[Editor's Note: This is part 2 of a multi-part series of articles on the Grant County Commission work session on Aug. 18, 2020, and the regular meeting on Aug. 20, 2020.]

By Mary Alice Murphy

After hearing the request from the Grant County Fair Board to utilize the Gant County Fairgrounds for the livestock show and sale the week of Sept. 23, 2020, commissioners heard a report from the executive director of the New Mexico Central Arizona Project Entity.

Anthony Gutierrez, NM CAP Entity executive director, said the group has a lot going on due to a decision by the New Mexico Interstate Stream Commission to terminate the National Environmental Policy Act process, which was supposed to lead to an environmental impact statement.

"I come to the board to give you an update," Gutierrez said. "There may be some incorrect information out there, I wanted to give you some information on what we had planned. I would also like to have the New Mexico CAP Entity's back on the effort they have put in on this project. I also want to address the existing status on the stopping of the EIS and the dispute resolution process."

He said that most agreements the entity has with other agencies do have dispute resolution as part of the process.

"A letter, we sent to the Bureau of Reclamation and the Interstate Stream Commission goes into our concerns," Gutierrez continued. "A mutual consent to terminate would be the easiest way to complete the dispute resolution, but our New Mexico CAP Entity board did not necessarily agree with the cause of termination that ISC acted on. A lot of things were unanswered. The EIS was in the public comment stage or just after the comment stage. The New Mexico CAP Entity sent in a large amount of comments about things we didn't feel were in the EIS or things that weren't analyzed to reflect what is in our regional area. I'll get to those a bit later on."

He addressed where the entity is on the dispute resolution. Mostly the purpose of a dispute resolution is to make sure the administrative record shows why the dispute resolution is required. "We're not necessarily trying to change the ISC's mind on whether or not they want to continue funding the project. That's not our purpose. Our purpose is to ensure the administrative record shows exactly what the EIS shows, but also to make sure it makes it easier to understand in the event of a demand for the 14,000 acre-feet of water. This is an agricultural project. I know (District 5) Commissioner (Harry) Browne has said the water is too expensive for an agricultural project. After all the economic analysis is done, we might be able to make a dollar. We'll go into that in more depth."

Gutierrez addressed the regional water plan, which has been touted as necessary for Grant County. "But just drilling wells may not get enough water. I've talked to drillers and I've spent countless hours studying the aquifers and the connection between surface water and recharge. And it's pretty evident, we're not getting any recharge. The creeks are dry; perennial springs are dry; the tanks are dry. There was a lot of planning done around the infrastructure for the regional water plan, but not a lot of discussion on how to recharge an aquifer that has failed, and how to address the depletion of the aquifer."

He said he knows that opponents see it as a win not to have the development of a New Mexico Unit. "I see that what we've done is important for future demand and could be beneficial."

Gutierrez said one of the concerns was that the NM CAP Entity was given no cause for the termination. "We know that there are concerns over the economics. We have this letter from the Secretary of the Interior telling us if we don't have funding for the project, they will choose Alternative A, which is No Action. I also provide Attachment B, which is our comment on the EIS. It addresses the economics; it addresses the lack of regional information. For instance you talk about the amount of agricultural land and how it's used. In the EIS it says that 70 percent of the agricultural land is used for pasture. They took this information, not to whether it benefits our region, but whether it benefits the nation. When you take the pastureland, but don't include the cows, then that pastureland is much less beneficial. We don't bale pastureland for hay, as they do in the Midwest. Here most pastureland is used for livestock production. In our comments, we said the majority of our pastureland is used for livestock production and they didn't include that in the EIS. Plus, they used leasing state land for pastureland. To my knowledge the state does not lease agricultural land to be irrigated for pasture. The EIS also puts us in the entire western region from Texas to California. They did not talk about how Virden has extensive agriculture. The analysis did not show the private land in the Gila Valley. They had the costs, because our engineers gave them the costs. But the benefit-cost ratio analysis didn't fit our region."

He said the group had comments on the environment. "We felt the EIS didn't analyze the benefits of water storage to be able to put water into the river for ecological benefit."

Attachment C was developed at the beginning of the EIS mandated by the Secretary of Interior to show financial commitment to use the water and pay for it.

