HB 10-1250 (Water Conservation Bd Construction Fund): La Plata-Archuleta Water District update

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From The Durango Herald (Dale Rodebaugh):

The water district, created in 2004, wants to provide drinking water in a 400-square-mile area in southeastern La Plata County and southwestern Archuleta County. La Plata County would be developed first. But before it can move ahead, residents must agree to tax themselves to pay for planning, capital improvements, construction, maintenance and administration. If they approve ballot Issue A, voters are authorizing a levy on the market value of their property of 5 mills (half a penny), expected to raise $5.1 million in 2011. The levy could vary in future years but may never exceed 5 mills. The 5-mill levy would cost the owner of a $200,000 house $7 a month.

[Board president Dick Lunceford] and Amy Kraft with Harris Water Engineering, the district’s consulting engineer, told commissioners they’ll soon begin discussing technical issues with county planners and the Southern Ute Indian Tribe on whose reservation much of the area to be serviced lies. They’ll also be evaluating the project’s overall viability in light of possible drops in revenue, Kraft and Lunceford said. BP is the largest gas producer and the largest source of property-tax revenue for the district. But as gas production eventually falls off, so will revenue. For now, however, a 5-mill property tax levy – applied to the $1.2 billion of assessed value in the district – will produce the $5.1 million annually that the district anticipates, Lunceford said…

The district has several water sources in mind, Lunceford said. For starters, it owns a total of about 22 cubic feet a second from the Piedra, Pine, Animas and Florida rivers. It also is interested in buying 500 to 1,000 acre-feet from the state if Colorado exercises its right to Animas-La Plata Project water. The district has its eye on leasing 200 to 300 acre-feet from the Pine River Irrigation District. The district will need an estimated 2,750 acre-feet to serve about 5,000 customers in the two counties over the next 20 years…

Eventually, a joint water-treatment plant with Bayfield is anticipated, Lunceford said. But whether it would be constructed before a treatment plant at the base of Lake Nighthorse, the A-LP reservoir, depends on which water source comes on line first, he said. If the A-LP is developed first, distribution lines would be extended to Florida Mesa. If the joint project with Bayfield comes about first, Gem Village and points south and west would be the first area to receive district water.

Meanwhile State Senator Bruce Whitehead is pushing the state of Colorado to buy water from the Animas-La Plata project, according to a report from Joe Hanel writing for The Durango Herald. From the article:

The proposed sale – financed by state natural-gas and oil tax money – raises the question of why the state should buy the same water that the tribes can get for free. “I might have the same question,” said Scott McElroy, an attorney for the Southern Ute Indian Tribe.

The answer lies in control of the water. “It comes down to whether you would rather own the water or do long-term leases,” Whitehead said. Whitehead was the executive director of the Southwestern Water Conservation District until last year, when he filled a vacancy in the state Senate. The district has pushed the state for years to buy rights in the Animas-La Plata Project.

The Southern Ute tribe also welcomes state participation, McElroy said. But if the state doesn’t buy in, the tribe is willing to talk with local water districts about supplying water, McElroy said at a Colorado Water Conservation Board meeting on March 29…

The new La Plata Archuleta Water District wants to buy up to 1,400 acre-feet from the state. The La Plata West Water Authority also has told the state water board it is interested in buying water out of the state’s future share. The La Plata Archuleta district has not talked to either Ute tribe about leasing water, said Steve Harris, the district’s consulting engineer. The district would need the lease to be permanent, Harris said. “But if they were reasonable terms, of course, we’d be willing to talk,” Harris said…

The federal government built the reservoir [Lake Nighthorse] primarily to settle American Indian water rights claims. Both the Southern Ute and Ute Mountain Ute tribes get 33,050 acre-feet, enough to turn the tribes into two of the biggest water owners in the Four Corners. Smaller amounts go to the Navajo Nation and water districts in Colorado and New Mexico. The state of Colorado has an option to buy 10,460 acre-feet, half of which could be consumed in any year. It’s roughly enough water for a city the size of Durango. If Colorado does not buy the water, it would go to each Ute tribe in equal parts…

On Thursday, the Senate Agriculture and Natural Resources Committee will consider an amendment to House Bill 10-1250 to spend $36 million over three years to buy the water from the federal government…

The last two years, the Legislature has raided most of Colorado’s water funds in order to balance the budget. An improved forecast for gas and oil tax money has given state officials the confidence that they will have enough money to complete the Animas-La Plata deal.

Ballots for the election will be mailed to residents in the district on Thursday, according to a report from Dale Rodebaugh writing for The Durango Herald. From the article:

Votes must be cast by May 4. Voters may mail their Issue A ballot or hand-carry it to the office of Harris Engineering, the district’s consulting engineer.

Voters are asked to approve a 5 mill (half a penny) property-tax increase to raise $5.1 million in 2011, and future mill levy increases cannot exceed 5 mills annually. Approval of Issue A also would remove the La Plata Archuleta Water District’s revenue limit set by the Taxpayer’s Bill of Rights Amendment – allowing it to spend such proceeds and any other revenue such as from grants.

The mill levy could be adjusted annually by the district’s board of directors. [ed. This is the TABOR exemption — the mill levy adjustment does not require taxpayer approval.]

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