MEMORANDUM To: Arizona Water Banking Authority Members From: Kim Mitchell, Manager Subject: Amended 2009 Annual Plan of Operation Date: April 17, 2009 AUTHORITY MEMBERS Herbert R. Guenther, Chairman Maureen R. George, Vice-Chairman Tom Buschatzke, Secretary John Mawhinney Lisa Atkins EX OFFICIO MEMBERS Senator Steve Pierce Representative Kirk Adams As approved by the Authority at the April 1, 2009 meeting, the 2009 Annual Plan of Operation (Plan) has been amended to reflect changes made to the original Plan due to additional supplies that have been made available to the AWBA and to include an interstate water banking component. Attached to this memorandum are an Amended Table 2, replacement paragraphs that discuss these changes, and an Amended Table 5. These changes constitute the Amended 2009 Plan of Operation. Amended 4-1-09 The 2009 Plan of Operation (Plan) has been amended to include additional supplies and water deliveries for interstate banking purposes. The following paragraphs have been changed and constitute the Amended 2009 Annual Plan of Operation. Page 7, second paragraph I. Water Availability The AWBA had planned to deliver for storage a total of 118,523 acre-feet under the original 2009 Plan of Operation (Plan). In March, an additional 15,124 acrefeet of water available became available to the AWBA. The 2009 Plan was amended to include delivery of this additional water to the Central Avra Valley Storage and Recovery Project (CAVSARP) located in the Tucson AMA. Thus, the total deliveries scheduled under the 2009 Amended Plan are 133,647 acrefeet. Page 8, paragraphs 1 and 2 III. Available Funds The AWBA will have limited withdrawal fees available for use in this Amended Plan for intrastate storage. Because of a shortfall in the State’s fiscal year 2009 budget, $12.6 million was transferred from the AWBA fund in accordance with Senate Bill 1001. Of this amount, an estimated $4.1 million will come from the withdrawal fee subaccounts for the three AMAs and will include 2009 collections and carryover from 2008. An estimated $764,000 will remain for use in this Amended Plan: $82,000 for the Pinal AMA and $682,000 for the Tucson AMA. The remaining $8.5 will be transferred from the Nevada subaccount. As in previous years, the CAWCD Board resolved to continue to retain the county ad valorem property taxes collected and not transfer those revenues to the AWBA Fund. Property tax revenues retained by CAWCD can be used to offset the cost of AWBA water deliveries in the tri-county CAWCD service area. The estimated ad valorem tax balances available for 2009, including carryover, are: Maricopa County ($91 million), Pinal County ($2.48 million), and Pima County ($10.1 million). Page 9, Table 2 Amended 4-1-09 Amended Table 2 Water Delivery Schedule Calendar Year 2009 (Acre-feet) GSF USF AWBA-Recharge Sites PHOENIX AMA : West Maricopa Combine HIEROGLYPHIC AGUA FRIA TONOPAH DESERT TONOPAH Interstate SRP CHANDLER HGTS ID NEW MAGMA QUEEN CREEK TONOPAH ID GILA RIVER INDIAN IDD Permitted Capacity (AF) GSF Apr May Jun Jul Aug Sep Oct Nov Dec Total 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 100,000 3,000 54,000 28,000 15,000 37,520 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,402 0 0 0 0 0 5,711 0 0 0 0 0 10,475 0 0 0 1,343 0 8,365 0 0 0 2,285 0 5,373 0 0 0 2,285 0 0 0 0 0 1,142 0 0 0 0 0 1,142 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,402 0 5,402 5,711 0 5,711 10,475 0 10,475 9,708 0 9,708 7,658 0 7,658 2,285 0 2,285 1,142 0 1,142 1,142 0 1,142 0 0 0 0 3,240 0 0 0 0 0 0 2,000 0 0 0 0 0 0 2,070 0 0 1,500 0 0 0 2,590 0 0 2,000 0 0 0 3,110 0 1,000 5,500 0 0 0 3,120 0 0 5,500 0 0 0 3,110 0 0 5,500 0 0 0 760 0 0 0 5,500 0 0 0 3,120 0 0 4,750 0 0 0 5,570 0 0 1,750 0 0 0 3,090 0 0 500 0 0 0 720 0 3,240 0 3,240 2,000 0 2,000 2,070 0 2,070 4,090 0 4,090 6,110 0 6,110 8,620 0 8,620 8,610 0 8,610 6,260 0 6,260 0 8,620 8,620 0 10,320 10,320 0 4,840 4,840 0 1,220 1,220 0 0 0 0 0 0 0 500 0 0 2,000 0 0 0 500 0 0 2,000 0 5,000 0 500 0 0 0 0 5,000 0 500 0 0 0 0 5,124 0 520 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 110,000 55,000 120,000 18,480 TOTAL INTRASTATE TOTAL INTERSTATE AMA TOTAL TUCSON AMA: USF Mar 0 0 0 0 0 AMA TOTAL PINAL AMA : GSF Feb 25,000 35,000 100,000 150,000 TOTAL INTRASTATE TOTAL INTERSTATE CAIDD CAIDD Interstate HOHOKAM HOHOKAM Interstate MSIDD MSIDD Interstate GILA RIVER INDIAN IDD Jan 11,000 30,000 0 0 0 0 0 0 0 0 0 8,197 0 35,326 43,523 43,523 0 43,523 20,000 12,500 0 0 20,000 12,500 1,000 66,000 41,000 25,000 66,000 AVRA VALLEY PIMA MINE RD PMR Interstate LOWER SANTA CRUZ LSC Interstate CAVSARP SAVSARP 100,000 60,000 480 0 0 2,000 0 0 0 BKW KAI FARMS (Red Rock) 16,615 11,231 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2,480 