[Senate Hearing 107-271]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 107-271

                        NEW MEXICO WATER SUPPLY

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

 TO IDENTIFY ISSUES RELATED TO THE WATER SUPPLY CHALLENGES FACING THE 
  SOUTHERN NEW MEXICO BORDER REGION, A REGION INCLUDING THE EL PASO, 
                     TEXAS AND JUAREZ, MEXICO AREAS

                               __________

                            AUGUST 14, 2001

                         LAS CRUCES, NEW MEXICO


                       Printed for the use of the
               Committee on Energy and Natural Resources

                                _______

                  U.S. GOVERNMENT PRINTING OFFICE
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               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                  JEFF BINGAMAN, New Mexico, Chairman
DANIEL K. AKAKA, Hawaii              FRANK H. MURKOWSKI, Alaska
BYRON L. DORGAN, North Dakota        PETE V. DOMENICI, New Mexico
BOB GRAHAM, Florida                  DON NICKLES, Oklahoma
RON WYDEN, Oregon                    LARRY E. CRAIG, Idaho
TIM JOHNSON, South Dakota            BEN NIGHTHORSE CAMPBELL, Colorado
MARY L. LANDRIEU, Louisiana          CRAIG THOMAS, Wyoming
EVAN BAYH, Indiana                   RICHARD C. SHELBY, Alabama
DIANNE FEINSTEIN, California         CONRAD BURNS, Montana
CHARLES E. SCHUMER, New York         JON KYL, Arizona
MARIA CANTWELL, Washington           CHUCK HAGEL, Nebraska
THOMAS R. CARPER, Delaware           GORDON SMITH, Oregon

                    Robert M. Simon, Staff Director
                      Sam E. Fowler, Chief Counsel
               Brian P. Malnak, Republican Staff Director
               James P. Beirne, Republican Chief Counsel
                          Mike Connor, Counsel
                     Shelley Brown, Staff Assistant
                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Bingaman, Hon. Jeff, U.S. Senator from New Mexico................     1
Burkstaller, John, P.E., Chief Technical Officer, El Paso Water 
  Utilities Public Service Board.................................    20
Domenici, Hon. Pete V., U.S. Senator from New Mexico.............     2
Esslinger, Gary, Treasurer/Manager, Elephant Butte Irrigation 
  District.......................................................    25
Fifer, Edd, General Manager, El Paso County Water Improvement 
  District #1....................................................    28
Gold, Rick L., Regional Director, Upper Colorado Region, Bureau 
  of Reclamation.................................................    48
Little, Debra J., Principal Engineer, Engineering Department, 
  United States Section of the International Boundary and Water 
  Commission.....................................................    53
Peach, James, Professor, Department of Economics, New Mexico 
  State University...............................................    10
Rascon, Antonio, Principal Engineer, Mexican Section of the 
  International Boundary and Water Commission....................    57
Smith, Ruben A., Mayor, City of Las Cruces, NM...................    16
Turney, Tom, State Engineer, State of New Mexico.................    40
Wood, M. Karl, Director, New Mexico Water Resources Research 
  Institute......................................................     4

 
                        NEW MEXICO WATER SUPPLY

                              ----------                              


                        TUESDAY, AUGUST 14, 2001

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Las Cruces, NM.
    The committee met, pursuant to notice, at 9:07 a.m. in the 
Corbett Center Auditorium, New Mexico State University, Las 
Cruces, New Mexico, Hon. Jeff Bingaman, chairman, presiding.

           OPENING STATEMENT OF HON. JEFF BINGAMAN, 
                  U.S. SENATOR FROM NEW MEXICO

    The Chairman. Let us get started. If anyone wants to hear 
the testimony, please come sit down where you can hear it. We 
have lots of room in the front row.
    Let me thank you all for being here. This is a hearing of 
the Senate Energy and Natural Resources Committee to provide a 
forum for identifying issues and learning more about the 
various water supply challenges facing southern New Mexico's 
border region, including, of course, El Paso and the Juarez 
metropolitan areas.
    Before we begin, let me just recognize some of the 
congressional staff who are here. First, Mary Catherine Zee and 
Don Manzanares, both from Senator Domenici's staff. We 
appreciate them being here very much. We understand that 
Representative Reyes, Congressman Reyes may have a 
representative here later on, and if so, we will certainly 
recognize him.
    From the energy committee staff, Mike Connor, who is 
sitting beside me here, and Shelley Brown have come out to help 
organize this hearing. We appreciate that very much.
    There has been an increasing amount of attention and 
scrutiny on water issues in the border region. Initially that 
attention was focused on the need to increase the environmental 
infrastructure in the area, particularly the wastewater 
treatment plants. Although more needs to be done in that area, 
progress is being made on these issues through the Border 21 
Program, the ongoing partnerships between the United States and 
Mexico. Fernando Macias was here a few minutes ago, he is back 
towards the back, and we appreciate his good work on many of 
those issues.
    The focus of today's hearing, however, concerns a separate 
and ongoing challenge facing the region, that is the issue of 
water supply. While the need to secure an adequate supply of 
fresh water is nothing new in the arid West, there are some 
unique aspects here which warrant special consideration. First, 
addressing water supply issues among several different 
governmental entities is a very real challenge. We have two 
nations, and that complicates the issue even further.
    Second, the region is experiencing growth at a rate 
significantly exceeding that of most other areas. The growth 
not only increases the demand for water, but also changes how 
and when the available water supply is used.
    The goal of this hearing is to learn more about the current 
projections of available water supply, any plans to address 
increased and changing demands, and issues which need to be 
resolved as part of that process.
    We have a distinguished group of witnesses here today who 
can give us their perspective on this subject from several 
different viewpoints. At the end of the day I hope we can have 
a better understanding of the challenges facing the region and 
the role that the Federal Government can play in helping meet 
those challenges.
    We are going to start with Mr. Karl Wood, who is the 
director of the Water Resources Research Institute here at New 
Mexico State University, and following him, Professor James 
Peach, who is at the Department of Economics here at New Mexico 
State. We will hear from both of them, and then we may have an 
additional witness on this panel, and I will have questions of 
both of you.
    But Karl, will you start and take 10 or 15 minutes, 
whatever you think is appropriate, to tell us your perspective.
    [A prepared statement from Senator Domenici follows:]

       Prepared Statement of Hon. Pete V. Domenici, U.S. Senator 
                            From New Mexico

    I want to thank all of you for attending today's hearing on water 
supply challenges facing the southern New Mexico border region. Of 
course, those of us from this area know what the problem is--increasing 
demands on a limited water supply. Of the issues facing New Mexico in 
the next decade, the greatest challenges will be water-related, in 
terms of both quantity and quality.
    I have often reminded my colleagues in the Senate not to be fooled 
by the name ``Rio Grande''--our great river is no Potomac. We all know 
that securing enough clean water for our needs is crucial for the 
future of New Mexico. As demand grows more intense between urban areas, 
industry, agriculture and others, we must work together to balance all 
interests.
    Many of you may know that I have been very involved for years in 
working to improve the water situation in New Mexico. I am pleased to 
continue funding work to sustain the endangered Rio Grande silvery 
minnow, as well as provide enough water for human uses, through my 
position on the Senate Energy and Water Appropriations Subcommittee. 
The Energy and Water bill funds the Department of Energy, the Bureau of 
Reclamation, and the Corps of Engineers--all crucial agencies to water 
in our state, through research, development and delivery. I have helped 
fund activities supporting endangered species, as well as water 
development for agricultural and municipal users throughout the state.
    Specific to the border area, colonias, the North American 
Development Bank (NADBank), Border Environmental Cooperation Commission 
(BECC) and the proposed El Paso-Las Cruces Regional Sustainable Water 
Project have all received funding over the years; however, permanent 
solutions to supply and demand issues are needed. The rest of the 
country is realizing what we have known for decades, namely that water 
has become the new liquid gold. Just this past Sunday, the New York 
Times published an article stating that water supply concerns threaten 
the entire country, not just the arid west. The Times predicts that El 
Paso and Albuquerque could ``go dry'' in 10 to 20 years. The recent 
emergencies in the Klamath Falls area of Oregon, which has pit 
agricultural water needs against those of endangered species, is 
hopefully not a precursor for a similar crisis here in New Mexico.
    We know that Las Cruces, Santa Teresa, Sunland Park and smaller 
communities in southern New Mexico need water to grow. The El Paso 
region and growing areas around Juarez have the same needs. We must 
find ways to ensure that people, endangered species, and agricultural 
land can strike a balance on water needs. These challenges, along with 
water quality concerns, will define the next few years of effort along 
our water systems. We must also realize that the problems we face here 
in New Mexico are not unique.
    The greatest water quality issue facing New Mexico today is the 
lowering of the arsenic drinking water standard. The compliance cost 
estimates associated with these new standards are staggering. I do 
believe that if the federal government is going to place this kind of 
cost on Americans, then it must also be willing to help foot the bill. 
Otherwise, we shouldn't be too surprised to see systems serving small, 
rural and largely low-income communities being shut down.
    If you have not already read it in the newspapers, the House 
recently passed language prohibiting the use of appropriated funds to 
delay the 10 parts per billion arsenic standard published in the waning 
hours of the Clinton administration. Additionally, the language 
prohibits using FY 02 funds to increase the standard. The Senate passed 
language stating that the EPA administrator must immediately put a new 
standard into effect that should protect the population in general, 
while fully taking into account those at greater risk such as infants, 
children, the elderly and pregnant women.
    The Senate language is more flexible and is not an outright 
prohibition on review or standard level. I am pleased that the Senate 
language, unlike the House, is not a strict prohibition and does not 
mandate the Clinton standard be immediately put into effect. I am not 
against a new standard, but want one that is based on sound science.
    Based on the work being conducted by our National Laboratories, we 
feel more confident in affordable technologies that may soon be 
available to treat water. Additionally, on August 1, I introduced a 
bill authorizing $1.9 billion for a grant program to help local 
communities pay for the cost of improving water treatment facilities to 
meet potentially stricter federal quality standards. Communities would 
apply directly to EPA for grants. Grants would be awarded based on 
financial need and per capita cost of complying with drinking water 
standards.
    Our water issues will only continue to grow more challenging. We 
must be innovative thinkers and visionaries in the water world. We 
cannot delay facing these issues now. One way is to chart a broad new 
course aimed at channeling scientific innovation to ensure plentiful 
future water supplies through the desalination of brackish and sea 
water.
    One major thrust of a bill I introduced this month, the Water 
Supply Security Act of 2001, authorizes the construction of a 
desalination test and evaluation facility over the Tularosa Basin in 
Otero County, New Mexico to improve existing technologies and develop 
new technologies to reduce costs. Although communities throughout the 
nation and the world have depleting stores of fresh water, they all 
have large deposits of brackish and sea water. Because brackish and sea 
water account for over 97 percent of the water on Earth, being able to 
cheaply convert this water into fresh water will play a key role in 
ensuring an adequate water supply in the future.
    The bill would direct the Bureau of Reclamation and the Department 
of Energy to collaborate on evaluating current technology, advising on 
additional research, and building a facility to test and prepare 
desalination technologies for ``real-world applications.'' In addition, 
this basin has the highest level of solar radiation in the world, which 
will allow us to evaluate a combination of renewable energy and 
desalination applications, an important area of future research. 
Although desalting technology has become significantly cheaper in 
recent years, the cost of desalting brackish and sea water is still 
substantially more expensive than treatment and delivery of other 
municipal water supplies.
    The proposed desalination facility would be located near several 
research and development organizations including White Sands Missile 
Range, Fort Bliss, Holloman Air Force Base, New Mexico State 
University, and the University of Texas at El Paso. Evaluation of 
technologies in the Tularosa Basin would have direct applications to 
cities in southern New Mexico, West Texas, and northern Mexico, as well 
as inland applications throughout the United States. Revolutionary 
desalting technologies would provide significant relief to communities 
throughout the world, be they rich or poor, coastal or inland.
    We are all neighbors; the city-dweller, the farmer, the fish, the 
American and the Mexican. Water sustains us all. For our future, we 
cannot wait to solve the crucial problem of finding enough water for 
all. ``Agua es la vida de nuestra tierra.''

STATEMENT OF M. KARL WOOD, DIRECTOR, NEW MEXICO WATER RESOURCES 
                       RESEARCH INSTITUTE

    Mr. Wood. Thank you, Senator Bingaman. I wish to welcome 
you back to New Mexico, and especially welcome you to New 
Mexico State University, what we like to describe as the 
university of choice.
    Today, I wish to talk briefly about the water resources in 
the border region. The binational border region, of which 
southern New Mexico is part, is generally defined as an area 
which extends from east of El Paso to west of Juarez, and 
extending north into New Mexico approximately 60 miles.
    The water resources of this area consist of both surface 
and groundwater. The surface waters relate generally to the Rio 
Grande. Numerous other small streams, creeks, arroyos, and 
draws are typical of the arid southwest. The groundwater 
resources of the region consist of a number of alluvial and 
basin-fill aquifers. These groundwater aquifers include the 
Tularosa/Hueco, the Jornada del Muerto, and the Mesilla 
Bolsons.
    The climate of the region is typical of that of the arid 
Southwest with mostly clear skies, abundant sunshine, limited 
rainfall, and limited humidity. Average annual precipitation of 
most of the area is less than 10 inches per year. In the last 
100 years in Las Cruces, as an example, it has been about 8\1/
2\ inches. The last 40 years in Las Cruces have been 9\1/2\ 
inches.
    The Hueco/Tularosa aquifer extends from the north of 
Alamogordo south beyond El Paso and Juarez. Most of the water 
is found in the ground. Total surface area of the Hueco/
Tularosa aquifer is 4,160 square miles, approximately 67 
percent of it being in New Mexico, 22 percent in Texas, and 11 
percent in Mexico. The aquifer is a primary source of water for 
the city of El Paso and Ciudad Juarez, and for military 
installations and smaller cities and towns in New Mexico, 
Texas, and Mexico.
    Well yields in this aquifer vary greatly with yields 
between 1,800 gallons per minute to as low as 15 gallons per 
minute. Depth to the groundwater in the north is between 20 and 
150 feet. Drawdowns in many municipal wells up to 100 feet have 
been recorded in this area.
    Groundwater is at or near the surface near the White Sands 
National Monument. Current depth to groundwater beneath the 
city of El Paso is usually between 250 and 400 feet. That 
distance is away from the river.
    Present depth to groundwater beneath Ciudad Juarez varies 
from about 100 to 250 feet, except near the Rio Grande where 
depths are less than 70 feet.
    A bit on the water quality in this basin. The groundwater 
north of New Mexico/Texas State line is usually greater than 
100 milligrams per liter of total dissolved solids, except 
around the mountains. The water along the interior of the basin 
has TDS greater than 10,000 milligrams per liter. 10,000 
milligrams is quite salty. It is generally considered to be 
toxic even to most livestock.
    Groundwaters along the Franklin Mountains are 
characteristically less than 700 milligrams per liter. Away 
from the recharge areas along the Franklin Mountains, water 
salinity increases to over 1,000 milligrams per liter in many 
wells, reaching concentrations of over 1,500 in wells along the 
center of the basin. The salinity of groundwater underlying the 
Ciudad Juarez area is generally less than 1,000 milligrams.
    Chloride and other dissolved ions have increased over time 
in many of the municipal wells in El Paso and Ciudad Juarez. 
Nitrate data collected between 1994 and 1995 indicate nitrate 
problems in some parts of El Paso County. In the Ciudad Juarez 
area, sampling in 1987 suggested that groundwater beneath 
Ciudad Juarez was contaminated by sewage.
    The Hueco Bolson has served for many decades as the 
principal source of water for the city of El Paso and Ciudad 
Juarez, as well as communities in Dona Ana and Otero Counties 
of New Mexico. The city of El Paso has actively pursued 
development of alternative supplies, rigorous conservation 
programs and recharge programs to prolong the life of the 
aquifer.
    In New Mexico, the community of Chaparral and small 
acreages of irrigated cropland in the area are principal uses 
of the Hueco basin water. In the Tularosa subbasin, a number of 
municipal systems, the White Sands Missile Range, as well as 
self-supplied uses depend on the resource for domestic 
supplies.
    Now, to talk a minute about the Jornada del Muerto Bolson. 
It lies east of the Mesilla Bolson on what is 
characteristically called the east mesa. The basin covers 
approximately 3,344 square miles and is approximately 12 miles 
across at the widest section. The depth to the water table here 
is between 300 and 575 feet.
    In the southern part of the basin, estimated volume of 
water in storage is over 100 million acre-feet. Groundwater in 
the southern section of the Jornada del Muerto Bolson is 
classified as fresh and water in the northern section is 
classified as slightly saline. Water use in this basin is 
limited to public, self-supplied domestic, industrial, 
commercial, and livestock uses. Currently no agriculture 
activities are present, but there have been limited acreages in 
the past.
    The Mesilla Basin aquifer system consists of floodplain 
alluvium and the underlying Mesilla Bolson. It extends from 
southern New Mexico to West Texas and northern Mexico along the 
Rio Grande. The Rio Grande originates in northern New Mexico 
and southern Colorado Rocky Mountains, flows through New 
Mexico, and forms the boundary between Texas and Mexico on its 
way to the Gulf of Mexico. It is the dominant and limiting 
surface water resource throughout most of its watershed.
    The surface drainage of the Mesilla Basin covers 
approximately 1,100 square miles. Historically, Rio Grande 
flows have been highly variable both between years and between 
seasons. Average annual flow above Elephant Butte Reservoir was 
569,000 acre-feet from 1895 to 1969, with a standard deviation 
of nearly 400,000 acre-feet.
    With this high a flow and this high a standard deviation, 
it is obvious to see that the variation is tremendous. This has 
led to floods and extended periods of no flow. These flows were 
stabilized by the Rio Grande Project, so that there is 
generally a consistent flow every year.
    The Rio Grande floodplain between Leasburg Dam and the El 
Paso narrows is not a confined aquifer. The water table is 
approximately 10 to 25 feet below the land surface. Recharging 
to the aquifer occurs primarily as vertical flow from the 
surface water system. These include the river, canals, 
laterals, and drains and irrigated cropland fields. The quality 
of the water generally reflects the quality of the surface 
water system, ranging from about 500 to over 1,000 milligrams 
per liter of TDS.
    In conclusion, the flows of the Rio Grande are stored in 
Elephant Butte and Caballo Reservoirs. Elephant Butte Reservoir 
has a capacity of just over 2 million acre-feet. The capacity 
of Caballo is about 330,000 acre-feet. Ground and surface water 
is used below Caballo Reservoir by individual homes, 
municipalities, industry, and agriculture.
    In 1906, a treaty was negotiated with Mexico for the 
delivery of 60,000 acre-feet of water annually at the Acequia 
Madre ditch that headed below the principal diversion in El 
Paso. The authorized acreage to be irrigated is 90,640 acres in 
New Mexico and 69,010 in Texas.
    That describes the water resources of the region. It seems 
like there is a lot of water, but there is a lot of uses, also. 
Thank you.
    [The prepared statement of Mr. Wood follows:]

 Prepared Statement of M. Karl Wood, Director, and Dr. Bobby J. Creel, 
   Associate Director, New Mexico Water Resources Research Institute

                              INTRODUCTION

    The bi-national border region of New Mexico is generally defined as 
an area which extends from east of El Paso to west of Juarez, Mexico 
and extending north into New Mexico approximately 100 km (60 miles). It 
includes portions of Otero and Dona Ana counties. The water resources 
of this area consist of both surface and groundwater.
    The surface water (rivers) in the area include the Rio Grande. 
Numerous other surface water courses (streams, creeks, arroyos and 
draws) which range from small perennial streams to ephemeral drainages 
are typical of the arid southwest. Because most of these smaller 
surface water courses typically terminate in playa-lake plains or 
floors of the basins they are only discussed with respect to their 
contribution to groundwater recharge.
    The groundwater resources of the region consist of a number of 
alluvial and basin-fill aquifers. From east to west these groundwater 
aquifers (or Basins or Bolsons) include the Tularosa/Hueco, Jornada del 
Muerto, and Mesilla.
    These water resources are described in the following sections first 
with a physical or structural description followed by a discussion of 
the water use of each. Before proceeding into these descriptions, some 
general discussion of the regional physiographic setting, climate, and 
hydrogeologic concepts are included.

                         PHYSIOGRAPHIC SETTING

    Most of the area lies within the Mexican Highland section of the 
Basin and Range province. The dominant landforms are gently sloping to 
nearly level of the extensive intermontane basins. Basin floors merge 
mountainward with broad slopes (primarily ``bajadas'' formed by 
alluvial fans) that flank isolated mountain highlands and other upland 
areas.

                          HYDROLOGIC CONCEPTS

    Some basins have floors containing ephemeral-lake plains (playas) 
and no surface outlets. Others contain drainageways which occasionally 
discharge to lower external areas. Others are ``open'' basins that have 
surface runoff to rivers. The Mesilla and Hueco Basins are ``open'' 
basins, and surface runoff is drained by the Rio Grande. The Tularosa 
and Jornada del Muerto are closed basins, having no exterior surface 
drainage.

                                CLIMATE

    The area is typical of the arid southwest, with mostly clear skies 
and limited rainfall and humidity. Average annual precipitation of most 
of the area is less than 10 inches per year. As an example, the average 
for Las Cruces (at the New Mexico State University station, elevation 
3,880 feet) averaged 9.47 inches over the period 1959-1996.

