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THE ARtzONA REPUBLIC CAP/Specl.1 Report 5 , T he Central Arizona Project is among the most expen. sive federal reclamation projects ever undertaken, but Uncle Sam will get much of his money back. Congress, in authorizing the CAP, provided that a large pro- portion of the money it would advance for construction would be returned to the Treasury with 3.342 percent interest. The 1968 legislation authorized $832,180,000 for the CAP's main features and $100 million for non-Indian irrigation works. In the 15 years since, because of increased costs of materials and labor, the cost of the CAP's main features has risen to an estimated $3.5 billion. The cost of non-Indian irriga- tion distributions systerns now is put at $276 million. Spending for the non-Indian work is just beginning and will be repaid without interest. Nor will non-Indian farmers or Indians pay intereat on the cost of the main CAP features. Inter- eat will be paid by municipal and industrial-CAP water usera. Con- gress has left the rate of interest 88 it W.Q.6I in 196& In October 1983 prices, the Bureau of Reclamation estimated the OO8t of the main CAP work at $2,475,338,000. This does not include the proposed Plan 6 or costs for non.lndian irrigation- water distribution systems. Of the total cost to date, the bureau estimates $1,659,433,000, or 67.1 percent, will have to be repaid by the Central Arizona Water Conservation District, the three-county agency established for this purpose. Approximately $52,424,000 of the project costs will be repaid by other beneficiaries of the CAP law, including those in New Mexico. The other $763,481,000 will not have to be repaid because it is classified as deferred or non." reimbUl'88.ble. Repaying Uncle Water district's share estimated at $1.6 billion Deferred refers to the Indians' share of CAP costs, which so far, totals $387,250,000. The money will remain deferred as long as the Indians do not sell their lands. Non-reimbursable dollars ~ $376,231,000 - are those spent for flood control, some fish and wildlife, and recreation. The oontract ff>>' CAP con_ struction and repayment between the conservation district and the Department of the Interior speci. flee that repayment to the federal government will begin when the interior secretary declares the CAP substantially is complete. The repayment period is 50 years. Interest so far on CAP con- struction costs totals $216,264,- 000. The Bureau of Reclamation reported it cannot estimate the interest over the 50-year repay- ment period because of uncer. tainty over which part of the remaining $3.5 billion will be reimbursable. However, Frank Welch, execu- tive director of Citizens Con- cerned About the Project, a Valley ta:r.payers group opposed to using federal funds for con- struction of the CAP, estimated the interest will bring the total CAP cost to $5.4 billion. The conservation district will have three sources of revenue: water sales to municipal and industrial users and non-Indian farmers, electricity sales and property taxes. In ordor to p.y tho con..rva_ tion district's annual obligation, not including interest, the Bu. reau of Reclamation estimated the anticipated revenue from each of these as follows: . Water sales: $550,127,000. Water will be sold to non- Indian farmers at $2 per acre- foot, a charge set by the Bureau .of Reclamation. The bureau projects these farmers will receive approximately 29 million acre- feet of water in the 50-year repayment period, which means their total contribution to repay- ing the costs of the main CAP features will be $58,704,000. The conservation district, for planning purposes, in 1972 set the price of water at $32.50 per acre-foot for municipal and in- dustrial users. Municipal and industrial users are projected to get about 12.1 million acre-feet of water at a cost of $491,423,000. . Electricity sales: $917,218,-- 000. . Most of this - $842,809,000 _ will come from sales of power at the Navajo Generating Station at Page. Hoover Dam power sales are expected to contribute $74,- 409,000, starting in 1993. The law authorizing the CAP said the CAP will receive power revenues from the Parker-Davis Project, too, but the Bureau of Reclamation reported the rates for electricity produced by this project do not provide enough revenue to help with CAP repay- ment. CongreB8 next year will con- sider a bill that would specify that 41h mills, or 0.45 of a cent, for each kilowatt-bour of electric- ity sold at the Navajo Generating Station and Hoover Dam go into the repayment fund. The Bureau of Reclamation already has calculated the 4V2 mills into the expected repay. ment revenues. The Navajo Generating Station was built to provide electricity to pump CAP water. .-Propol't.y-t.aJ.oe; tl92,088,()()(). The Conservation District has authority to levy a property tax of 10 cents per $100 of 8B8eBsed valuation in the three-county district: Maricopa, Pinal and Pima. The current property-tax levy is 5 cents. Pam Kohnken, chief of the contract and repayment branch for the bureau's Arizona projects office in Phoenix, said the gov. ernment is interested only in the total annual payment. How the district collects the money_ is up to its board of directors and .it could change the price of water for cities and industries and change the property-tax rate. She said when repayment be~ gins, the conservation district also will have to pay interellt.on tbe balance of CAP conatnictioA costs due the government. "