0 2,480 0 0 0 2,500 0 2,500 7,500 0 7,500 5,500 0 5,500 5,624 0 5,624 520 0 520 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5,720 0 5,720 2,000 0 2,000 4,570 0 4,570 11,590 0 11,590 17,012 0 17,012 19,955 0 19,955 19,605 0 19,605 15,968 0 15,968 7,658 8,620 16,278 2,285 10,320 12,605 1,142 4,840 5,982 1,142 1,220 2,362 108,647 25,000 133,647 50,000 TOTAL INTRASTATE TOTAL INTERSTATE AMA TOTAL Outside AMA: HARQUAHALA VALLEY ID OUTSIDE TOTAL TOTAL INTRASTATE TOTAL INTERSTATE TOTAL 50,000 3,000 0 0 6,000 0 15,124 0 24,124 0 0 0 24,124 0 24,124 Amended 4-1-09 Page 10, Paragraph 3 Indian Firming The Settlements Act recognizes three categories where the State has firming responsibilities. The first two obligations pertain to firming of water for the Gila River Indian Community (GRIC) and other Arizona tribes in times of shortage for a 100-year period; the third obligation pertains to providing assistance to the Secretary of the Interior (Secretary) in carrying out obligations of the Southern Arizona Water Rights Settlement Act. 1. GRIC - The AWBA must ensure that up to 15,000 acre-feet per year of CAP NIA priority water be made available to the GRIC The 2009 Plan had included 31,326 acre-feet of water storage deliveries for this purpose. However, because of the legislative transfer of funds from the Phoenix and Pinal AMA withdrawal fee subaccounts, the 2009 Amended Plan does not include deliveries for meeting this obligation. Page 11, paragraph 1 GRIC Water Settlement Program In addition to the firming requirements of the Settlements Act, the AWBA, acting as agent for the State, is required to enter into an inter-governmental agreement (IGA) with GRIC for direct delivery of 15,000 acre-feet of water for the purpose of establishing the Southside Replenishment Bank. A minimum of 1,000 acre-feet per year is to be delivered to the GRIC to establish this Bank. The Southside Replenishment Bank will fulfill the obligations created under the Settlements Act for protection of the Reservation from off-reservation groundwater pumping. The 2009 Amended Plan includes 1,000 acre-feet of direct deliveries to the GRIC for this purpose anticipating the execution of the IGA. Page 11, paragraph 2 INTERSTATE WATER BANKING The 2009 Amended Plan has been updated to include an interstate water banking component for the State of Nevada. The legislative transfer of funds resulted in zero to near zero balances for the Phoenix and Pinal AMA withdrawal fee subaccounts, respectively. While CAWCD has sufficient funds available in the Maricopa County ad valorem tax fund to offset the AWBA’s water delivery costs for the Phoenix AMA, the same is not true for the Pinal County fund. Therefore, to preserve the AWBA’s originally scheduled deliveries to the Pinal AMA, a total of 25,000 acre-feet of deliveries have been rescheduled as interstate deliveries utilizing funds available in the Nevada subaccount. If more water becomes available later in the year after all storage for intrastate purposes has been maximized, the AWBA could store additional supplies for interstate banking to ensure that Arizona’s full entitlement is diverted from the Colorado River. Amended 4-1-09 Page 14 Amended Table 5. Funding for 2009 Amended Annual Plan of Operation Funds Available ($) AWBA CAWCD Funds Utilized ($) AWBA CAWCD Credits (AF) Withdrawal Fees Phoenix AMA Pinal AMA1 Tucson AMA $0 $82,000 $682,000 Phoenix AMA Pinal AMA Tucson AMA2 $0 $0 $0 General Phoenix AMA Pinal AMA Tucson AMA $0 Indian Firming Phoenix AMA Pinal AMA Tucson AMA $284,000 - - $0 $82,000 $682,000 0 0 5,990 Four Cent Tax $91,032,000 $2,478,000 $10,134,000 $0 $0 $0 $2,600,062 $2,000,000 $1,445,000 40,480 37,200 13,950 Other Gifts, Grants, Donations Shortage Reparations3 (NV): Phoenix AMA Pinal AMA Tucson AMA Interstate Banking Nevada4 California - $0 $0 $0 - 0 0 0 - $0 $0 $284,000 - 0 0 2,490 - $0 $0 $0 $0 $10,748,300 (not applicable) $5,175,000 Total Funds Available $115,440,300 Total Funds Expended $12,268,062 0 0 0 23,250 Credits 123,360 1 Includes expenditures for 1,000 acre-feet of direct deliveries for establishing the Southside Replenishment Bank under the Gila River Indian Water Settlement Program. 2 Includes CAWCD’s capital charge recovery for costs of construction of state demonstration projects when facilities are used for interstate purposes and by entities that do not pay the 4¢ ad valorem tax. Revenue through 2008 is estimated to be $1,368,863. 3 Southern Nevada Water Authority (SNWA) agreed to provide $8M to the AWBA to assist Arizona in offsetting impacts from shortages pursuant to Arizona-Nevada Shortage-Sharing Agreement. Approximately $2.3M of these funds were expended in 2008. 4 Balance available in the Interstate Resource Account.