                         HUECO-TULAROSA AQUIFER

    A surface divide near the New Mexico/Texas State line separates the 
Tularosa Basin (a closed basin) and the Hueco Basin (a through-flowing 
basin) topographically. The surface divide does not correspond to a 
structural or groundwater divide, and the two basins are connected by 
interbasin groundwater flow from New Mexico into Texas. Because of the 
interconnection, the Tularosa and Hueco Basins are considered as one 
aquifer; the Hueco-Tularosa aquifer.
    Total surface area of the Hueco-Tularosa aquifer is 4,160 square 
miles. Approximately 67% of its land area is in New Mexico, 22% of its 
land area is in Texas, and 11% is in Mexico. The aquifer is a primary 
source of water for the City of El Paso and Ciudad Juarez, and for 
military installations and smaller cities in New Mexico, Texas, and 
Mexico.
    Well yields in the New Mexico part of the Tularosa-Hueco aquifer 
vary greatly. Well yields of 1,400 gallons/minute are reported at 
elevations high on the fans decreasing to 300 to 700 gallons/minute at 
the lower edges of the fans. Well yields in the mud-rich sediments 
toward the center of the Tularosa Bolson are usually less than 100 
gallons/minute and sometimes less than 15 gallons/minute. In the Hueco 
Bolson, just east of the Franklin Mountains, yields are as much as 
1,800 gallons/minute. Wells underlying Ciudad Juarez yield from 300 to 
1,500 gallons/minute.
    Depth to groundwater in the Hueco-Tularosa aquifer is variable. 
Depth to groundwater near the Cities of Tularosa and Alamogordo at the 
flanks of the Sacramento Mountains is between 20 and 150 feet. 
Drawdowns in many municipal wells, up to 100 feet, have been recorded 
in this area. Groundwater is at or near ground surface near White Sands 
National Monument due to evaporative discharge from a wet gypsum playa. 
Depth to groundwater near the White Sands Missile Range Headquarters, 
at interior portions of the basin, is up to 400 feet. Little drawdown 
has been recorded there. Drawdowns in the Hueco Bolson near the New 
Mexico/Texas State line has been relatively small, not exceeding 30 
feet. Current depth to groundwater beneath the City of El Paso is 
usually between 250 and 400 feet at distances from the Rio Grande. 
Present depth to groundwater beneath Ciudad Juarez varies from about 
100 to 250 feet, except near the Rio Grande where depths are often less 
than 70 feet.
    In heavily developed parts of the Hueco-Tularosa aquifer, drawdowns 
since 1940 are up to 150 feet. Pumping cones of depression in municipal 
wellfields are the focal points of drawdown. Most of the drawdowns near 
municipal wellfields vary between 50 and 100 feet.
    Groundwater north of the New Mexico/Texas State line is usually 
greater than 1,000 mg/L Total Dissolved Solids (TDS) except in 
mountains and along mountain fronts, where groundwaters are dilute. 
Many samples along the interior of the basin at or just south of Alkali 
Flat have TDS greater than 10,000 mg/L. Near and extending across the 
state line to the Rio Grande, groundwaters along the Franklin Mountains 
are characteristically less than 700 mg/L TDS. Away from the recharge 
areas along,the Franklin Mountains, water salinity increases to over 
1,000 mg/L in many wells, reaching concentrations over 1,500 mg/L TDS 
in wells along the center of the basin. The salinity of groundwater 
underlying the Ciudad Juarez area are generally less than 1,000 mg/L 
TDS.
    Chloride and other dissolved ions have increased over time in many 
of the municipal wells in El Paso and Ciudad Juarez. Chloride now 
exceeds 250 mg/L in several of the wells in the area. Mixing due to 
pumpage, leakage from mud interbeds and artesian confining beds, 
cascading waters along well casing and screens, lateral salt water 
encroachment, and potential upcoming have started to degrade the 
freshwater zone.
    Nitrate data collected between 1994 and 1995 indicate nitrate 
problems in some parts of El Paso County. A cluster of wells in the 
vicinity of the Old Mesa Well Field in southwestern El Paso County 
exceed the 10 mg/L drinking water standard. Many of the samples in El 
Paso County tested between 5 and 10 mg/L. All of the wells in Ciudad 
Juarez and immediate vicinity are less than 5 mg/L.
    In the Ciudad Juarez area, residential water supplies were tested 
in 1987 for possible contamination of groundwater by sewage. Fecal 
coliform was used as an indicator parameter. Forty-two samples were 
obtained; 30 from tap water and 12 from raw groundwater. Ninety-one 
percent of raw groundwater samples were fecal coliform positive. Sixty 
percent of tap water samples were fecal coliform positive. The 
percentage of positive bacteria detections in these samples suggested 
that groundwater beneath Ciudad Juarez was contaminated by sewage.

                    WATER DEVELOPMENT AND WATER USE

    Most groundwater discharge from the Hueco Bolson is due to pumping 
withdrawals for municipal and military water supply. Quantities of 
groundwater pumped from the Hueco Bolson from municipal and other 
sources have increased by a factor of almost 6 since 1950. Recent 
trends indicate that municipal pumpage in Mexico increased about 12.5% 
between 1990 and 1994. Municipal and military pumpage in the United 
States decreased 24.0% during the same time interval. Pumping trends 
reflect the increased dependence on groundwater in Mexico, and partial 
conversion from groundwater to surface-water use in the United States.
    The Hueco Bolson has served for many decades as the principal 
source of public and self-supplied domestic water for the city of El 
Paso and Ciudad Juarez as well as communities in Dona Ana and Otero 
counties of New Mexico. The city of El Paso has actively pursued 
development of alternative supplies, rigorous conservation programs, 
and recharge programs to prolong the life of the aquifer. In New 
Mexico, the community of Chaparral and small acreages of irrigated 
cropland in the area are principal uses of the Hueco basin water. In 
the Tularosa subbasin a number of municipal systems, the White Sands 
Missile Range, as well as self-supplied uses depend on the resource for 
domestic supplies. Because the quality of the water in the Tularosa 
subbasin (at least in the central floor area) is extremely saline 
(exceeding 10,000 mg/L TDS) most systems attempt to capture groundwater 
near the mountain-front recharge areas.
    Water depletions for Otero County, New Mexico for 1995 were 8,448 
acre-feet from surface water sources and 27,444 acre-feet from 
groundwater sources. The surface water depletions were 3,860 acre-feet 
for public water supply, 3,603 acre-feet for irrigated agriculture, 885 
acre-feet for commercial, and 100 acre-feet for livestock. Groundwater 
depletions were 23,767 acre-feet for irrigated agriculture, 2,639 acre-
feet for public water supply, 507 acre-feet for self-supplied domestic, 
287 acre-feet for commercial, 216 acre-feet for livestock, and 24 acre-
feet for industrial uses.

                       JORNADA DEL MUERTO BOLSON

    The Jornada del Muerto Bolson lies east of the Mesilla Bolson. It 
is a north-south trending valley. The basin covers approximately 3,344 
square miles and is approximately 12 miles across at its widest 
section. The depth to the water table is between 300 to 575 feet and 
the thickness of the saturated sediment is between 400 to 500 feet. 
Recharge occurs primarily from precipitation and infiltration of 
mountain runoff through major arroyos.
    In the southern part of the basin, the estimated volume of water in 
storage in the aquifer was 100,400,000 acre-feet prior to development, 
the amount that had been withdrawn (pumped) between 1962 and 1994 was 
about 39,850 acre-feet, and the amount remaining in storage is 
100,360,000 acre-feet. Groundwater in the southern section of the 
Jornada del Muerto Bolson is classified as fresh and water is the 
northern section of the bolson is classified as slightly saline.
Water Development and Use
    Water use in the basin is limited to public, self-supplied 
domestic, industrial, commercial, and livestock. Currently no 
agricultural activity is present, but there have been limited acreages 
irrigated in the past.

                             MESILLA BASIN

    The Mesilla basin aquifer system consists of floodplain alluvium 
and the underlying Mesilla Bolson. It is an extensive intermontane 
aquifer system which extends from southern New Mexico to northern 
Mexico. It is surrounded by mountains which form the boundaries. The 
Rio Grande originates in the northern New Mexico and southern Colorado 
Rocky Mountains, flows through New Mexico, and forms the boundary 
between Texas and Mexico on its way to the Gulf of Mexico. It is the 
dominant and limiting surface water resource throughout most of its 
watershed. The surface water system is comprised of the Rio Grande and 
its tributaries and a network of canals, laterals and drainage ditches 
that discharge to the river. The surface drainage of the Mesilla basin 
covers approximately 1,100 square miles. Historically, Rio Grande flows 
have been highly variable both between years and between seasons. 
Average annual flow above Elephant Butte Reservoir was 569,063 acre-
feet from 1895 to 1969 with a standard deviation of 398,868 acre-feet. 
This led to floods and extended periods of no flow. These flows were 
stabilized by the Rio Grande Project.
    The Rio Grande Floodplain, between Leasburg dam and the El Paso 
narrows, is not a confined aquifer. The water table is approximately 10 
to 25 feet below the land surface. Groundwater typically moves 
southeastward down the valley; however, the direction is influenced by 
nearby hydraulic structures such as the river, drains, canals, well 
pumpage and heavily irrigated fields. Recharge to the aquifer occurs 
primarily as vertical flow from the surface water system (river, 
canals, laterals, and drains) and irrigated cropland fields. The 
quality of the water generally reflects the quality of the surface 
water system, ranging from about 500 mg/L TDS to over 1,000 mg/L TDS. 
The majority of underground discharge occurs through evapotranspiration 
of irrigated crops, flow to drain systems, irrigation pumping, 
industrial pumping, and percolation to the underlying Mesilla Bolson.
    The majority of recharge occurs through mountain front recharge and 
through vertical flow of groundwater from the floodplain surface. The 
quality of the groundwater varies both with depth and across the basin.
Water Development and Use
    The principal source of surface water in the border region is the 
Rio Grande which flows from its headwaters in Colorado and northern New 
Mexico. The flows of the Rio Grande are stored in Elephant Butte and 
Caballo Reservoirs. These storage units were constructed as a part of 
the Rio Grande Project. The Project was authorized by Congress under 
the Reclamation Act of 1902 to provide irrigation water farms in Texas 
and New Mexico by capturing flood-flows and storing them in Elephant 
Butte Reservoir. Elephant Butte Reservoir, at the time of its 
construction, had a capacity of over 2.6 million acre-feet, but 
sediment from up-stream lands has reduced the effective storage to just 
over 2 million acre-feet in recent years. Caballo Reservoir (about 28 
miles down-stream was built in 1938 to hold waters released from 
Elephant Butte for power generation and to provide additional flood-
storage capacity. The usable capacity of Caballo Reservoir, including 
100,000 acre-feet of flood storage, is 331,500 acre-feet. The Project 
was to include diversion dams and a canal delivery system. The Project 
also provided supplemental water (Project return-flow) to about 18,000 
acres in the Hudspeth County Conservation and Reclamation District No. 
1 below El Paso.
    At the time of the 1902 Reclamation Act, Texas was not eligible for 
participation as there were no public lands in Texas to help under-
right the reclamation fund. Because farmers in the El Paso, Texas area 
claimed the right to use the flows of the Rio Grande for irrigation, as 
did farmers in New Mexico, some accommodation was necessary. A division 
of the anticipated supply from Elephant Butte, between the two states, 
was a necessity, if the Project was to go forward. In 1904 an agreement 
between business people from El Paso and Las Cruces formed the basis 
for a Congressional act in 1905. The 1905 Reclamation Extension Act was 
in fact a Congressional adjudication of the rights in each state and 
should be considered to be an equitable apportionment of the waters of 
the Lower Rio Grande. The 1905 law extended the benefits of the 
Reclamation Act of 1902 to include the El Paso area, provided that all 
irrigated lands in the Project would have the same standing with 
respect to priority dates and charges; and established the guidelines 
for the division of the water supply above and below El Paso on the 
basis that New Mexico would be allowed to irrigate 110,000 acres, and 
Texas would be allowed to irrigate 70,000 acres.
    Another primary objective of the Project was to ensure that the 
United States could deliver water to Mexico under the provisions of the 
Treaty of 1906. For many years, Mexico had complained that excessive 
uses of Rio Grande water were depriving Juarez Valley farmers of their 
historic supply. In 1906 a treaty was negotiated with Mexico for the 
delivery of 60,000 acre-feet of water annually at the Acequia Madre 
ditch that headed below the principal diversion at El Paso. The U.S. 
has delivered the amount of water to Mexico in most years, but has 
reduced these deliveries during periods of short-supply. The concept 
behind this reduction is that all acreage under the Project would 
receive the same duty of water and the water delivered to Mexico is 
Project water.
    The acreage to be irrigated in Texas and New Mexico under the 
Project and municipal water-uses were arrived at by means of contracts 
between the Bureau of Reclamation and each of the irrigation districts 
and by three party contracts that included the Bureau of Reclamation 
and both of the districts. The most important of these joint agreements 
was signed in September 1937 when the districts were allowed to 
increase their authorized acreage: 90,640 acres in New Mexico and 
69,010 in Texas. This increased the authorized Project acreage to 
159,650 acres. The 1937 contract is important as it provided for a 
proportional sharing of shortages (67/155 for the Texas district and 
88/155 to the New Mexico district).
    Colorado, Texas and New Mexico entered into an interstate compact 
that divided the supply of the Rio Grande between the three states by 
providing sliding-scale, delivery-tables. New Mexico's deliveries at 
Elephant Butte Dam were to ``Texas'', or in reality to the Project, as 
it was the ``unit'' beneficially using all of the surface water below 
that point. The Compact did not further divide the water supply between 
New Mexico users (Elephant Butte Irrigation District) and the Texas 
users (El Paso County Water Improvement District #1). The Compact did 
recognize the delivery requirement to Mexico. Article VIII of the Rio 
Grande Compact, defined the ``normal release'' of ``usable water'' for 
the Project from Elephant Butte Reservoir to be 790,000 acre-feet per 
year. This amount provided for the ``full Project'' allocation of 
730,000 acre-feet per year plus 60,000 acre-feet for delivery to 
Mexico.
    Total water use in 1995 for Dona Ana County was 250,785 acre-feet 
with 171,286 acre-feet from surface water and 79,500 acre-feet from 
groundwater. Surface water depletions were primary used by irrigated 
agriculture (171,156 acre-feet) with a small amount (41 acre-feet and 
89 acre-feet) for livestock and commercial uses, respectively. These 
depletions do not include all of the Elephant Butte Irrigation District 
which extends into Sierra County. Groundwater depletions were used by 
irrigated agriculture (49,150 acre-feet), public water supply (20,716 
acre-feet), livestock (3,385 acre-feet), commercial (2,980 acre-feet), 
power (2,439 acre-feet), and self-supplied domestic uses (769 acre-
feet).

    The Chairman. Thank you very much. Professor Peach, will 
you go ahead with your testimony, and then I will have some 
questions.

 STATEMENT OF JAMES PEACH, PROFESSOR, DEPARTMENT OF ECONOMICS, 
                  NEW MEXICO STATE UNIVERSITY

    Mr. Peach. Thank you very much, Senator Bingaman. It is 
always a pleasure to see you here, and I would like to echo Mr. 
Woods' welcome to New Mexico State University. As requested by 
Mr. Connor, my remarks will be brief. That is a hard job for an 
academic, but I will keep them brief. But I provided copies of 
some articles, and I have also provided Mr. Connor with 100 
copies of some charts I am going to refer to. Can they be given 
to the audience? They have been?
    The Chairman. Those are out on the table, I am told. Does 
everyone have a copy of those? If not, maybe we should just 
take a minute here and get copies. Shelley, you might see if 
there are some extra copies we can distribute.
    This is a table on population projections?
    Mr. Peach. Yes, and also some charts that I am going to 
refer to. And I anticipated not having an overhead, so I can do 
it high-tech, low-tech or no-tech.
    The Chairman. Okay.
    Mr. Peach. I will not say New Mexico Tech.
    The Chairman. Please go ahead.
    Mr. Peach. You bet. My comments will be focused mainly on 
demographic trends in Dona Ana County, El Paso County, and 
Ciudad Juarez. And for brevity, I will simply prefer to those 
three areas as the region.
    The regional demand for water depends, for the most part, 
on the size and characteristics of the population, income 
levels, the industrial structure of the region, and the price 
of water. The price of water is especially important. A few 
weeks ago at a conference in El Paso, I purchased a 20-ounce 
bottle of water for a dollar out of a machine. That is 5 cents 
an ounce, or $2.1 million per acre-foot. And at that price, I 
would be happy to solve the water problems of southern New 
Mexico. A shortage has meaning only in relation to price.
    All of these factors are important determinants of the 
demand for water, but it is safe to say that very few people 
would be interested in regional water issues if the regional 
population were declining instead of growing rapidly. Recent 
census data indicate that the population of the region is now 
just slightly over 2 million people, 1.2 million in Ciudad 
Juarez, right at 700,000 in El Paso, and 180,000 in Dona Ana 
County.
    Consistent with historical trends, the region's population 
continues to grow rapidly. Chart 1 that you have in front of 
you has some population growth rates there.* At current growth 
rates, the region's population is increasing by about 75,000 
people a year. In other words, this three-county area, if you 
like, is adding a city about the size of Las Cruces annually, 
and that is certainly going to be a big issue in water-related 
issues.
---------------------------------------------------------------------------
    * The charts have been retained in committee files.
---------------------------------------------------------------------------
    Detailed population projections based on the 2000 census 
data have not been completed yet. There are a variety of 
organizations that do that, including New Mexico State 
University, the University of New Mexico, the city of El Paso, 
Ciudad Juarez, but no one has completed the detailed 
projections yet. But if we take a very simple approach and use 
the growth rates of the 1990's, the population of the region 
would increase to about 4.5 million people by the year 2025. 
Four and a half million people in the area is going to change 
the way we look at water issues, I think.
    Yet there is also a great deal of evidence that uncertainty 
is the key to looking at population growth in the region. There 
are several reasons for this uncertainty. First, population 
projections of a region are inherently more difficult than 
population projections of larger areas. At the world level, of 
the three components of demographic change, births, deaths, and 
migration, at the world level we do not have to worry about net 
migration. Given current technology, we are not exporting 
people to Mars yet. So that leaves births and deaths, and yet 
the best projections of the world population from the United 
Nations suggest a tremendous range of 7.3 billion to 10.7 
billion by the year 2050.
    Similar variation in the projections of the United States 
and Mexico appear in the projections of those two nations. The 
U.S. population projected from the U.S. Census Bureau, those 
population projections range from 280 million to almost 500 
million by the year 2050. In Mexico, there is a similar broad 
range from about 135 million to nearly 275 million.
    The difference in those projections, both in the United 
States and Mexico, is migration, migration, and migration. The 
fertility and mortality assumptions do not make a lot of 
difference to those projections.
    At the regional level, we have inherently even more 
uncertainty about what the population will be. A range of 
somewhere between 3 and 6 million by the year 2025 in the 
three-county region is probably a pretty good guess.
    A second reason for uncertainty is the aging of the 
population. People in this room, of course, are immune to that, 
but nationally in both Mexico and the United States, the 
population is aging. An older population will have fewer births 
and more deaths than a younger population of similar size. So 
we are going to see a slowdown both nationally and within the 
region of population growth that is due to natural increase, 
the excess of births over deaths. That is almost inevitable.
    If you look at the charts, I have given you two population 
pyramids there. The first one is from 1900 of the United 
States. And in 1900, nearly all populations had this classic 
pyramid shape. Most people were in the younger age groups. 50 
percent were below the age of 20. In 1900, nearly all 
populations looked like that.
    The next chart is one of my favorites and usually gets a 
little bit of a chuckle. That is Sun City, Arizona, in 1990, 
and that is sort of an exaggerated look at where we are all 
headed. Median age in Sun City is 74, and a place like that has 
very little demographic momentum, the tendency of the 
population to grow due to its age and sex structure.
    Now, the point on the aging of the population, we are 
getting older in the region as well. In New Mexico we now have 
a median age of 34.6 years, very, very close to the national 
median of 35.3 years. Historically, we had a very young 
population. As we age, our population growth rate in New Mexico 
is going to slow down. In Dona Ana County, the median age is 
now 30 years. In El Paso it is 30 years. In Ciudad Juarez, the 
median age is 23 years. And so we are going to see this decline 
in natural increase of the population both from reduced crude 
birth rates and increased crude death rates.
    A third source of demographic uncertainty is that regional 
migration patterns are highly sensitive to economic conditions. 
Economists always indicate that people move from areas of high 
unemployment and low income to areas of low unemployment and 
high income. Economic conditions matter.
    But when it comes to projecting the population, we would 
have to project those economic variables at the regional level. 
We would have to predict employment growth, unemployment rates, 
income levels, the growth of income relative to other areas. 
That is a very difficult job. It is a difficult job even at the 
national level, and I am sure Mr. Greenspan would confirm that. 
So we have a great deal of uncertainty added by economic 
uncertainty in the future as well.
    A fourth source of uncertainty regarding the future 
population of the area has to do with the national policy 
context. Unlike Mexico, the United States has no national 
population policy, but we have a lot of policies that do affect 
the growth of population and will affect the growth of 
population in the region. Immigration policy, currently being 
debated in Washington, is an obvious example. But there are 
many, many others. We have tax deductions for children in the 
income tax code. We have educational subsidies. Trade policy 
can even affect population growth in the region. NAFTA has 
certainly affected the region's population growth. The 
possibility of a North American common market would change that 
equation as well.
    Transportation and land use policies at the local level and 
State level. Tax policies may change population growth. The 
list is a long one. But the key point is that the national, 
State, and local policy context add even greater uncertainty to 
the demographic situation in the region.
    I will conclude with some very brief comments. A reasonable 
range of population for the year 2025 for the region is 
somewhere between 3 and 6 million people. No one knows what 
that figure is going to be. Rational water planning in the 
region requires a recognition that we do not know what that 
figure will be. We should plan both for the high and the low 
figure.
    Thank you very much. I will be happy to answer questions.
    The Chairman. Thank you very much, both of you. Let me just 
ask a few questions here.
    Karl, in your testimony you sort of gave us some of the 
facts on the water supply and quality in the various 
underground aquifers. I have read some of these reports, which 
I am sure you have read as well, about the rate at which the 
groundwater is being depleted, particularly in Juarez. And one 
projection was that Juarez groundwater could be depleted to a 
point where by the year 2005, they would no longer be able to 
get the water from the current sources.
    What is your projection as to groundwater depletion in 
Juarez? Is that something that you are able to measure and 
monitor and make projections on or not?
    Mr. Wood. Well, the people and the authorities in Juarez 
are doing that. We feel that they are putting down more wells 
and they are doing a better job in collecting more data each 
year. 2005-06 is a number that comes up often. It is a scary 
number. It is not that they will be out of water. Their water 
would be more difficult to obtain and it will be of a lower 
quality to where by that time, they would like other sources.
    The Chairman. To what extent is there binational 
cooperation? I gather there is dispute between our projections 
about water depletion and Mexico's projections about water 
depletion here in the same area. To what extent are we 
cooperating between the two countries in the testing and 
development of the information that goes into those 
projections?
    Mr. Wood. We are in the infancy in cooperation, 
cooperation, but we have several efforts that have been 
started. The BECC group, with Fernando Macias, is off and 
running in a project to do this. The Paso Del Norte Water Task 
Force, which is a group of academics with Mexico, west Texas, 
and southern New Mexico, also have efforts to look into this. 
The New Mexico/Texas Water Commission and its Watershed Council 
are looking into this.
    They are efforts that are relatively new, relatively short 
in funds right now, but with much potential for the future. And 
I think we are off starting to do that, but we are a bit of a 
ways away from having a real good handle on what is available 
and where.
    The Chairman. It would seem to me that a first obvious step 
in trying to get a better cross-border cooperation in dealing 
with potential water shortages would be a good sort of 
monitoring ongoing assessment effort that involved both 
countries. Am I right in thinking that way?
    Mr. Wood. You are absolutely right.
    The Chairman. And if you do not have that in place, 
everything else will sort of falter because everyone has a 
different idea of where they are?
    Mr. Wood. That is right, exactly.
    The Chairman. You say a lot more is needed in that regard?
    Mr. Wood. I feel that is correct.
    The Chairman. Okay. Let me ask you about this map that you 
have here attached to your testimony. There is a map showing 
the Mesilla Basin, and I think you indicated in your testimony, 
as I understood it, that that is the main source of water for 
Las Cruces and for Dona Ana County. It also goes over into 
Mexico. To what extent is Mexico using water from the Mesilla 
Basin?
    Mr. Wood. I do not believe they are using much right now, 
but the potential is there to use quite a bit.
    The Chairman. Do you know if they have plans to do that?
    Mr. Wood. Yes, they do.
    The Chairman. Do you know anything more specific about 
their plans?
    Mr. Wood. I am sorry, I do not.
    The Chairman. The water there in the Tularosa Basin, I have 
always thought that that was, at least up around Alamogordo and 
Tularosa and that area, the water was so saline, or brackish, 
that it really was not usable for any kind of municipal or 
industrial use. Am I wrong about that?
    Mr. Wood. Well, it can be used if it is diluted. And that 
is why water from the Bonito Lake is brought around the 
mountain and taken to Alamogordo and it is diluted with the 
local water. So it is somewhat usable. In its raw form, no, you 
would not want to drink it. You would chew it rather than drink 
it. But it can be diluted and used.
    The Chairman. But I understand, from what you are saying, 
that the same aquifer is much less saline when you get further 
south?
    Mr. Wood. That is right.
    The Chairman. And El Paso is able to use that water?
    Mr. Wood. Right. And also when you get towards the edges of 
the bolson, it is more usable.
    The Chairman. One of the charts, Professor Peach, that you 
have here shows Las Cruces per capita income as a percentage of 
U.S. per capita income. That is not something you talked about, 
but you have got a chart here. And I was struck by how this has 
dropped over the years. I do not know, I cannot tell from this 
chart, my eyesight is not good enough to tell what years you 
are covering here. But it looks like you are starting----
    Mr. Peach. I have a larger copy if you would like.
    The Chairman. You are starting up around 75 percent of U.S. 
per capita income, and then we are ending up at the end of the 
chart down close to 60 percent.
    Mr. Peach. I skipped that chart. It is a rather dramatic 
chart. It is a chart that looks similar if we look at almost 
any of the U.S./Mexico border counties. It is a chart that 
starts in 1969, which is the first year that the Bureau of 
Economic Analysis produced income figures at the county level. 
And it shows a steady deterioration of per capita income in 
Dona Ana County--El Paso County looks the same, so do the other 
border counties--since 1969, right up through 1999 relative to 
the Nation.
    It does not mean that per capita income has been declining 
all those years. It simply means that relative to the national 
figure, we have been declining. And, you know, NAFTA did not 
interrupt that trend. Nothing----
    Mr. Bingaman. Did it contribute to the trend?
    Mr. Peach. I do not think so. It is a trend that started 
long before NAFTA was implemented. I can remember providing 
testimony in Washington, D.C. almost 20 years ago in a 
committee saying that I suspected in 20 years, the trend would 
still be there. The border counties would have low per capita 
income relative to the Nation.
    In the current context, that has a lot of importance, both 
in terms of attracting population from other areas, it will 
change water demand, but also because income level is a prime 
determinant of water demand.
    The Chairman. You mean the higher a person's income, the 
more water they use?
    Mr. Peach. You bet.
    The Chairman. So you are saying that if, in fact, we had 
not declined substantially in our per capita income relative to 
the rest of the country since 1967, we would be using a lot 
more water than we are today.
    Mr. Peach. I suspect so
    The Chairman. So as we make progress in improving the 
economy, we are going to dig ourselves into a deeper hole as 
far as water?
    Mr. Peach. We are going to consume more water. Poor people, 
generally speaking, do not build a lot of golf courses, and 
other high-use kinds of water things. If we had very high 
income in the area, we would use more water.
    The Chairman. Do you see anything that is going to reverse 
or affect this trend of lower per capita income as a percent of 
U.S. per capita income?
    Mr. Peach. I do not.
    The Chairman. You think it will continue to drop?
    Mr. Peach. Drop or remain about the same over the next 
decade or so. I have spent a long time studying the U.S./Mexico 
border economy, and as you know, the border economy is a very 
complex place. But I do not see anything on the horizon that is 
going to change those trends, either in Dona Ana County or in 
El Paso County.
    It may level off a little bit simply due to the change of 
the age distribution of the population. Historically, we have 
had a very, very young population. Young people do not enter 
the labor force at the high end of the wage scale. They enter 
the labor force at the low end of the wage scale. So as we get 
older, we are going to perhaps improve a little bit. But we 
need much more than that to reverse this kind of a trend.
    The Chairman. Let me ask you. I do not know if you have 
gotten down to this level of specificity, Professor Peach. Have 
you done any research into the trends with the agricultural 
economy in this part of the State, as to whether or not it has 
improved, declined, remained the same?
    Mr. Peach. No, I have not. The one minor exception, I do 
look at industrial structure up and down the border. Pretty 
generally, agricultural employment in the area, in Dona Ana 
County, has remained relatively constant. It has been declining 
somewhat in El Paso County. And I could get those figures for 
you easily enough because El Paso County, of course, now the 
urban area is absorbing most of the land area of El Paso.
    But I am not an agricultural economist and have not really 
studied the agricultural sector.
    The Chairman. Let me ask Karl just another question or two 
about your chart. When you look at this chart showing the 
various underground aquifers that are available for use by 
municipalities, industrial customers, agriculture here in this 
region, the only surface water is the Rio Grande, and you have 
these particular underground aquifers. Are there others in 
Mexico that are close enough to be useful to a metropolitan 
area like Juarez?
    Mr. Wood. Yes, there are other aquifers, specifically one 
called the Bismark aquifer, which is further away from--it is a 
ways away from Juarez, and they are exploring those presently 
as potential sources for the future.
    The Chairman. But they do not currently obtain any of their 
water out of that aquifer?
    Mr. Wood. I do not believe so.
    The Chairman. Well, this is useful. I appreciate the 
testimony by both of you. And we will go on to the second 
panel, then. Thank you very much.
    Did Kevin Bixby show up here? He was going to be on the 
first panel. He has not, so we will go to the second panel. 
Mayor Smith, Ruben, come right ahead, Gary Esslinger, John 
Burkstaller and Edd Fifer.
    Just so that everyone is clear, once we hear from this 
panel and ask questions, Tom Turney, who is the State engineer 
for New Mexico, I wish to go ahead with his testimony, and 
we'll do that as well this morning.
    So let me just start. First let us hear from our good 
mayor, Mayor Ruben Smith, mayor of the city of Las Cruces, 
welcome. Thank you for being here.

