FINAL MEETING MINUTES

AUTHORITY MEMBERS
Rita P. Pearson, Chairman
Tom Griffin, Vice-Chairman
Bill Chase, Secretary
George Renner
Richard S. Walden

EX OFFICIO MEMBERS
Rep. Gail Griffin
Senator Ken Bennett

Welcome / Opening Remarks

All members of the Authority were present except Tom Griffin and Bill Chase.

Minutes

The May 19 minutes were approved as submitted.

Plan of Operation and Other Staff Activities

Tim Henley, Manager of the AWBA, reviewed May 1999 delivery figures. He explained that the AWBA is just about on target for May water delivery projections.

A revised schedule for the SRP groundwater facility was presented to the AWBA staff. The change was from 66,000 af of water to 22,000 af of water for the remainder of 1999.

Approval of FY 2000 Budget

Mr. Henley provided an overview of the fiscal year 2000 Water Banking Authority budget. Mr. Henley explained that the AWBA would be 'under' the budget stating that various bills for services provided by other entities were much lower than projected in 1999. The recharge figures for water are budgeted for potentially about 345,000 af of recharge. The recharge budget is approximately $12,000,000.00. The overall FY 2000 budget is anticipated to be $12.3 million dollars.

The Authority adopted the Bank's budget as presented

Annual Report Overview

Tim Henley gave an overview of the structure of the 1998 Annual Report. By statute, it must be submitted by July 1, 1999. There was a heavy emphasis on the activities of the Study Commission. Mr. Henley stated that the draft Annual Report was made available for comment to the public but none were received.

The Authority approved the Annual Report as submitted with any minor changes.

General Fund Appropriations Subcommittee Update

Ms. Pearson stated the newly formed subcommittee met on May 28th. The subcommittee discussed what the plans are for the AWBA with respect to meeting its obligations to provide water supplies for Colorado River communities. It was also discussed that 420,000 af has been identified as the amount of long-term storage credits that would be appropriate for the river communities. The subcommittee reviewed whether or not it needed to begin to identifying specific amounts of general fund monies that should be committed for Indian water settlements. At this time the discussions are on-going and the subcommittee is not prepared to comment on the level of the AWBA's commitment.

Ms. Pearson stated that the Authority has a prepared a resolution which basically acknowledges the obligations of the AWBA to store for municipal and industrial users with Colorado River contracts during times of shortage. The Authority adopted the resolution as submitted.

Discussion of Role of AWBA in Indian Settlements

Herb Dishlip gave an overview of the background of one of the authorized functions of the AWBA, which would be to provide assistance to Indian water rights settlements. Mr. Dishlip discussed Central Arizona Project (CAP) water being pledged to help assist in the Indian water rights settlements and what could be done in times of shortages.

Mr. Marvin Cohen, attorney with Sacks Tierney, gave an overview of two specific concepts he is concerned about; Gila River Indian settlement and the Southern Arizona Water Right Settlement Act (SAWRSA). He stated the Gila Indian Community has a concern about potential residential development (M&I development) south of their reservation. One of the concerns is that potential residential development could affect the tribes' use of groundwater. Mr. Cohen stated that they are looking at establishing a credit account of 1,000 af that the AWBA could develop using withdrawal fees. The credits would be used to compensate the tribe in the event of excess use of water by new industries. The concept would be to have the AWBA use its withdrawal fees to provide water for recharge. Central Arizona Irrigation and Drainage District (CAIDD) and Maricopa Stanfield Irrigation & Drainage District (MSIDD) do not have a problem with the use of withdrawal fees for this purpose.

In reference to SAWRSA, Mr. Cohen stated that the AWBA could be of assistance financially by providing the recharge facilities. The Secretary of the Interior would then provide the effluent to use in these recharge facilities.

Tim Henley gave an overview of the demands that are currently being discussed: the M&I demands, Indian lease demands, and subcontract demands. The AWBA's main obligation is be to firm the water supplies of the M&I subcontractors and the outside CAP contractors. There will be some opportunities to firm other supplies in the Phoenix AMA area. In the Tucson AMA the $.04 tax would generate approximately 400,000 af of credits, but there is a need for at least 900,000 af of credits for this purpose. In the Tucson AMA, the AWBA will have to use other revenues (such as general funds or withdrawal fees) to develop the credits needed for firming. This might not leave funds for Indian Settlement in the Tucson AMA. In the Pinal AMA area, it will be possible to use withdrawal fees for Indian Settlements and still maintain a program for in-lieu recharge.

Future Meeting Schedule

The Authority agreed to reduce the monthly AWBA meetings to quarterly meetings, effective with the meeting scheduled for September 15th. Future AWBA meetings are potentially scheduled for December 1999, March 2000, June 2000 and September 2000. The AWBA staff will prepare monthly newsletters containing updates pertaining to the AWBA. The web page will also serve as a tool for monthly updates, notices, and news releases.

Interstate Issues

Herb Dishlip stated that the USBR held meetings on the surplus criteria in Phoenix, AZ, and Ontario, CA. Two additional meetings are scheduled to take place in Las Vegas, NV and Denver, CO. The "scoping" meetings have considered who will benefit and who will be impacted by declaring a surplus on the Colorado River. The AWBA could be the primary beneficiary and user of surplus water in Arizona.

California would like a liberal surplus declaration surplus policy while the other six basin states are firmly opposed to this request, unless California adopts a "4.4 Plan". Absent a "4.4 Plan" the other six states favor a more conservative policy governing the declaration of surplus.

The AWBA will submit comments pertaining to the policy governing surplus declaration by June 30, 1999.

Call to the Public

The next meeting will be September 15, 1999. The meeting was adjourned at 12:00 p.m.