request design and construction input. "The ISC will be more than happy to sit down and consult with you. As Ms. Sobien has said, the ISC is reviewing the RFPs."

Ryan Jameson of the Fort West Irrigation Association asked if what the ISC was wanting was for the CAP Entity to take over everything.

Dixon said the ISC made the decision to go with the RFP. "The CAP Entity certainly has the possibility to request it of the Department of Interior. Nov. 23, 2015, the New Mexico Unit Agreement has to be signed. A representative of the CAP Entity is consulting on the review of the RFPs. The NEPA process cannot go forward until the 30 percent engineering is done. We are looking at other alternatives. We're just getting a head start. If the CAP Entity wants to take over, it can participate as it wants to. We do not consider going all the way to 30 percent is needed. We just need enough information to start the NEPA process. Everything is possible."

Lee asked who would determine if the NEPA requirements had been satisfied.

Dixon said Reclamation is the lead agency.

Kasten requested the deadlines be written down for the members' information. "If we don't have enough information, it's a recipe for chaos."

Dixon said: "The ISC asks for your input as much as you want to participate. The broad scope was what was advertised."

Effati noted that the New Mexico Unit description and exhibit 2.48, both of which were handed out to all participants, "does not limit any options for the New Mexico Unit, including ones not yet considered."

After a short break, Anderson said he wanted to give some history about "why we are here today." He said in 1964, the Supreme Court in its Arizona v. California decision on water rights set limits on what the Gila and San Francisco basins in New Mexico could develop. "New Mexico was shorted and some lost water rights. New Mexico was not allocated any water for future development, while Arizona and California were allocated water for future development. In 1968, the Colorado River Basin Project Act allocated 18,000 average annual acre-feet of water and sought to make New Mexico whole for what it lost in 1964. The Hooker Dam or suitable alternative was authorized. New Mexico had the most junior rights and was never able to use the water. The AWSA remedies solve the priority issue through an exchange. Downstream users agreed to the use of the water in New Mexico, if their water lost as a result was replaced one-to-one from the Central Arizona Project."

Roepke showed a graphic of where the water comes from for use in the Gila Basin and where it comes from the Colorado River through the CAP for the exchange to Phoenix and the San Carlos Reservoir. "All the downstream users have agreed except for the San Carlos Apache tribe. They signed off on the agreement. With compliance with the Consumptive Use and Forbearance Act, New Mexico can consume water without objections. The way the exchange works is that water is delivered down the CAP Canal to the Gila River Indian Community and the San Carlos Irrigation and Drainage District. It is done by pre-banking, then New Mexico can divert a like amount of water. What New Mexico is diverting is senior water, which is being replaced from the Colorado River. It can only be used in New Mexico."

Claudia Duerinck of Gila asked what the cost to New Mexico is to pre-bank the water.

Roepke said it is the cost of transporting the water from Lake Havasu through the Central Arizona Project. That cost varies, and the CAP Entity will have to talk to the Arizona CAP to determine exact costs at the time of pre-banking.

Amy Haas, ISC general counsel, and Dominique Work, ISC staff attorney on the Gila River, gave an overview of supplemental terms the ISC is requesting for the NM Unit Agreement.

"The essential terms are appended to the CUFA," Haas said, "so there are terms in the NM Unit Agreement that are not negotiable. The agreement is between only two parties—the Department of the Interior and the New Mexico CAP Entity. Reclamation is also proposing supplemental terms.

"The CAP Entity and the Secretary may modify the agreement provided the modification is consistent and doesn't conflict with the CUFA," she said. "All this can be found on the nmawsa.org website."

She and Work alternated on explaining the definitions, many of which mirror those in the CUFA. Item 2.38 on page 105 of the draft NM Unit agreement document defines the three roles of the Secretary of the Interior, as the owner of the CAP, the official responsible for design, construction, operations and maintenance until and unless the CAP Entity takes it over, and the official authorized to divert.

Section 2.39 requires the NM CAP Entity to request permission to divert.