              STATEMENT OF RUBEN A. SMITH, MAYOR, 
                     CITY OF LAS CRUCES, NM

    Mr. Smith. Thank you very much for the invitation and we 
thank you very much for coming to Las Cruces, as usual, and I 
will be looking forward to listening to you during the lunch 
today, also.
    I wanted to make just a little apology. I was sitting next 
to Gary Esslinger and it looked like everyone was turning 
through copies. I said, Gary, were we supposed to have copies? 
He said, You are supposed to have 15 copies. And we did not get 
that memo, evidently, so we are preparing it to bring.
    The Chairman. Not a problem.
    Mr. Smith. But my presentation, you do not even need 
copies, Senator. It is going to be at a level to where I think 
anybody walking in without any background in water could 
understand and hopefully appreciate the level that we are at 
right now.
    Overall, I think it is important to note we are talking 
about the Rio Grande surface water, we are talking about 
groundwater, and everybody has talked very nicely about the 
different aquifers that we collectively pump from. I think it 
is important to understand that about 85 percent of the water 
that is used is from the river, most of it being for 
agricultural use. And these are round percentages. About 15 
percent of the water used is groundwater.
    Now, historically, the city of Las Cruces has always pumped 
from the ground. We have not used surface water up to this 
point. And I will get to that at the end of my presentation.
    But several years ago, we realized that we, as a 
municipality, were facing challenges that many other 
municipalities in the southern part of the State were facing. 
We were not necessarily in crisis situation, but we realized 
that we were going to have to be taking some actions to face 
those challenges or problems.
    And to put it in perspective, the city of Las Cruces has, 
to its credit right now--I am thankful that Tom Turney is here, 
because I am going to lobby him just a little bit more. Right 
now, presently, the city of Las Cruces has 22,000 acre-feet of 
water that we are utilizing, that we are able to utilize. We 
are pumping and using about 20,000 acre-feet. It does not take 
a mathematician or a brilliant mayor to tell you that that is 
only about a 10 percent cushion, and we are living kind of 
right on the edge.
    So I cannot pick on Tom Turney today, because it would go 
back to 1981 that we made applications for an additional 14,000 
acre-feet from one of the basins that was described earlier 
called the Jornada Basin. That is a basin that there is very 
little recharge. And this is something that we have changed the 
direction from our 40-year master plan as a city, where we were 
solely depending on groundwater. So temporarily, what I am 
telling you is that we have enough water. With the additional 
14,000 acre-feet, that will get us into the future.
    And what we have done in addition to that, to couple to 
that, is that we have taken some conservation steps. First of 
all, we have developed what they call an inclining block rate 
that truly just means the more water you use to water your 
lawns, the more you are going to pay for it, and you pay for it 
dearly. We have gone to the same system at that time the city 
of El Paso does, and I think the city of Albuquerque, 
alternating days. If you live on one side of the street, it is 
every other day of the week, and the same thing on the opposite 
side of the street.
    We have also, by doing those conservation issues, we have 
cut down, a reduction by about 10 percent of the water that is 
being used. And after about 4 years, we are approaching the 
1995 amount of water that we were using.
    Along with that, the city has taken to replace most of the 
water meters so that we can reduce the unaccountable water that 
we have had over the years, and we are doing that every seven 
years. And this will save an additional 5 to 10 percent, we are 
computing, on that.
    That is what we have done kind of in a reactive mode. In 
terms of a proactive stance, we have taken three different 
steps. First, we have lobbied the State engineer. And I spoke 
to Tom Turney as we came in this morning and he said the 
application for the 14,000 acre-feet looks very good. The 
numbers might not be what we would like--and he did not tell me 
exactly what that meant--but I am optimistic that we can 
resolve the 14,000 acre-feet.
    I was hoping he would give us a gift by September. But for 
sure, it looks like it will be before the end of the year. And 
that is something very critical that we have been working on. 
That is the first thing that we have done.
    The second thing that we have done is to establish a 
relationship, and we did receive the memo from your staff 
regarding a relationship between the agricultural community and 
the municipalities. What I can tell you without a doubt is that 
we have established a communication system, not only 
communication system, but a working system, with our neighbors 
to the south. Both municipalities belong to this organization, 
both universities, both irrigation districts.
    And I can tell you that it has not been an easy step to 
take, because this has never been done in the past. But I can 
tell you that it has been one of the most positive challenges 
that I think all of us collectively have taken. And I can tell 
you it is been something that has been very, very fruitful to 
us.
    One other thing that I would like to say is that we have 
formed a Lower Rio Grande Water Users Organization that is 
comprised of essentially everybody, including municipal water 
organizations, the university, different municipalities, so 
that we could have one unified voice when it comes to going to 
Santa Fe to lobby for funds, and that has proved to be very 
successful.
    And I have got to thank Tom Turney, because it is actually 
through his, not insistence, but his encouragement. He threw 
out, said something, mayor, you need to speak with one voice as 
opposed to everybody going individually to lobby Santa Fe. And 
that has been very, very beneficial to all of us down here.
    We have an agreement with EBID that I think Gary Esslinger 
will probably get more into detail, but it deals with transfers 
of agricultural use of water for municipal purposes. And the 
nice thing about this, it is the first of its kind in the 
State.
    The third proactive step that we have taken is dealing with 
the transfer system to facilitate the water from the 
agricultural to municipal and industrial purposes. We have also 
been extremely active in the adjudication process, and this is 
so that--I think everybody will understand that the negotiation 
process is going to be a very, very difficult one, and the 
presence of a city is absolutely critical in the resolution of 
that.
    The only thing, Senator, I would like to end in saying is I 
started out with telling you that the city of Las Cruces has 
essentially pumped water since the inception of our founding. 
What we have done over the years is collectively gone to 
Washington to lobby, in particular, the EPA. Do not hold me to 
the year, but about 4 or 5 years ago we went hand-in-hand and 
we lobbied along with the city of El Paso and irrigation 
district for, if I recall, it was a little bit over $2 million 
so that El Paso could receive funds to build, if I recall, an 
additional surface water treatment plant.
    We did that because we felt very strongly that the city of 
El Paso was at the position, a far more critical position than 
what the city of Las Cruces is. But when we did that, we had an 
agreement and an understanding that approximately 10 years in 
the future, the city of Las Cruces will be in line to build our 
first surface water treatment plant. We feel very strongly 
about that because the question was asked about the water 
situation in El Paso and Juarez.
    We do not feel we are as critical here, but we can no 
longer just sit back and hope that there is plenty of water to 
be pumped up. So what we are doing is doing a very visionary 
thing, and that is working with our colleagues to the south so 
that in 10 years, they will be supporting us when we go back 
for funding for our first water treatment plant.
    And that is basically my comments.
    [The prepared statement of Mr. Smith follows:]

  Prepared Statement of Ruben A. Smith, Mayor, City of Las Cruces, NM

    Five years ago, the City of Las Cruces was in a situation that many 
municipalities in New Mexico are in at the present time. We are facing 
some major problems associated with water supply and did not realize 
the gravity of that situation. Do not misinterpret those statements. We 
were not in a crisis situation, but could have been had we not taken 
immediate action. The problems were:
    1. We were utilizing 20,000 acre-feet of our 22,000 acre-feet water 
right, leaving one of the fastest growing cities in the State with only 
a 10% cushion for water supply.
    2. Applications for an additional 14,000 acre-feet per year of 
water from the Jornada Basin had been sitting in a pile of paper on the 
State Engineer's desk since 1981.
    3. The City's forty-year master plan relied solely on groundwater 
pumping with the increase coming from a mined basin (the Jornada) that 
has very little recharge. When Council became aware of these issues, 
action was taken immediately to remedy the problems.

          a. A conservation plan was developed and adopted. This plan 
        included an inclining block rate for water consumption, lawn 
        watering restrictions, and other conservation measures. This 
        relieved the immediate crisis as water consumption was reduced 
        by 10% almost immediately. After four years, the total 
        consumption is now approaching that of 1995.
          b. Water meter replacement and line repairs have accelerated 
        to reduce unaccounted for water. This will save an additional 
        5-10% in the future.

    Those were reactionary measures to avert a crisis. We then became 
proactive to solve a problem and address future needs.
Proactive #1
    We lobbied the State Engineer, the Governor, and the legislature 
for action on these pending applications. Those efforts have paid off. 
We have been promised a decision this fall (after 20 years).
Proactive #2
    We evaluated our position on future supply and determined that we 
should maximize our groundwater right, but plan to utilize surface 
water to accommodate future growth.
    1. We amended and enlarged our groundwater right declarations.
    2. Most importantly, we began to develop a positive relationship 
and later a partnership with the irrigation district. We went to the 
legislature together, and initiated legislation to increase the lease 
term and later to form Municipal Water Users Organizations (MWUA) 
within irrigation districts. We have entered into agreements with the 
EBID that are the basis of transfers from agricultural use of water to 
municipal use of the same water, the first of its kind in the State. 
Only last week, the EBID board of directors approved a new policy for 
MWUA. This policy was the result of eight months of negotiations 
between the City and the District. (Steve Hernandez has or will address 
that policy).
    3. We are now in the process of amending our forty-year plan to 
reflect this move to surface water and to determine when and how it 
will occur. (The action of the ongoing adjudication will have a large 
influence on timing).
Proactive #3
    Water supply is an ongoing effort as is community growth and 
development. For those reasons, our efforts will continue. We are 
working to develop a transfer system that will not inhibit or delay the 
transfer of water from Agriculture to Municipal and Industrial 
purposes. This may be done through negotiations, or the courts, but it 
will be pursued by the City.
    We are becoming very active in the adjudication process. As the 
second largest City in the State of New Mexico, we are responsible to 
provide water to 80,000 citizens.

    The Chairman. Thank you very much. Appreciate those 
comments.
    John Burkstaller, who is the chief technical officer with 
the El Paso Water Utilities. Thank you very much for coming.

 STATEMENT OF JOHN BURKSTALLER, P.E., CHIEF TECHNICAL OFFICER, 
          EL PASO WATER UTILITIES PUBLIC SERVICE BOARD

    Mr. Burkstaller. Thank you very much for inviting us. I am 
not going to be quite as extemporaneous as Mayor Smith was. He 
did an excellent job. But I want to go through some issues that 
we think are very important, and I have brought some written 
testimony with me.
    El Paso Water Utilities is the regional planner and 
provider of water and wastewater services to over 700,000 
people in the El Paso County area. Our combined regional 
population--and I missed Professor Peach's talk--but I am 
sure----
    The Chairman. Pull that microphone a little closer.
    Mr. Burkstaller. Our combined regional population, 
including the city of Juarez, is over 2 million now, and it is 
expected to grow substantially, as I am sure Professor Peach 
elaborated on earlier. Along with that, of course, is going to 
be the demand for additional water and wastewater service.
    We face a very serious problem of increased demand for 
water service while our groundwater aquifers, that are the bulk 
of our supply, are being rapidly depleted. The aquifers, or 
bolsons, provide approximately 57 percent of the city's water 
needs and 100 percent of Juarez's water needs.
    Juarez currently draws water from the southern end of the 
Hueco Bolson, while El Paso draws water from both the Hueco and 
the Mesilla. Southern Dona Ana County also relies heavily on 
water from the Mesilla, and Juarez plans to develop wells in 
the southern end of that aquifer in Mexico, which they call the 
Conejos Medanos.
    The committee is familiar with the challenge that we face 
in extending the life of these aquifers by identifying and 
developing new replacement sources of supplies. We also need to 
conserve and make the best use of these resources, and we need 
to partner with other entities within the region to identify 
bistate and binational solutions.
    The challenges are formidable given the complex political, 
jurisdictional, environmental, legal and technical issues. 
Sufficient water is available to sustain this expected 
population growth, but the costs of ensuring an adequate water 
supply are going to be high. Given the low per capita income of 
the region, we will need major Federal support to implement 
these solutions.
    El Paso Water Utilities is actively engaged in a number of 
initiatives, including construction of a 20-million-gallon-per-
day desalination plant. If we are able to team with Fort Bliss, 
it may start out at 29 MGD, which would be the largest inland 
facility in the nation.
    We are also involved in expansion of the reclaimed water 
programs and joint water resource planning with Juarez and with 
southern New Mexico, southern Dona Ana County, supported by the 
Border Environment Cooperation Commission. We are also looking 
at the possible importation of ground and surface water from 
outlying areas.
    Virtually all these initiatives require substantial 
investments in infrastructure. We estimate that El Paso Water 
Utilities, even with our new per capita consumption goal of 140 
gallons per capita per day, which is probably the lowest in the 
United States, perhaps Tucson is quite close, but we are one of 
the lowest per capita consumption rates in the country.
    Even with this conservation goal, we'll still have to spend 
approximately $900 million over the next 10 years to address 
all of our water supply issues, as well as deal with water 
quality issues such as the new upcoming arsenic drinking water 
limit. Although we are proceeding rapidly----
    The Chairman. What's the arsenic level in your drinking 
water?
    Mr. Burkstaller. On the Hueco side, it runs slightly less 
than 10. On the Mesilla side, it averages 16, but some of the 
wells are up in the 20s. We have got a cost estimate right now 
of about $90 million to comply with 10, maybe somewhat reduced 
by the new technologies.
    Although we are proceeding rapidly ahead with desalination 
and reuse projects, the ultimate source of sustainable water 
for the region is obviously the Rio Grande. All other available 
supplies are both very expensive and exhaustible. These 
alternative supplies should be kept in reserve for drought and 
peak demands. Sensible regional water planning requires that 
the Rio Grande water be made available to meet municipal 
demands.
    El Paso engaged in many years of litigation with entities 
in southern New Mexico over the right to export groundwater. In 
principle, we won. New Mexico cannot prohibit exportation. 
However, along with that decision, New Mexico has the right to 
impose conditions on export that led to continuing legal 
battles, or at least potential legal battles, and the parties 
involved ultimately agreed to a settlement. The settlement was 
based on optimizing the use of the Rio Grande Project surface 
water and developing mechanisms for transferring water rights, 
or rights to use water, to provide additional municipal supply.
    As a result of this settlement, New Mexico State 
University, UTEP, the cities of El Paso and Las Cruces, Dona 
Ana County also was involved, both irrigation districts, the 
bureau, the International Boundary and Water Commission, and 
others were involved in probably 10 years and many million 
dollars' worth of water resources planning, which culminated 
with the recommendation of the El Paso-Las Cruces Regional 
Sustainable Water Project. The sustainable project developed a 
comprehensive plan for maximizing use of surface water during 
times of abundance, treating and delivering it for current 
municipal needs, and banking the excess for times of shortage.
    An approved environmental impact statement authorizes us to 
proceed with the project, but we cannot do that. Successful 
implementation of the project depends on the availability of 
Rio Grande water, and additional Rio Grande water is currently 
not available in the city of El Paso.
    The problem is not insufficiency of supply. Records of the 
bureau show that in recent years, the Rio Grande water supply 
has exceeded the needs of the agricultural users, and water has 
gone unused while municipalities are forced to depend on 
shrinking groundwater sources. Since 1995, an average of almost 
73,000 acre-feet has been left in the reservoir each year 
unused by the New Mexico or Texas districts after all 
irrigation demands have been met. Annually, the amount has 
ranged from 36,000 to over 100,000 acre-feet.
    These surpluses, which occur in non-drought years, are 
partially available for reallocation in subsequent years. They 
are not totally lost for the system. But we believe that they 
are part of the potential solution for municipal use. With 
them, we can preserve the bolsons for future drought periods, 
which will surely occur.
    There is more than enough water to supply the sustainable 
water project in full-allotment years without taking any water 
away from agricultural uses. But making it available requires 
the cooperation of two irrigation districts and the Bureau of 
Reclamation. Unfortunately, this cooperation has been lacking.
    Instead, we see precisely the opposite pattern. The bureau 
has refused to honor water rights contracts between El Paso 
Water Utilities and El Paso County Improvement District Number 
1, contracts that would have allowed El Paso to significantly 
reduce its dependence on the bolsons. Reclamation has also 
refused to approve water rights contracts between the district 
and our wholesale customer, the Lower Valley Water District.
    In similar fashion, reclamation and EP-1 have chosen to 
pursue very strict interpretations of our existing water rights 
contracts. This resulted in El Paso losing over 13,000 acre-
feet of water rights that the EP-1 had historically honored and 
credited for our use. We bought some of that back at a much 
higher rate, but did not recover all of it.
    Although New Mexico statutes no longer prohibit the export 
of water, they continue to prevent us--let me--interstate 
cooperation is really no better. That is the point. Although 
the statutes no longer prohibit the export of water, they 
continue to present a severe obstacle to the sale of New Mexico 
water to El Paso, even water in excess of New Mexico's existing 
demand.
    If our goal is to use available water resources for the 
maximum benefit of the citizens of the region, our current 
legal and political structure fails to achieve this goal. 
Available water from the Rio Grande is going unused while 
municipalities continue to deplete limited groundwater sources 
and contemplate development of costly alternative supplies. 
Farmers who might welcome the opportunity to periodically sell 
their irrigation water to the municipalities are prohibited 
from doing so by the Bureau of Reclamation and the districts.
    We believe that good solutions exist and are achievable 
through regional cooperation. We believe that Rio Grande water 
can be made available through conservation and through 
establishing a voluntary water market that would allow 
irrigators to sell water to municipalities. This can be 
accomplished without disruption of the agricultural economy. 
Normal municipal development retires agricultural land make 
additional water available.
    Conservation through lining of canals has already made 
thousands of acre-feet of conserved water available. Additional 
canal lining and other agricultural conservation practices can 
make more water available. A practical forbearance or water 
marketing program workable for both the city of El Paso as a 
dependable source of water and El Paso Water Improvement 
District Number 1, farmers, as a source of revenue should be 
implemented.
    Political and institutional constraints, whether within the 
irrigation districts, across State lines or imposed by the 
Federal bureaucracy, should not be allowed to limit development 
of a market which puts water to the highest value beneficial 
use. The United States, both through its laws and agencies, 
should facilitate making Rio Grande water available.
    The municipalities, the farmers, the irrigation districts, 
the Bureau of Reclamation, and most importantly the citizens of 
the region will all benefit from a system which allows the 
water to be marketed to its highest use. We solicit the 
committee's support in making this a reality. We are confident 
that the region's water and wastewater issues can be addressed 
to ensure both thriving municipal and agricultural communities.
    That's it, and I expect it to generate quite a few 
questions.
    [The prepared statement of Mr. Burkstaller follows:]

