FINAL MEETING MINUTES

AUTHORITY MEMBERS
Rita P. Pearson, Chairman
Tom Griffin, Vice-Chairman
Bill Chase, Secretary
Grady Gammage, Jr.
Richard S. Walden

EX OFFICIO MEMBERS
Senator Pat Conner
Rep. Gail Griffin

Welcome / Opening Remarks

Chairman Rita Pearson opened the Arizona Water Banking Authority (Bank) meeting. All members of the Authority were present except Representative Gail Griffin.

Adoption of Minutes of June 17 Meeting

The June 17 meeting minutes were adopted as submitted.

Plan of Operation and Other Staff Activities

Tim Henley, Manager of the Water Banking Authority, discussed operation of the Bank and monthly water deliveries for June. Mr. Henley stated that because the irrigation districts are taking more water, June’s deliveries have increased. The Bank is back on schedule for June.

Mr. Henley announced that Roosevelt Water Conservation District (RWCD) will not be taking any more Bank water this year. The result is a loss of 24,000 af from RWCD. Mr. Henley will begin talking with potential partners over the summer to see if there are any opportunities either through the in lieu process or if there are any opportunities at GRUSP for additional storage. The Bank is still looking into the opportunities for some demonstration facilities, where there could be some potential storage of water before the end of the year.

Mr. Chase inquired on the status of the Aqua Fria Recharge Site. John Newman from CAWCD stated that there will be a permit application filed for about 100,000 af with stipulations related to monitoring and some litigation issues that might preclude build up of water levels. CAWCD anticipates filing a permit application in approximately 30 days.

Correction to 1997 Annual Report

Mr. Henley provided a corrected version of the 1997 Annual Report referring to page 17, Table 1, Monies Collected, Expended, and Available in Banking Fund. The table was revised to more accurately reflect the funds expended to acquire the credits developed in 1997. In addition to the revisions made to the "expended" column, a change was made to reflect not only the funds remaining in the various accounts but also the credits available to the Bank from the CAWCD.

Update on the Draft Facilities Plan

Kathy Jacobs, Director of the Tucson AMA gave a presentation. She stated that the Institutional and Policy Advisory Group (IPAG) in the Tucson AMA had hosted two meetings in the last two weeks to provide input on the Draft Facility Plan. Some preliminary suggestions for the Facility Plan include expanding it to include substantially more background information and to indicate which of the many AWBA objectives could be met by each of the projects under consideration and having the AWBA extinguish credits to achieve water management goals and support Indian water rights settlements.

Copies of the Recharge Project Descriptions chart and letters from the Town of Marana and Tucson Water Department were provided.

John Newman, Assistant General Manager from CAWCD, stated that he believes the projected capacities at the state demonstration projects in Pima County are a bit conservative.

• The Avra Valley project has recently been permitted for a 20 year period at a capacity of 11,000 af per year. The only commitment at Avra Valley for CAWCD is a short term commitment to Metro Water District at 2,200 af per year.
• At the rate that the Pima Mine Road facility was recharging, CAWCD would have been exhausting its pilot capacity in 1998. At this time CAWCD has slowed its water deliveries to AVRP and will be watching how the project is operating.
• The CAGRD replenishment needs in Pima County are growing. An agreement commits CAGRD to provide up to 12,500 af of recharge capacity in the Tucson AMA.
• The Lower Santa Cruz is nearing the final stages of negotiations of an IGA with Pima County Flood Control District. The expected recharge capacity at the site is 30,000 af.

Mr. Henley gave an overview of the draft Facility Plan and encouraged the Authority members to provide any comments and concerns.

Update of CAP/USBR Settlement Subcommittees

Larry Dozier, Deputy General Manager of CAWCD, stated Phase II of the trial has been delayed until mid-October.

Ms. Pearson stated that she and Sid Wilson attended a meeting in Washington, D.C. with representatives from the USBR. No agreements were reached. Senator Kyl and Secretary Babbitt will be meeting to see if there is any room for additional negotiations on some of the points that are in dispute.

Mr. Henley summarized two key allegations contained in the USBR’s Motion to Amend the Counterclaim. The USBR sought to allege that:

• The Secretary possesses exclusive control over uncontracted water (paragraph 111; Joint Report, p. 37) and
• CAWCD lacks authority to deliver Colorado River Water to/for the benefit of the Arizona Water Banking Authority (paragraphs 118-20; Joint Report, p. 51)

Special Master L. Ray Haire issued a Report and Recommendation ("R&R) to deny the USBR's Motion to Amend its counterclaim with respect to these allegations be denied. This recommendation does not take effect unless Judge Carroll enters the R&R as a formal order.

Update on Study Commission Activities

The next Full Study Commission meeting is Thursday, July 30 at 10:00 a.m. at the ADWR third floor conference room.

Update on Interstate Discussions

Ms. Pearson stated that the state representatives met in Nevada regarding interstate banking. A report was given by David Kennedy, who is directly involved in negotiations between Metropolitan Water District (MWD) of Southern California and the San Diego Water Authority. They are attempting to resolve disagreements over the Imperial Irrigation District’s delivery of water to San Diego. There appears to be a breakthrough as the two entities have a tentative agreement on a wheeling arrangement, but one of the key components is a $100 million contribution from the state of California to help finance the wheeling arrangement. This will require a bond initiative, which is hoped to be on the fall ballot.

• Wellton Mohawk - Ms. Pearson explained that California agencies are trying to amend a bill currently working its way through Congress. They want to clarify the USBR's plans for utilization of the Yuma Desalter and how the Secretary accounts for the return flows from the Wellton- Mohawk Irrigation District. If the amendment is successful it will substantially affect Arizona’s utilization of Colorado River water.
• Salton Sea - Ms. Pearson stated that California officials are holding "scoping hearings" (a public comment process provided for by the National Environmental Policy Act and its state counterpart). This issue relates to the Salton Sea Legislation that has been introduced in both the House and the Senate. A bill in the U.S. House of Representatives has a $350 million federal appropriation and a state matching fund component. It includes use of flood flows on the Colorado River as a potential supply source for the Salton Sea restoration. The Senate Bill does not refer to Colorado River water. The bill has not yet been assigned to a committee.
• Interstate Banking - Herb Dishlip, an Assistant Director of the ADWR, explained that Nevada Interstate Water Banking meetings are moving slower than earlier anticipated. Federal regulations governing interstate banking should have been in the Federal Register the week of July 6. The goal is to publish the regulations in the Federal Register before Congress recesses in August.

On June 23, representatives from the ADWR, the AWBA, the Southern Nevada Water Authority, and the Colorado River Commission met in Nevada to discuss the implications of the draft interstate water banking regulations with respect to NEPA compliance. Southern Nevada suggested going through the "scoping" process, with public meetings to be held in Nevada and Arizona. These meetings would describe what the potential action is and try to frame the environmental studies around the scoping process.

Call to the Public

The meeting was adjourned at 11:10 a.m. The next meeting is scheduled for August 19, 1998.