Work talked about section 4—Consumptive Use of Gila River and San Francisco River Water, including a portion, 4.5, stipulating that before New Mexico can divert water, at least 30,000 acre-feet of water must be stored in San Carlos Reservoir, and the New Mexico water must be pre-banked.
Sections 4.3 and 4.4 set the amounts that may not be exceeded at 140,000 acre-feet diverted in any 10-year period, with a possible 4,000 of that in any given year coming from the San Francisco River. A caveat on the 30,000 acre-feet stored water in the San Carlos Reservoir is that, if the level falls after New Mexico has already pre-banked the water, the state can divert as allowed under the CUFA.

Section 4.6 states that New Mexico may divert up to 64,000 acre-feet of consumptive use water in a given year, if in compliance with CUFA and there are credits in the NM CAP Water Bank equal to or greater than the amount.

Concerning the required 30,000 acre-feet of water stored in the San Carlos Reservoir, if the amount falls below that level and for five years, New Mexico cannot divert, there are provisions to renegotiate the water level.

New Mexico is not required to divert in any given year, and diversions cannot exceed 350 cubic feet per second at any time.

The Secretary of the Interior has the responsibility to design and construct, unless and until that responsibility is transferred to the CAP Entity upon its request. The NM CAP Entity shall own and hold title to the New Mexico Unit.

Haas noted that there are two different tranches of money attached to the AWSA. The first is the $66 million, which is indexed to inflation. Four installments already been deposited to the New Mexico Unit Fund and can be used for construction or any other water supply demand. The second portion of $34 million up to a possible $62 million is available only for construction. Once the NEPA process concludes will be the earliest it is available. The money derives from the Lower Colorado River Basin Development Fund. Any funding used for construction is non-reimbursable.

[Editor's Note: This author is not a lawyer and will not attempt to paraphrase what sections 6 and 7 say about legal matters.]

Section 6 addresses the operations and maintenance of the NM Unit. The legal ramifications are laid out in detail. Section 7 goes into dispute resolution. Section 8 is for miscellaneous items not covered in other sections.

Jameson asked about the permission to divert portion of the agreement. "Do we get a once a year permission to divert or must we ask each time?"

Haas said she thinks permission can be given at any time, because it is difficult to anticipate when conditions will be right for diversion. She said it was spelled out in detail in the CUFA.

"In flood conditions, I think you would be in daily communication with Reclamation," Work said.

"We probably have about a 24-hour period to pull water," Jameson noted.

"There has to be a way to get authorization quickly," Work agreed.

Lee asked how and when the number between $34 million and $62 million would be firm.

Mary Reece of the Phoenix Office of the Bureau of Reclamation said she would explain it in her presentation.

Jameson asked if a lawsuit could shut down operations while it was pending.

Haas said she couldn't predict that.

Wendell Hahn of the Gila Farm Irrigation Association asked, if a lawsuit involved the CAP Entity, "Are we liable?"

Haas replied that the individual members are indemnified by their individual groups, but the CAP Entity had to waive its sovereign immunity and could be named in a monetary or non-monetary lawsuit.

M.H. "Dutch" Salmon said since the San Carlos Apache Tribe did not sign onto to AWSA, could the tribal members object to the renegotiating of the level of the San Carlo Reservoir.

"We're not sure," Work said.

"The Secretary of the Interior is responsible for the tribes, so likely she would have to make the decision," Haas said.

"The people who signed this agreement agreed to this provision," Roepke said, "but in the AWSA, they have specific title to their needs. There has lately been a lot made about the limiting factor of 30,000 acre-feet in the reservoir. From a technical viewpoint, when it is below 30,000 acre-feet, it is because the area is in a drought period, so there would no water to take out of the Gila anyway. It's not quite as big a problem as people make it out to be."

Allyson Siwik of the Gila Conservation Coalition asked if there were anything in the CUFA or the terms discussed at the meeting that precludes the leasing of AWSA water.

Work said the NM Unit Agreement does not talk about leasing and neither does the CUFA. "It is not authorized specifically or precluded either."

Haas said one supplemental term that must be added to the agreement is the description of the New Mexico Unit.

Effati explained the New Mexico Unit is the physical construction. "It has a placeholder in the New Mexico Unit description (an additional required document) that will be attachment 3.2 as an exhibit to the CUFA. The Gila/San Francisco Water Commission, ISC and Reclamation have had input on the description. The draft description is broad. It will accommodate any alternatives to be considered in the NEPA and will allow future considerations."

Work said it was important for the description to be broad, so the final project fits into the description.

The next article will feature Reclamation's presentation by Mary Reece.