Prepared Statement of John Burkstaller, P.E., Chief Technical Officer, 
              El Paso Water Utilities Public Service Board

    My name is John Burkstaller, and I am the Chief Technical Officer 
for the El Paso Water Utilities--Public Service Board. El Paso Water 
Utilities is the regional planner and provider of water and wastewater 
services to over 700,000 people in the greater metropolitan area of El 
Paso. Our combined regional population, including the City of Juarez, 
is over two million. The population within the region continues to grow 
and is expected to double in the next 20 years, as is the demand for 
water and wastewater service.
    Our region faces a very real and very serious problem. Concurrent 
with the expected increase in population and increased demands for 
water service, our local groundwater aquifers are being rapidly 
depleted. The aquifers or bolsons provide approximately 57% of our 
City's water needs and 100% of the water needs for the City of Juarez, 
Chihuahua, Mexico. Juarez currently draws water from the southern end 
of the Hueco Bolson, while El Paso draws groundwater from both the 
Hueco and Mesilla Bolsons. Southern Dona Ana County also relies heavily 
on water from the Mesilla Bolson, and Juarez plans to develop wells in 
the southern end of this aquifer, which they call the Conejos Medanos, 
in the near future.
    The Committee is familiar with the challenge we face of extending 
the life of these aquifers by identifying and developing new sources of 
supply, conserving and making the best use of our existing resources, 
and partnering with other entities within the region to identify bi-
state and bi-national solutions to the region's water problems. The 
challenges are formidable given the complex political, jurisdictional, 
environmental, legal, and technical constraints in each area. 
Sufficient water is available to sustain the expected population 
growth, but the costs of ensuring an adequate water supply are going to 
be high. Given the low per capita income of the Region, we will need 
major federal support to implement these solutions.
    El Paso Water Utilities is actively engaged in a number of 
initiatives including construction of a 20 million gallon per day 
desalination plant, continuing improvement of our conservation efforts, 
the planned expansion of reclaimed water programs, joint water resource 
planning with Juarez supported by the Border Environment Cooperation 
Commission (BECC), and the possible importation of ground and surface 
water from outlying areas. Virtually all of these initiatives require 
substantial investments in infrastructure. We estimate that El Paso 
Water Utilities, even with our new per capita consumption goal of 140 
gallons per day, perhaps the lowest in the Southwestern United States, 
will have to expend approximately $900 million dollars over the next 
ten years to address all of our water supply issues as well as deal 
with increased water quality regulation, such as implementation of the 
new arsenic drinking water limit.
    Although we are proceeding rapidly ahead with desalination and 
reuse projects, the ultimate source of sustainable water for the region 
is the Rio Grande. All other available supplies are both very expensive 
and exhaustible. These alternative supplies should be kept in reserve 
for drought and peak demands. Sensible regional water planning requires 
that Rio Grande water be available to meet municipal demands.
    El Paso engaged in many years of litigation with entities in 
Southern New Mexico over the right to acquire and export groundwater. 
In principal we won--New Mexico cannot prohibit the exportation of 
groundwater. However, New Mexico's right to impose conditions on the 
export lead to continuing legal battles, and the parties ultimately 
agreed to a settlement. This settlement was based on optimizing the use 
of Rio Grande Project surface water and developing mechanisms for 
transferring rights to use water to provide additional municipal 
supply. As a result of the settlement, New Mexico State University, the 
University of Texas at El Paso, the cities of El Paso and Las Cruces, 
both irrigation districts, the Bureau of Reclamation and the 
International Boundary and Water Commission and others were all 
involved in ten years and many millions of dollars worth of water 
resources planning which culminated with recommendation of the El Paso-
Las Cruces Regional Sustainable Water Project. The Sustainable Water 
Project developed a comprehensive plan for maximizing use of surface 
water during times of abundance treating and delivering it for current 
municipal needs and banking the excess for times of shortage. An 
approved Environmental Impact Statement authorizes us to proceed with 
the project, but we cannot. Successful implementation of the project 
depends on the availability of Rio Grande water--and that water is not 
currently available to the City of El Paso.
    The problem is not insufficiency of supply. Records of the Bureau 
of Reclamation show that in recent years the Rio Grande's water supply 
has exceeded the needs of agriculture and water has gone unused while 
municipalities are forced to depend on shrinking groundwater resources. 
Since 1995, an average of almost 73,000 acre-feet of water have been 
left in Elephant Butte Reservoir each year, unused by the New Mexico or 
Texas irrigation districts after all irrigation demands have been met. 
Annually the amount has ranged from 36,000 acre-feet to over 100,000 
acre-feet. These surpluses, which occur in non-drought years, and are 
partially available for reallocation for use in subsequent years, 
should be available for municipal use. With them we can preserve the 
bolsons for future drought periods which will surely occur. There is 
more than enough water to supply the Sustainable Water Project in full 
allotment years without taking any water away from agricultural uses, 
but making it available requires the cooperation of two irrigation 
districts and the Bureau of Reclamation. Unfortunately, such 
cooperation has been lacking.
    Instead, we see precisely the opposite pattern. The Bureau of 
Reclamation has refused to honor water rights contracts between El Paso 
Water Utilities and El Paso County Water Improvement District #1 (EP 
#1), contracts that would have allowed El Paso to significantly reduce 
its dependence on the bolsons. Reclamation has also refused to approve 
water rights contracts between the District and our wholesale customer, 
the Lower Valley Water District. In a similar fashion, Reclamation and 
EP#1 have chosen to pursue very strict interpretations of existing 
water rights contracts. This resulted in El Paso losing over 13,000 
acre-feet of water rights that the EP #1 had historically honored and 
credited to either El Paso Water Utilities or the Lower Valley Water 
District. Interstate cooperation is no better. Although New Mexico 
statutes no longer prohibit the export of water, they continue to 
present a severe obstacle to the sale of New Mexico water to El Paso, 
even water that is in excess of New Mexico's existing demand.
    If our goal is to use available water resources for the maximum 
benefit of the citizens of the region, our current legal and political 
structure fails to achieve this goal. Available water from the Rio 
Grande is going unused while municipalities continue to deplete limited 
groundwater resources and contemplate development of costly alternative 
supplies. Farmers who might welcome the opportunity to periodically 
sell their irrigation water to municipalities are prohibited from doing 
so by the Bureau of Reclamation and the irrigation districts.
    We believe that good solutions exist and are achievable through 
regional cooperation. We believe that Rio Grande water can be made 
available through conservation and establishing a voluntary water 
market that would allow irrigators to sell water to municipalities. 
This can be accomplished without disruption of the agricultural 
economy. Normal municipal development retires agricultural land, making 
additional water available. Conservation through lining of canals has 
already made thousands of acre-feet of ``conserved water'' available. 
Additional canal lining and other agricultural conservation practices 
can make more water available. A practical ``forbearance'' or water 
marketing program, workable for both the City of El Paso as a 
dependable source of water and for the EP #1 farmers as a source of 
revenue, should be implemented. Political and institutional 
constraints--whether within the irrigation districts, across the state 
lines, or imposed by the federal bureaucracy--should not be allowed to 
inhibit development of a market which puts the water to its highest 
value beneficial use. The United States, both through its laws and its 
agencies, should facilitate making Rio Grande water available for 
municipal use. The municipalities, the farmers, the irrigation 
districts, the Bureau of Reclamation, and most importantly the citizens 
of the Region, will all benefit from a system which allows the water to 
be marketed to it's highest use. We solicit the Committee's support in 
making this a reality. We are confident that the region's water and 
wastewater issues can be addressed to ensure both thriving municipal 
and agricultural communities.

    The Chairman. Thank you very much. I appreciate the 
testimony, and I will have some questions. Let me move to our 
two other witnesses. First, Gary Esslinger here, who is 
representing the Elephant Butte Irrigation District.

STATEMENT OF GARY ESSLINGER, TREASURER/MANAGER, ELEPHANT BUTTE 
                      IRRIGATION DISTRICT

    Mr. Esslinger. Good morning, Senator. It is a pleasure to 
be here, and I am here representing the Elephant Butte 
Irrigation District as their treasurer/manager. Our district 
manages the New Mexico portion of the Rio Grande Project, a 
supply of water to some of the most productive farmland in the 
Nation. And certainly, I hope you get down to Chope's to try 
some of the local chile this year. It is pretty good.
    In order to understand the water supply problems of the 
area, I think it is important to understand also the source of 
this renewable water supply that serves southern New Mexico. 
The Rio Grande Project was one of the first reclamation 
projects formed in 1905 under the Reclamation Act, and that 
project provided water for lands in west Texas and also in 
southern New Mexico. The El Paso Water Improvement District 
Number 1 manages that water for Texas and EBID, or Elephant 
Butte Irrigation District, manages it for New Mexico. The 
project also stores water for delivery to Mexico under the 1906 
water treaty.
    One important, unique aspect of our project, which I find 
difficult for some people to realize is that we are paid out. 
We do not owe the government anything, and we paid our 
construction debt. We are a single-purpose project and we were 
authorized for agricultural use only.
    However, during the last 10 years, we have been thrown in a 
mix with multipurpose projects, it seems, and there is 
confusion as to whether or not contracts, which understandably, 
when you owe someone something, they can draw you to the table 
and make you sign contracts. However, we believe the opposite 
in some of the contract arrangements that are being made today 
with the United States and some of the irrigation districts in 
the west. We believe because we are paid out, that those 
contracts do not necessarily apply. And I will touch briefly on 
that later on.
    The other interesting thing is that we paid out in 1972 our 
obligation to the United States on the construction costs of 
Elephant Butte, and in 1978, we actually took over operation 
and maintenance of our system. Right then we realized that, you 
know, in order to take over, then we needed to actually own and 
be responsible for the facilities as well. So during the other 
Bush administration, we were able to get legislation passed, 
which, Senator, you helped us do so, which enabled us to get 
our facilities transferred as far as our drainage and canal 
system. And since that time, we have operated it and now we own 
those facilities.
    Our project in New Mexico, the district in New Mexico under 
the Rio Grande Project manages over--at approximately 90,640 
acres of water-righted land. And that portion of land is 
approximately 57 percent of the use of project supply, with 43 
percent of that project water supply then being used by the El 
Paso area district. Our average annual releases from upstream 
project reservoirs are approximately 790,000 acre-feet, and 
that includes the 60,000 acre-feet that we deliver to Mexico.
    What I would like to just talk to you briefly about today 
is how the New Mexico share of project supply will be used in 
the future to address future demands in southern New Mexico. I 
think probably the foremost, which has already been talked 
about earlier, is the New Mexico/Texas commission. I believe 
that is the instrument that has really brought everyone 
together to at least begin discussing regional water planning.
    Unfortunately, there is a State line that crosses in that 
planning, and certainly State law in New Mexico and State law 
in Texas certainly cause a hurdle. However, I believe, though, 
that the attitude of the commission and certainly the progress 
of the commission has pointed towards looking at surface water 
as an alternative.
    It became obvious to us in southern New Mexico that we 
could not rely totally on an unknown quantity of groundwater as 
our supply for the future. But we needed to look at a renewable 
water supply, and that, of course, is the Rio Grande. That put 
quite a bit of pressure on our district to begin, then, 
thinking of the possible solutions that we could provide to 
cities such as Las Cruces or other communities within the 
valley floor that would benefit from a surface water supply.
    One of the uses that the municipal and industrial purpose 
is, is that they pull total, at this point, pull totally from 
the groundwater supply, whereas in agriculture, we try to use 
the renewable supply, which is the surface water, and then go 
to our savings account, which is our groundwater supply, in 
times of emergency or drought. Drought hasn't been spoken of, 
as far as I know, this morning, and it is certainly something 
that is here on the horizon. And we have been blessed with 
about 23 years of good, full water supply. But I believe this 
may be the winter that tells it all if a drought is inevitable.
    However, the irrigation district feels that because we have 
a renewable supply that we can count on, we feel that there is 
an opportunity to work with the city of Las Cruces and other 
communities to provide surface water in the future. One of the 
obstacles, which is a necessary obstacle, is the stream 
adjudication process, which we are working with the State 
engineer in trying to work through that difficult negotiation 
that everybody feels is compelled to address. And through that, 
it is very emotional because we are talking water and we are 
talking water rights, and water that has been used by farmers 
for years. And the fear that they may lose that is a constant 
reminder that certainly the process has its difficulties.
    And so we understand, though, it has to be done, and in 
order for us to even think about transferring water or leasing 
water or selling water to a city, we have to know how much 
water we own. And that is an important factor that has not been 
established yet. And that has to be done in order for our 
district to go forward with any kind of a lease program or 
long-term program to supply a city with water. We need to know 
how much water we own.
    The State of New Mexico has done a great job of developing 
a State regional water planning effort, and as the mayor 
mentioned earlier, we are part of this Lower Rio Grande Water 
Users organization that actually assists and participates in 
regional planning. And we have efforts underway right now to 
develop our regional plan for southern New Mexico, which 
includes utilizing surface water as a resource in the future, 
with projects and contracts out right now to select sites in 
southern New Mexico for potential surface water treatment 
plants.
    The group consists of almost all the players in southern 
New Mexico, which I think is very important. I believe Sunland 
Park may be the only entity that was a part of the commission, 
or the Lower Rio Grande Water Users group, but elected to stay 
out of the group. And at the same time, though, Dona Ana County 
is a great player in this group.
    I think one of the most important things that we have done 
to spell out exactly what we believe we could do to work as a 
partner with communities in southern New Mexico is what we have 
done with the city of Las Cruces. We have gone hand-in-hand to 
the New Mexico State legislature to get pieces of a puzzle, if 
you can imagine, that have to be put together in order to fit a 
regional surface water alternative.
    And what we did was we developed some legislation that 
enabled our statutes, under which our irrigation district is 
governed, to be able to then form municipal water users 
associations, which, in turn, can then come and solicit from 
the district a supply of water in the future. And the city of 
Las Cruces is the first that has approached us and worked with 
us to get this transaction in place.
    And so just 2 weeks ago at our board meeting, the board of 
the irrigation district passed an internal policy that will be 
what I believe is the genesis of the process in which we will 
be able to transfer water, surface water, to municipal water 
users associations in the future.
    The one thing that I guess we have difficulty with is even 
though that we have paid out our allocated construction costs, 
the Bureau of Reclamation is attempting to claim that the 
Federal Government must also give its approval for transfers of 
water for municipal and industrial purposes under the 1920 Act. 
And EBID has filed a suit in New Mexico Federal district court 
to determine whether or not such approval under that act is 
necessary.
    We maintain that the appropriate provisions of State water 
law apply and no approval is needed by the Bureau of 
Reclamation. And more importantly, we believe that the cities 
and other major water users should not have to pay some tribute 
to the United States in order to get this water.
    Local entities in southern New Mexico are addressing how 
the Rio Grande Project water managed by our district can be 
used to fuel future municipal and industrial growth, and we 
believe that the grass roots planning among these local 
entities is the way to address the local needs. Intervention by 
the Bureau of Reclamation only serves to delay the transition 
and add to the final cost to the consumer.
    We hope that you and your committee will question the 
necessity of the Bureau of Reclamation inserting itself in a 
matter of State water law.
    With that, thank you very much.
    The Chairman. Okay. Thank you very much. Our final witness 
on this panel, Edd Fifer, is with the El Paso County Water 
Improvement District Number 1. Thank you very much for being 
here.

 STATEMENT OF EDD FIFER, GENERAL MANAGER, EL PASO COUNTY WATER 
                    IMPROVEMENT DISTRICT #1

    Mr. Fifer. Senator, thank you very much for allowing us to 
be here with you today. And of course, this is a very 
entertaining subject as we go through this ordeal. I have been 
the manager of the El Paso district for 23 years and very proud 
of that time. Every day is a new learning experience.
    Something that is real interesting about our area and our 
region, I think we can teach a lot of the world about things 
that we are all doing. You know, we are doing different things, 
and we try to work together. I can honestly say Gary Esslinger 
is my very good friend on a personal basis. John Burkstaller 
was, before today, a very close friend. I think he shot me in 
the back now, so we are going to have to go back to work on 
that relationship again.
    Water is difficult, and the things that we do with water is 
extremely difficult. There are an awful lot of things that is 
going on. You know, you take our irrigation district, Senator. 
We have over 35,000 accounts. You do not see too many 
irrigation districts in this world that have 35,000 accounts. 
The reason for that is that we have a city that sits in the 
center of our irrigation district. We do not sit around the 
city. The city sits in the middle of our irrigation district.
    And as it expands, yes, there are 100-acre parcels that go 
out and become subdivision, 23-hundredths of an acre 
subdivision parcels. And in the State of Texas, water rights 
are permanent easements and transfer with the title to the 
land. So, in turn, those lands retain those water rights. And 
so when they break down, at one time I have an account of 100 
acres. The next day I have 400-plus because it was subdivided. 
And so that is where all the 35,000 come from. Kind of an 
interesting aspect about it, though, is out of the 35,000 
accounts, 31,500 of them are less than two acres in size.
    But let us look at the land side of it. It only represents 
19 percent of the 69,010 acres that we have. When I came to the 
district 23 years ago, in 1978 or way back there before Diane 
was ever born, I can assure you that there were--it represented 
14 percent. And so you know, in listening to Mr. Peach a while 
ago, I am kind of shaking my head trying to figure out these 
numbers. Because if it took 23 years for 5 percent more of the 
land to become urbanized, how much longer will agriculture be 
there? According to those numbers, it is going to be there for 
a long time to come.
    It is very interesting. I do not come from a background in 
engineering or a background in agriculture. I come from an 
educational background, and I can assure you that the 23 years 
that I have spent with the district have been very interesting 
and very educational. And I think we have done a good job. I 
think we have worked very hard.
    I can go back to 1982 and remember as a rookie turning over 
a plan to the board, we called it a year 2000 plan, and what we 
were trying to do back in 1982 was to try to figure out what in 
the world was going to happen to the El Paso County Water 
Improvement District Number 1 by the year 2000. And of course, 
the main thing there was the population. You know, what's the 
population going to do?
    Well, here we are, it is 2001. I go back and I take a look 
at that little plan and you know, the darn thing worked pretty 
good. It was not great, but it worked pretty good. And so one 
of the things that we realized back in 1982 was the fact that 
the population was growing, and that the city did sit in the 
center of the irrigation district, and what we were going to 
try to do?
    We fumbled around and stammered around and kind of fell 
down a few times and got up a few times. As a matter of fact, 
in 1985 we tried to enlarge our district to take in Hudspeth 
County, which is a small irrigation district, 18,000 acres, 
small irrigation district south of us, realizing that, yes, 
there was going to be the need for water for municipal 
purposes, but it was going to be several decades to come.
    Well, we got mashed pretty good in that election. Those 
elections are pretty difficult. We got beat 6 to 1. And what 
happened was the city of El Paso stood up and said, no, you are 
not going to send our irrigation water, or our future drinking 
water, to Hudspeth County for drinking--or for irrigation. And 
so, I mean, that was kind of the--the light kind of came on at 
that point in time, we said, well, you know, they have a point.
    And from that point forward, I think that we started doing 
a lot of things realizing that we had to start developing some 
kind of a plan of action to involve the municipal use of water. 
You look back in history, 100 years ago there were a handful of 
people that went to the Federal Government and said we need to 
capture some water so we can farm these fertile grounds in 
southern New Mexico and west Texas. And that handful of people 
asked--I am sure they asked city of El Paso--I have not talked 
to any of them lately--but I am sure they asked the city of El 
Paso to be part of that. And I am sure city of El Paso felt 
that they had enough groundwater to where they did not have to 
be a part of that.
    These people agreed to have their lands taxed. I mean, that 
is a big step. But that is looking into the future and what 
your future is all about. As we progressed and moved along and 
became a part of the Rio Grande Project, there were numerous 
contracts. And every one of those contracts, if you take and 
sit down and look at every one of those contracts, it is for 
the betterment as we go along.
    In 1941, there was a contract between the city of El Paso, 
El Paso County Water Improvement District, and the Bureau of 
Reclamation that allowed for the city of El Paso to purchase 
2000 acres of water right land and to utilize that water for 
municipal purposes, knowing that the water was tied to the land 
and keeping some semblance of control over the water making 
sure that it was tied to the land. And so the allotment to that 
land would go to the city of El Paso for municipal purposes.
    The city of El Paso built a water treatment plant in, I 
think, 1951, 1953 somewhere in there, and did utilize that 
water.
    Again in 1962, there was another contract that allowed for 
the City of El Paso to lease the rights to water off of water 
right lands. So if someone like Edd Fifer, I have three acres 
in the lower valley, and I cannot receive irrigation water, 
because it would involve a bunch of legal action for me to make 
people open the ditch to get the water to me. In turn, what I 
do is I lease my rights to water to the Public Service Board. 
So Edd Fifer, as an individual, provides 4 million acre-feet of 
water a year to the Public Service Board. They, in turn, pay my 
taxes.
    And so that was a way of working into that municipal thing. 
But if you will stop and think about that, that continues to be 
tied to the water right acre. I have the three acres. 
Everything is tied to that water right acre. So whatever that 
water right acre receives in an allotment is what the Public 
Service Board receives.
    It has only been until recently that the city of El Paso 
and the Lower Valley Water District, two municipal users in our 
area, have decided that they need water in bulk, or in larger 
quantities, that they do not want to go to these individual 
landowners. The vehicle is still there. If they want to do it, 
they can still do it. But those small landowners, it takes some 
time to go there and sit down with them and convince them that 
they need to turn their water over to the city. So they wanted 
their water in bulk.
    When we went back and took a look at how that was going to 
occur, we sat down and negotiated some contracts, and with the 
Bureau of Reclamation, we negotiated the first conversion 
contract. And of course, this is what Gary says. Gary's 
attitude towards this--or excuse me, Elephant Butte Irrigation 
District's attitude toward this and El Paso's are different. I 
mean, we are just as different as can be.
    And we felt like we wanted to convert irrigation water to 
municipal, recreational, environmental, whatever other 
beneficial uses there were. So we negotiated the first of its 
kind conversion contract. And these are some of the things we 
have been doing in the background and trying to get 
accomplished, so that whenever it did come time for us to 
provide a bulk water supply, then perhaps we could do that.
    That contract was completed in March 1996. After the 
conversion contract--the conversion contract was between the 
Federal Government, the Bureau of Reclamation, and the 
irrigation district, and it simply stated that you can convert 
irrigation water to municipal uses. After that, you have to go 
to your third-party contractors and do a third-party generic 
contract. And in that, we have those two contracts completed, 
one with the Public Service Board and one with the Lower Valley 
Water District. Those are both completed. They are the only 
ones of their kind in the Western United States.
    And then following that you do the nuts-and-bolts thing, 
which is the third-party implementing contract, the nuts and 
bolts being the price and the term and all of these situations. 
And we now have that completed with the Public Service Board, 
and we are working on an implementing contract with the Lower 
Valley Water District right now. I think it will be finished 
hopefully by the end of the year.
    So we have taken that route and we have gone that route as 
a way of providing water for municipal use. We have not sat on 
our hands. We have not gone out and hidden. We are not being 
negative. I think we are trying to get something done here. But 
there are so many rules and regulations, there are so many 
contracts, and there are so many ways that we have to do 
things, we are trying to work within the system and trying to 
get that accomplished.
    We have taken some blasting by the Public Service Board in 
the newspapers, but that is not the place you negotiate is in 
the news media. You get down and you work hard and you 
negotiate contracts and you get the thing accomplished. Yes, we 
would like to start all over again.
    I sometimes wish that we were in the shoes of Elephant 
Butte Irrigation District and the city of Las Cruces because 
they are kind of starting from the beginning here. It is kind 
of neat to see how it is all working out for them. If they have 
picked up anything from us whatsoever, I think that is 
terrific. If they have not, then I am sorry that they have not. 
But when you really get down to it, I think we have all worked 
very, very hard to get where we are at today.
    The city of El Paso receives 48,000 under these 1941 and 
1962 contracts, 48,000 acre-feet of water, and this newest 
contract, this implementing contract, approximately 28,000 
acre-feet of water. So you can kind of see we are moving along.
    What do we do from here on out? The El Paso County Water 
Improvement District really does not have any water. The only 
water that--every bit of the water that we get on allotment 
goes to our landowners. Our landowners are the beneficial 
owners of that water. The district does not have any water. The 
only time the district might have any water is when our 
landowners all are assured this they are going to receive their 
annual allotment.
    Now, can we create new water sources above that? Yes, I 
think we can, and I think John hit it on the head a while ago 
when he talked in terms of concrete lining. That is something 
that we all need to do, we all need to take a look at. That 
conserves water in our region. I do not know about Elephant 
Butte Irrigation District. I only now know about El Paso County 
Water Improvement District.
    If we were to go in and concrete line canals, yes, we can 
conserve water. The issue of who pays for those concrete canals 
comes up. We have very close to 600 linear miles of system 
within the County of El Paso. If you go in and you start 
concrete lining canals, your cost is going to be in the 
neighborhood of a million dollars a mile. How much water does 
that conserve? What you have to do is you have to turn around 
and say, okay, if it conserves X amount of water, divide the 
million by X amount of water, and whatever the number comes up 
is the price that has got to be paid.
    That is what we have done recently on a contract that we 
have had with the Public Service Board. And it is very 
difficult for me to go to my constituency and say, you are 
going to pay for these concrete-lined canals and we are going 
to give the water to El Paso, because you know what the answer 
is there. The answer in Washington or New Mexico or Texas, it 
is all the same, go to hell. We are not going to do that. And 
so that is basically where it all comes from.
    Now, terms and how long these contracts are, it is all, 
like I say, it is very interesting to negotiate these things. 
And we all have our story to tell. There is no doubt about 
that. I think the important thing, Senator, is that when you 
look at the people sitting in this room, the people sitting at 
this table, we all enjoy one another. We all will work 
together. We are not always going to hug and kiss, but I can 
assure you that we are going to work together. And I think we 
have done that in a big way and I think we are going to 
continue to do that in a big way.
    The district that I work for wants to work with everybody 
else, but we just do not want to give the ship completely away. 
Thank you very much.
    [The prepared statement of Mr. Fifer follows:]

