U.S. Water News Online
SANTA FE -- The cost of needed water projects in New Mexico approaches $4 billion, which is as much as the yearly budget for the state's government.
The New Mexico Finance Authority outlined the preliminary cost estimates to an interim legislative committee, which is trying to find a way to pay for the water problems confronting New Mexico.
``It's going to take a greater deal of leveraging to complete a lot of these projects,'' said David Harris, executive director of the NMFA.
He said the state must do a better of job of bringing together a variety of funding sources -- state, local and federal -- to cover the spiraling costs of water projects.
The finance authority is a quasi-public agency that issues bonds and makes loans to provide low-cost financing for local and state governmental projects.
New Mexico needs at least $2.1 billion for community drinking water systems and wastewater projects across the state in the next five years, said Carlos Romero, director of intergovernmental relations for NMFA.
Of that, water supply projects will cost about $988 million; wastewater projects represent $837 million; storm and surface water control, $257 million; and almost $25 million for water rights, Romero said.
Many community water systems are small and operate in rural or unincorporated areas. Lawmakers were told the state should consider regional water systems to avoid duplication and help control costs.
Communities have ``medium term needs'' of about $375 million to upgrade water systems to comply with new federal standards for arsenic, Romero said.
Long-term projects to develop new supplies of water will cost at least $1.5 billion and some of those will take more than a decade to complete. Among the projects are the Navajo-Gallup water pipeline in northwestern New Mexico, a proposed pipeline from Ute Lake to supply water to communities in eastern New Mexico and work along the Rio Grande corridor to help communities such as Taos, Espanola, Santa Fe and Albuquerque that use water from the San Juan-Chama project.
Sen. Carlos Cisneros, D-Questa, chairman of the Water and Natural Resources Committee, said one of the panel's main assignments is to find a stable source of revenues for water projects. The committee will make recommendations to the full Legislature, which meets in January.
In 2001, the state created a water trust fund to help finance projects. It was to operate in a fashion similar to New Mexico's permanent funds. Investment earnings would accumulate in the trust fund, which eventually would make annual distributions that would be used for grants and loans for water projects.
However, the fund has no money. Two years ago, former Gov. Gary Johnson vetoed $20 million that lawmakers had set aside for the fund.
This year, a measure was enacted to earmark 10 percent of the yearly severance tax bond financing for water projects. That could mean an average of about $10 million a year.
Harris said Gov. Bill Richardson would recommend next year that 10 percent of general obligation bond financing be directed for water projects. Those bonds require voter approval. In 2002, voters approved $13 million in bond financing for water rights purchases and water projects.
Lawrence Rael, director of the Mid Region Council of Governments in Albuquerque, said New Mexicans would accept a permanent revenue source for water projects if it's broad-based and equitable. He outlined several options, ranging from a dedicated increase in the gross receipts tax to a higher property tax levy to expand general obligation bond financing.
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