Marana to buy Metro water credits - The Explorer: Pima Pinal

Marana to buy Metro water credits

Town to save money

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Posted: Tuesday, September 21, 2010 11:00 pm | Updated: 8:07 am, Thu Mar 24, 2011.

Marana is entering a five-year agreement with the Metro Water District to purchase up to 1,537 acre feet of long-term storage credits from Metro each year.

The deal, now approved by both the Metro board of directors and the Marana Town Council, is going to reduce Marana's overall water costs, utilities director Dorothy O'Brien asserts.

Marana is required "to replenish as much water as it uses," O'Brien said in a memo to the town council.

In calendar year 2009, for example, Marana pumped 2,126.5 acre feet of groundwater to supply some 5,266 customers in its service area. To replace that water, Marana delivered all of its 1,528-acre foot allotment of Central Arizona Project water to the Lower Santa Cruz Replenishment Project. It completed its requirements by paying the Central Arizona Groundwater Replenishment District $113,627 for recharge, by purchasing long-term storage credits for 1,039 acre feet of water from excess CAP and other sources, and through use of accrued storage credits.

Under the new agreement, Marana would pay Metro Water $155 per acre foot, up to $253,567, annually in 2011 and 2012 for CAP long-term storage credits. Marana would be paying $377 per acre foot for CAGRD credits, and future CAGRD prices are expected to increase.

"The cost of purchasing these credits from Metro is anticipated to be significantly less than the town's cost of having the CAGRD replenish the same quantity of water," O'Brien said. In fact, Marana would divert funds from its water purchase and replenishment line items to pay Metro.

With the new agreement, "this makes our payment to the groundwater recharge district zero," O'Brien said. "It's an interim solution as we continue to look for additional water supplies."

Because Marana's CAP allotment is "smaller" than what it would prefer, "we needed to have another source," O'Brien said. "There are not places readily available to go and buy CAP allocations."

Metro expects its CAP allotment to exceed its replenishment obligations by 1,635 acre feet per year. Under the new agreement between the two jurisdictions, Marana would have "first priority" to purchase Metro water credits.

"It gets us to the head of the line with their CAP water," O'Brien said, and it was "an opportunity to lock in our fees for the next five years."

Marana would pay Metro each month for its credits. Marana would pay a "minor administrative fee" for the acquisition, but it's "a small price to pay to be guaranteed a certain amount of water," O'Brien said.

The Metro board approved the agreement on Monday, Sept. 13, and by the town council on Tuesday, Sept. 14.

"To me, it's a good deal for the town," Councilwoman Roxanne Ziegler said.

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