The city of Española lost access to $3.7 million in unspent state water funding Jan. 15, despite pleas by Mayor Joseph Maestas that the city is still on track to regionalize its water system.
“We did have to change direction on our surface water treatment plant, but we are moving forward,” Maestas told the state Water Trust Board in Santa Fe.
Maestas was asking the Board for permission to redirect old project awards from 2004 and 2006. Instead of building a regional water treatment plant that would have diverted the city’s San Juan-Chama water rights from the Rio Grande, as initially planned, the money would be used for a series of municipal pipeline improvements intended to increase the capacity, pressure and safety of the city’s well-water system. The city had dropped the surface water plan in 2008 because of concerns over the cost of the project, which were estimated at $22 million just for construction.
State Finance Authority Program Administrator Jana Egbert told the Board that based on the city’s application, state staff didn’t have enough information to evaluate the new projects’ merit — a standard review process that all state-approved projects must go through.
Given that, the outcome of last week’s meeting could have been even worse for the city — state staff had recommended revoking both the $3.7 million award and a more recent $1.9 million award.
Board member and state Energy Secretary Joanna Prukop said she stood behind that recommendation, in the interest of fairness and competition — after all, other agencies had competed for those funds and lost. The city’s new projects should have to undergo that same competitive process, Prukop said.
But when it came to a vote, the Board took some pity on Española and rescinded one award but not the other.
“I have a great interest in this project because I drink the Española water every day,” Board member David Ortiz said. “A reauthorization of the previous appropriation I think would be very beneficial to the area.”
Ortiz, who lives in Nambé but works at Valley National Bank in Española, said he was disappointed by the Board’s decision not to reauthorize both awards.
“The Water Trust Board was certainly promoting a regional water solution, which I think Española is pursuing,” Ortiz said.
That regional water solution is not necessarily in peril — public water groups in Chimayó and the Cuatro Villas area of Sombrillo, Cuarteles, La Puebla and Arroyo Seco are still moving forward with their funding requests for new infrastructure (see sidebar).
During the Board’s deliberations, there was a sense that Española was being grandfathered in, and may be the last applicant to be so lucky. Maestas stressed that a decision to pull funding now would delay “shovel-ready” water projects — even though the city has known for more than a year that the surface-water project is financially impractical and could still not muster the necessary information about the alternate projects.
More than one Board member expressed a desire to keep the city’s projects moving. Board Chair Katherine Miller said Board policies need to be revisited to clarify the process for altering previous awards, so the Board isn’t in the position of revoking funding after it’s too late to reapply.
“We shouldn’t be doing these on an individual basis,” Miller said. “It puts us in a difficult spot.”
In April of last year, the Board awarded the city $2.58 million April 23 to construct a water line that will be used to sell water to Cuatro Villas Mutual Domestic Water Users Association. That money was not taken away by the Board.
What Now?
Acting City Manager Veronica Albin met Tuesday with District 2 City Councilor Alfred Herrera and District 4 City Councilor Alice Lucero to discuss the future of the water projects outlined in the funding request.
Albin said the city will likely use the remaining $1.9 million to engineer and design the projects, then reapply to the Board or other funding sources for money to complete construction. Starting under the leadership of previous mayor Richard Lucero and continuing into Maeastas’ administration, the city has already sunk more than $1 million into engineering the proposed surface-water treatment plant before the current City Council balked at its ballooning cost.
Albin said the loss of the $3.7 million grant will probably not affect the water-rate increase proposal which is scheduled for a public hearing Thursday (1/22) at 5:30 p.m. That increase is designed to fund the ongoing operation and maintenance of the city’s water system, not new capital improvements, Albin said.