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<br />Last in line
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<br />Non - Indian farmers
<br />gambling on future
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<br />The non-Indian farmer is l~t
<br />in line to get Central ArI-
<br />zona Project water. but
<br />some of those farmers intend to
<br />mortgage their land and machin-
<br />ery to I{et it.
<br />The property will be security
<br />for bonds to be sold to help pay
<br />for systems to link their farms
<br />with the CAP aqueducts.
<br />
<br />The tOtal cost for building all
<br />of the non-Indian. distribution
<br />systems is estimated at $275 mil.
<br />lion in 1983 dollars, according to
<br />Larry Morton, chief of the office
<br />of distribution systems for the
<br />Arizona projects office of the
<br />Bureau of Reclamation.
<br />Congress has required that
<br />non-Indian water users pay
<br />20 percent of the construction
<br />costs before the federal govern-
<br />ment fmances the remainder.
<br />After construction, the water
<br />Ulen will repay the government
<br />the other 80 percent at no inter-
<br />est.
<br />Agricultural groups are willing
<br />to indebt themselves because the
<br />cost of pumping water to irrigate
<br />crops has skyrocketed, and CAP
<br />water, though expensive, in some
<br />cases will be cheaper than draw-
<br />ing it from the ground with
<br />electricity.
<br />Other factors 'are the realiza-
<br />tion that someday the water will
<br />'be too deep to justify the expense
<br />of pumping and that the wells
<br />will run dry.
<br />. . .
<br />The cost of pumping water'
<br />varies from district to district. At
<br />the low end, costs run about $35
<br />per acre-foot of pumped water for
<br />the Hohokam Irrigation District
<br />in Pinal County; the high is about
<br />$70 per acre-foot for the Harqua-
<br />hala Valley Irrigation District
<br />west of Phoenix.
<br />The non-Indian farmer will
<br />pay $2 per acre-foot for CAP
<br />water,. plus an estimated $53 per
<br />acre-foot to operate and maintain
<br />the CAP.
<br />For planning purposes, cities
<br />and industries are estimated to
<br />pay $32.50 per acre-foot in addi-
<br />tion to the operation and mainte-
<br />. nance cost, for a total of $85.50
<br />per acre-foot.
<br />These figures, except for the $2
<br />per acre-foot the non-Indian
<br />farmers will pay, are for planning
<br />purposes and subject to change.
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<br />Most of the money the farm
<br />districts need will be used to
<br />connect to the main CAP aque.
<br />'tiucts and to improve ditches and
<br />canals by lining them with con.
<br />
<br />crete. .. 11 h pod
<br />The districts orlgma y 0
<br />to build the systems with low.
<br />interest long-term federal loans.
<br />Howev:r, in 1981, then-Interior
<br />Secretary James Watt announced
<br />no 'funds for loans would be
<br />available, at least through 1984,
<br />because of federal budget defi.
<br />cits. There is no indication the
<br />loans will be reinstituted after
<br />1984.
<br />After Watt's announcement,
<br />the districts began examining the
<br />possibility of bank financing.
<br />High interest rates and loan
<br />periods of only 10 to 15 years led
<br />them quickly to abandon this
<br />funding avenue. Federal loans are
<br />for longer periods.
<br />The Bureau of Reclamation,
<br />recognizing the problem, pro-
<br />posed an alternative - a "work_
<br />contribution program." Under
<br />this plan, the districts, instead of
<br />the bureau, will plan and design
<br />their own connecting systems and
<br />fmd ways to pay for them.
<br />The bureau oversees the plan-
<br />ning and will issue the construc-
<br />tion contracts.
<br />The bureau has agreed to
<br />accept the districts' purchase of
<br />rights of way, planning, engineer-
<br />ing, 4~s and job specificati~ns
<br />
<br />as part of the 20 percent cost
<br />requirement.
<br />"We will tell them how to do
<br />it," Morton said. "The irrigation
<br />districts actually will donate the
<br />work."
<br />. . .
<br />Federal funds will be used in
<br />the construction, but the districts
<br />will have to repay the money
<br />within 40 years. Until repayment
<br />is completed, the government will
<br />retain title to the water-delivery
<br />. systems.
<br />. . .
<br />Because of the cutoff in federal
<br />loans, the agricultural districts
<br />are taking another cost-cutting
<br />step: They are designing bare-
<br />bones water-delivery systems.
<br />The Bureau of Reclamation
<br />assisted in this respect by reduc-
<br />ing its design requirements to
<br />conform with local practices.
<br />These design changes include
<br />the delivery of CAP water to the
<br />highest elevation of the land in
<br />each square mile, or 640 acres,
<br />rather than to the high point of
<br />each quarter section, or 160 acres
<br />- the traditional delivery point
<br />of water in federal reclamation
<br />water projects. The districts also
<br />. abandoned plans to replace old
<br />ditches, designing smaller new
<br />ones where needed.
<br />
<br />. . .
<br />Morton said the benefits of the
<br />work-contribution program are
<br />twofold: It allows the Bureau of
<br />Reclamation to work on and
<br />finance other CAP features, and
<br />it enables the districts to speed
<br />construction of irrigation sys-
<br />tems.
<br />"The bureau is operating
<br />under some budget limitations,
<br />reduced staffing and has a very
<br />high priority program to build
<br />the CAP's Granite Reef, Salt-Gila
<br />and Tucson aqueducts," Morton
<br />said. "Recognizing there may be
<br />some conflict if we were to build
<br />the (distribution) systems and,
<br />the other CAP features concur.
<br />rently, the bureau decided to:
<br />accept work contributions from
<br />the districts."
<br />To raise funds for planning,
<br />designing and developing con-
<br />struction specifications, to be
<br />paid for as part of the 20 percent
<br />funding requirement, the dis.
<br />tricts intend to Beli bonds, and
<br />the individual landowners will
<br />put up their property as security.
<br />, To do this, a district must be in
<br />good financial shape. If it isn't,
<br />brokerage houses will not agree to
<br />market a district's bonds, and the
<br />bureau will not enter into the
<br />federal repayment contracts.
<br />Some irrigation districts may
<br />back out of CAP plans because of
<br />their poor financial conditions.
<br />
<br />0- nIy four of 23 dis.tricts that
<br />need to connect to the
<br />CAP system have devel-
<br />oped plans for the repayment
<br />program with the bureau.
<br />They are:
<br />The Harquahala Valley Irriga.
<br />tion District, the most westerly of
<br />all irrigation districts on the
<br />Granite Reef Aqueduct; the New
<br />Magma Irrigation and Drainage
<br />District on the Salt-Gila Aque-
<br />duct in' Pinal County; the Mari.
<br />copa-Stanfield Irrigation District,
<br />on the Tucson Aqueduct in Pinal
<br />County; and the Central Arizona
<br />Irrigation District, on the Tucson
<br />Aqueduct in Pinal County.
<br />. . .
<br />Sixteen groups, including some
<br />cities, have shown interest in
<br />entering into the repayment con.
<br />tracts to construct wat.er-distri.
<br />bution systems.
<br />Morton said he believes agri-
<br />cultural groups will be the major
<br />participants in the program be-
<br />cause cities generally do not want
<br />their systems owned by the
<br />federal government.
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