Lawyer: Legislature could create water shortage

A legislative raid on Central Arizona Project funds is not only illegal but also could leave state residents literally high and dry, the lawyer for the organization is charging.

In legal papers filed with the Arizona Supreme Court, attorney Robert Lynch said the $13.9 million taken to balance prior and current state budgets comes not from Arizona taxpayers but is part of a $100 million payment from Nevada in exchange for Arizona letting that state have some of its Colorado River water allocation. The money is supposed to be used by Arizona to "bank'' some of the water this state does not need now but will require in future years.

Lynch said lawmakers do have the power to "sweep'' certain special funds to balance the budget. But he said that is limited to those accounts where the money was raised through legislation in the first place and comes from Arizona taxpayers.

In this case, Lynch said, the funds are being held in trust for future water banking projects. He said that makes the sweeps of the fund unconstitutional, and he wants, at the very least, an order directing the state to give back the most recent $5.4 million taken.

Legal issues aside, Lynch said the move could leave residents without the water they need when demand exceeds the amount of Colorado River water Arizona is entitled to take.

"This is one of those things where we're stabbing ourselves in the back,'' he said.

Central to the lawsuit is a 2001 deal between the states where Arizona agreed to bank some of its Colorado River water allocation and then sell more than 14 billion gallons of that every year to Nevada for the next three decades.

Under the deal, Nevada gave Arizona $100 million upfront, with the promise of $23 million a year for a decade beginning this year.

Nevada already is using all of the Colorado River water to which it is entitled. The deal gives Nevada excess river water it needs well into this century ‑ water Arizona does not now need ‑ to fuel the explosive growth of Las Vegas while it finds other sources.

That $23 million strictly covers the storage costs for Nevada's water.

What's at issue in the lawsuit is that $100 million payment. Lynch said that money was specifically earmarked for Arizona to start storing water for itself it doesn't need now ‑ and is not being sent to Nevada ‑ for its own future needs.

Arizona is entitled to 2.8 million acre-feet a year of water from the Colorado River. An acre-foot is 325,851 gallons and, depending on the community, enough to provide water for one or two families for a year.

Lynch said even with giving Arizona about 40,000 acre feet a year, the state still is not using all of its current allocation.

At the same time, there is concern that at some future point Arizona is going to need all of that. Yet, if the Colorado River flow doesn't match expectations, the U.S. Secretary of the Interior could cut Arizona's allocation below that 2.8 million acre-feet entitlement.

Lynch said that $100 million is supposed to go to storing that excess now that Arizona does not currently need it. The goal is to put away at least 1.2 million acre feet, or close to 400 billion gallons.

Taking that money, he said, cuts the state's ability to bank that water, which was one purpose behind cutting the deal with Nevada ‑ and getting the cash payment.

"If we take the money and don't buy water and put it in the ground, then when it hits the fan and the secretary (of Interior) starts scratching everything back, Nevada continues to take (Arizona's allocation of) water out of Lake Mead like nothing happened, and we cut back,'' he said.

"And so, we've done it to ourselves,'' Lynch continued. "By not having water in the ground, we'll have to cut back from what we're taking from the river.''

Gov. Jan Brewer, who approved the transfer, said in a prepared response that she does not believe any of them "are good, long-term solutions for budget improvement.'' But gubernatorial press aide Paul Senseman said Brewer had no choice but to sign the legislation with those sweeps ‑ including this one ‑ because it was "part of keeping government operations open and functioning.''

And House Majority Leader John McComish, R-Phoenix, said the concerns are unwarranted.

"We are confident the fund sweeps don't jeopardize the Arizona-Nevada deal,'' he said in a prepared response. "This lawsuit appears to be designed to prevent future fund sweeps rather than actually protect water agreements with a neighboring state.''

Lynch said the state is close to half-way to having that 1.2 million acre feet of water in storage. But he stressed that is a contractual minimum, with the goal being to bank more of what Arizona does not need now if possible.

"It's our water,'' he said. "It's use it or lose it.''

What has occurred was actually foreseen.

When that deal was formally signed in 2004, John Mawhinney, a member of the Central Arizona Water Conservation District board, told Capitol Media Services he was concerned that the $100 million upfront payment will be grabbed by "scavengers,'' a not-so-veiled reference to the practice of legislators to grab various funds when state revenues run short. Mawhinney, a former state senator from Tucson, said he wanted the money somehow legally sealed off from lawmakers in a trust account.

Lynch, in his legal papers, contends the money where the funds were put does qualify as such a trust account, making it off-limits to the raid.