Prepared Statement of Edd Fifer, General Manager, El Paso County Water 
                        Improvement District #1

                              INTRODUCTION

    Hello. My name is Edd Fifer. I am proud to be the General Manager 
of the El Paso County Water Improvement District #1 and have been for 
the past 23 years. The El Paso County Water Improvement District #1 is 
unique in that it has 34,946 accounts representing 69,010 water right 
acres. In excess of 31,500 accounts are less than 2.00 acres in size 
but the total land represented by those 31,500 accounts is 
approximately 12,718 acres or 19% of the total 69,010 water right acres 
located inside the boundaries of the El Paso County Water Improvement 
District #1. The El Paso County Water Improvement District #1 has 
exercised strong conservation efforts over the 20 years of its 
operation and maintenance responsibilities by maintaining a 65 to 74% 
efficiency rate over the last 15 years. This is accomplished by 
metering of all farm tract irrigations (2.O acres and above) every time 
the lands are irrigated, implementing of an annual water budget, and a 
support by the Board of Directors to conserve precious water supplies 
by stringent water operational policies practiced on a daily basis.
    The El Paso County Water Improvement District #1 (EPCWID #1) is a 
political subdivision of the State of Texas established in 1917 under 
the Texas Constitution. EPCWID #1 is one of the three water users in 
the Rio Grande Federal Reclamation Project and receives its annual 
surface water allotment via the Rio Grande from Elephant Butte and 
Caballo Reservoirs as well as return flow entering the Rio Grande below 
Caballo Reservoir. Approximately 41% of EPCWID #1's annual allotment is 
return flow from New Mexico agriculture drains as well as discharges of 
sewage effluent from facilities along the Rio Grande north of the 
greater El Paso area.
    The EPCWID #1 took over operations and maintenance of the 
irrigation drainage system in El Paso County from the Bureau of 
Reclamation in 1981 by Contract #0-07-54-X0904. In 1996, after a long 
legislative effort and 21 years after the EPCWID #1 repaid the Bureau 
of Reclamation for construction of the irrigation distribution and 
drainage system, the Bureau conveyed to EPCWID #1 by special warranty 
deed the irrigation facilities in El Paso County.
    The present and the future need for water was and is dependent on 
population growth and weather. The total dependence on surface water 
supplies could be a very dangerous municipal water path to take based 
on the historical water supply patterns in the Rio Grande Project over 
the existence of the Project. In 1982, EPCWID #1 prepared a Year 2000 
Plan realizing that the municipal needs for water were growing due to 
the only factor which was certain to occur by the Year 2000: increased 
populations in the greater El Paso area. The same holds true for 
southern New Mexico and northern Mexico. With the increase in 
population, municipal water had to become more and more important. That 
is why we are here today.

                     ADDRESSING FUTURE WATER NEEDS

    In the very early 1900's, the City of El Paso had the opportunity 
to become a water user in the Rio Grande Federal Reclamation Project. 
The City of El Paso chose not to subject their lands to water right 
taxation, believing they had sufficient groundwater supplies.
    A handful of landowners in both southern New Mexico and far west 
Texas agreed to have their lands taxed and signed contracts with the 
Federal government for the development of the Rio Grande Federal 
Reclamation Project. The point being raised is that future water needs 
were addressed in the early 1900's, and today we see the results of 
that major effort on the part of landowners who wished to farm their 
land and address their future water needs by contracting with the 
Federal Government for an irrigation system and dam to collect the 
surface water flowing down the Rio Grande.
    The EPCWID #1 and the Bureau of Reclamation addressed future water 
needs every time they entered into a contract. In 1941, the Bureau of 
Reclamation and EPCWID #1 signed a contract with the City of El Paso to 
provide for a municipal surface water supply by allowing the City of El 
Paso to purchase 2,000 acres of water right lands and use the annual 
allotment for those acreages up to 3.5 acre-feet per acre. Again, in 
1962, the Bureau and EPCWID #1 signed another contract with the City of 
El Paso allowing the City to seek surface water assignments from owners 
of water right lands.
    More recently, in 1988, EPCWID #1 and the Bureau of Reclamation 
signed a contract with the Lower Valley Water District allowing the 
LVWD to seek surface water assignments from the owners of water right 
lands located within the LVWD boundaries. This contract helped the 
fledgling municipal water district to attain much-needed water supplies 
for its constituents located outside the El Paso City limits on the 
east side of El Paso.
    In the last four to five years, the fears of running out of water 
have haunted the municipal suppliers of water. The contracts which 
allowed for municipal water entities to seek surface water allotments 
from water right lands located in the boundaries of EPCWID #1 was not 
enough. Larger quantities of water became the desire of municipal 
entities. Prior to 1996, every drop of surface water secured by the 
municipal utilities was linked to a specific parcel of land. After 
1996, municipal interests urged the EPCWID #1 to ``sell'' them larger 
quantities of surface water for municipal needs.
    The EPCWID #1 had no surface water to sell in large quantities. The 
water right landowners are the beneficial owners of the surface water, 
and EPCWID #1 divided the annual allotment received from the Bureau of 
Reclamation among every landowner on a per-acre basis. If the EPCWID #1 
were to ever have any surface irrigation water to sell it would have to 
come from conserved water remaining after each and every water right 
acre (69,010) inside EPCWID #1's boundaries received their fair and 
equitable annual allotment on a per-acre basis. The City of El Paso 
benefited from this allotment procedure because under its water supply 
contract, it also received an annual water allotment for lands it 
owned.
    In March 1996, the EPCWID #1 signed a conversion contract--the 
first of its kind--with the Bureau of Reclamation. The conversion 
contract provided for the ``conversion'' of agricultural irrigation 
water to water for other beneficial uses such as municipal, industrial, 
recreational and environmental. After signing the conversion contract, 
the EPCWID #1 entered into two ``third-party contracts,'' one with City 
of El Paso and the other with the Lower Valley Water District (LVWD). 
Those two contracts--the only contracts of their kind in the entire 
western United States--allow for the two entities to convert irrigation 
water to municipal purposes. But before they can purchase water for 
municipal purposes, each entity must enter into an ``implementing 
contract,'' which specifies the quantity, price and other terms of the 
sale. Each implementing contract is subject to satisfying the 
requirements of the National Environmental Policy Act (NEPA). Today, 
the EPCWID #1 has a third-party implementing contract with the City of 
El Paso and expects to negotiate an implementing contract with the LVWD 
in the very near future.
    EPCWID #1 is attempting to address the future water needs of the 
surrounding area. Future surface water supplies will have to come from 
the concrete-lining of canals or from the water right landowners 
through forbearance contracts whereby the landowner sells his or her 
annual allotment of surface water to approved third-party contractor 
for an agreed price. The Board of Directors of EPCWID #1 have enacted a 
policy regarding Forbearance Contracts and a form forbearance contract 
will be provided for the EPCWID #1 landowners to negotiate price, term 
and quantities of water.
    EPCWID #1 welcomes the importation of water for municipal needs. If 
the municipal needs exceed the sustainable supply provided by the Rio 
Grande, the EPCWID #1 supports the importation of water from other 
sources. If municipal interests in the greater El Paso area can 
contract for ground or surface water in New Mexico, EPCWID #1 supports 
those efforts.

                             ARISING ISSUES

    EPCWID #1 will face numerous critical issues if municipal interests 
only wish to furnish large populations with an endless supply of water. 
Nevertheless, EPCWID #1 has moved in a positive direction in providing 
additional surface water for municipal use. The 1996 Conversion 
Contract allows for irrigation water to be converted not only for 
municipal needs, but also other beneficial needs such as recreation and 
environmental. If a recreational or environmental entity were to seek 
water supplies from the EPCWID #1 as an approved third party 
contractor, the EPCWID #1 would work to negotiate a third-party as well 
as a third-party implementing contract. Although a contract would 
reduce the amount of surface water available in the future for 
municipal interests.
    Loss of water quality is a major disadvantage for EPCWID #1 to 
provide municipal interest with surface water supplies delivered at 
their water treatment plants. As more and more Rio Grande water goes 
toward municipal use, particularly in New Mexico, an increasing 
percentage of the water received by EPCWID #1 will consist of effluent 
discharges. Already a large portion of the Project water received by 
EPCWID #1 consists of agriculture return flows which is water that has 
been used to irrigate and is returned to the irrigation system through 
drainage. This return flow degrades the water quality, as does effluent 
discharged from water treatment plants operated along the Rio Grande. 
EPCWID #1 remains concerned that its water will be further degraded as 
the population of southern New Mexico grows.
    Agriculture water efficiencies likely will be adversely affected 
when the water right landowners enter into forbearance agreements to 
sell their allotment water. This activity would reduce the number of 
water right acres irrigating in specific areas. Delivery efficiencies 
which are achieved today will not be operationally possible; therefore, 
overall less surface water will be available for water right landowners 
who do irrigate.

                               CONCLUSION

    EPCWID #1 has always realized the need for water both agricultural 
as well as for municipal purposes. History shows that surface 
irrigation water has been made available to satisfy municipal needs. 
Numerous contracts have been negotiated and signed allowing for use of 
irrigation water for other beneficial uses. EPCWID #1 has for years 
strived to conserve this precious natural resource and will continue to 
do in the future so that a long range plan of action for all parties in 
need can be pursued.
    In closing, I would like to thank the Chairman, Senator Bingaman, 
for holding this hearing. As you may know, Senator Bingaman was born in 
El Paso, and I have heard that he spent a fair amount of time attending 
movies at the old Plaza Theater. Many of us in my area of Texas 
consider you to be our Senator too.
    Thanks again for allowing me to participate today and remember 
``Irrigation Water is not for Wasting!''

    The Chairman. Thank you very much. Thanks to all of you. 
Let me ask a few questions here before we conclude this panel. 
Let me start, I guess I am just unclear. I am trying to 
understand all this. John, you make some statements here in 
your testimony that I am just not clear on.
    You say that the farmers who might welcome the opportunity 
to periodically sell their irrigation water to municipalities 
are prohibited from doing so by the Bureau of Reclamation and 
the irrigation districts. I assume you mean by ``selling,'' you 
mean also leasing?
    Mr. Burkstaller. I mean basically the big potential source 
of water at this point that I am sure Edd agrees with is 
forbearance. If they got a full allotment year, maybe they can 
sell a portion of their water to us and forbear using it.
    The Chairman. How does that square with what Edd is just 
talking about there? Your statement is that the irrigation 
districts are prohibiting people like Edd from making their 
water available for municipal use.
    Mr. Burkstaller. In our eyes, the Bureau and the irrigation 
districts are making it too complicated and putting too many 
restrictions on the process for us to use forbearance as a 
dependable supply. And we would like to be included in the 
process and have input to the program so that we can assure 
that whatever comes out of it is a usable water source.
    The Chairman. So that what Edd has done with his three 
acres is not useful to you.
    Mr. Burkstaller. Edd is just starting to be fair. And we 
need to work together and we feel like we are not working 
together.
    The Chairman. But now, let me try to understand, also, and 
also in the New Mexico side in Elephant Butte Irrigation 
District. What are the obstacles that exist to an individual 
farmer who has certain water rights in this irrigation 
district? If that farmer would want to go ahead and provide 
those, lease on a temporary basis, on a year-by-year basis, 
make that available to the city, that is not permitted by the 
Elephant Butte Irrigation District. Is that correct?
    Mr. Esslinger. Well, Senator, what the problem is, is the 
farmer is given an allotment every year based upon what is in 
storage. However, as far as determining what his water right 
is, that is a process that has to be perfected by the stream 
adjudication process. And that has to affect everyone, whether 
you are a groundwater pumper or a surface water user or both.
    And so it is real difficult for a farmer at this point to, 
without some uncertainty, to establish a lease with a city 
supplier not knowing for sure if he can use his groundwater as 
a supplement to whatever he leases as a surface supply to 
sustain his crop. And all of that has to be worked out through 
the stream adjudication process.
    We believe that through our municipal water users policy, 
that what we are envisioning is that as a city grows or our 
community grows and acquires irrigation land that had a water 
right on it, well, then that water right stays appurtenant to 
the land, and the land that is consumed by the city would then 
be able to acquire that surface water right in the future for 
its surface water treatment plant.
    Right now, we just do not have the mechanism in place, and 
there is an uncertainty by every farmer and every groundwater 
user of what they own as a right to sell.
    The Chairman. I can understand that they do not have an 
adjudication yet completed. But what if I am an irrigator, I 
have a farm, and I am advised by the Elephant Butte Irrigation 
District that I have a certain allotment for this year based on 
how much water is going to be released, and I decide I would 
just as soon go ahead and lease that water or provide it or 
sell it or do something with it this year instead of planting 
my crop, I do not have that option?
    Mr. Esslinger. What you do have is an option within the 
irrigation district to allow another farmer to transfer your 
water to his land. Internally, we have been doing that since 
the inception of the State, transferring the water between 
agricultural users. And so if you, for whatever reason, did not 
want to farm, there are farmers waiting to acquire that water 
right. In fact, we have a waiting list of close to 500 acres of 
farmers who have perfected and have cleared land waiting to get 
water-righted land classified.
    And so what has happened in the past is if the city 
acquired--or if a farmer sold a 20-acre parcel, we would 
transfer that 20-acre parcel to a farmer on the waiting list, 
because we have room within our district to grow as a farming 
community. We are not at the same position that El Paso is in, 
where they are squeezed between the river and their mountain 
range. We have in our project boundaries 133,000 acres of 
project land. We have 90,640 acres of irrigatable water-righted 
land. What we have been doing over the past is just 
transferring the water from a subdivision back to a farmer who 
needs it.
    Now the point is as the city has approached us, they would 
like to acquire that water for future use. And what they are 
doing is they are putting it in our conservation pool for our 
farmers to continue to use the water as they acquire the land. 
And that is something that was a basis of these statutes that 
we got legislative action on.
    The Chairman. Let me just understand. The distinction that 
I am hearing between what you are doing and what they are doing 
in El Paso is that in the case of El Paso, at least there is, 
although there are complaints about all the paperwork and 
obstacles that have been thrown up, at least there is the 
possibility of an individual water owner, water rights owner 
down there in El Paso, a person who has some rights, going 
ahead and transferring those to the city or leasing them to the 
city for municipal use.
    And here in the Elephant Butte Irrigation District, that 
option does not exist for an individual because the 
individual's water rights have not yet been established. And 
the district will not allow the allocation of water to be 
transferred out of agricultural use by an individual.
    Mr. Esslinger. That is correct, because at the present 
time, we still have all of our water being used for 
agricultural purposes.
    The Chairman. But the district itself is entering into a 
contract with the city which will allow the district to 
transfer it out of agricultural use to municipal use, although 
the individuals who get the allotment would not have that 
option.
    Mr. Esslinger. No, sir, Senator. What this water users 
policy does is it allows for, first of all, the city to be able 
to lease water from our district. But it also gives the 
opportunity for the city to go outside and also have the 
opportunity to lease water from individual farmers. There is 
two components of the policy, and it is attached in my 
testimony, which allows for the city, as they acquire land, to 
actually receive that as part of their water-righted acreage.
    And then the second component is for them to go out and by 
the forbearance, also be able to purchase or lease water on an 
annual basis from the farmers.
    We believe that that process cannot happen yet because 
there is no surface water treatment plant in place for the 
water to go to. So the city is not interested in purchasing 
water or buying farms at this time because it would be a costly 
venture for them with no place to go. So all they are doing now 
is just grabbing what they are acquiring through their 
expansion of their city limits and allowing that water, the 
first set of water, it is kind of a base for them to go and 
bind for later on to establish a surface water treatment need. 
So they are trying to establish a base allotment right now of 
surface water right.
    Have I confused you?
    The Chairman. Yes, pretty much. Let me ask about the Bureau 
of Reclamation. John, in your testimony you cite the fact that 
the Bureau of Reclamation has prohibited this transfer or this 
use of irrigation water for municipalities. What is the 
Bureau's role? How do they accomplish that prohibition?
    Mr. Burkstaller. I think, basically, we had a number of 
agreements with El Paso County Number 1 that the Bureau was not 
a party to. And when it came time to negotiate for more water 
at the new municipal price, the district went back and looked 
at all those and kind of wanted the Bureau of Reclamation on 
board to approve them. And technically, the Bureau feels that 
all agreements have to be co-signed by the Bureau. They have to 
be between the district, the bureau, and the other potential 
user.
    In the process, we lost quite a bit of water by 
reinterpretation of what the contracts allowed. And when we 
negotiated our recent implementing agreement, we got it back 
again for $200 an acre-foot as opposed to the 15 or so that we 
paid in the past. But we did not get all of it back. Some of it 
we have lost indefinitely. So we feel that there was kind of a 
severe pro-irrigation-district interpretation of all the issues 
that came up in the process of negotiating this implementation 
agreement.
    The Chairman. And I can understand there is a disagreement 
there as to how it was done. But the Bureau of Reclamation does 
not have a policy of not approving these uses or these efforts 
to use irrigation water for municipal use. I mean, they have no 
reason to prohibit that that I am aware of.
    Mr. Burkstaller. They have no formal policy, that is for 
sure, yes.
    The Chairman. Let me ask, it strikes me we are having this 
whole discussion that we are having this morning and virtually 
nothing said about what is going on on the other side of the 
river, except that at one point there are 2 million people in 
Juarez and they are out of water, or nearly out of water. And 
they're taking into account the problems on one side versus the 
other or the actions on one side versus other in moving ahead.
    Again, John, do you have any involvement with the city of 
Juarez as to their water needs or their projections for water 
needs, or is that just sort of in a different category that you 
do not have to concern yourself with?
    Mr. Burkstaller. Until recently, we have kind of kept track 
of how much of the Hueco Bolson they are using because we 
naturally have an interest. And even though they have a lower 
per capita consumption, their population has grown so much that 
they withdraw quite a bit more from the aquifer now than we do.
    Based on that and a number of issues, we realized the need 
to go into regional planning, and we do have a planning group 
now that includes representatives from Dona Ana County, El 
Paso, the Juntas, the utility in Juarez, and we have embarked 
on a program to identify options that might be beneficial 
collectively for water treatment and conversion of some of the 
Juarez ag water to M&I uses and so on.
    So we are actively involved in that process. We do not 
really have a plan at this point, but we have embarked on 
trying to find one.
    The Chairman. One of the points that we discussed with Mr. 
Wood in the previous panel was that there is no real joint 
effort to analyze the water resources and make projections as 
to future need and future uses. Is that your assessment as 
well, that we really do not have anything that both the Mexican 
officials and the folks on our side are involved in that people 
have confidence in?
    Mr. Burkstaller. I think both sides have made their own 
projections, but we do not necessarily agree on all of the 
issues. One example is they dispute some of the claims we have 
made about how fast they will exhaust the potable water in the 
Hueco Bolson. They think it will last longer than we do, and so 
on. And there are a number of kind of political constraints and 
what their national government allows and so on.
    But I think all the parties individually are projecting the 
water resource, just that we do not have any overarching----
    The Chairman. There is no joint effort to project the water 
resource.
    Mr. Burkstaller. To impose agreement to the various parties 
involved.
    The Chairman. Or to even cooperate in the development of 
data and information with which to make projections.
    Mr. Burkstaller. There has been some limited cooperation, I 
would say. The USGS has modeled the Hueco on both sides of the 
border, but there are disputes in Mexico about whether or not 
they did an accurate job in the Mexico portion. I think there 
is a level of mistrust in the numbers that come from various 
sources
    The Chairman. Edd, did you have any involvement in any of 
this cross-border?
    Mr. Fifer. No, sir, we have not. There is a very 
interesting aspect to this whole thing, though. In the process 
of converting water from agriculture or irrigation to 
municipal, we are creating markets for that water. And at the 
present time, there has been no discussions about whether or 
not Mexico can participate in those markets or not.
    This is going to become very interesting, and I think this 
is a decision that is going to have to be made perhaps by the 
Bureau of Reclamation, also, or by the U.S. Government, whether 
or not that can be done. That would really open things up for 
the landowner who owns the water and who has the right to 
forbear that water.
    I know in our district, the owner has the right to forbear. 
That would create a tremendous market. But that would also 
create a water shortage, I think, on the U.S. side. Everything 
that we have looked at from a municipal standpoint, we feel 
like we can work very closely with the Public Service Board, El 
Paso Water Utilities, Lower Valley Water District, but we are a 
little bit concerned about going beyond those things.
    We do not have a surplus amount of water. I know we 
exercise conservation continuously. We do a water budget every 
year. We set efficiency marks. My board of directors tells me 
that I have to attain a certain efficiency, and if I do not, I 
get my hand spanked pretty good over the deal. So I think there 
is just a lot of things that we do to conserve water. You 
really do not know how much water you have until the year ends 
for you because you have these thousands and thousands of 
irrigations that are going on.
    I just think that there is an aspect there that maybe--I do 
not know, maybe somebody is hiding or whatever. But I think 
that there is a possible market in Mexico for water, for 
surface water.
    The Chairman. Mayor Smith.
    Mr. Smith. Senator, just very quickly, I hear comments 
about Federal and irrigation districts trying to work together. 
As you can tell, it has taken us literally years to get to this 
point. And as mayor, I can tell you something that we have done 
within the region and I guess we can act a lot more 
spontaneously, much more quickly.
    As you well know, there have been new elections in El Paso 
and Juarez and there are new mayors on the border. I have been 
able to--talking about sustainable projects--I have been able 
to sustain the mayorship here for about 10 years. But over the 
past 10 years, we have worked collaboratively as three 
communities, not--obviously, we cannot make decisions dealing 
with water. But what we have been able to do in several 
different areas is to bring together and take the initiative to 
essentially lead the people in the different communities to 
come together to understand the issue, first of all. And I 
think we went a long ways in the past several years with the 
previous two mayors in El Paso and Juarez.
    And we have a meeting set up this coming week in El Paso. 
For the first time the two new elected mayors and myself will 
be getting together to talk about the issues paramount to the 
region. And we most definitely think Las Cruces is part of the 
major region. Water is one of those issues. Obviously, 
transportation issues is going to be a second issue. Border 
crossing issues always are on the front plate.
    But I can tell you since it takes a Federal system quite 
some time to go through all of the hoops and whatnot to get the 
process moving, I think what we are attempting to do, and 
particularly with the three mayors, is to surface the issue, no 
pun intended, to surface the issue of the water as it relates 
to Juarez and maybe to initiate some new processes that we have 
not even thought about.
    But if anybody thinks that we can talk independently just 
as Texas and New Mexico and not bring in the Mexican 
connection, we are never going to be resolving the issue of 
water. Which in political elections, that is always the prima 
donna, that is the red flag, but after elections, it kind of 
wanes. The good news is I think that we have shown that if you 
continue to pursue the issues with some basis, scientific 
information with the quality of the water, the quantity of 
water, and if you plug in what Dr. Peach gave us, those 
wonderful statistics, then we begin to understand that we just 
cannot sit around and see which one of the entities is going to 
try to take the lead.
    So we are going to continue to push that. And hopefully, 
once we have the ideas in place, we will be visiting with you. 
Because we have already spoken in general terms independently, 
not the three of us collectively, of bringing in the Federal 
delegation on the Mexican side truly to work hand-in-hand with 
the United States side to begin to resolve this issue, because 
we are not going to be able to do it on a local issue. We are 
clearly going to have to have the support and understanding on 
the Federal level, and I think that is precisely what this 
hearing you have called for should go a long way in doing.
    The Chairman. Thank you all very much. I think it has been 
useful testimony and I appreciate it. We will try to follow up 
on some of these suggestions, and see if we can be of help.
    Let us take about a 5-minute break and then we will hear 
from the State engineer.
    [A short recess was had.]
    The Chairman. Let us get started again here. Our final 
witness this morning is going to be Tom Turney, who is the New 
Mexico State engineer. He is going to give us his perspective 
on some of these same issues we have been talking about so far 
this morning. And we appreciate you being here very much. Go 
right ahead.

