Recovering CAP Water Work Session for Participants in the CAP Recovery Process

1. Recovering CAP WaterWork Sessionfor Participants in the CAP Recovery Process Dee Fuerst Sr. Policy AnalystCentral Arizona Water Conservation District April 1, 2011

2. RECOVERY PLANNING for M & I CAP SUBCONTRACTS April 1, 2011 10:00 a.m. – 12:00 p.m. Conference Rooms 10 and 11 CAWCD Headquarters AGENDA • Welcome • Definitions – review • Operational Recovery Planning Overview • Guiding Principles – review and discussion • Suggested Policy Topics - discussion

3. DEFINITIONS Review draft and discussion Any additional items needing definition?

4. RECOVERY OPERATIONS

5. What is Recovery ? Recoveryis the retrieval of CAP water that has been stored underground within the CAP service area (Maricopa, Pinal and Pima Counties). The Arizona Water Banking Authority (AWBA) has stored unused Colorado River water to meet future needs within Arizona. This water has been stored in recharge facilities within the CAP service area and is tracked as long term storage credits. The AWBA water will be recovered when there is: • A shortage of supplies on the Colorado River system • Requests for water supplies pursuant to Interstate water agreements • Impacts on the CAP system including outages

6. Another way of looking at it…. CAP Supply CAP Demand - Enough CAP water to fill the orders? • CAP water orders: • M&I subcontracts • Interstate obligations • P-4 obligations • (AF) = Available Colorado River Water for CAP (AF) Recovery is not needed YES NO Recover AWBA credits to make up the difference

7. RECOVERY OPERATIONS RECOVERY OPERATIONS Must Include: • Continual monitoring and modeling of the Colorado River supplies • Energy Management • Collaboration for Recovery Methods • Scheduling deliveries to subcontractors and recovery partners such as irrigation districts • Executing agreements with subcontractors and irrigation districts to use their infrastructure • If /when needed, implement a well drilling and infrastructure construction plan • Water quality monitoring if needed • Maintaining recovery well permits • Familiarity with the subcontractor’s systems

8. OPERATIONAL RECOVERY PLAN For an Operational Plan, what must CAWCD know during a recovery event? • Supply – the amount available from the Colorado River – When a “call” for Nevada or P-4 water will be made • Individual Demand – an individual subcontractor’s water order • Maximum Demand – by AMA – as an aggregate across the tri-county service area • Location of AWBA’s stored CAP supplies (credits) • Location of a CAP subcontractor’s service area • How a CAP subcontractor processes their CAP water, e.g. ASR or WTP • Shortage triggers, e.g., levels in Lake Mead

9. OPERATIONALRECOVERY PLAN What can components does CAWCD need to include in an Operational Recovery Plan ? • Delivery Schedules • An Activation Plan • Guiding Principles • Recovery Methods • Recovery agreements with CAP Subcontractors • Recovery agreements to use other water purveyor’s infrastructure • Recovery agreements to utilize less expensive energy • Schedules for building new infrastructure • Cost evaluation • Relocating AWBA water and credits to strategic sites • Reporting and administration of AWBA credits during recovery

10. EXTERNAL INFLUENCES IMPACTING RECOVERY OPERATIONS • COLORADO RIVER SUPPLY • AWBA TOPICS RECOVERY OPERATIONS • INDIAN RECOVERY • ADWR ADMINISTRATION • ALTERNATE SUPPLIES • OTHER

11. The individual “boxes” of external influences are detailed at the end of this packet. Time permitting we will go over them.Input is welcome, now or later. Feel free to call or email me with add-ons, ideas, suggestions.

12. GUIDING PRINCIPLES • Review draft & discussion. Feedback greatly appreciated! • Flag items that may need to pulled out and placed in a policy. • Any new items to be inserted or addressed?

13. SUGGESTED POLICY TOPICS Review list and discussion Any additional items need to be included?

14. COLORADO RIVER SUPPLY Things that impact Colorado River supply, i.e. how much is available for the CAP : • Levels in Lake Mead • Upper Basin Hydrology • Colorado River Shortage Sharing Agreement • Arizona Shortage Sharing Agreement • User priority within AZ: P-1, P-2, P-3, P-4 (CAP) • CAP Subcontract: Shortage Language – Section 4.7 • (from the Arizona Water Settlement Agreement) • Climate Change

15. AWBA TOPICS • What is the status of AWBA’s firming goals for M&I CAP? Will they meet their obligation for each AMA before a shortage occurs? What if AWBA has not reached the firming goal in one AMA, and that AMA runs out of credits before the other AMAs? • Will AWBA be revising the firming goals? • Many CAP M&I Subcontractors lease Indian CAP water. Will AWBA be firming this supply? If so, when? • During a shortage event, may AWBA credits be transferred to a CAP M&I Subcontractor’s long term storage account (LTSA) as part of their order for their CAP subcontract? Or will AWBA credits only be used for current demand by the CAP subcontractor?

16. AWBA TOPICS (Continued) • When AWBA uses credits during a shortage, will they be replaced? • AWBA credits may not necessarily be located in ideal locations in relation to the CAP M&I subcontractors’ service areas. Will locations be considered in future recharge efforts by AWBA? • If a CAP subcontractor decides to not take the water they ordered during a shortage, will the water (or credits) be returned to AWBA’s account? • What is AWBA’s plan for storing additional Nevada water? Where will they store it? Will the Nevada funds be available to build recovery infrastructure? • AWBA has nearly completed firming the P-4 obligation for Colorado River water users. Those credits were paid with General Fund monies. Will those credits be used to satisfy other AWBA obligations such as Indian settlements?

17. ADWR ADMINISTRATION • What happens if a CAP subcontractor accepts AWBA credits for ASR, and they discover they have not used the credits? Will there be a grace period to return the credits to AWBA or CAWCD without it impacting their annual report?

18. RECOVERY FOR INDIAN OBLIGATIONS Background: The CAP Indian allocation is not firmed by AWBA. Note there is a difference between this allocation and the CAP Indian water received in settlements where AWBA is Arizona’s agent for meeting Indian firming commitments for the various settlements. • Does CAWCD have a responsibility to recover this water? Or, is this the responsibility of the Bureau of Reclamation or the Indian Community? • Will Indian obligations be firmed with sources of water other than Colorado?

19. OTHER • If additional Colorado River supplies become available during a shortage year, what happens to AWBA credits already transferred? • Will CAWCD be required to obtain recovery permits to cover all the recovery wells used by its M&I subcontractors? • Will Arizona modify the agreement with Nevada, changing the amount of water stored in the CAP service area to a smaller volume? If so, what happens to the credits and funds already accumulated? Will the funds be sufficient for recovery of the water already stored under the Nevada agreement?