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THE ARIZONA WATER BANKING AUTHORITY SUMMARY For over 70 ye3J"s. Arizona leaders have wodced 10 ensure thai Arizona's communities bave dependable long-tenn water supplies. From securing the state's fair share of Colorado River water and gaining Congressional authorization for the Central Arizona Project (CAP) to crafting the 1980 Groundwater Management Code. their foresight 3lld planning have provided the walCl' supply that saves ror growing communities and maintains our quality of life. During the 1996 legislative sesslon. Governor Symington and the Arizona Legislature continued the tradition by creating the Arizona Water Banking Authority (AWBA), Until the AWBA was a-ealed. Arizona did Dol use its full 2.8 million acre fool share of Colorado River waler. Without the A WBA. Arizona would nol use its full allocation until the year 2030. Between now and 2030. the accumulated amount of water left in lhe Colorado River would amount to approximately 14 m.ilIion acre feet. Most of thai water would go to southern California. Leaving a portion of Arizona's water in the Colorado River is a lost opportunity. The AWBA seizes this opportunity and gives Arizona the capability to furthef" secure the dq>endable water supplies necessary to ensure the state's 10ng-l.c:nn prosperity. The AWBA was created to store unused Arizona Colorado River water to meet future needs for: (1) Assuring adequate water supply to municipal and industrial users in times of shortages or disruptions of the CAP system; (2) Meeting the management plan objectives of the Arizona Groundwatef" Code; (3) Assisting in the settlement of Indian water rights claims; and (4) Exchanging water to assist Colorado River communities. '.J In addition to these functions. which were set forth in the A WBA 's enabling legislation. the A WBA can also undertake some additional water banking activities. The Arizona Water Banking Authority Study Commission. created in 1996 to considea- and recommend possible addilional roles for the AWBA in carrying out Arizona's water policy. proposed a series of water banking amendmenls during the 1999 legislative session. all of which were approved by the Legislature and signed into law in April 1999 by Governor Hull These Sl1ltutory amendments include provisions to allow .... -' ~, ::::> the AWBA to perfonn banlcing services for specific entities in Arizona and create a mechanism for distribution of long-tenn storage aedits earned on behalf of specific Arizona entities; to permit the A WBA to store effluent for the same purposes allowed for Central Arizona Project water but only when all available excess CAP watel' has been stored or when excess CAP water is oct available to the AWBA; to [.rolect non-cAP surface water supplies; to create a mechanism for long-tenn storage credit lending; and to require the A WBA to include in each annual report a section that discusses how the previous year's activity fits in with the authority's long-tenn goals. How does the A WBA work? Eadl year. the AWBApays the delivery and storage costs to bring Arizona's unused Colorado River water into Central and Southern Arizona through the CAP. The water is stored underground in existing aquifers (direct red:Jarge) a" is used by irrigation districts in lieu of pumping groundwater (indirect recharge or in-lieu recharge). For each acre foor srored. the AWBA accrues a credit that can be redeemed in the furore when Arizona's communities need this backup water supply. What an the key benefils of waJer banking? Drought Protection The A WBA prolects communities dependent on the CAP by providing a stored reserve of water that can be t8J:Ped in future times of drought on the Colorado Rivea-. Enhanced Water Management The A WBA provides the ability to replenisb depl..ed groundwaler aquifers with CAP waler, thereby belping Arizona meet its groundwatef" management goals and objectives. Indion Water Right$ Senlement$ Indian tribes in Arizona have signifICant cbims to water rights. Often the affected parties ncg<tiate settlements to resolve these claims. The A WBA provides another pool of watel' to be used in settlements. For instance. aedirs for stored groundwater can be transferred to a tribe as a component of a settlement. Statewide Benefit Arizona communities along the Colorado RiVef" can also benefit. For example. cities in Mohave County may acquire credits Ihrough the AWBA for water stored in central Arizona and redeem those credits by diverting water directly from the Colorado Rivea-. Inle1'Sl4le Water Transfers The A WBA could contract with similac authorities in California and Nevada to allow these states to annually acquire a portion of Arizona's lemporary surplus of Colcndo RiVtt water. The contracting state would pay to store wattt in Arizona.. helping to replenish Arizona's aquifers. and in the future would be able to draw a similar quantity directly from the Colorado River. The program does Dol involve the sale of any future rights to water. only a specific quantity of unused water. In December 1997. the United States Departmeor of the Interior promulgated draft rules that may someday enable interstate water banking. Those rules are not Y" fmaL Who operates the A WBA? A five person commission directs the activities of the A WBA Tbe Director of the Department of Water Resoorces chairs the A WBA and members include the President of the Board of the Central Arizona Water Conservation District (CAWCD) and three persons appointed by the Governor. By law. of these appoinbnents. one person represents CAP municipal and industrial water users. one person represents Colorado River water users along the Colorado River. and one person must be knowledgeable in water resource managemenl issues. Additionally. the Arizona Senate and Hoose of Rcpresent3lives each appoint one non-voting ex officio member' 10 the AWBA How is the A WBAfunded? Much of the money that funds the A WBA cernes from existing revenue sources and from fees that are charged to those benefiting directly from the stored water. Restrictions on the ways these monies can be used depend on the source of the monies. which currently include: . Fees for groundwmer pumping cmrently collected wilbin the Phoenix. Pinal. and Tucson Active Management Areas (AMAs). In the Phoenix AMA Tucson AMA and most areas of the Pinal AMA pumping fees for waler banking PUlpOses are $2.50 per acre foot. For groundwater pwnping in areas of the Pinal AMA na served by the CAP. the $2.50 fee pbases in over seven years. Money from thi$ source mUft be wed for the benefit of the Active Management Area in which ;1 wa$ collected. . A four cent ad valorem prq>erty tax in the CAP service area to pay for wmer storage. To help finance the AWBA's efforts. the tax will be extended through 2016 and revenues will be deposited in the Wa'... Banking Fund, The CAWCD r..ains the option to use this money for capital repayment of the CAP if necessary. The CAP detcnnined that it ctid not require these funds for its purposes in both 1997 and 1998, Moneyfrom rhi, source mU$t be uud to benefit the county in which it wa$ collected. . A general fund appropriation based on the level of water storage the amount the Arizona Legislature and Governor believe to be appropriate. The annual appropriation has amounted to $2 million for the past two years. Water $lored