"In speaking with the Bureau of Reclamation, it was pretty unorthodox for the Secretary of Interior to say we have to have funding before we can make a decision on an alternative," Gutierrez said. "In most cases the EIS is used in applications for funding. For funding, you have to provide an engineering plan, and environmental impact statement and public input and all those things have to be done.

"I'm not trying to change anyone's mind, because what's done is done, but it shows a pre-decision on the record of decision before the EIS was complete," he said.

Attachment D was provided to show the entity was able to design three projects, one on the Gila, one on the San Francisco and one in Virden. "It shows that we were able to take a project, which originally was a huge dam, which was not our project. The dam brought an outcry that we were going to ruin the Gila Valley, ruin the ecology, so many things that we were going to ruin. I'm a lifetime resident of the Gila Valley. I had people who had known me my whole life ask me why we were going to ruin the Gila Valley. We knew it was imperative that we have a project that wasn't going to do what people said we were going to do. We designed projects to minimize impact to the environment and to endangered species. It provides benefit, because right now, Alternative A is the push up dams for the diversion ditches that put equipment into to the river to divert the water to the agricultural land, and the river dries out downstream. The baseline of analysis done in the EIS did not analyze anything we proposed. It just compared them with what was existing. Without an impact analysis on what is existing, how can you make a true comparison?"

In that same attachment, he noted, it said annual costs would exceed annual benefits.

He addressed availability of water and operational adjustments to overall impact.

"People say there is not enough water in the Gila and it's drying up because all the water is being diverted," Gutierrez said. "The storage we were planning of about 1,900 acre-feet would use existing infrastructure and existing canals. We could potentially divert 7,500 acre-feet, which could supply Deming and Silver City and potentially the Mining District, too."

He had a table that showed how the water could be utilized and included the losses through evaporation and seepage. "The project was limited by storage capacity. With more capacity for storage, it brings the cost of the water down."

Gutierrez showed USGS graphs that show exactly how much water flows down the Gila River. "I had a discussion with Sen. (Martin) Heinrich one time, and he said potentially the water has more value if it stays in the stream. So, I said if you threw a stick in the river, how long would it be before you couldn't see it any longer. I understand the value it has, as the water continues to flow. In April and May of 2020, Coolidge Dam has about 220,000 acre-feet stored. That's more than 71 billion gallons of water. While we're struggling to farm a little bit, we're struggling to get water to Hurley and Hanover, there are 71 billion gallons of water stored in Arizona. It doesn't make a lot of sense to me."

The Gila River, at the same time as water is being stored in Arizona, in May and June there's less than 100 cfs flow and in July, less than 20 cfs. "That's how much we didn't have. In July, in Arizona, they still had 41 billion gallons of water in the dam. While we look at the science behind trying to store water, the EIS does show the potential of storage, which can be released into the system for ecological benefit."

"Before we get into the CAP Entity didn't do its job, it didn't meet deadlines, I want to give a little bit of history," Gutierrez said. "The New Mexico ISC didn't approve that we wanted to develop a New Mexico Unit until the last day, the last hour to send the document to the Secretary of the Interior's office for approval to move forward with a project in November 2014. We spent two years putting together agreements that we feel have not been adhered to by the ISC and Bureau of Reclamation. We need to make sure that all the work we've done for past 15-20 years will show all the benefits of what we're doing. That's why we're in dispute resolution. What I wanted to do was to clarify the intent of what the CAP Entity has been doing. The ISC said they wanted to keep the door open to develop the water, and our opponents don't want that. That's why they want the New Mexico CAP Entity removed."

He also provided the joint powers agreement. "In item H, it speaks about a program to develop the New Mexico Unit, as well as non-diversion projects. When we developed the last JPA amendment, the ISC asked us to prioritize the New Mexico Unit in the JPA, as well as to prioritize development of the water and to use the New Mexico Unit Fund for those purposes. In 2018, I came to the board, after battling with legislators and asked the board to include adding non-diversion alternatives. It was the ISC that prioritized a New Mexico Unit. I've had several conversations with Priscilla Lucero (Southwest New Mexico Council of Government executive director) about infrastructure."

