Gov. Herbert: Conservation, transparency needed before Lake Powell Pipeline

Stock image | St. George News

ST. GEORGE – Recommendations in Gov. Herbert’s proposed 2017 budget may signal a shift in the willingness of state officials to fund the Lake Powell Pipeline and other large water projects — at least before major conservation efforts, increased transparency and other measures are put in place.

The 2017 fiscal year budget proposal, unveiled by Herbert Dec. 9, recommends several conditions be met before the state would be willing to consider funding billion-dollar projects like the Lake Powell Pipeline. The pipeline would bring 86,000 acre-feet of water 140 miles from Lake Powell to Washington and Kane counties and, according to a recent study, cost an estimated $1.4 to $1.8 billion.

The Governor’s recommendations validate our long-held position favoring water conservation and fiscally responsible, locally financed water projects,” Tom Butine, board president of local conservation group Citizens for Dixie’s Future, said. 

“He has recognized the elephant in the room. It’s crazy to spend billions of dollars on a water project when we are wasting millions of gallons of water per year.”

The budget and its recommended changes for how large water projects are financed were released a week after state water officials submitted a preliminary licensing proposal to the Federal Energy Regulatory Commission, and a month after a group of economists predicted building the pipeline would result in massive water rate increases for residents of Washington and Kane counties.

Read more: Utah submits Lake Powell pipeline proposal to federal agency; comment period opens

Read more: Study predicts Lake Powell Pipeline will trigger massive water rate, impact fee increases

Conservation

Graphic shows water distribution in Utah | Image courtesy of Gov. Herbert's office, St. George News
Graphic shows water distribution in Utah | Image courtesy of Gov. Herbert’s office, St. George News | Click image to expand

Although water use data is imperfect, the Governor said in his budget, U.S. Geological Survey data shows that Utah has the highest per capita municipal and industrial water use in the nation.

Of all the “diverted” water in Utah, 82 percent is used for agriculture, and 18 percent for municipal and industrial use.

Just 3.5 percent of the state total is used for residential indoor use while 6.5 percent is used for residential outdoor use.

Relatively minor increases in agricultural efficiency could provide an amount equal to the current statewide indoor water use.

The budget recommends better tracking of water use and stronger conservation measures:

Utahns have an important choice to make about water use. The need for additional water supply at some point is a given; however, the timing of water system development varies dramatically, depending on changes in water usage.

Increased conservation could delay major development projects for decades while the failure to conserve water will lead to accelerated building schedules and their associated increased costs sooner. …

If Utah’s water were used more efficiently, the need for costly water development projects could be postponed for decades.

Funding

Water projects totaling $33 billion, including the Lake Powell Pipeline, have been proposed by a group representing large water conservancy districts, the budget states.

The Lake Powell Pipeline Act of 2006 and the Bear River Development Act of 1991 indicate that the projects are subject to future funding decisions, the budget states. Under the acts, once the projects are built, and repayments to the state begin, repayment of 70 percent of the costs would be made within 50 years after local entities take water that was contracted prior to construction.

However, 30 percent of the repayment remains “completely open-ended,” meaning no set time period is in place for repayment to the state.

“Under the proposal, the State of Utah’s General Fund would never be repaid and the ongoing allocation of tax revenues would create a permanent sizable state taxpayer subsidy for water development,” Herbert said.

Conservancy districts are essentially asking the state to assume the role of financing large water projects — a function formerly filled by the federal government, a move which would be a “massive expansion of the state’s role.” Because the state balances its budget, this would have to affect other state-funded programs such as education, or increase taxes.

Out of respect to the taxpayer, the governor’s budget recommends the state only finance major projects after exhausting all other alternatives.

Details

The Governor recommends that these conditions be met before the state funds water projects:

  • Better water data and data reporting before state financing or funding, including universal metering in all areas that would receive state-funded water and three years of data under new state standards to be implemented in 2016
  • New and meaningful water conservation targets that strongly emphasize better water conservation
  • Independent validation of project costs, including a comprehensive price elasticity and repayment feasibility study
  • Local funding effort and increased emphasis on user fees, including water districts paying up front for a “meaningful portion” of any water project and movement away from using property taxes to fund water in favor of user fees
  • Transparency and local voter engagement through processes such as public hearings and local votes on proposed projects
  • Appropriate financing and repayment terms such as 100 percent repayment of project costs and an interest rate that reflects the state’s actual borrowing costs.

The Governor’s budget recommends spending $6 million to collect and study water data throughout the state and $460,000 to improve water reporting from local and state agencies.

Other proposals would provide funding for water conservation at state facilities, water conservation advertising and rebates, water rights adjudication and funding for safe drinking water.