  STATEMENT OF TOM TURNEY, STATE ENGINEER, STATE OF NEW MEXICO

    Mr. Turney. Well, thank you. Senator Bingaman has asked me 
to speak today to discuss water supply issues facing the 
southern New Mexico border region. I am happy to do so.
    The recent 2000 census confirmed that the State of New 
Mexico is growing. Among Western States, New Mexico now ranks 
eighth in growth. New Mexico is basically a desert. New Mexico 
water resources for people to use are finite. In a desert, not 
everyone can have all the water they want.
    This basic principle was recognized 400 years ago when the 
Spanish government settled New Mexico. This concept is 
reflected in the State constitution, which embodies a prior 
appropriation system of water administration. As the State 
grows and water becomes more and more scarce, water 
availability will ultimately define the future of New Mexico.
    New Mexico is experiencing a period of rapid growth. Its 
population over the past four decades has almost doubled. The 
Denver Post recently carried a projection on its front page 
that New Mexico's population will grow by almost 85 percent 
over the next 50 years. Heavy growth is projected for the city 
of Las Cruces and Dona Ana County. These numbers paint a 
dramatic change in this area. It is important that the State 
understand that it needs to work with this area, and that there 
is something we can do while taking into consideration existing 
State water laws.
    New Mexico is a rural State. There is much agriculture 
along its rivers. In the southern part of the State, water 
rights for the most part are attached to farmlands. Under State 
law, the owner of a land can sever the water right from his 
lands and transfer it to other lands or, alternately, the owner 
can transfer the rights for other purposes without losing the 
priority of that right.
    Water right holders who wish to transfer their right to 
another parcel of irrigated land or who wish to transfer their 
water right to another such use, such as a municipal or 
industrial use, must apply to my office for approval of the 
transfer. We only transfer actual water rights, that is, water 
that is actually put to beneficial use. State engineer will not 
transfer a claim to water where there has not been water put to 
beneficial use.
    State law allows water rights to be leased as well as 
purchased. A water right may be leased for 40 years to 
municipalities, counties, State universities, public utilities 
supplying water to municipalities and counties, and member-
owned community water systems.
    The rapid growth in this region will result in water supply 
pressures in the area. My office has taken major steps toward 
addressing the water supply in this area. 30 years ago the 
lands from Las Cruces to El Paso were basically rural. Now, 
there is an infill of homes and businesses almost continually 
along this corridor.
    Because of this substantial growth, my office began a major 
adjudication of water rights along the Rio Grande south from 
Elephant Butte to the New Mexico-Texas State line. An 
adjudication is similar to what is called a quiet title suit 
for a piece of commercial or residential property. In an 
adjudication suit, a court defines the elements of a water 
right, who is the owner, what is the amount of the right, what 
is the priority of the right, and finally, what is the purpose, 
place of use, and the point of diversion of that right.
    Adjudications are key to providing a viable water market in 
this area. An adjudication provides certainty about the nature 
and the extent of water rights because they are judicially 
determined.
    As challenges to New Mexico's water supply increase and 
more and more demand for new water sources arise from entities 
such as municipalities and commercial interests, only those 
rights that have been adjudicated will be marketable at low 
risk to the purchaser. Adjudicating New Mexico's water rights 
is essential to protect New Mexico water and will allow for 
orderly development.
    In 1997, we began to conduct a comprehensive hydrographic 
survey of the lower Rio Grande, an area that begins below 
Elephant Butte Reservoir. The hydrographic survey for the 
entire Rio Grande was completed earlier this year.
    In late 1997, we began the adjudication of water rights in 
a State court proceeding. The first step is to serve what we 
call an offer of judgment on each water right claimant. The 
offer of judgment is a settlement offer that describes the 
State's position based on hydrographic survey of what the water 
rights claimant and entitlement is. The lower Rio Grande 
adjudication contains approximately 13,000 water right claims. 
This may grow up to about 25,000 claims as we work forward.
    To date, about 3000 offers of judgment have been mailed. 
Many of these offers are being negotiated or litigated. The 
result is a water right that is defined by court order. The 
lower Rio Grande adjudication is necessary for the development 
of an efficient water market in this area. This market is 
essential to the economic future of the region. Every drop of 
water for new use has to come from existing uses or from water 
conservation. The days of free or cheap water are probably 
past. But with completion of the adjudication, there will be 
substantial water available in the marketplace.
    My office is exploring ways to streamline the permit 
application process so that water rights can be moved more 
quickly or transferred to new uses. This includes ways to 
expedite transfer processes so that entities like the city of 
Las Cruces and Dona Ana County can more rapidly transfer 
agricultural water to municipal uses. We recognize what Mayor 
Ruben Smith was talking about this morning, of waiting almost 
20 years for a decision is no longer acceptable. Cities do need 
certainty.
    With respect to the city of Las Cruces's immediate water 
supply concerns, I did promise the mayor that I would have the 
decision made by the end of this year. He said this morning he 
would like to get that a little faster, and I hope we can 
accommodate that. My staff has completed a preliminary review 
and it looks like we can possibly approve for immediate use a 
substantial amount of water from the Jornada area.
    There is a substantial amount of proposed industrial and 
residential development in the border region, in particular, in 
the city of Las Cruces, Dona Ana County, and in the areas 
around the Santa Teresa border crossing.
    In order to present you a complete picture of groundwater 
supply issues in that region, it is necessary first to 
understand the relationships between surface and groundwater. 
There is a basic rule of Mother Nature relating to hydrologic 
reality in a basin that has a surface stream connected with an 
underground water basin. That is, for every gallon of water 
pumped from a well, ultimately, there is one less gallon of 
water flowing in a nearby river.
    This reality directly impacts groundwater development in 
the reach from Elephant Butte Dam down to the Mexico-New Mexico 
border. Since no new appropriations of surface water are 
allowed on this stretch of the river, any new groundwater 
withdrawals that affect or deplete the surface flow of the Rio 
Grande must be fully offset by retiring surface water rights.
    Because the primary aquifer in the region is hydrologically 
connected to the Rio Grande, groundwater pumping in this 
aquifer ultimately will result in diminishment of the surface 
flows of the Rio Grande. It is likely that surface water rights 
will have to be acquired to offset any new groundwater 
withdrawals in the Santa Teresa area.
    The State of New Mexico, by necessity, must begin to 
actively manage its water resources. State law requires that I 
must administer water rights in accordance with the State's 
constitution, which says that a senior water right is a better 
right. In the lower Rio Grande, the State will have to curtail 
junior rights in times of shortage or as required to satisfy 
interstate obligations.
    With few exceptions, the water rights with the earliest 
priority in the basin are the surface water rights of the 
irrigators within the Elephant Butte Irrigation District. New 
Mexico State University and the city of Las Cruces may further 
have valid senior water right claims. They may be senior water 
right holders.
    Nearly all groundwater claims in the lower Rio Grande, 
including the claims in the immediate border area around Santa 
Teresa, are considerably junior to the senior water rights of 
these three entities. Even if the groundwater claimants in this 
border area obtain orders from the water right adjudication 
court recognizing water rights in the full amount of their 
claims, these priorities of these rights will, in all 
likelihood, be junior by decades to the more senior water 
rights in the basin. Such junior water rights will be subject 
to curtailment if administration of priorities is ever required 
in this basin. This hydrologic reality must be considered when 
policymakers assess the long-term dependability of the water 
supply in the border region.
    In addition to internal challenges, New Mexico is facing a 
number of outside challenges to the region's water supply. In 
1997 the United States filed a lawsuit in Federal district 
court claiming title to all the waters in the lower Rio Grande. 
My office vigorously fought the lawsuit, and in August 2000 the 
Federal district court dismissed this lawsuit. This dismissal 
is currently being appealed by the United States and the El 
Paso Public Service Board.
    Additional challenges come from Texas entities and the 
State of Texas. Hunt Building Corporation, a Texas entity, 
recently declared an intent to divert up to 45,000 acre-feet of 
groundwater from the Salt Basin, which lies in New Mexico's 
southern Otero County just north of Dell City, Texas. Hunt 
Building Corporation stated that the water would be used, in 
part, for municipal purposes within El Paso County.
    El Paso has on previous occasions made it clear that it 
intends to find ways to export water from New Mexico. I do want 
to be very clear that any exports by Texas entities can occur, 
but they must be through compliance with New Mexico's export 
statutes, which requires the State engineer to determine the 
withdrawal and transportation of water outside the State will 
not impair existing water rights and not be contrary to 
conservation or the public welfare of the State.
    Additionally, the State engineer must consider if there are 
any shortages in New Mexico and whether any sources of water 
are available--any other sources of water are available to the 
applicant.
    Some of the people in the Salt Basin have suggested the 
construction of a pipeline from the Salt Basin to Santa Teresa 
area. The cost of such a pipeline has been estimated to be in 
the neighborhood of $60 million. Such a pipeline may, indeed, 
be possible, but would involve much more consideration. As 
such, recent actions by the State of Texas, the Texas 
legislature has appropriated in May of this year $6.2 million 
for vigorously representing Texas interests for water right 
litigation in the State of New Mexico in the lower Rio Grande. 
At issue will be the Rio Grande Compact.
    It is clear that Texas wants additional quantities of water 
to provide for the growing needs of the El Paso region. El Paso 
further wants better quality water so it can more inexpensively 
treat Rio Grande surface water in its municipal water treatment 
plants. The State of New Mexico has entered into preliminary 
discussion with the State of Texas over this issue. Per the New 
Mexico attorney general, all these discussions will be held 
under an umbrella of confidentiality.
    There are international threats to the waters of the Rio 
Grande. Mexico is in the process of developing a Conejo 
wellfield across the border from the Santa Teresa area to 
ultimately divert approximately 12,000 acre-feet per year of 
water from the Mesilla Bolson. This is the same aquifer that 
underlies the Mesilla Valley in New Mexico. It is likely that 
any withdrawals by Mexico from the Mesilla Bolson will directly 
affect the surface water supply of the Rio Grande Project and 
make it more difficult for New Mexico to meet its delivery 
obligations to Texas under the Rio Grande Compact. This pumping 
greatly concerns New Mexico.
    Under the 1906 treaty with the United States, Mexico 
received 60,000 acre-feet of Rio Grande Project water each 
year. If Mexico's Conejo wellfield pumping draws on the Rio 
Grande, then New Mexico may have to demand that any depletions 
resulting from Mexico's pumping be appropriately addressed by 
the United States.
    In summary, New Mexico is facing many challenges over the 
waters of the lower Rio Grande. These challenges occur on many 
fronts. The next decade will be crucial. In the meantime, the 
State is moving rapidly forward with the lower Rio Grande 
adjudication in an effort to provide greater certainty about 
the nature and extent of water rights to farmers and other 
water right claimants in the region. This adjudication is 
necessary to build the proper and necessary foundation for a 
future, efficient water market. Water markets are the key to 
meeting any future water supply needs of the region.
    Until the adjudication is complete, my office will work 
with the city, the county, Elephant Butte Irrigation District, 
the State of Texas, and other entities in the region within the 
constraints of State water law to offer interim solutions for 
their near-term water supply needs.
    Thank you, Senator, and I will be glad to take any 
questions.
    The Chairman. Thank you very much for that excellent 
statement. Let me ask if there is any projection that you could 
give us as to the time frame for completing the adjudication 
here in the southern Rio Grande. Is this a several-year project 
or a decade-long project? Or can you give us any estimate as to 
when it might be done?
    Mr. Turney. We would hope at the end of another decade, it 
is substantially moving along. The State legislature does have 
something to say about this. They have provided additional 
attorneys and engineers for us to begin to rapidly move through 
completion. This year it was a 1-year appropriation and they 
did give us a number of term employees, and we are hoping that 
they will continue this appropriation in upcoming years. And it 
is only if we have additional staff can we complete this within 
a reasonable time frame.
    Otherwise, if we go at our current staffing levels, 
unfortunately, it will be decades and decades long.
    The Chairman. You said that the Conejo wellfield that 
Mexico is now developing will affect New Mexico's ability to 
meet its obligation to deliver water in compliance with our 
treaty with Mexico. Is that correct?
    Mr. Turney. Yes.
    The Chairman. This is the 60,000 acre-feet per year?
    Mr. Turney. What it may impact more strongly is our ability 
to deliver water to the State of Texas. But I am sure that 
there will be an impact on this, on the 60,000 acre-feet
    The Chairman. And that is because the drawing down of water 
in the Mesilla Bolson would be expected to diminish the flow of 
surface water in the Rio Grande? Is that what I am 
understanding?
    Mr. Turney. Yes, sir.
    The Chairman. And you indicated that if that, in fact, 
occurs, you would then look to the United States for some 
adjustment to the New Mexico obligation? Is that what I 
understood?
    Mr. Turney. It may be some sort of an adjustment to that 
60,000 acre-feet of water, because they may be taking out the 
water out of the ground that they should have been receiving as 
a surface water diversion.
    The Chairman. Would you also expect that this would require 
some renegotiation of the Texas-New Mexico compact, the Rio 
Grande Compact?
    Mr. Turney. Senator, I have not given that any thought one 
way or another. I am sorry.
    The Chairman. You heard the previous panel talk about some 
of the issues surrounding the transfer of water that is 
presently used for irrigation purposes over to municipal uses. 
Are you in agreement that as far as New Mexico is concerned and 
this Elephant Butte Irrigation District is concerned, that any 
such transfer by individual water rights owners has to await 
the final adjudication of this area?
    Mr. Turney. No, sir. We are doing this adjudication in 
steps and phases. And we started at the lower Rio Grande--or 
excuse me, the upper portions of the basin and we are working 
down to the bottom. This is an ongoing process. There will be 
court orders that are currently coming out right now. We have 
adjudicated, basically completed all the Nutt-Hawkett Basin 
today.
    There are adjudication orders coming out almost on a weekly 
basis. And it is true that these will ultimately be subject to 
interstate process, but certainly transfers can begin to occur 
way before completion of the last piece of the adjudication in 
20 years.
    As a matter of fact, in downtown Las Cruces, there is a 
number of small tracts of land. We have initiated a special 
hydrographic survey, put out to contract, and the contractors 
are starting to work on this as we speak. As soon as this is 
completed, we are hoping we can work closely with the city on 
how this process can be expedited quickly within my office.
    The city needs additional water, and the idea of waiting 
for 20 years is just unacceptable. And what we want to do is 
establish some sort of a process that when application is made 
to my office, that this kind of transfer can occur quickly. We 
will, of course, have to evaluate it on the standard things, of 
impairment of existing water rights, water conservation, and 
public welfare of the State.
    The Chairman. Let me ask about this Hunt Building 
Corporation application. This is to take water out of the 
Tularosa Basin. Is that right?
    Mr. Turney. Actually, it is out of a small basin that looks 
like about half a moon that exists below Alamogordo. It is a 
separate basin called the Salt Basin. They did not make an 
application yet. Instead what they made is they filed an 
amended declaration. And the amended declaration stated that 
they would be taking about 45,000 acre-feet of water for export 
out of the area.
    Subsequently, I have met with some of the people from that 
area. Santa Teresa has very significant water supply problems 
in their future because of the priority date of their water 
rights. And it may be possible for the water to be pumped from 
the Salt Basin to supply water to the Santa Teresa area or to 
other areas in New Mexico.
    The Chairman. So that would be a competing use that would 
have to be considered, potential?
    Mr. Turney. Competing use, I am not sure with who.
    The Chairman. Well, the Hunt Building Corporation is not 
expecting to use their 45,000 acre-feet to meet that need in 
Santa Teresa, are they?
    Mr. Turney. I have not yet met with Hunt Building 
Corporation, so I do not know what their intentions are. I am 
sorry, Senator, I cannot answer that question.
    The Chairman. Okay.
    Mr. Turney. I can tell you, though, that because of New 
Mexico's export statutes, it will be a lengthy process for them 
to transfer water rights outside the State of New Mexico. It 
may or may not be possible. And at this point right now, it 
would be a lot easier to market those waters inside the State 
of New Mexico.
    The Chairman. You indicated that a possible source of water 
for Las Cruces is the Jornada?
    Mr. Turney. Yes, sir.
    The Chairman. And is there water now being used out of the 
Jornada? Are there wells there that the city of Las Cruces is 
using?
    Mr. Turney. The Jornada Basin, Senator, is located east of 
this building that we are in today. It is a basically, a 
separate, isolated basin. There is just a very, very tiny 
connection from it to the Rio Grande. There are some wells in 
the area, but we are talking about a major appropriation of 
water from this area.
    And there are some water companies that have filed 
applications with our office, and we are in the process of 
processing those. And probably within the next week or two, we 
will be issuing final decisions on those as well. And these 
will impact the amount of water that is available for the city 
of Las Cruces.
    But even considering what sizes of water claims that are 
being made by some of these other private utilities that are 
within the Jornada area, we anticipate we will be able to grant 
a substantial amount of water to the city of Las Cruces from 
this area.
    The Chairman. Are there proposals that you know of for sort 
of a State-based water bank, or is there anything to that 
effect that has been floated as an idea to meet some of the 
water needs in this region or elsewhere in the State?
    Mr. Turney. Senator, certainly the idea of a water bank has 
been heavily debated by the legislature. It is of interest 
because of a lot of concerns, especially from the northern 
parts of New Mexico, that this is just not an appropriate thing 
to be discussing at this time. A water bank makes a lot of 
sense once the adjudication is completed.
    But I think that one major concern of a water bank is that 
there will be a large tendency to float or to push into these 
water banks a number of these claims for extraordinarily large 
amounts of water and people will try and market these claims. 
And in fact, these are simply claims, they are not a water 
right. And it is my opinion that before New Mexico really 
develops, gets actively involved in a water bank, it needs to 
complete adjudications throughout the State.
    The Chairman. Tell me which adjudications have been 
completed in the State. Is there a group that has been 
completed and then others that are still in process?
    Mr. Turney. Senator, in the last 100 years, the State of 
New Mexico has completed about 15 percent of its lands, 
adjudications. At the rate we are going right now, that is 
about 600 years to complete the entire State. Clearly, that is 
not acceptable for the State. And we have actually been working 
with the legislature. We are developing a 20-year plan to 
basically complete all the adjudications in the entire State. 
And the cost is going to be very expensive. I think about $170 
million is our preliminary projections. We will also be looking 
into----
    The Chairman. $170 million would be spent over the 20 
years?
    Mr. Turney. That is right, yes. And we are looking at the 
court process as well. We retained a retired supreme court 
justice as well as a retired appeals court justice to give us 
advice on how we can change the adjudication process to make it 
work more quickly. And some of the ideas that are being floated 
around right now are the establishment of a special water court 
just to work on these adjudications. But it is a very, very 
high priority throughout the State.
    The Chairman. You have been very generous with your time, 
and thank you very much for your testimony. And we wish you 
well in these many challenges that you have. Thank you.
    Mr. Turney. Thank you.
    The Chairman. We will adjourn until 1:30. We will take the 
final panel in this hearing at 1:30.
    [Lunch recess.]
    The Chairman. We will go ahead and start the hearing again. 
We have a third panel that will address these issues from a 
somewhat different perspective. Rick Gold, who is the Regional 
Director with the Upper Colorado River Region for the U.S. 
Bureau of Reclamation is here. We appreciate you being here 
very much. Deborah Little is here, and she is the principal 
engineer with the International Boundary and Water Commission 
in the U.S. section. And then Antonio Rascon is here. He is the 
principal engineer with the International and Boundary Water 
Commission in the Mexican section. Thank you all very much for 
being here.
    We will go in that order. Rick, will you start and give us 
your thoughts, and then after all three of you have spoken, I 
will have a few questions.

