WSP02305

• File Number: 8220.106
• Description: Animas-La Plata
• State: CO
• Basin: San Juan/Dolores
• Water Division: 7
• Date: 12/1/1994
• Author: Bookman-Edmonston
• Title: Economic Impact Study - Animas-La Plata and Colorado Ute Water Rights Settlement Act
• Water Supply Pro - Doc Type: Report/Study

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REGIONAL ECONOMY WITHOUT PROJECT

Litigation Costs

Due to the uncertainties associated with all of the legal questions that potentially could arise
if the ALP is not constructed, it is extremely difficult to estimate litigation costs. These
uncertainties include: (1) whether only claims on the Animas and La Plata Rivers would
be involved, as is commonly agreed, or if a legal theory could emerge which placed the
entire Settlement in jeopardy and all claims would be reevaluated; (2) impacts on the
La Plata River Compact; (3) impacts on the Upper Colorado River Basin Compact; and
(4) questions concerning the possibility of impacts on New Mexico under some equitable
apportionment argument or assignment of Reclamation's New Mexico water rights to Tribes.
McElroy estimated litigation costs for the scenario that the entire Settlement would be
revoked and all claims would be settled by a lengthy litigation process culminating with a
final appeal to United States Supreme Court to be $30 million and included outside legal
and expert fees and expenses for the United States, the Tribes, the states of Colorado and
New Mexico, and other affected parties. The estimated costs do not include staff time and
other expenses that would be incurred by the parties. The McElroy estimate does not
consider possible litigation associated with compact issues or litigation that may result as
part of an environmental compliance action. Assuming that failure to construct ALP only
affects the claims on the Animas and La Plata Rivers and that such claims would raise
compact issues, $20 million is considered a reasonable estimate of the litigation costs.

CITY OF DURANGO M&I WATER SUPPLY

The city of Durango has historically supported ALP and presently has applied for
2,500 acre-feet per year for M&I water supply. Previous (Harris3) and ongoing (Gronning4)
studies have shown that this amount would satisfy the city's increased demands for a
population of 30,000. The current population is 18,000, and the current peak day demand
is approximately equal to the existing delivery capacity of the water system (Gronning).

3 Harris Water Engineering, Inc., City of Durango Water Supply Feasibility Study, report prepared for the
City of Durango, August 30, 1993.

4 Gronning Engineering Company, City of Durango Water Supply Study, report prepared for the City of
Durango, September 19, 1994 (Final Draft).

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