Gutierrez also summarized the history of the AWSA, which was signed into law in 2004. The statute stipulates the Southwest New Mexico Water Planning Group to do the planning for a project. "The group was spearheaded by Luna and Grant counties. Hans Voss was the Grant County attorney at the time, and he put together a JPA, which became the Gila-San Francisco Water Commission as the planning group. In parallel, Gov. Richardson said he wanted a stakeholders' group. It had about 30 members, state agencies, federal agencies, environmentalists, county and municipal representatives. They spent five years and came to no consensus. We even did a week-long consensus building exercise, and everybody came back together, all with the same ideas. Nothing happened. So, the ISC stepped in and developed a Tier 1 and Tier 2 process for non-diversion proposals. We received more than 70 proposals, 16 were chosen and the ISC funded nine out of the New Mexico Unit Fund."

"I understand the frustration with the CAP Entity, but we've already been down the road of stakeholders and nothing was accomplished," he said. "We do want to make an amendment to the JPA to allow non-diversion water projects."

District 4 Commissioner Billy Billings, who represents Grant County on the NM CAP Entity, asked how likely a lawsuit might come from the dispute resolution process.

"There is no real potential for a suit," Gutierrez said. "If we sue, what are we going to get? Nothing. The board members have frustration over what has happened, but they have no interest in litigation because there is no benefit."

Billings asked if, however, a suit did come up, would Grant County be on the hook for paying part of the legal costs.

"The JPA assures that no individual entity is responsible for any legal costs," Guierrez said. "I surmise that the reason why the ISC decided to stop funding the EIS is because the Secretary of the Interior said it was likely that Alternative A would be the outcome of the record of decision."

Billings explained that in light of a resolution on the commission agenda to oppose litigation that he wanted to be clear that the board does not support litigation. "You're proposing to amend the JPA to change the priorities from a New Mexico Unit for more diversions to capture water in on-farm storage ponds, so it can be released during times of low flows. That priority would be lessened. You will have new priorities. Could you outline them?"

Gutierrez said there are still concerns for the need to replace push-up dams with more permanent structures. "We looked at that in Alternative C in the EIS, but the analysis showed it would bring an increase in operation, maintenance and replacement costs if they were to blow out in a flood."

He talked about a project in Virden Valley, which the CAP Entity deemed as a preferred alternative. "There's litigation in Arizona just over the border from Virden that could be a concern if we want to store water.The suit is looking at correlating groundwater and surface water and could take away some water rights. That is a concern that, although it hasn't gone to court yet, it could impact the lower part of the Gila River. We also want to set how to evaluate and prioritize non-diversion projects. Some of the money allocated to the projects chosen before still has not been spent because they have run into problems. Our intent is to get funding that we can grow for groups to have matches to their funding for projects, especially to assist smaller groups. It's important to people who don't have planners and funding matches."

Billings noted that to amend the JPA requires a unanimous vote of all members of the entity. "What makes you think you can do that?"

Gutierrez said: "We did it before." He noted that $239,000 of the funding set aside to complete the NEPA process was still available for closure and documentation of the process. "We want to make sure public comments are addressed to make sure the the EIS where we need it be. Catron County has opposition to changes of the JPA, but they would benefit from the funding for infrastructure projects. At the beginning of the process, Catron County sent a list of things they want to accomplish."

Billings said he believes the JPA can be amended. "Catron County has everything to lose. If the CAP Entity is dissolved, we would have everything to lose, all of us. Do you see that some of the 14,000 acre-feet of water can be saved?"

"It's difficult to answer," Gutierrez said. "We have some interest in the Upper Gila for well water for higher-value crops, as well as sprinkler and drip irrigation to replace flood irrigation. There are still components that we can still apply for to the Secretary of the Interior for the water. It could be based on demand, but the longer it goes, it always comes with increased cost. I want to clarify that the New Mexico CAP Entity is in existence because of the congressional act, the Arizona Water Settlements Act. It stipulates the Southwest New Mexico Water Planning Group or its successor in the act. We are its successor. We've been meticulous about the changes that make us the successor. The JPA is also by statute, so it's pretty clear that the New Mexico CAP Entity exists. The chairman of the ISC said something about replacing the CAP Entity and the ISC director was quick to say it would be easier to amend what we've got."

District 2 Commissioner Javier "Harvey" Salas asked if the $70 million left in the New Mexico Unit Fund was increasing.

"Only by market increases and investments," Gutierrez said.

Is the direction to dissolve the CAP Entity Salas asked.

Gutierrez said he guesses it is a possibility, "but I don't know how."

