From: Kay Ledbetter, Amarillo Globe-News, Texas
Published October 14, 2004 12:00 AM

Canadian River Water Board in Texas to Issue $43 million in Bonds for Rights

Oct. 14—PLAINVIEW, Texas — The Canadian River Municipal Water Authority is preparing to issue $43 million in bonds so it can buy another 32,000 acre-feet of water rights.


CRMWA board members Wednesday authorized General Manager Kent Satterwhite to begin the process, which includes going to all member cities and contracting with them for the repayment of the bonds. The issue will require final board approval in January.


The bond proceeds could be used for buying water rights from the Duncan Ranch in Hutchinson County or the leasing or trading of city of Amarillo water rights, as well as the buying of linear water rights along the CRMWA pipeline.


The board gave Satterwhite approval to begin contract negotiations on water rights on land between Amarillo and Brownfield/Lamesa, as well as water rights in Carson County adjacent to the line.


The board tabled any decision on buying Duncan Ranch's 8,777 acres of water rights until its next meeting, saying things in the Panhandle Groundwater Conservation District's new rules affect the deal.


"We're still concerned about the rules," Satterwhite said. "I think they are getting real close. I'm not comfortable with converting our original permit to fall under the new rules, but I think they have a lot of positive aspects to what they've done."


At issue, he said, is the PGCD depletion rule, which was considered at the meeting.


C.E. Williams, PGCD manager, presented an outline of the new regulation, scheduled for a final hearing Nov. 10. He said two absolutes are the 50/50 rule, where at least 50 percent of the water must remain in 50 years, and the maximum 1.25 percent annual allowable decline.


If an area exceeds the 1.25 percent decline rate, it will be designated as a study area, which must be at least nine square miles, but can be much larger if necessary, Williams said.


After a year of study to determine no one within the designated area is producing more than the allowable 1 acre-foot per acre, the area can be designated as a conservation area and reduced by 0.1 acre-foot every two years until it reaches a floor rate, recently set by the water district.


Williams explained that all sections of land contiguous to the designated area would be included in the step down.


A new caveat Williams said he would recommend to his board of directors is to allow an entity, whether it is an individual farmer or CRMWA, to consider all contiguous acreage under one permit to be used in calculating compliance.


By doing so, he said, it allows the entity to buy nearby water rights that they may be affecting.


For instance, CRMWA could consider all 40,000 acres of its permit, Williams said, and if it buys the Duncan Ranch or leases Amarillo water rights, it could change its permit to include those acres in the calculation.


"Then it is up to them if they want to drill additional wells within the permitted area to lessen the depletion in the study area," he said. "It gives them latitude of deciding when they will do that and how they want to react."


Williams said he will make this recommendation to the board. However, he qualified it by saying negotiations toward this change have been good, but "I'm not going to continue to negotiate and then you sue me anyway."


Legal actions have been talked about by CRMWA concerning the district rules, but after a two-hour executive session, there was no mention of legal action.


Satterwhite said CRMWA's biggest concern is the necessity to rework its 40,000-acre-feet water rights permit to include additional land, because then it would fall under the new water regulations.


CRMWA has an emergency clause, due to a permit amendment, allowing it to pump 10,000 acre-feet over its permit in emergency situations. The water district's new regulations do not include an emergency allowance.


"We tabled the Duncan Ranch purchase until January because of the groundwater district rules. That water, by itself, may or may not be productive to us," Satterwhite said. "We may end up with less allowable production than we currently have."


There is a possibility that CRMWA can negotiate for more land in the area to incorporate with the 8,777 acres of Duncan Ranch water rights and put those together to offset the 10,000-acre-feet emergency allowance, Satterwhite said.


Among the possibilities, he said, are leasing or trading some of the city of Amarillo water rights in Roberts County, which are adjacent to CRMWA water rights.


These could then be considered in the calculations but never actually pumped. Amarillo is bound by a 25-year no-production clause on these water rights.


Satterwhite said that at the same time he will be trying to buy water, either by the gallon or by outright water rights, along the pipeline. He said the by-the-gallon purchases from irrigation farmers could be made before the next meeting.


Any water purchased in this method would be put into the current line and would be subject to the rules and regulations of the High Plains Underground Water District, Satterwhite said.


To see more of the Amarillo Globe-News, or to subscribe to the newspaper, go to http://www.amarillonet.com.© 2004, Amarillo Globe-News, Texas. Distributed by Knight Ridder/Tribune Business News.


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