Water district response

Washington County has already reduced per capita water use by 26 percent from 2000 to 2010, Karry Rathje, spokesperson for the Washington County Water Conservancy District, said. And the district supports continued efforts to reduce use.

The District is considering a down-payment option in its funding scenarios, Rathje said, but that is not a requirement of the financing terms specified in the Lake Powell Pipeline Development Act.

The state and participating districts are acting in accordance to the terms specified in the Lake Powell Pipeline Development Act, Rathje said.

“The Governor’s budget is proposing state financing concepts and requirements for the Lake Powell Pipeline and Bear River Development that are not in the current statutes,” Rathje said. 

The District believes transparency and local voter engagement are already established.

The Lake Powell Pipeline was voted (on) by our publicly elected legislative branch of government with tremendous support in 2006,” Rathje said. “Local elected officials who support the project continue to get the majority public vote.”

In addition, the District has and will continue to host public meetings and provide information, Rathje said.

Unlike transportation and education, water conservancy districts are the only essential public utility that repays state loans with interest, Rathje said, and investments in water infrastructure yield some of the highest state and local economic returns.

For every $1 invested in water infrastructure in Utah, Rathje said, $6.27 is produced in economic output, $5.17 is generated in personal income and $0.41 is collected in state and local taxes. 

“The district would not pursue a project if the costs exceeded the economic returns or jeopardized the financial stability of the state or local communities,” she said.

Ed. note: Added clarification of Lake Powell Pipeline Development Act repayment recommendations.

Email: japplegate@stgnews.com

Twitter: @STGnews

Copyright St. George News, SaintGeorgeUtah.com LLC, 2015, all rights reserved.

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10 Comments

  • Bender December 16, 2015 at 9:44 am

    Ron Thompson’s all “But it ain’t be like that.”

  • wilbur December 16, 2015 at 11:17 am

    “The District believes transparency and local voter engagement are already established.”

    Really? When do we get to vote on this Ron?

    • Bender December 16, 2015 at 12:23 pm

      “When do we get to vote on this?” – You must be new around here wilbur. Your betters in the leadership of Washington County Republican Party will decide what is best for you.

    • .... December 16, 2015 at 1:58 pm

      You’re a nasty nasty man Wilbur. You have no right to vote on this. and you thinking you do shows just how stupid you really are. Btw how’s Mr Ed doing these day’s Wilbur ?

  • tcrider December 16, 2015 at 12:45 pm

    Saint George city officials need the tax payers of Washington county to pay for this pipeline so they can make more deals for cheap water for developments like the ledges golf course community, why do these people pay less for water than anyone else in the region ?

  • beacon December 16, 2015 at 1:41 pm

    Funny how the water district always likes to use “percent” improvement when talking about the water conservation success they’ve inspired but not what the 26% improvement really equates to in actual usage per person. Just more of their effort to “appear” transparent when they really aren’t!

  • Lastdays December 16, 2015 at 2:49 pm

    So which will cost more in the end? If they shove this project down our throat, and charge what ever they dare get away with ? Or, if the usual 18% who vote turn out and a 51% majority of that group choose to have the project go forward. Then with voter permission, they charge what ever they want for water because 9.1% of those who vote said so. Either way we lose in the end.
    So instead of the usual “we need more water” explanation, we need the district to tell us why do they “really” need a 2 billion dollar project. Is it an ego thing ? A feather in the cap thing ? Is it a contest between other water districts as to who can spend the most thing ? A future statue to be built so we can idolize Ron thing ? What’s the real reason? Please tell us.