Salas said it seems that the ISC is making is difficult to utilize the 14,000 acre-feet of water, but the $70 million is for local projects. "What happens to the water? It continues to flow to Arizona?"

"That's right," Gutierrez said. "The AWSA still offers the ability to develop the water. The challenge now is money. It will be more of a challenge with no funding."

Salas asked why the water can't be taken and pumped into the aquifer.

"We did have a discussion with Freeport to recharge the Mimbres Basin," Gutierrez confirmed. "But the ISC said the priority was to develop a New Mexico Unit. That's not to say we didn't think about recharge. Recharge is exactly what Arizona does on the eastern part of the state. In 2012, Silver City had a plan to use surface water to recharge the Franks Well Field, but changes in the Town Council went toward conservation, which they've done a good job with. I have my opinion that issues with water are only beginning. I think this water will be critical."

Salas said the Gila and Mimbres basins are separate, but "are they connected?"

Gutierrez said to his knowledge they are not, but there has not been much research on the Mangas Trench. The Continental Divide goes between the two basins, but a pipeline could connect them.

Salas said because Grant County is mostly in the Mimbres Basin water would have to be pumped over the divide to recharge.

Gutierrez agreed.

Salas asked again about the $70 million in the NM Unit Fund. "If we don't belong to the CAP Entity, if it's gone, can that money still be used for local projects?"

"I believe it's the intent of the Interstate Stream Commission," Gutierrez said. "It's also the intent of the CAP Entity. I don't understand why people are saying the New Mexico CAP Entity may not exist. In the AWSA, it clearly says that the ISC has to discuss any expenditures of the money with the planning group, of which the NM CAP Entity is the successor. What would they dissolve the entity?"

Salas said the ISC does have a political atmosphere because the majority of its members were replaced by the current administration and is causing a roadblock.

"Only for the New Mexico Unit to go forward," Salas said. "As the political atmosphere changes, so can the project."

Gutierrez chuckled and said he had seen it, with the Richardson administration not wanting to touch a drop of the water, Martinez putting it back into play, and Grisham saying, although she didn't really want a project, the process has gone so far, let's see how EIS plays out and make a decision from there.

Salas noted Luna County has a big interest in the water.

Gutierrez said the county has more water rights than they can use. "But water rights are different from wet water. Luna County is looking at recharge."

District 3 Commissioner Alicia Edwards had a clarifying question. "You've had administrative changes, but the thing that has remained constant is the 14,000 acre-feet allocated to the region. The thing that can change with administrative changes is how the money can be spent. Presuming Grisham has a second term, by the time of administrative change, the money has been spent. As conditions change, you may need to develop the water. You will still have the water, but no money. The question will be where will the money come from? How will private funding work in that? Who has the authority to take Jeff Bezos money to buy the rights to the water and to ship the water to, I don't know, Dallas?"

Gutierrez said he thought he had the answer but was a tough question he would usually pass to the entity attorney. "I want to make some clarifications. I don't necessarily charge the ISC with trying to appease the governor. There are a lot of intelligent, project-oriented people on the ISC. I think their decision on the EIS was based on the economic analysis from the EIS in consultation with that letter from the Department of Interior. I just want to make that clear."

"But what has happened in the past is the members of the ISC can change with administrations," Edwards said.

Gutierrez agreed, "but back to the actual question, it's my understanding in the act, New Mexico has already been given the authority to develop the water, whether it's this New Mexico Unit or one in 10 years, where the ISC is still the fiscal agent and the New Mexico CAP Entity would still be the entity that would contract with the Department of the Interior for the use of the water for development or for sale to someone. We've already had private money come looking for the water. Lion's Gate came in with money, but we said, 'We don't want your money. We don't want your process. We just want the water.' It's imperative to keep the CAP Entity with its structure, so we can keep regional representations. With the members we have now, their interest is in local use of the water. If we had a demand and it was privately owned, we would have to buy it back."

Edwards noted that there are thousands of examples of water being controlled by those who are not local. "My fear is privatization of the water."

Gutierrez said it has been his fear all along. "It's why it's important for people to be involved. Where the demand is and where the dollar is that's where the water goes."

