Water district responds to criticism of controversial Lake Powell Pipeline

Composite stock images | St. George News

ST. GEORGE – The Washington County Water Conservancy District is refuting statements made by University of Utah economists and the Utah Rivers Council that accuse the district of only intending to pay for 28 percent of the controversial Lake Powell Pipeline – leaving the balance on the backs of Utah taxpayers.

Utah Division of Water Resources Nov. 30, 2015, Map of Lake Powell Pipeline proposed project | Map courtesy of UDWR, St. George News
Utah Division of Water Resources Nov. 30, 2015, Map of Lake Powell Pipeline proposed project | Map courtesy of UDWR, St. George News | Click image to enlarge

The district is also disputing statements that the pipeline would cause massive price increases for water in Washington County.

The Water District responded to an analysis by the economists and the Utah Rivers Council in a letter sent to Gov. Herbert and others Sept. 28 and signed by district general manager Ron Thompson.


Read more: Soaring water rates inevitable if Lake Powell pipeline is built, economists say


Officials say the district will repay the costs of the pipeline according to the terms of the Lake Powell Pipeline Development Act, including “reimbursable preconstruction costs, construction costs, and interest on those costs within the time period specified.”

District officials also say it’s inaccurate to use the term “repayment plan” for documents released after a Government Records and Access – or GRAMA – request and a ruling enforcing the request made by the Utah State Records Committee in May 2016.

The document is not a repayment plan, district spokeswoman Karry Rathje said, but is simply an Excel spreadsheet created by a third-party consultant in 2013 for the purpose of conducting a focus group exercise. 

The claim that the district will only pay for ’28 percent’ of the project cost is the result of misuse of the worksheet,” the letter states.

The district said the worksheet was designed to encourage potential funding options rather than answer questions about how the project will be funded.

“Those who will ultimately determine the project’s financing terms and repayment plan did not participate in the focus group exercise and therefore their opinions may not be represented in the worksheet,” district officials said in the letter.

Joel Williams (light striped shirt and glasses at far right), of the Utah Division of Water Resources, answers questions about the Lake Powell Pipeline project at an open house held at the Washington County Water Conservancy District Wednesday night. St. George, Utah, Jan. 13, 2016 | Photo by Mori Kessler, St. George News
Joel Williams (light striped shirt and glasses at far right), of the Utah Division of Water Resources, answers questions about the Lake Powell Pipeline project at an open house held at the Washington County Water Conservancy District, St. George, Utah, Jan. 13, 2016 | Photo by Mori Kessler, St. George News

University of Utah economist Gail Blattenberger, who performed the analysis along with fellow university economist Gabriel Lozada, said that ultimately the analysis is not dependent on what the document is called.

Blattenberger and Lozada’s analysis states that the district’s model includes no interest payments to the state.

The question of who pays for the project depends on interpretation of language in the Lake Powell Pipeline Development Act, Blattenberger said, but whether it’s the taxpayers of Washington County or all of Utah, the costs are “exorbitant.”

Rising cost, lower demand

The economists predict that water rates in Washington County will soar if the pipeline is built and say the rates will go so high that demand for water will drop below levels needed to justify the massive pipeline project.

However, the Washington County Water Conservancy District disputes the statement in a price elasticity statement, saying the economists’ argument was based on faulty numbers, “understating the price actually paid by Washington County consumers by roughly 430 percent.”

The district’s full 37-page statement is available here.

The error invalidates the rest of the economists’ findings and conclusions, district officials said.

Ron Thompson, general manager of the Washington County Water Conservancy District, (tallest man on the left) listens to people's questions and skepticism about the Lake Powell Pipeline project at an open house held at the Washington County Water Conservancy District Wednesday night. St. George, Utah, Jan. 13, 2016 | Photo by Mori Kessler, St. George News
Ron Thompson, general manager of the Washington County Water Conservancy District, (third from the left) listens to people’s questions and skepticism about the Lake Powell Pipeline project at an open house held at the Washington County Water Conservancy District, St. George, Utah, Jan. 13, 2016 | Photo by Mori Kessler, St. George News

“Per capita water use will continue to decrease in the future … however, we must be realistic about water use in our planning efforts,” district officials state in the letter. “The professors project a future water use that has not been achieved to date in any community in the nation.”

Blattenberger, however, said that she and other economists used wholesale water prices rather than retail, and rightly so, because it is the district that will be contracting for the pipeline.

“If the wholesale prices go up by a factor of six, then the retail prices will go up by a factor of six, also,” she said.

After extensive study of water use in Utah and the Southwest, the economists stand by their belief that the pipeline would increase costs dramatically, causing demand for water to drop drastically.

