Central Arizona Project
Thomas W. McCann
January 7, 2015
Central Arizona Project
History
Physical System
Operation
Governance
Contracting
Finances
CAWCD
• Central Arizona Water Conservation District was
formed in 1971 by Maricopa, Pinal and Pima
Counties to repay Arizona’s share of CAP
construction costs
• U.S. had requested a
single CAP repayment
entity with ad valorem
taxing authority
Evolution of CAWCD Responsibilities
1972
•
CAWCD entered into Master Repayment Contract with
Reclamation providing for:
•
Delivery of CAP water supply
•
Repayment of reimbursable project costs allocated to CAWCD
1982
•
Arizona Legislature granted CAWCD authority to contract
with U.S. to be the operating agent for the CAP
1983
•
CAWCD began performing CAP O&M under an interim
contract with Reclamation
CAWCD Mission
• Operate and maintain the CAP system
• Deliver the remainder of Arizona’s Colorado
River apportionment
• Repay reimbursable costs to U.S.
– Approx. $1.65 billion, plus interest
• Develop and operate recharge projects
• Operate the Central Arizona Groundwater
Replenishment District
CAP Recharge Projects
Phoenix area
– Tonopah Desert
– Hieroglyphic Mountains
– Agua Fria
– Superstition Mountains
Tucson area
– Lower Santa Cruz
– Pima Mine Road
CAGRD
• Central Arizona Groundwater Replenishment
District is a function added to CAWCD by the
Arizona Legislature in 1993
– Governed by CAWCD Board
– Separate funding from other CAP operations
• Provides a mechanism to comply with Arizona’s
100-year assured water supply rules
• Member Lands (subdivisions)
• Member Service Areas (water providers)
CAWCD Governance
• Not a State agency
• Governed by 15-member Board of Directors elected
from the 3 counties that formed CAWCD
– 10 from Maricopa
– 4 from Pima
– 1 from Pinal
• Directors serve staggered 6 year terms
– 1/3 of Board elected every 2 years
CAWCD Funding
• Not funded by State appropriations
• CAWCD revenues come from:
– Water service charges from sale of CAP
water
– Ad valorem tax levied on all property in
its 3-county service area
• CAWCD also receives benefit of
revenues from sale of surplus power
from the Navajo Generating Station
Contracting for CAP Water Service
• CAWCD holds a master water service contract for
the entire CAP supply
– Nominally about 1.5 MAF per year
• Long-term entitlements to CAP water allocated
by Secretary of the Interior
– 650,724 AF reserved for federal uses
– 764,276 AF allocated for non-Indian uses
• Allocation between federal and non-federal uses
affects CAWCD repayment obligation
Contracting for CAP Water Service
• Native American tribes contract directly
with U.S.
– CAWCD responsible for water deliveries
• Municipal & industrial users hold 3-party
subcontracts for CAP water with CAWCD
and U.S.
• Non-Indian agricultural users relinquished
long-term CAP entitlements pursuant to
Arizona Water Settlements Act of 2004
CAP Water Rates
• Three main rate components:
– Fixed OM&R
• All costs of operating and maintaining the CAP
• Costs distributed evenly across all water deliveries
– Pumping Energy
• All costs for energy needed to pump CAP water
• Costs distributed evenly across all water deliveries
– Capital Charges
• Used to repay U.S. for CAP construction costs
• Only collected from M&I users
CAP Economic Study
• What is the value of CAP to the state of Arizona?
• ASU study asked the question: What if CAP was
never built and no CAP water was delivered?
• Two periods considered
–
Construction (1973-1993)
–
Water delivery (1986-2010)
• Calculated impacts in 22 sectors of the economy
– Gross state product
–
Job-years of employment
13
CAP Economic Study
Construction period (1973-1993)
• CAP generated approximately
$2.4 billion of gross state product
• Roughly equivalent to what CAWCD
has to repay U.S. for CAP
• CAP generated annual employment
of up to 9,400 job-years
14
CAP Economic Study
CAP water deliveries (1986-2010) have accounted for
more than $1 trillion of Arizona gross state product
15
CAP Economic Study
• For 2005-2010, CAP
generated economic benefit
averaging more than $90
billion per year (35% of
Arizona’s GSP)
• In 2010, CAP generated
$128 billion (49.5%) of
Arizona’s gross state
product
16
CAP Economic Study
In 2010, the existence of CAP generated more
than 1.6 million job-years of employment
17
Questions?