Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance

committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).

Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and

attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.

F I S C A L I M P A C T R E P O R T

SPONSOR McCoy

DATE TYPED 02/17/05 HB 623

SHORT TITLE Carnuel Mutual Domestic Water Association

SB

ANALYST Ford

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

$275.0

Non-Recurring General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Office of the State Engineer (OSE)

SUMMARY

Synopsis of Bill

House Bill 623 appropriates $275 thousand from the general fund to the local government divi-

sion of the department of finance and administration for the purpose of acquiring water rights for

the Carnuel mutual domestic water and wastewater consumers association in Bernalillo county.

Significant Issues

The OSE writes:

“The [Carnuel mutual domestic water and wastewater consumers association’s] well is

located within the Rio Grande Underground Water Basin or more specifically in the mid-

dle Rio Grande region. It is known that groundwater in the area is connected to the sur-

face water and all surface water is considered fully appropriated. Any new ground water

appropriation in the region must be offset with valid water right so the Rio Grande stream

system is kept whole.

“The Association is required to obtain a permit from the State Engineer, which transfers

valid water rights to its well(s).

House Bill 623 -- Page 2

“According to Wilson et al. (2003), in 2000 the Carnuel MDWCA served a population of

35, and pumped 3.88 acre-feet of groundwater, a per capita usage of 99 GPCD.

“A recent (July/August 2003) article in Southwest Hydrology reported that prices for wa-

ter rights in the middle Rio Grande region have risen to more than $4,000/acre-foot (AF).

The same article reported a mean price of $4,250/AF for water rights in New Mexico in

2001. Per City officials, Albuquerque currently offers between $ 5,000 per acre-foot and

$ 6,000 per acre-foot for consumptive use rights. Assuming a price of $5,500 per acre-

foot, and assuming no other costs are involved, the proposed appropriation would fund

the purchase of 50 acre-feet of consumptive use rights. At current use rates (99 GPCD),

this would provide water for a population of approximately 450.

“Although the amount requested may be excessive for the needs of the Association, this

may not be a major problem because unexpended funds would revert to the general fund

at the end of the fiscal year. However, encumbrance of the funds during FY06 would

make them unavailable for other projects that may have a higher priority and/or greater

need.”

FISCAL IMPLICATIONS

The appropriation of $275 thousand contained in this bill is a non-recurring expense to the gen-

eral fund. Any unexpended or unencumbered balance remaining at the end of FY 06 shall revert

to the general fund.

OTHER SUBSTANTIVE ISSUES

According to OSE, wells in the Carnuel area, including numerous domestic wells, produce from

a fractured granite aquifer that is generally marginal as a source of supply. Future water avail-

ability in the area is likely to be limited by physical (aquifer) constraints and impairment issues.

EF/yr