Other areas of the Southwest use far fewer gallons per day than Washington County, so there is lots of flexibility in how much residents would use if prices were higher, Blattenberger said.

For example, gallons per capita per day used by residents of Los Angeles is 132; in Tucson it is just 88, Blattenberger said. According to the water district, Washington County’s gallons per capita per day is approximately 285.

“There is substantial room for improvement in Washington County,” Blattenberg said.

The water district said that if the pipeline is built, water rates will go up slightly, but the economists’ arguments are not valid because water is “an essential human commodity.”

Blattenber said she agrees that water is an essential human commodity.

“But I don’t agree that many of the uses to which water is put by humans are essential,” Blattenberger said. “It’s essential that you have water to drink, but that is such a small proportion of your gallons per capita per day.”

Background

The proposed pipeline would stretch nearly 140 miles and carry up to 86,000 acre-feet of water from Lake Powell to Washington and Kane counties, water which proponents say is needed to support future population growth in Southern Utah.

Opponents say the pipeline is not needed and would be prohibitively expensive.

Initial estimates have placed the final cost of the project at approximately $1 billion, but others believe the initial price tag would be closer to $2 billion, plus the cost to manage and maintain the pipeline.

In November 2015, a study endorsed by 20 economists from three major Utah universities predicted the controversial pipeline would incur debt as high as $781 each year for every man, woman and child in Washington County.

Paying for the pipeline would require extreme increases in water prices, impact fees or both; water rates could increase as much as 678 percent, the study’s authors state.


Read more: Study predicts Lake Powell Pipeline will trigger massive water rate, impact fee increases


State officials submitted a formal licensing proposal for the pipeline in December 2015.

In September 2016, University of Utah economists had harsh criticism for a Lake Powell Pipeline repayment plan and said they stand by their prediction of massive increases in water prices and impact fees for Washington County residents if the pipeline is built.

Email: japplegate@stgnews.com

Twitter: @STGnews

Copyright St. George News, SaintGeorgeUtah.com LLC, 2016, all rights reserved.

Free News Delivery by Email

Would you like to have the day's news stories delivered right to your inbox every evening? Enter your email below to start!

Posted in Government, Life, NewsTagged , ,

25 Comments

  • .... October 4, 2016 at 2:33 pm

    I’m excited about the pipeline coming here this will be a wonderful project to completion and will be of great service and assistance to our loved community

    • Real Life October 4, 2016 at 3:27 pm

      The pipeline is a horrible idea, much like your constant trolling of StG News.

      • .... October 4, 2016 at 8:02 pm

        Bless you my beloved brethren

      • .... October 5, 2016 at 12:08 am

        Bless you my fellow brethren

      • .... October 5, 2016 at 8:21 am

        I’m all excited about the pipeline coming here. we are going to have a welcome pipeline celebration. Its going to be a festive jubilation of friends and family and other members of our beloved community Praise the Lord !

  • Pheo October 4, 2016 at 2:53 pm

    Why is it always a foregone conclusion that St George is going to grow to half a million people by 2050? Don’t we have any say in the matter? For those people living here now, what percentage want it to get that big? The minority of the people who stand to make a killing off developing the land are going to do so at everyone else’s expense.

    Whatever happened to living within our means? For our community, that means not outgrowing our water supply.

    Allowing fast growth just kicks problems down the road. There will be some maximum capacity in this community, whether it is 250,000 or 600,000. At some point, we’re going to be forced to say, no more development. At what point do we want to make that decision?

    To be sure, stopping the fast growth will make city finances and management more challenging. Our city managers like fast growth because there are no hard choices to be made. Revenue growth can be counted on to provide ample money for all of the projects in the city. No need to tighten belts or make sacrifices to get things done. It might also make housing costs higher or certain jobs more scarce. But at some point we are going to have to draw the line. Guaranteed, we are going to let this community get too large. But I maintain that the size of this community is really up to us, if we make our voices heard.

    • tcrider October 4, 2016 at 6:24 pm

      I disagree,
      I think there are other forces at work, when it comes to deciding the growth of saint george.
      and I am betting it comes from higher government than the mayors office and would wager
      the farm that it is more about the state of utah and the allocation of water rights from lake
      powell.
      It does not matter who wants it or not, I predict we will be paying 8-10 times more for water, and it might not show up as a water bill, but rather higher taxes.
      It will be the same no matter how they make it look, the part that really grinds my gears, is that these money
      grubbing developers will still put up more golf courses and the tax payers are paying for it in the end, just like
      obamacare.

