Further delays could drive up pipeline price

By Darrell Todd Maurina

Local officials told an interim committee of the State Legislature on Wednesday morning that any further delays in building the Ute Water pipeline will hike costs by about $3 million per year.
Total capital and enhancement costs for the proposed Ute Water system are now estimated at $310.2 million, according to estimates presented to the state’s Water and Natural Resources Committee during the last of two water meetings at Clovis Community College.
The Ute Water project would pipe water from Ute lake in Logan to nine cities and three counties in eastern New Mexico. Eastern New Mexico Rural Water Authority officials are lobbying for a project that is 80 percent funded through the federal government, 10 percent from the state and 10 percent from the communities involved.
Ute Water Project Manager Scott Verhines told legislators that the proposed funding share has received opposition at the federal level and staff from the Bureau of Reclamation objected when local officials presented their request to the Senate Energy and Natural Resources Committee.
“The Bureau of Reclamation position with regard to these projects is if there is a federal cost share greater than the 65-35 federal-local cost share, they oppose it,” Verhines said.
Rep. Brian Moore, R-Clayton, asked officials about contingency plans.
“Do you guys have a backup plan, 70-30, or some other way to make this work?” Moore asked.
Portales Mayor Orlando Ortega Jr., vice-chairman of the ENMRWA, said there may be few options other than major federal funding for the project because a number of the affected communities can’t raise sufficient funds to provide a substantial share of the costs.
Verhines agreed.
“We are assuming our local match of 10 percent would be financed, but we have not been able to make the project affordable if much more of the project is financed,” Verhines said.
Rep. Anna Crook, R-Clovis, asked what deadlines the project faces.
Verhines said the project doesn’t have much time left.
“The entities involved have been paying a fee for years to reserve their rights to this water. If this water is not purchased by December 31, 2006, the state can go ahead and sell it to someone else,” Verhines said. “That would be devastating to the communities that have been paying money for all these years to keep their rights in place, and it is why we are working so hard to get this project done on time.”