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

SPONSOR Marquardt

ORIGINAL DATE

LAST UPDATED

2/4/06

HB 175

SHORT TITLE Salt Basin Water Distribution System

SB

ANALYST Hoffmann

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$300,000.0 Non-recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to Senate Capital Outlay Request 269, Senate Bill 662, House Bill 847, and House

Bill 131/HACS.

SOURCES OF INFORMATION

LFC Files

Responses Received From

Office of the State Engineer (OSE)

Department of Finance and Administration (DFA)

SUMMARY

Synopsis of Bill

House Bill 175 appropriates $300,000,000 from the general fund to the Interstate Stream Com-

mission to plan, design, and construct a distribution system for water from the Salt Basin. Ac-

cording to the Office of the State Engineer, the Salt Basin is a relatively newly declared under-

ground water basin in the south central portion of the state immediately north of the Texas state

line.

FISCAL IMPLICATIONS

The appropriation of $300,000,000 contained in this bill is a non-recurring expense to the general

fund. The appropriation may be spent in 2007 or any subsequent fiscal year. Any unexpended or

unencumbered balance at the end of a fiscal year shall not revert to the general fund.

House Bill 175 – Page

2

SIGNIFICANT ISSUES

According to the Office of the State Engineer, studies of the water resources in the Salt Basin

have been made utilizing similar appropriations in recent years. Preliminary estimates are that

50,000 to 75,000 acre-feet of water per year could be reliably developed from the Salt Basin, or

approximately as much water as the San Juan Chama Project delivers.

The southern portions of the state are currently short of water. In the coming decades, the south-

ern portions of the state are expected to experience the state’s, if not the nation’s, highest growth

rates. The water in the Salt Basin currently flows underground across the Texas-New Mexico

border where Texas farmers pump it for irrigation.

The distances over which Salt Basin water would have to be conveyed are great. Some estimates

range as high as $400 Million to build the well fields and infrastructure necessary to get the wa-

ter to all needed communities in southern New Mexico. This funding would provide the funding

necessary to develop and deliver that water to New Mexico citizens.

PERFORMANCE IMPLICATIONS

Water from the Salt Basin could potentially be used to improve the ISC's performance in meeting

the state's interstate water compact delivery requirements.

ADMINISTRATIVE IMPLICATIONS

The ISC, along with other state agencies that participate in water project development, would

appear to have the administrative capacity to administer this legislation.

RELATIONSHIP

There are four bills that have a purpose similar to House Bill 175.

•

Senate Capital Outlay Request 269 appropriates $100,000,000 to plan; design; acquire

property, water rights and rights of way; and construct facilities to transfer water from the

Salt Basin to communities in New Mexico.

•

Senate Bill 662 creates the “Salt basin water development fund” in the Interstate Stream

Commission and appropriates $100,000,000 to the fund

to

develop the water resources of

the salt basin in southern New Mexico.

•

House Bill 847 appropriates $75,000 to the Department of Finance and Administration to

fund the development of a water model for the Salt basin by an national laboratory in Berna-

lillo County.

•

House Bill 131/HACS appropriates $150,000 to the Interstate Stream Commission to assess

options to put Salt basin water to beneficial use.

TECHNICAL ISSUES

Water resource projects may take many years to complete. There should be a reversion clause in

House Bill 175 – Page

3

the bill, even if the date is twenty or twenty-five years in the future.

OTHER SUBSTANTIVE ISSUES

The bill does not state where the water would be distributed or how the water might be used.

CH/nt