Browne thanked Gutierrez for the presentation on a "super important" topic and said he was glad for the time spent on it. "We can identify things we can agree on. We can certainly all agree on the concern of the future availability of water in the area and the concerns with privatization. One of the concerns I and others had was if there was a pipeline that connected us to Luna County, it would just take some more pipeline to take the water to Las Cruces or even El Paso, and we didn't want the infrastructure developed that could take it there. It's nice to know we have the same big-picture goals."

He started with the history and said Gutierrez had talked about the stakeholder group not achieving anything. "It certainly endured a lot of different opinions and a lot of discussions, but one thing that came out of it was they approved 70 projects that were sent to the ISC that everyone in the group could get on board with. I think you were right to point the finger at the ISC. It had an overzealous director, who, in this case eliminated a bunch of stakeholders in narrowing down the interests to irrigators, local governments, and was a biased decision toward a New Mexico Unit. I think some who want to dissolve the New Mexico CAP Entity don't want to ever see the water developed. And I think we run into trouble when we try to realize other people's motives. That is certainly not why I want to see the CAP Entity dissolved. And perhaps we don't have to see it dissolved. Perhaps there's room for addressing its fatal flaws. It's a very biased organization, basically just irrigators remain. Would you support an amendment to the JPA to exclude those special interests and just have broadly elected entities on the body?"

Gutierrez said he couldn't speak for the board, because he doesn't make that type of decision. "No. 1, we have a concern about the water perhaps going to Las Cruces, but there is language in the act that stipulates beneficial use of the water in the four-county area. So, there are some protections. You say the members are biased, but in order to enter into a joint-powers agreement, you have to be a political subdivision. The irrigators are elected to their positions by their association water users. Would I be ready to eliminate them? No. Once you make decisions just by large elected bodies, such as counties or municipalities, you start to eliminate the smaller guy from the funding. They don't have the resources that the larger entities have. I would be hesitant to eliminate them."

He continued by saying that agriculture is a big part of the local economy. "While we may not notice it, look at Virden and Luna County for agriculture, and the ranching business in Grant County."

Browne interrupted and said his point is that the groups in the entity are not broadly representative of other interests that cannot be part of the decision-making. "I think that's a good rationale to see major change in the CAP. It needs a unanimous vote to amend the JPA. It's not democratic. One member can stop any amendment. You require a record of decision from the Secretary of the Interior before any more money can be spent on a New Mexico Unit. I was very happy to hear you say you think that most CAP entity members would not agree to pursue a lawsuit and that the county or any other entity would not be on the hook to pay for a lawsuit."

He read a portion of the JPA that reads that if a member withdraws from the CAP Entity it will be liable for any financial commitments made to the CAP Entity before withdrawal. "So, I think my resolution is necessary. I would welcome an opinion from you or Mr. Domenici if my interpretation is not correct."

"I think your interpretation is correct," Gutierrez said, "but I don't see how the CAP Entity can obligate any funds we don't have. Another part of the JPA says, for instance, Grant County may obligate funds toward a project, but you don't have to. If you don't make the commitment, why will you be stuck with a commitment?"

Billings said the language would require a commitment from the entire commission, "not me as one representative. The CAP Entity has its own budget."

Browne said he understood what he was going to say was unlikely, but he "wanted to make sure it was zero. If the CAP Entity decided to pursue litigation against the ISC for not fulfilling its agreements, could not the members request a contribution from the members to fund that?"

Gutierrez said no language in the JPA requires that.

Billings laughed and said: "Yeah, I'm going to come back and say the CAP Entity wants to sue, how much do you want to put in? It's not going to happen."

Gutierrez said he is taking notes on potential clarifications in the JPA.

Salas asked what the $70 million could be used for.

Gutierrez said it could be used for water projects to benefit the four-county region. "There would have to be criteria set on how it would benefit, because some of the things that we ran into with the 70 proposals was no information from state agencies on their criteria. There are a lot of criteria that have to be followed in order to get a publicly funded project."

Salas asked what funds the CAP Entity.

Browne said the ISC gets an appropriation. Gutierrez said the money comes from the appropriation from the New Mexico Unit Fund to the ISC. "The budget just approved was closer to $250,000 than previous budgets. We cut legal fees this year, because we figured we would not require any contracts or anything like that."

The next article in the series will begin with the presentation at the regular meeting by Gila Regional Medical Center Interim Chief Executive Officer Scott Landrum.

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