 STATEMENT OF RICK L. GOLD, REGIONAL DIRECTOR, UPPER COLORADO 
                 REGION, BUREAU OF RECLAMATION

    Mr. Gold. Thank you, Senator. Mr. Chairman, thanks for the 
opportunity to appear today to discuss reclamation's 
involvement in meeting the water supply challenges facing the 
southern New Mexico border region from Las Cruces to El Paso, 
Texas, and Juarez.
    My remarks today will be primarily concerned with water 
contract conversions, which we have heard something about from 
previous panels, conversion from irrigation to municipal and 
industrial use, the proposed El Paso-Las Cruces Regional 
Sustainable Water Project, and finally with desalination.
    Virtually since its inception in 1902, the Bureau of 
Reclamation has been involved in the management of water 
resources in this region, focusing initially on traditional 
irrigation water management and meeting the water delivery 
treaty and compact requirements. As the population growth rates 
have increased dramatically, the demand for safe drinking water 
has also increased in direct proportion.
    The groundwater basins may run out of fresh water. Shifting 
from groundwater to surface water for drinking water supply in 
sufficient quantity and quality has by necessity focused on 
reclamation's Rio Grande Project. First let me touch on the 
water contract conversions.
    In February 1905, Congress authorized the construction of 
the Rio Grande Project to supply irrigation water to lands in 
the Rincon and Mesilla Valleys in southern New Mexico and the 
El Paso Valley in west Texas. The project also supplies 60,000 
acre-feet of water annually to Mexico under the 1906 treaty 
obligation.
    Acting within the laws of the then Territory of New Mexico, 
Reclamation filed appropriations for water rights, which 
included an initial 730,000 acre-feet annually and subsequently 
all unappropriated water of the Rio Grande. Thus, all the water 
in the Rio Grande between Elephant Butte Dam and Fort Quitman, 
Texas, became Rio Grande Project water supply.
    In February 1920, Congress passed the Sale of Water for 
Miscellaneous Purposes Act. We also refer to that as the 1920 
Act. It authorized the Secretary of the Interior to enter into 
contracts to supply water from any reclamation irrigation 
project for other purposes. That act imposes very specific 
requirements designed to protect the integrity of those 
projects and the Federal investments in them. Those 
requirements include prior approval of the water users' 
organizations, no other practical source of water must be 
available, delivery must not be detrimental to the water 
service for the involved irrigation project, and monies derived 
must be placed into the reclamation fund and credited to the 
project from which that supply is made.
    In 1940, as you heard from a previous panel, the city of El 
Paso approached Reclamation and El Paso County Water 
Improvement District Number 1 to obtain surface water for a 
growing city. The result was a 1920 Act contract allowing the 
conversion of a portion of the irrigation water supply for 
municipal and industrial use by El Paso without congressional 
reauthorization. That is because of the content of the 1920 
Act. Over the years a series of those conversion contracts 
followed, the most recent being signed in June of this year, 
2001.
    Even more recently, Reclamation met with representatives of 
the city of Las Cruces and the Elephant Butte Irrigation 
District to discuss the long-range plans to gradually convert 
project irrigation water to other uses. And although 
conversions in Las Cruces are still several years away, we look 
forward to working with Las Cruces and the Elephant Butte 
district on a 1920 Act contract when the time is right.
    Congress clearly recognized that the needs may change in 
the areas served by reclamation irrigation projects. 
Reclamation has used the 1920 Act again and again in the Rio 
Grande Project to meet the changing needs of the project area. 
The strict requirements of the 1920 Act have protected and will 
continue to protect the rights and interests of everyone, the 
affected States, the irrigation districts, individual 
landowners and the Federal investment in the project. 
Reclamation remains committed to work with these and other 
interested parties in these conversions.
    Second, let me shift to the El Paso-Las Cruces Regional 
Sustainable Water Project. In the early 1990's, water managers 
in the El Paso and Las Cruces area determined that some long-
term planning was advisable. Reclamation provided a little over 
$1.1 million for a study to evaluate the ability of the 
conveyance alternatives to deliver surface water of suitable 
quantity and quality to each irrigation district and the city 
of El Paso.
    The most viable alternatives then underwent National 
Environmental Policy Act analysis, resulting in the preparation 
of the environmental impact statement (EIS) for the sustainable 
project. Reclamation served as a cooperating agency in that 
effort. Reclamation also participated as a member of the 
steering committee of the New Mexico-Texas Water Commission, 
whose role was to help guide the EIS process for the 
sustainable project.
    We believe that while this EIS was of a programmatic 
nature, NEPA compliance will be required for future water 
conversions of the Rio Grande Project. Any water conversions 
must also be consistent with the statutes under which the Rio 
Grande Project was authorized and other applicable laws, 
especially the 1920 Act.
    And finally, a few words about desalination. Desalination 
water reuse and water purification technologies are 
increasingly viable means to expand our fresh water supplies 
and maintain water quality. Reclamation has been making 
investments in developing and implementing these technologies 
to meet the growing demands for water and relieve stress on 
over-allocated rivers and groundwater systems. Our storage and 
delivery facilities and our water and infrastructure 
laboratories in Denver provide a unique and essential 
capability that supports and integrates our technical 
development and research efforts.
    In addition to offering opportunities for expanding 
supplies and improving water quality, alternative--desalination 
and water purification technologies that are more energy-
efficient can reduce the large power consumption associated 
with basin transfers and groundwater-pumped water supplies.
    Reclamation has successfully implemented Public Law 104-
298, the Water Desalinization Act of 1996, and a report to 
Congress on the findings of 5 years of research conducted under 
the act is currently undergoing review within the Department of 
the Interior.
    Several of the advances achieved under the act could 
potentially be applied here. Among those different technologies 
addressed by the study, at least four appear particularly 
promising. One, combines wastewater reclamation technology with 
desalination techniques to purify wastewater to a level that 
meets or exceeds drinking water standards. Through the use of 
membrane bioreactors that use less space, equipment, chemicals, 
and energy, this method may be cost-competitive with 
conventional methods and have fewer environmental impacts.
    Combining the research components of pretreatment intake, 
advanced membranes, and a high-pressure pumping system to 
facilitate continued development of acceptable concentrate 
disposal methods is also promising. Third, a process called 
dewvaporation, a humidification-dehumidification process that 
is energy efficient and which uses innovative technology and 
inexpensive materials. This could be a viable option for low-
cost, low-maintenance treatment for small communities.
    And fourth, clathrate desalinization is an improved freeze 
desalinization technique, which facilitates ice-like formation 
of crystals at higher temperatures using guest molecules. These 
are all sophisticated research ideas that are part of the 
report that we are bringing forth to the Congress.
    The conversion of irrigation to municipal and industrial 
uses, the El Paso-Las Cruces Regional Sustainable Water 
Project, and desalinization are all viable solutions to 
providing safe drinking water for a growing population. The 
Bureau of Reclamation remains committed to working with all the 
stakeholders in the region to manage the water resources in an 
economically efficient and environmentally sound manner to 
address future water needs of the changing society and the 
economy.
    Mr. Chairman, that concludes my remarks. Thank you.
    [The prepared statement of Mr. Gold follows:]

 Prepared Statement of Rick L. Gold, Regional Director, Upper Colorado 
                     Region, Bureau of Reclamation

    Mr. Chairman and members of the Committee, thank you for the 
opportunity to appear today to discuss the Bureau of Reclamation's 
involvement in meeting the water supply challenges facing the southern 
New Mexico border region, from Las Cruces to El Paso, Texas and Juarez, 
Mexico. My remarks today will be primarily concerned with the water 
contract conversions from irrigation to municipal and industrial uses, 
the proposed El Paso-Las Cruces Regional Sustainable Water Project, and 
desalination.
    Virtually since its inception in 1902, the Bureau of Reclamation 
has been involved in the management of water resources in this region, 
focusing initially on traditional irrigation water management and 
meeting water delivery, treaty, and compact requirements. As the 
population growth rates have increased dramatically, the demand for 
safe drinking water has also increased in direct proportion. The Texas 
portion of the Hueco Bolson groundwater basin may run out of fresh 
water by the year 2025 because water is being pumped out faster than it 
can be replenished. Shifting from groundwater to surface water for 
drinking water supply in sufficient quantity and quality has by 
necessity focused on the Rio Grande Project.

                       WATER CONTRACT CONVERSIONS

    On February 25, 1905, Congress authorized the construction of the 
Rio Grande Project to supply irrigation water to lands in the Roncon 
and Mesilla Valleys in southern New Mexico and the El Paso Valley in 
west Texas. The project also supplies 60,000 acre-feet of water 
annually to Mexico under the 1906 Treaty obligation. Acting within the 
laws of the then-Territory of New Mexico, Reclamation filed 
appropriations for water rights, which included an initial 730,000 
acre-feet annually, and subsequently, all unappropriated water of the 
Rio Grande. Thus, all water in the Rio Grande between Elephant Butte 
Dam and Fort Quitman, Texas, became Rio Grande Project water supply.
    On February 25, 1920, Congress passed the Sale of Water for 
Miscellaneous Purposes Act (also known as the 1920 Act), authorizing 
the Secretary of the Interior to enter into contracts to supply water 
from any Reclamation irrigation project for other purposes. This act 
grants the Secretary discretion as to the terms of such contracts, but 
also imposes very specific requirements designed to protect the 
integrity of those projects and the Federal investment in them:

   Prior approval of the water user organizations must be 
        obtained;
   A showing must be made that no other practicable source of 
        water supply is available;
   Delivery of water under such contracts must not be 
        detrimental to water service for the involved irrigation 
        project or the rights of any prior appropriators;
   Moneys derived from such contracts must be placed into the 
        Reclamation fund and credited to the project from which such 
        water is supplied.

    The 1920 Act made it possible for Reclamation to utilize water 
supplies from irrigation-only projects for other purposes without 
Congressional re-authorization. This was an important development for 
projects where no other water supply was available, such as in the case 
of the Rio Grande Project where all water had been appropriated.
    In 1940, the City of El Paso approached Reclamation and the El Paso 
County Water Improvement District No. 1 to obtain surface water for a 
growing city. The result was a 1920 Act contract allowing conversion of 
a portion of the irrigation water supply for municipal and industrial 
use by El Paso. Thus, a portion of a fully-appropriated water supply 
was converted without Congressional re-authorization. Over the years, a 
series of conversion contracts among these parties followed as El Paso 
continued to grow, along with its need for additional water. The most 
recent contract, signed in June 2001, will supply the expanded Jonathan 
Rogers Treatment Plant.
    Even more recently, Reclamation met with representatives of the 
City of Las Cruces and Elephant Butte Irrigation District to discuss 
Las Cruces' long-range plans to gradually convert Project irrigation 
water to other uses. Although conversions in Las Cruces are still 
several years away, we look forward to working with Las Cruces and 
Elephant Butte Irrigation District on a 1920 Act contract when the time 
is right.
    Congress clearly recognized that needs may change in the areas 
served by Reclamation irrigation projects. Since 1940, Reclamation has 
used the 1920 Act again and again on the Rio Grande Project to meet the 
changing needs of the Project area. During that time, the strict 
requirements of the 1920 Act have protected, and will continue to 
protect, the rights and interests of everyone--the affected states, the 
irrigation districts, individual landowners, and the Federal investment 
in the Project. Reclamation remains committed to working with these and 
other interested parties.

         EL PASO-LAS CRUCES REGIONAL SUSTAINABLE WATER PROJECT

    Beginning in 1997, Reclamation, the City of El Paso, and the El 
Paso County Water Improvement District No. 1 determined that long-term 
planning to meet the changing needs of the El Paso-Las Cruces area was 
advisable. Reclamation provided $1,105,000 for a study to evaluate the 
ability of conveyance alternatives to deliver surface water of suitable 
quality and quantity to each irrigation district and the City of El 
Paso. A model was developed by the U.S. Geological Survey and a Boyle 
Engineering/Parsons private consultant to evaluate the interaction 
between the ground water systems and surface water flows in the Rio 
Grande. The most viable of the alternatives then underwent National 
Environmental Policy Act analysis resulting in the preparation of an 
Environmental Impact Statement (EIS) for the El Paso-Las Cruces 
Regional Sustainable Water Project (Sustainable Project). Reclamation 
served as a cooperating agency while the International Boundary and 
Water Commission and City of El Paso Public Service Board were joint 
lead agencies for the EIS which evaluated long-range proposals for 
implementation. Reclamation participated as a member of the Steering 
Committee of the New Mexico-Texas Water Commission, whose role was to 
help guide the EIS process for the Sustainable Project. As part of our 
written comments during the NEPA process, Reclamation is on record that 
we believe the EIS to be programmatic in nature because the document 
did not identify specific future sources and amounts of water to be 
converted and that additional NEPA compliance will be required for 
future water conversions of Rio Grande Project water. Additionally, we 
reiterated that any water conversions must be consistent with the 
statutes under which the Rio Grande Project is authorized and other 
applicable laws especially the 1920 Act.

                              DESALINATION

    Desalination, water reuse, and water purification technologies are 
increasingly viable means to expand our fresh water supplies and 
maintain water quality. Reclamation has been making investments in 
developing and implementing these technologies to meet the growing 
demand for water and to relieve stress on over-allocated rivers and 
groundwater systems. Our many water storage and delivery facilities, 
and our water and infrastructure laboratories in Denver, part of the 
Federal Laboratory Consortium, provide a unique and essential 
capability that supports and integrates our technical development and 
research efforts. Under Reclamation's Science and Technology Program, 
Reclamation has made many technological advances and continues to 
improve water management in New Mexico and Texas along the Rio Grande.
    In addition to offering opportunities for expanding fresh water 
supplies and improving water quality, alternative, more energy-
efficient desalination and water purification technologies can reduce 
the large power consumption associated with basin transfer and 
groundwater pumped water supplies. As part of a Federal effort to spur 
desalination research, Reclamation has successfully implemented Public 
Law 104-298, the Water Desalination Act of 1996 (the Act). A report to 
Congress on the findings of five years of research conducted under the 
Act is currently undergoing review within the Department of the 
Interior. Several of the advances achieved under the Act could 
potentially be applied to New Mexico to show how the quality of life in 
water-scarce regions could be improved by increasing water supplies 
through water desalination.
    Among the different technologies addressed by the study and the 
report, at least four desalination technologies appear particularly 
promising:
    1. Combining wastewater reclamation technology with desalination 
techniques to purify wastewater to a level that meets or exceeds 
drinking water standards. Through the use of membrane bioreactors that 
use less space, equipment, chemicals, and energy, this method may be 
cost competitive with conventional methods and have fewer environmental 
impacts.
    2. Combining three research components (a pretreatment intake 
system, advanced membranes, and a high pressure pumping system) to 
facilitate continued development of acceptable concentrate disposal 
methods.
    3. Devaporation, a humidification-dehumidification process that is 
energy efficient and which uses innovative technology and inexpensive 
materials. This could be a viable option for low cost, low maintenance 
treatment for small communities.
    4. Clathrate desalination, an improved freeze desalination 
technique which facilitates ice formation at higher temperatures using 
guest molecules.
    The conversion of irrigation to municipal and industrial uses, the 
El Paso-Las Cruces Regional Sustainable Water Project, and desalination 
are all viable solutions to the same problem, providing safe drinking 
water for a growing population. The Bureau of Reclamation remains 
committed to working with all stakeholders in the region to manage the 
water resources in an economically efficient and environmentally sound 
manner to address future water needs for a changing society and 
economy. Mr. Chairman, that concludes my remarks for today.

    The Chairman. Thank you very much.
    Ms. Little, go right ahead, please.

 STATEMENT OF DEBRA J. LITTLE, PRINCIPAL ENGINEER, ENGINEERING 
DEPARTMENT, UNITED STATES SECTION OF THE INTERNATIONAL BOUNDARY 
                      AND WATER COMMISSION

    Ms. Little. Thank you. Mr. Chairman, I am pleased to 
discuss with you today the role of the International Boundary 
and Water Commission in working with U.S. and Mexican water 
users of southern New Mexico and a region that includes both El 
Paso, Texas, and Juarez, Mexico.
    The IBWC was established by the 1889 convention between the 
United States and Mexico as an international commission 
composed of a U.S. section, headquartered in El Paso, Texas, 
and a Mexican section, headquartered in Ciudad Juarez, 
Chihuahua, Mexico. The IBWC applies the water and boundary 
treaties between the United States and Mexico and is tasked 
with resolving all differences that may arise in the 
application of those treaties.
    The two major treaties that define the role of the IBWC in 
water supply issues of the southern New Mexico border region 
are the Convention of 1906, also known as the Treaty of 1906, 
it is entitled ``Equitable Distribution of the Waters of the 
Rio Grande,'' and the 1944 treaty, known as the 1944 Water 
Treaty, and it is entitled ``Utilization of Waters of the 
Colorado and Tijuana Rivers and of the Rio Grande.''
    The 1906 convention provides for the distribution between 
the United States and Mexico of the waters of the Rio Grande 
for irrigation purposes in the greater El Paso-Juarez area. 
Mexico receives 60,000 acre-feet annually at the Acequia Madre, 
or Old Mexico Canal, in Juarez, Mexico. In case of 
extraordinary drought, which is not defined by the treaty, the 
amount delivered to Mexico is reduced in the same proportion as 
water delivered to U.S. irrigators.
    The 1944 treaty extended the terms of the 1889 convention 
and expanded the duties of the IBWC. In fact, the 1944 treaty 
is known as making the IBWC the IBWC of today. Decisions of the 
commission are executed in the form of minutes, and these 
minutes, when approved by the U.S. and Mexico governments, 
become legally binding agreements of the two countries.
    In terms of the Rio Grande waters, the 1944 treaty provides 
for allocation between the two countries of these waters 
between Fort Quitman, Texas, and the Gulf of Mexico. Now, 
although this part of the river is downstream approximately 75 
river miles from the El Paso-Juarez area, the significance of 
the 1944 treaty for the El Paso-Juarez region lies in several 
articles of that 1944 treaty.
    Among them, Article 3 provides for the preference of joint 
international water use ranging from, first, domestic and 
municipal, through agricultural and stock raising, electric 
power, other industrial, navigation, fishing and hunting, to 
the last preference described as any other beneficial uses. All 
of these uses are subject to the preferential attention to be 
given to the solution of all border sanitation problems.
    Article 24 extends to the IBWC the powers and duties to 
initiate and carry on investigations and develop plans for the 
works to be constructed or established in accordance with the 
treaty and other agreements enforced between the two 
governments dealing with boundaries and international waters.
    The IBWC has historically played a major role in the 
distribution of Rio Grande waters as required by the two 
treaties mentioned. More recently, it has taken on a leadership 
of initiatives that stretch the boundaries of its traditional 
roles. This has resulted in a number of challenges for its 
century-old experience in international cooperation for the 
solution of boundary water issues.
    These initiatives include the New Mexico-Texas Water 
Commission's El Paso-Las Cruces Regional Sustainable Water 
Project, the Paso Del Norte Watershed Council, regional 
groundwater studies, most specifically the Hueco Bolson, the 
Rio Grande Citizens Forum for the El Paso-Las Cruces Area, and 
the Paso Del Norte Water Task Force. These multijurisdictional 
initiatives all involve, as indicated this morning, layers of 
competing interests, two different countries, which there are 
many differing authorities, responsibilities, histories, and 
jurisdictions covering, in addition, numerous local authorities 
and two different, very different, U.S. States.
    All involve technically complex situations for which there 
is not always complete or accurate information or data. All 
present the challenge of how to identify and provide full 
participation of all stakeholders. Also, all present the 
challenge of how to find water for the environment, to improve 
the health of that environment, and still adequately meet the 
needs of human beings. And finally, all pose the challenge of 
assuring what is very critical to the International Boundary 
and Water Commission, an international relationship that is 
based on parity and comity of both nations.
    The El Paso-Las Cruces Regional Sustainable Water Project 
proposes to protect and maintain the sustainability of 
groundwater sources for the area by relying on year-round water 
supply from the Rio Grande. The U.S. section of the IBWC was 
asked, and agreed, to take on a leadership role for the 
environmental documentation for this project required by NEPA, 
the National Environmental Policy Act, for which the record of 
decision was signed on January 16 of this year.
    In addition to this role as the Federal environmental lead, 
which involved the challenges of dealing with those competing 
interests, providing full stakeholder representation, and 
understanding the complexities of long-term effects of the 
project on the environment, the U.S. section of the IBWC has 
its traditional and mandated role to assure that treaty, 
compact, and contract requirements for water deliveries are 
met. And in regard to parity and comity with Mexico, there is 
the challenge of addressing varying viewpoints about the extent 
to which impacts in Mexico should be considered during project 
implementation.
    The Paso Del Norte Watershed Council was formed as an 
environmental enhancement commitment of the project I just 
described. The U.S. section of the IBWC has co-chaired the 
formation of this council with the intent to utilize a 
watershed approach, the watershed being that of the Rio Grande 
sub-basin between Elephant Butte Dam, New Mexico, and Fort 
Quitman, Texas, and to improve the Rio Grande ecosystem while 
balancing the needs of all stakeholders and foster 
communication and collaboration among the binational 
stakeholders in the watershed.
    Groundwater study and modeling of the transboundary 
aquifer, the Hueco Bolson, began in 1995 as an information 
exchange between the El Paso and Juarez municipal water 
utilities. The IBWC formed a binational technical group of 
local, State, and Federal representatives and produced a 
binational report blessed by both countries entitled 
``Transboundary Aquifers and Binational Groundwater Database, 
City of El Paso-Ciudad Juarez Area.'' This does consist of a 
database on ground waters in the area.
    This same binational technical group is in the final stages 
of developing compatible mathematical groundwater models for 
the Hueco Bolson that will assist authorities in both countries 
with planning for optimum utilization and administration of 
groundwater resources of the region.
    The challenges posed by this study and modeling effort 
include moving from data exchange to obtaining more complete 
information on the aquifer, producing modeling tools that truly 
are compatible in results, and providing due consideration to 
the master planning efforts of Juarez in view of decreasing 
groundwater supply in the minimal resources available to 
adequately study groundwater conditions.
    The Rio Grande Canalization Project was constructed in 1938 
and covers 105 miles of the Rio Grande from Percha Dam, New 
Mexico, to El Paso, Texas. The U.S. section built this project 
in order to assure the safe delivery of those 1906 convention 
waters to the El Paso-Juarez area. The project consists of 
maintenance of the river channel, flood control levies, and a 
vegetation-controlled floodway to assure the prevention of 
flooding by river waters.
    The U.S. section is currently performing an environmental 
impact study of the project with the objective of preserving 
the integrity of the traditional flood protection aspects of 
the project to assure continued water deliveries of the 1906 
convention waters, and to identify and consider environmental 
enhancement opportunities and nonstructural operational 
practices that support restoration of native riparian and 
aquatic habitats.
    With the draft environmental impact statement scheduled for 
December of this year and the record of decision expected by 
April of next year, the U.S. section faces the challenges of 
reconciling that traditional role of providing necessary flood 
protection and safe delivery of joint waters with the interest 
of the stakeholders in providing water for the environment and 
utilizing a watershed approach the river management versus the 
jurisdictional approach.
    Rehabilitation of the Rio Grande canalization project 
features, which consists of two irrigation water siphons and a 
flume, is needed to assure the structural integrity of these 
conveyance system for the agricultural community of southern 
New Mexico. The U.S. section has completed rehabilitation 
studies of those features, which indicate that river channel 
degradation has been a cause of the problem, with some field 
investigations still needed for the flume rehab. The designs 
for rehabilitation of siphons are complete and construction is 
planned to commence in the upcoming nonirrigation season.
    And in response to community stakeholder interest in this 
canalization project, the U.S. section of the IBWC formed the 
Rio Grande Citizens Forum. This forum represents cross-
sectional interests in the community, is chaired by a 
representative of the U.S. section of the IBWC and a community 
representative from the Southwest Environmental Center here in 
Las Cruces, and facilitates dialogue about IBWC projects in the 
Rio Grande from Percha to Fort Quitman. The quarterly meetings 
are held alternately in Las Cruces and El Paso, and topics 
include proposed river parks, non-native species eradication, 
siphon and flume rehab, which I just spoke about, and upper Rio 
Grande water operations model.
    In April 1999, the IBWC commissioners convened the Paso Del 
Norte Water Task Force, a regional organization of civic 
leaders, managers of municipal water utilities and irrigation 
districts, water users, and water experts from New Mexico, 
Texas, and Chihuahua, working toward a more sustainable water 
use in the region. Again, this region being from Elephant Butte 
Dam to Fort Quitman.
    The task force functions as an apolitical advisory 
organization that bases its work on input from scientific 
analysis and community consultation.
    The task force first study was that of water planning 
activities in the region. The results of this substitute study 
were disseminated in the March 2001 report entitled, ``Water 
Planning in the Paso Del Norte Toward Regional Coordination.''
    Its three broad conclusions are: There are gaps in the 
information needed for planning. Water entities in this region 
face many common challenges and issues, and regional 
coordination in water planning is definitely needed. The major 
challenge facing this task force and the IBWC as the conveners 
of the task force is identifying the next steps that can be 
taken within the current institutional context--and I must 
stress, there is not a formal regional planning management 
entity in existence--to move the region towards a more 
sustainable water future.
    This challenge is recognized in the context of the task 
force stated goals that include keeping abreast of progress 
being made by others, to avoid duplication of efforts, and 
submitting policy recommendations to appropriate authorities in 
Mexico and the United States for resolution of high priority 
water issues in the Paso Del Norte water region.
    Mr. Chairman, as my report has made clear, hopefully, the 
IBWC's role in working with area water users, both in the 
United States and Mexico, is one that is based on over 100 
years of experience in meeting treaty obligations on water 
issues between the two countries, and one that is responding to 
a call for the IBWC to take a stronger leadership role in 
addressing the challenge of providing a sustainable water 
resource for the southern New Mexico border region.
    I want to thank you for the opportunity to testify on 
behalf of this agency. And I would like to conclude by inviting 
my counterpart, Principal Engineer Antonio Rascon of the 
Mexican section of the IBWC, to present some concluding 
observations on behalf of the Mexican section. Thank you.
    The Chairman. Thank you very much.
    Mr. Rascon, we are very pleased to have you here. Go right 
ahead.