  • Bill Barlet December 17, 2015 at 12:49 pm

    The Lake Powell Pipeline Project proposal has greatly disturbed me since I moved to southern Utah from Denver four years ago. The reported lack of transparency provided by the project’s proponents is troubling. Their alleged refusal to share complete financing repayment plans arguably suggests subterfuge, at some level. At the very least, refusing to share financing plans and data methodology should be nonstarters for any project in the public domain. If proponents of a policy, procedure or plan, cannot or will not provide supporting information, or cannot or will not explain why that policy, procedure or plan makes sense and should be adopted and/or sustained, addressing all questions and competing concerns, then perhaps that policy should be changed or rejected. The narrative of the Lake Powell Pipeline proposal, and any substantive, informed debate among southern Utahns is becoming bogged down by the lack of supporting detail from the project’s proponents. Perhaps that is the tactic intended by proponents. Perhaps the intent is to obfuscate the core issues until the public just becomes confused or distracted. Southern Utahns should not abdicate their right and duty to understand the issues surrounding this project; southern Utahns should not simply acquiesce to their leaders and assume those leaders know best, or will necessarily act in their best interests. That will be a shame. It is not difficult to know how much water a family uses per capita. Southern Utahns should be asking their neighbors about their water usage. Are the water usage projection numbers being used by the pipeline’s proponents’ reasonable? They clearly appear significantly overstated to me, given my own personal usage patterns. We conserved water in Colorado. The rules were strict but tolerable. They made sense. Citizens understood the stakes involved and accepted the rules as a requirement to live in Colorado. There are essentially zero rules for water conservancy here in southern Utah. Why? I now live in a desert and yet my water usage is managed by a “whatever” governmental policy. It makes absolutely no sense to forego conservation measures and make the leap directly from Washington County to Lake Powell via a water pipeline. To dismiss conservation as a viable solution, based on arguably greatly inflated water usage projections, is bad public policy. Insufficient details have been provided to comprehensively assess financial issues; however, what has been shared suggests this project is frighteningly bad fiscal policy as well. This project, as currently proposed, lacks sufficient rationale for constructing a water pipeline, or for how that pipeline will be funded. To say nothing of the myriad issues surrounding the water levels in Lake Powell and the sustainability of Lake Powell as a viable water source. Perhaps the proponents of the Lake Powell pipeline are considering a second pipeline from Lake Mead upstream to Lake Powell to replenish Powell as the water level is drawn to further lows. That circular reasoning would seem to fit very nicely with the rhetoric, and lack of substantive detail, the pipeline’s proponents have provided thus far. As I have read of the political wrangling surrounding the proposed pipeline, this project has never passed the smell test for me. I am very leery of pricey public projects which are cobbled together behind soundproof doors. I don’t like propaganda of any kind, and the narrative provided by the pipeline proponents sounds like propaganda. I want clear, objective rationale. I want clear explanations of data methodologies and projections. I don’t want excuses why I cannot be told how the project will be funded. I want proponents to explain why conservation has not been implemented. Propaganda, by definition, is intended to manipulate minds. I prefer facts and data. If facts and data are not provided, or are sanitized or propagandized to manipulate minds, we should be alarmed. Truth is always useful. Always!

  • Bender December 17, 2015 at 4:53 pm

    “Perhaps the proponents of the Lake Powell pipeline are considering a second pipeline from Lake Mead upstream to Lake Powell to replenish Powell …” Now we’re cookin’ with gas!
    .
    Bill, the numbers don’t add up on this project with our small population of ~150,000. With Gov Herbert’s push back we’re starting to see reality come in to focus and this will become more apparent to the local proponents as they attempt to move the project forward. The county will not be able to sell bonds for the project, the state is realizing that they can’t be on the hook for the financing and the era of big federally financed water projects is long gone. The only question is how much money of other people’s money will Ron Thompson piss away on palatial office buildings, pro-pipeline financial studies by out of state consultants and engineering before his board and the county commissioners shut down his failed attempt at legacy building.
    .
    Washington County has enough water in place right now to more than triple our population if our usage rates come down to what people in Tucson or Las Vegas use per person. After that there are cheaper developable water sources nearby. At that point, maybe a Lake Powell pipeline makes sense.

  • Bill Barlet December 19, 2015 at 2:03 pm

    Bender, I’m in complete agreement concerning the numbers. I don’t understand why it has taken the office of the governor this long to state the obvious. The fact that such an ill-conceived, poorly substantiated proposal has made it this far, is rather remarkable. It really is extraordinary that the proponents of the pipeline have succeeded thus far in pushing their agenda with really nothing more than bluster and political pseudoscience. If nothing else, the fact this proposal has made it this far, given the flimsy justifications, may be an example of the insular nature of politics, and business relationships, in southern Utah. One could suggest that the proponents of the pipeline are taken aback that there is actual pushback to their project. One could also suggest that historically there has not been much pushback from the southern Utah public to their leaders, political or otherwise. A default mindset of deferring to one’s leaders has perhaps become ingrained and serves to confer a sense of omnipotence to those leaders, who can act as they see fit with impunity, and the public should trust them because the ‘thinking’ has been done for them. Ron Thompson, in this case, seems to fit that bill; however, Mr. Thompson is but one example of how local politics within an isolated jurisdiction can morph into a clandestine multi-layered, highly complex, interdependent web of enablement and entitlement. Seems to me that since we’re debating whether southern Utah has adequate water resources to quench the thirst for future growth, it would be only appropriate that the takeaway for southern Utahns from the Lake Powell pipeline debate will be that going forward, southern Utahns will have an increased thirst for their own critical thinking, and for transparency and objective, reasoned policy-making from their leaders. Ironically and refreshingly, the population growth projected for southern Utah will be instrumental in changing that ingrained mindset and will serve to dilute and eventually break down the insular, isolated local political model, which spawns project proposals such as this.

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