Signing ceremony at Hoover Dam

Drought Contingency Plan

The Arizona Water Banking Authority (AWBA) plays an important role in Arizona's plan for implementing the Lower Basin Drought Contingency Plan (LBDCP). The LBDCP is intended to operate through December 31, 2026, concurrent with the Interim Guidelines.

The LBDCP contains several key elements:

  1. Additional contributions to water storage in Lake Mead by Arizona and Nevada, along with new contributions to water storage in Lake Mead by California and the United States.
  2. Incentives for additional water storage in Lake Mead by creating flexibility for water users to store water and take delivery of storage even during lower reservoir conditions.
  3. A commitment by parties in the Lower Basin to protect elevation 1,020 feet in Lake Mead, implemented through consultation to determine what additional measures would be necessary to protect that elevation.


In addition to the LBDCP contributions made by the Lower Basin States and the U.S., the Republic of Mexico has agreed to create additional water savings in parity with the LBDCP contributions, under a Binational Water Scarcity Contingency Plan pursuant to Minute 323. 

AWBA DROUGHT CONTINGENCY PLAN AGREEMENTS AND POLICY

To protect Lake Mead water levels, the LBDCP requires additional mandatory water delivery reductions, in addition to those already imposed under the current Colorado River operating guidelines. These additional mandatory water reductions disproportionately impact Central Arizona Project (CAP) agriculture and CAP non-Indian agricultural (NIA) priority water users. To address this issue, an Arizona Steering Committee was formed to examine possible solutions acceptable to Arizona water users. The AWBA participated in the Steering Committee to develop a collaborative plan to address these issues.

The Arizona DCP Implementation Plan incorporates two components that operate in tandem. The first is a mitigation component that is structured to provide mitigation water to the CAP agricultural (Ag) pool and CAP NIA priority pool. The second is an offset component that leaves water in Lake Mead through system conservation and the creation of new Intentionally Created Surplus (ICS) to offset existing ICS delivered for mitigation purposes. The Arizona DCP Implementation Plan relies on a multitude of complex inter-related agreements among multiple parties. Some of these agreements required statutory changes as well as the adoption of new policies. On January 31, 2019, Governor Ducey signed legislation authorizing Arizona’s participation in the LBDCP and the federal legislation authorizing the DCPs was signed on April 16, 2019.

The AWBA plays an important role in both the mitigation and offset components of the Implementation Plan, resulting in the following policy and agreements:

ARIZONA LBDCP FRAMEWORK AGREEMENT

This agreement captures the components of the Implementation Plan. It describes the mitigation component as well as the offset component and references numerous agreements as exhibits. The AWBA is included as a party due to the vital role it plays in the implementation framework as indicated by the policy and agreements described below.

CAP NIA MITIGATION AGREEMENT

This agreement describes the mitigation supplies for the CAP NIA priority pool, including the reduction in mitigation percentages in subsequent years. It also captures the mitigation commitments applicable to the CAP agricultural pool. As a key provision, it clarifies that the AWBA will calculate its statutory firming obligations and commitments prior to the inclusion of mitigation resources, thereby ensuring that mitigation resources are not used for firming purposes.

AGREEMENT TO EXCHANGE LONG-TERM STORAGE CREDITS

This agreement facilitates water storage by Phoenix and Tucson Active Management Areas (AMA) CAP Municipal and Industrial (M&I) Priority subcontractors at Groundwater Savings Facilities (GSFs) located in the Pinal AMA to provide partial wet water mitigation during Tier 1 and Tier 2a shortages that might occur between 2020 and 2022. The AWBA agreed to exchange long-term storage credits (LTSCs) accrued in the Phoenix and Tucson AMAs for an equal volume of LTSCs accrued by the storing entities in the Pinal AMA. This allows storing entities the ability to recover and use the water in the AMA where they are located.   

The AWBA has agreed to exchange up to 43,225 acre-feet of LTSCs per year (from 45,500 acre-feet of storage, less 5 percent cut to the aquifer) for the three-year period. Legislation authorizing the AWBA to exchange its water management LTSCs for this purpose expires December 31, 2026. Therefore, all exchanges must be completed by this date. The agreement also allows for other unplanned mitigation water supplies, if available, to be used to substitute storage deliveries in order to reduce the amount of LTSCs exchanged by the AWBA. 

During the three-year period there was a shortage condition in only one year (2022). A total of 45,500 acre-feet was stored, creating 43,225 acre-feet of LTSCs for exchange pursuant to this agreement.

AGREEMENT TO EXCHANGE LONG TERM STORAGE CREDITS WITH THE CITY OF TUCSON

This agreement will be similar to the agreement described above with the exception that the exchange would only be with the City of Tucson and only under Tier 2a and Tier 2b shortage conditions occurring from 2020 through 2022. The City of Tucson has indicated it would store up to 35,000 acre-feet per year at GSFs in the Pinal AMA to provide the difference in supply when Ag mitigation water decreases from 105,000 acre-feet under Tier 1 shortages to 70,000 acre-feet under Tier 2a and Tier 2b shortages. The AWBA will agree to exchange an equal volume of LTSCs it has accrued in the Tucson AMA for LTSCs that are subsequently accrued by the City of Tucson in the Pinal AMA for a maximum of 33,250 acre-feet per year for the three-year period.

IGA FOR THE DEVELOPMENT OF ICS FIRMING CREDITS

To facilitate the offset component of the Implementation Plan, the AWBA entered into an agreement with the Gila River Indian Community (Community) to purchase ICS created by the Community. 

The Community proposes to create at least 200,000 acre-feet of ICS that will be left in Lake Mead for the duration of the Interim Period. In this intergovermental agreement (IGA), the AWBA agrees to pay for the creation of 50,000 acre-feet of that ICS in order to satisfy a future firming obligation to the Community. Due to a one-time 10 percent reduction for the system and evaporation losses, the 50,000 acre-feet of ICS will result in 45,000 acre-feet of ICS credits. These ICS credits will be used after 2026 to meet the AWBA's firming obligations to the Community.  

POLICY REGARDING THE DISTRIBUTION OF LONG-TERM STORAGE CREDITS FOR FIRMING CAP MUNICIPAL AND INDUSTRIAL SUBCONTRACTORS 

Under this policy, during the implementation of the LBDCP, the AWBA will distribute LTSCs pursuant to A.R.S. §  45-2457(B)(7) to meet all reductions to scheduled CAP M&I Priority water due to a shortage condition or required LBDCP contributions, regardless of use. Consequently, this policy provides the certainty desired by CAP M&I subcontractors that there will be water supplies available to meet demand and to ensure sufficient resources for mitigating water reductions resulting from the LBDCP. The operating experience gained during this time will inform future AWBA policies on LTSC distribution.