   STATEMENT OF ANTONIO RASCON, PRINCIPAL ENGINEER, MEXICAN 
   SECTION OF THE INTERNATIONAL BOUNDARY AND WATER COMMISSION

    Mr. Rascon. On behalf of the Mexican section of the 
International Boundary and Water Commission, I would like to 
stress some aspects that were mentioned by Ms. Little. I would 
like to point out the efforts that have taken place under the 
IBWC coordination regarding groundwater in the El Paso-Juarez 
area.
    These efforts included the exchange of groundwater 
information and the development of a joint report in both 
English and Spanish as well as a joint development of 
groundwater flow model that is now next to be finished. This 
was done by a binational technical group under the IBWC 
coordination. We had to deal with different tools, criteria, 
resources and priorities on each side of the border. It has 
come to develop its own model but under a coordinated scheme.
    What each country did was discussed by a binational group 
in such a way that the results obtained by each country were 
acceptable by the other. Once the full model is finished, a 
groundwater quality model could be the next step.
    The Chairman. Could you say that once more? I was not able 
to hear that. Say that last thing once more.
    Mr. Rascon. The groundwater quality model, the first one 
was a flow model, and the next step could be a water quality 
model. This would provide more precise information regarding to 
the water quality distribution in the aquifer, the volumes and 
location of the fresh groundwater bodies, and the time it will 
take to--not to deplete the aquifer, because it is quite a big 
one, but what time will it take for the water quality to 
decline.
    On the other hand, I want to mention that a master plan was 
developed for Juarez city with the support of BECC, the Border 
Environmental Cooperation Commission. The master plan 
describes, among other aspects, which are the water sources for 
the city, how the water demand is going to grow in the future, 
which new sources are going to be developed to meet the demand, 
when the new sources need to be in operation, and what will be 
the cost to do it.
    That master plan clearly indicates what where the water is 
going to come from to support the future growth and the 
development of the city, including the Conejos Medano and 
others that was mentioned this morning. We are talking about a 
project that is going to supply 12 cubic meters per second by 
the year 2020.
    I also should mention that a regional plan is to be 
developed with the objective to identify water projects of 
common interest in the area of Ciudad Juarez-El Paso. The 
starting point for this regional planning is the master plan in 
Juarez and the sustainable water project developed for El Paso-
Las Cruces.
    As a first step, funds were provided through BECC to 
prepare the terms of reference to develop the regional plan. 
These are expected to be concluded within the next few months. 
Options like surface water, groundwater, desalination, or 
conservation will be evaluated.
    The IBWC has supported the efforts of the local agencies. 
We know that it is very important that the local agencies take 
the leadership in identifying the water problems and their 
solutions. We always offer the experience and support of the 
IBWC for the binational coordination of these kind of projects 
that involve international or transboundary waters. Of course, 
a closer and stronger binational leadership can be achieved by 
the IBWC when the resources are provided directly to the 
commission.
    As a conclusion, I think that a lot of things have been 
done regarding cooperation on water issues and a lot need to be 
done, and I am sure we are going to find a way to do it. Thank 
you.
    The Chairman. Thank you very much. Thank you for your 
testimony. Let me see if I could start with some questions for 
you, Mr. Gold. Have you done anything in the Bureau of 
Reclamation to determine the cost-effectiveness of any of these 
potential desalinization/desalination technologies? Is this 
something that would make sense from a cost perspective?
    Mr. Gold. Yes, Senator. Part of the previous research that 
was done, does, in fact, deal with how cost-effective some of 
these techniques might be. I think they still have a long ways 
to go in terms of being as cheap as some of the current water 
supplies. But significant improvements, particularly as an 
example I might give you, the average costs of seawater 
desalination have dropped from somewhere around $14 per 
thousand gallons in the 1950's to between $2 and $3 per 
thousand gallons in the year 2000.
    Now, obviously, that depends on power needs and costs, 
capital recovery and many other things. But it is becoming more 
attractive. To say it would be attractive enough at this point 
in time for cities or small entities to rely completely upon 
desalinization as a water supply is probably a stretch. But we 
have made great progress, and I think that is the principal 
reason that we support some continued research to reduce the 
risk. Let some of these new technologies ripen and get more and 
more competitive with the ever increasing costs of providing 
water supplies.
    The Chairman. Let me ask about some of the statements that 
were made this morning by the representative from El Paso, the 
utility down there, that the process for water transfer is 
unnecessarily cumbersome, in his view. Is that something you 
agree with? Disagree with? Is there anything being done to 
address that? Or what is your perspective on that, Mr. Gold?
    Mr. Gold. I think it is understandable, John's perspective 
that it is cumbersome. Keep in mind we are dealing with a set 
of Federal laws imposed by the U.S. Congress starting in 1905. 
The most important legislative tool that we have to allow this 
conversion to take place is the 1920 Act. So a lot of things 
have changed, and yet we do not have a clear legislative tool 
that has improved upon that situation.
    Now, in our own defense, I think that it is certainly 
possible, it has been demonstrated possible, to convert from 
agriculture supplies to municipal supplies. We have a long 
history of doing that with EP Number 1 going back as far as the 
1940's. Mr. Fifer mentioned the several contracts that we have 
been through.
    I think if you go back to the basic requirements that we 
have, things like being able to do this with the prior approval 
of the water district, with no other practical source 
available, cannot be detrimental to the water service of the 
involved irrigation districts, and that monies derived have to 
be placed back to the Reclamation Fund. In the case of Rio 
Grande Project, it is also really important to keep in mind, it 
is not a one-district project. It was originally designed with 
three key participants, Elephant Butte Irrigation District, El 
Paso Number 1, and the country of Mexico.
    So we need to take a position that whatever we do to modify 
and allow modification to occur to that project that was built 
in the 1900's, it has to protect all of the participants. Our 
concern is that the whole project must stay whole as opposed to 
granting the desires of any given participant. So we think it 
is important. I admit, certainly, to understanding John's 
frustration, but certainly it is a possibility. It has been 
worked through. There are mechanisms that make it work.
    Probably the most frustrating part--and we could sort this 
out with John--but is that from our perspective, the irrigation 
district, in this case El Paso Number 1, has to agree, and I am 
sure that has been a very frustrating issue. It is not the 
Bureau of Reclamation that gets to decide. That water supply 
was originally intended for EP Number 1, and the law for 
conversion requires us to have their agreement.
    The Chairman. How do you respond to the criticism that 
getting these transfers to occur provides an opportunity for 
the Bureau of Reclamation to essentially take its pound of 
flesh as part of the process? What is your response to that?
    Mr. Gold. My response would go like this. If you looked at 
the total cost that the United States invested in building the 
Rio Grande Project, certainly I think all would agree that a 
fairly substantial portion of those costs are not repaid. We 
have a situation where the local districts have repaid their 
irrigation obligations, as Gary Esslinger said this morning, 
and we agree with that.
    The problem is there were other Federal investments that 
were not repaid. There are also the mechanism of whether or not 
the United States has a continuing interest, and we do not need 
to go there. That is part of litigation that is ongoing in this 
basin. But that is also one of the threshold issues. Even 
though the project has had its irrigation repayment repaid, is 
there a continuing interest in the project by the United 
States?
    My answer would be yes, because, again, of the three 
entities who are the linchpins of the project, the two 
irrigation districts and Mexico.
    To assume that the United States has no further interest 
just does not get there for us. So yes, it is a small amount, I 
think it is like a 5 percent or $5 an acre-foot in a water 
supply that I do not know the most current exchange rate, but 
it is probably upwards of $150 or $200 an acre-foot, a fairly 
modest contribution to the United States.
    The Chairman. Is it your thought that these laws, these old 
laws that you operate under here in approving these 
conversions, that those should be modernized and simplified? Is 
that what I heard you to say?
    Mr. Gold. I do not know that I would suggest that. I would 
simply say that they are the tools that we have. Could they 
simplify the life of some of the folks out there who are trying 
to convert from ag to M&I? Very possibly. I think the risk is 
that if you were to open those laws and start to try to achieve 
what any given interest might want, many other interests might 
also come to that now legislative debate about how they would 
like to see the arrangements changed between the United States 
and its districts. So it is tender ground, from my perspective. 
It may, in fact, help the frustration, but it may, in fact, 
hinder it.
    The Chairman. So you think that the political and 
institutional constraints imposed by the Federal bureaucracy, 
which John Burkstaller referred to, are not near as great as he 
was indicating?
    Mr. Gold. I think the demonstrated impact is that it works. 
We can get the job done. We can convert water from ag to M&I 
with the agreement among the local sponsors. If they can come 
to that agreement about what makes sense, we can get it done. 
And we have demonstrated that many times in the Rio Grande 
Basin.
    The Chairman. Ms. Little, let me ask you about some of the 
testimony we had this morning. I thought it was interesting, 
particularly the State engineer's suggestion that if Mexico 
goes ahead with the development of this Conejo field of wells, 
that that would cause the State to believe that the Federal 
Government, perhaps, should revisit this obligation to provide 
60,000 acre-feet of water each year.
    Because as I understood his testimony, he was saying that 
development of that field will, in fact, reduce the flow of 
water in the Rio Grande, that is, that New Mexico is able to 
provide.
    Ms. Little. I think the first thing that would have to be 
established is that that is a fact, that the development of the 
Conejos Medanos would, in fact, reduce the river flow. That 
would be the first thing. But he was correct in stating that 
should that be an allegation on the part of the State of New 
Mexico, that it would be appropriate to take that to the 
national level, because it would be a dispute under the 1906 
treaty, and the IBWC is tasked with resolving disputes under 
that treaty.
    The Chairman. Has the IBWC looked into that question of 
whether or not the putting of those wells in this Conejos 
Medanos would, in fact, have that effect?
    Ms. Little. No, we have not. As a joint effort, we have 
not.
    The Chairman. Is that something you intend to do or should 
do?
    Ms. Little. I would say, as you stated earlier this 
morning, that it is very appropriate to do joint monitoring and 
studies of what the actual physical conditions of transboundary 
aquifers are.
    The Chairman. So you think it is an appropriate thing to 
look at jointly?
    Ms. Little. Yes, jointly.
    The Chairman. What about this concern I raised this 
morning, if we do not have agreement on the two sides about 
what the current status of the water supply is in these various 
aquifers and, therefore, we do not have agreement on the 
projected depletion of the aquifers. It seems to me that is a 
sort of a real basic kind of a thing, which I would have 
thought that the IBWC would have been able to accomplish that.
    I would have thought that would be one of the main purposes 
of the IBWC, would be to get this consensus developed about 
what the water availability and needs are along the border. Am 
I wrong in that?
    Ms. Little. Well, yes, I would address that. Let me first 
mention that groundwater is not something, as I mentioned, that 
was addressed in the 1906 or the 1944 treaties. It is implied 
that because we have the duty to conduct studies affecting 
boundary water issues, that, of course, we could and should 
play a role in transboundary aquifers or groundwater.
    There is a more specific obligation under one of our 
minutes, Minute 242, that actually deals with the Colorado 
issue of groundwater. But from that, there is a basic, basic 
responsibility for a groundwater treaty to be developed between 
the two nations. That has not occurred, and it is something 
that the IBWC would be tasked with actually developing.
    What has happened is that in various locations along the 
border, groundwater issues have been studied and in some places 
jointly studied--and I would say El Paso-Juarez is probably at 
the forefront of that--have been studied, but on an aquifer-by-
aquifer basis. There is no agreement between the two nations on 
groundwater management, none whatsoever.
    I do think it is appropriate that we work in that 
direction. The IBWC, both sections, believe it is appropriate. 
But I think you pointed out this morning something basic, that 
there is a tremendous resource investment in actually 
determining what are the conditions of the groundwaters. There 
are projections made. There is not agreement with the country 
of Mexico that those projections are made on accurate and 
correct information.
    Regardless, it does not diminish the fact that it is a 
critical situation and that we need to move forward jointly, 
not unilaterally, jointly with the country of Mexico. And in 
doing so, major challenges are involved because of the 
resources available to actually study and get accurate 
information.
    The Chairman. Well, bringing it down to sort of bedrock, 
from my perspective, if, in fact, you have these predictions 
being published in the literature that Juarez is going to run 
out of water by 2005----
    Ms. Little. A projection that is made by the United States.
    The Chairman. Right.
    Ms. Little. Not by Mexico.
    The Chairman. Not by Mexico. But that is 4 years down the 
road.
    Ms. Little. Yes.
    The Chairman. Four and a half.
    Ms. Little. If it is correct. That is right.
    The Chairman. Yes. It seems to me that it should be 
someone's priority to figure out if it is correct.
    Ms. Little. That is right.
    The Chairman. What is happening that has not already 
happened to try to get a binational effort to figure out if 
that is correct?
    Ms. Little. Well, the effort that I talked about, which is 
the groundwater study of the Hueco Bolson, in which USGS 
participated, we are projecting by the end of this year to have 
a report on the model, which would show the actual flow 
characteristics of that. But it would be one that is produced--
that would actually have binational agreement on what is 
happening in that aquifer.
    As Engineer Rascon stated, though, it is not addressing 
water quality. We need to invest time and money and expertise 
in actually looking at the quality of the aquifer. Engineer 
Rascon mentioned there is probably adequate water. It is the 
quality of that water that is available. And I agree that that 
effort needs to go forward. And I do believe, as somebody 
mentioned this morning, that that needs Federal support dollars 
in order to advance that.
    The Chairman. Federal support to determine the quality?
    Ms. Little. The quality as well as the other physical 
characteristics of that aquifer.
    The Chairman. So the USGS work that has been done to date 
is not adequate to tell us what we need to know?
    Ms. Little. It is not complete.
    The Chairman. And you agree with that, Mr. Rascon?
    Mr. Rascon. Well, I think that a lot of things have been 
mentioned. Maybe I would like to start by the Conejo Medano 
development is a development that is going to take place quite 
south from the border. We are talking about some kilometers 
south of the border, and quite a big distance from the Rio 
Grande. And the 1906 treaty is regarding of surface water, so 
we need to decide whether we want a groundwater treaty--at this 
moment, we do not have a groundwater treaty--and make the 
necessary studies in order to define whether an impact, if 
there is an impact from the developments that are being planned 
in New Mexico. But the developments are taking place or are 
planned to take place quite south from the border.
    Regarding the Hueco Bolson, the joint efforts that were 
taken were mostly exchange of information and not flow model. 
The flow model is providing some results, but not the 
distribution of the water quality in the aquifer. There is a 
lot of information that I am sure that could be used and maybe 
was used by the USGS and they could have obtained some figures 
on the Mexican side. But the results that have presented to the 
Mexican part were not well supported when they were presented.
    The conclusion was that we need more detailed information 
regarding the characteristics of the aquifer in order to arrive 
to a more specific conclusion. And we can say that it can take 
5 years or 20 years. It depends on some parameters that we 
input to the model.
    The fact is that the water in the aquifer is being over-
exploited very well within the aquifer. We are taking more 
water than it is being recharged. The water quality is 
declining. But we are not saying that we are going to get out 
of water. The water is there. The aquifer is quite big. We are 
going to have water of poorer quality. We are talking about 
water quality more than quantity.
    The Chairman. So you think there is adequate water, it is 
just poor quality. The quality is going to continue to 
deteriorate as you drain the aquifer?
    Mr. Rascon. Yes, it is being deteriorated. We know that 
there is a declining in the quality of water, and it is going 
to continue. As a matter of fact, there are some wells that 
need to be abandoned because of the quality, but there are 
other areas where the quality is still good.
    So it is a matter of defining what are the areas where the 
quality is going to continue to be good. So we need more 
detailed studies in order to clearly identify where are 
different water bodies.
    The Chairman. What is happening to bring about these more 
detailed studies that you seem to support and that the U.S. 
side seems to support? Is this strictly a matter of not having 
enough dollars to proceed? Is that where we are?
    Mr. Rascon. Well, I think when we want to develop 
groundwater studies along the border, we need to--we have 
different priorities. We have different criteria. And in order 
to develop a joint study, we need to put together our interests 
on both sides of the border. And we understand that in the 
United States, there are a lot of resources, personnel, and 
capabilities to develop these studies.
    We need to select specific areas to start this joint 
effort, because the capabilities on the Mexican side are more 
limited. So we identified some specific sites to develop these 
studies, and El Paso-Juarez was one of them so, we started to 
exchange information and all those kind of things.
    The Chairman. Who are the primary--I mean, we have had a 
discussion here this morning and here again this afternoon 
about all of the different agencies, Federal, State, local, 
that have responsibilities here on the U.S. side. Who are the 
counterparts on the Mexican side, across on the Juarez side?
    Mr. Rascon. Well, we have the Mexican section of the 
International Boundary and Water Commission.
    The Chairman. Right.
    Mr. Rascon. And then we have the National Water Commission. 
In general, the water is a Federal--is something that is 
managed federally. They give concessions to the States or the 
cities to develop some aquifers or some wells. So the 
coordination in this case in the Mexican section was with the 
Mexican section of the National Water Commission and the La 
Junta de Agua, the local utility.
    The Chairman. Let me ask, Ms. Little, you refer in your 
testimony to the review that is now going on, and I guess you 
are coming, a NEPA study, I believe?
    Ms. Little. In connection with the canalization project?
    The Chairman. Yes, in connection with the canalization. Is 
it your expectation that the end result of that will be a 
change in policy so that the clearing of vegetation along the 
Rio Grande will cease or be moderated?
    Ms. Little. I think moderated is probably an appropriate 
term. The alternatives that are being studied at this point, I 
believe there are four alternatives--I may be mixing that up 
with the lower Rio Grande EIS, so I better step back from that. 
But there are varying degrees to a complete outside the 
jurisdiction of the IBWC alternative, in other words, a true 
approach that would involve actions on the parts of 
jurisdictions that are not necessarily within IBWC authority. 
But I do think that we are looking at modifying, certainly 
modifying our traditional approach to the floodway.
    The Chairman. And that can be done under your existing 
statutory authority, as you see it? I mean, there is no need 
for Congress to change the law in order to bring about that 
change in policy?
    Ms. Little. That is correct.
    The Chairman. Well, I think this has all been useful. I 
think there are a lot of issues that have been raised and we 
will undoubtedly follow up on with some additional questions in 
the future. Thank you all very much. Appreciate it.
    Ms. Little. You are welcome.
    Mr. Gold. Thank you.
    The Chairman. Well, thank you all very much for coming and 
thank the witnesses again for the testimony. I think this has 
been a useful airing of issues, and we will try to follow up on 
some of these suggestions. We will conclude the hearing.
    [Whereupon, at 2:32 p.m., the hearing was adjourned.]

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