  • redblue October 4, 2016 at 3:06 pm

    The pipeline is a horrible idea. Way to costly! Why not purchase or take all the water being used to raise livestock and grow alfalfa? It makes absolutely no sense to raise livestock in the desert. It is a complete waste of water. Let the livestock be raised in wetter environments that have ample feed. Watering alfalfa 24/7 all summer long is wasteful. Maybe we could avoid wasting money on a pipeline, if the water were used responsibly. Times change and Washington County is changing, the old way of life is simply not supportable with the limited amount of water.

    • RealMcCoy October 4, 2016 at 3:19 pm

      Irrigation (non-culinary) water is not the same as culinary water. Cows and alfalfa drink the water that isn’t treated, same as the golf courses around here.
      There is plenty of water for the people that live in the area. This pipeline isn’t about us, though. The pipeline is about letting developers make more money by bringing in an over-priced project to allow more over-priced building. The only people that suffer are the current residents.

      Your argument about livestock in the desert is unfounded. It makes less sense to have a lawn in the desert than an animal in the desert.

      • redblue October 4, 2016 at 3:35 pm

        So you can’t treat non-culinary water and make is culinary?

        • RealMcCoy October 5, 2016 at 11:33 am

          You can, but it takes time, chemicals, and is a longer process.
          The non-culinary water currently used is just the by-product of the sewage treatment, and water pulled from local groundwater sources (well, river, rain, etc…). This water goes straight to the farmlands and golf courses, then goes right back into the ground. There are limited storage facilities for this type of water, so it is constantly used somewhere throughout the day.
          It literally goes right back into the ground when used, and no chemicals are needed- recycling at its best!
          In a simple example- it’s like the water used at a car wash facility- they just filter and reuse the same water. It’s not constantly pulling clean fresh water for every car.

          Again, there is ALREADY enough culinary water in this area for the people here, and a little more. The pipeline water is intended not for us to use, but for HUGE growth in this area, and enough to SELL to California for big $$$.

  • Real Life October 4, 2016 at 3:26 pm

    Why do most native Utahns hate conservation so much?

    • Bob October 4, 2016 at 5:38 pm

      because they are “conservatives”. “conservative” doctrine is usually very anti-conservation. makes a lot of sense, huh?

      • Bob October 4, 2016 at 5:48 pm

        mormon religion teaches that “the lord” gave us everything to use up, and use it ALL up. Your favor with “the lord” is determined by how lavish your lifestyle is. besides all that religious nonsense it’s just human greed. I’m sure if almost anyone owned large tracts of so. ut desert land here, and they stood make tens of millions by developing it–who wouldn’t?. govt’s roll is create a plan for such development, but when your politicians work hand in hand with developers the rest of us will not get a fair shake. the pipe will likely be built, and we’ll be saddles with massive taxes and fees to pay for it, and by the time it’s finished, who the hell knows–Lake Powell might be to dry to even pump from, but the old boy network will already have cashed out by then, so…

      • Real Life October 4, 2016 at 6:13 pm

        Crazy how that works.

        • .... October 5, 2016 at 12:11 am

          Oh my calling it crazy ! golly gee whiz such harsh language . Have a wonderful day my fellow brethren

    • .... October 4, 2016 at 8:09 pm

      This pipeline is coming and I’m looking forward to this project getting started. ..Praise the Lord

    • .... October 5, 2016 at 12:15 am

      They just don’t like you ! LOL ! have a nice day and peace be with you

  • RealMcCoy October 4, 2016 at 4:46 pm

    I’ll tell you what- that ‘composite image’ for the article looks like it would make for an awesome water slide.
    How about if they skip the pipeline and just make a giant water slide that leads to lake powell?
    I think we could all get on board with that, right?

    • .... October 4, 2016 at 8:13 pm

      I’m in favor of a giant water slide. that would be a fantastic idea. I hope they look into it. we could plan our weekends around it. a great way to spend time with friends and loved ones. ..

  • wilbur October 4, 2016 at 4:59 pm

    ..pay a whole lot for a whole little…what’s to hate about that?…

    …jeeeez…..

    • .... October 5, 2016 at 8:30 am

      Wilbur actually it’s like that when you get gas for the car. there’s no difference. you gotta pay fer the dang water to. cars are made cheaper and cost more. shoes are made by kids making 55 cents a day and the shoes cost 85 dollars here. Welcome to America ! Home of the brave and land of the free enterprise.

      • Real Life October 5, 2016 at 4:17 pm

        Wow. You are on some kind of kick.

        • .... October 6, 2016 at 12:54 am

          God Bless You my fellow brethren

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.