From: Richard Spotts
To: Scott Sandall, David Lifferth, Jack Draxler, Edward Redd, Curt Webb, Jacob Anderegg, Justin Fawson, Gage Froerer, Jeremy Peterson, Dixon Pitcher, Brad Dee, Mike Schultz, Paul Ray, Curtis Oda, Brad Wilson, Steve Handy, Stewart Barlow, Timothy D. Hawkes, Raymond Ward, Becky Edwards, Doug Sagers, Susan Duckworth, Sandra Hollins, Rebecca Houck, Joel Briscoe, Angela Romero, Mike Kennedy, Brian King, Lee Perry, Fred Cox, Sophia DiCaro, LaVar Christensen, Craig Hall, Johnny Anderson, Mark A. Wheatley, Patrice Arent, Carol Moss, Eric Hutchings, Jim Dunnigan, Lynn Hemingway, Daniel McCay, Kim Coleman, Earl Tanner, Bruce Cutler, Steve Eliason, Marie Poulson, Ken Ivory, Keven John Stratton, Robert Spendlove, Richard Cunningham, Greg Hughes, John Knotwell, Melvin Brown, Kraig Powell, Scott H. Chew, Kay Christofferson, Brian Greene, Derrin Owens, Val Peterson, Bradley Daw, Keith Grover, Jon Stanard, Dean Sanpei, Norm Thurston, Francis Gibson, Michael McKell, Marc Roberts, Merrill Nelson, Brad King, Kay Mciff, Brad Last, John Westwood, mnoel, Lowry Snow, Don Ipson,
Subject: Please oppose Lake Powell Pipeline funding in SB 80
Date: Sat Feb 06 17:57:36 MST 2016
Body:

Dear Utah Representative:

Please oppose the Lake Powell Pipeline (LPP) funding in SB 80, Senator Stuart Adams' infrastructure legislation.  Under SB 80, some sales and use tax revenue deposited into the Transportation Fund would be transferred to the Water Infrastructure Restricted Account for the LPP.  

As you know, Utah has many important transportation, education, and other funding needs, whereas the potentially multi-billion dollar LPP (construction, maintenance, and financing costs over fifty or more years) is a high-risk, exorbitantly expensive, and unnecessary project.  All Utah taxpayers should not continue to subsidize this LPP to ostensibly benefit water users in only two southwestern Utah counties who are unlikely to pay back the resulting enormous debt load, and who have excessive levels of per capita water use compared to other cities in the arid Southwest. 

If the LPP was a financially prudent project, the two county water districts would have put a bonding measure together for the funding as is often done for these types of projects.  However, these district officials know that this local bonding would not be possible due to likely opposition, both from cautious bonding companies and water users afraid of excessive costs that can harm the local economy.  So LPP proponents successfully lobbied for their customized state law that requires all Utah taxpayers to subsidize this questionable venture.  I think that it is time to repeal that law.

As a long-time Washington County resident, and potential LPP water user in the future, I have serious concerns that the LPP, instead of benefitting county residents, would instead become a huge financial liability that would greatly burden residents and businesses, and potentially lower property values and discourage future development.  Based on what other cities in the arid Southwest have been able to successfully accomplish, I am confident that removing the property tax subsidies, instituting tiered water pricing, and offering incentives to convert lawns to xeriscape would remove the need for the LPP and thereby eliminate the need for state funding.

Last spring, the Utah Legislative Auditor General released an extensive report that seriously questioned the Utah Division of Water Resource's data and projections, which are largely relied upon to justify the LPP.  Please see the newspaper article pasted in below that summarizes that report's findings. 

In addition, please see the attached letter from 21 Utah university economics professors that describes their serious concerns with the LPP's financial feasibility, and the likelihood of excessive impact fees and water rate increases that would be needed to eventually, potentially pay back the massive state loan debt.  They suggest that removing the property tax subsidy for the water districts and implementing market-based tiered water pricing would reduce projected water demand, encourage more effective water conservation, and be a cheaper and more reliable alternative to the LPP.

Finally, please see Governor Herbert's excellent attached 2016 budget water recommendations.  I strongly support these recommendations and believe that their implementation would greatly improve water management in Utah, and likely eliminate or at least postpone for many years the potential need for the LPP. 

Utah is proud of its culture of fiscal conservatism and using market based solutions whenever possible.  Continued proposed funding in SB 80 for the LPP should be evaluated in this cultural context.  Is this funding a good bet and equitable for all Utah taxpayers or high risk and unfair?  Are there much higher priorities for limited state funding?  Have the LPP proponents persuasively and thoroughly resolved the concerns and recommendations of the Utah Legislative Auditor General, 21 Utah university economics professors, and Governor Herbert's 2016 water budget?  I believe that reasonable answers to these questions would result in the conclusion that further state LPP funding is not appropriate.

Thank you very much for your consideration.

Sincerely,


Richard Spotts

255 North 2790 East
Saint George UT 84790



_________________________________________




Sky-is-falling water use projections are based on bad data, Utah auditors conclude

By BRETT PRETTYMAN | The Salt Lake Tribune connect

The Utah Division of Water Resources is relying on old data from unreliable sources and not paying enough attention to new water possibilities according to a report released Tuesday from the Legislative Auditor General.

Current estimates, based on bad water agency data auditors found, project Utahns' demand for water will outstrip the state's supply of the wet stuff in 25 years.

State auditors concluded water managers should consider raising the cost of water as a logical conservation incentive that could help pay for maintaining current water systems and build new storage options. At the same time, the state should develop and maintain better water use numbers, starting with regional water agencies.

"The Division of Water Resources has been using bad data to support billions of dollars in unnecessary spending for massive water projects," said Zach Frankel, director of Utah Rivers Council. "This marks the first time in two decades this agency will have any oversight."

The 82-page report took 16 months to complete and was requested by Legislators at the urging of conservation groups and others who want better state management of water.

Utah's population is projected to double, reaching close to 6 million by 2060, and will overcome the currently developed water supply around 2040.

State and local water managers figure the state will need $33 billion in the coming decades to maintain water infrastructure and find new sources.

To help quench the thirst of the future population, water managers have been ordered by the Legislature to plan two massive water projects. The proposed Lake Powell Pipeline and Bear River Project developments are estimated to cost at least $2.5 billion. Those plans are based on needs projected by the Division of Water Resources.

Data used to gauge future water demand is based on estimates of municipal and industrial water use in 2000. The magic number of 293 gallons per capita per day (gpcd) for residential, commercial, industrial and institutional users is applied to most of the agency's decisions.

"Because projections of future water demand are based on 293 gpcd, it is important that this per capita water use rate is accurate. If 293 gpcd is not accurate, then it casts doubt on the reliability of the projections derived from it. For this reason, verifying the accuracy of the 2000 baseline study was one of our primary audit objectives," auditors wrote.

"In order to effectively manage the state's water resources and plan for future water needs, accurate water use data is critical," the report continued. "Unfortunately, we found that the data submitted to the Division of Water Rights contains significant inaccuracies. State water agencies as well as local water systems also acknowledge these inaccuracies."

Current data is vital for the Division of Water and the current regimen of evaluating water use every five years is not sufficient for recognizing data trends, auditors said. Their report suggests analysis of water use should be done annually.

Auditors also say the current "investment" of just one staffer responsible for overseeing water use data is not enough.

"To improve data reliability, which is essential for water management and planning, the Department of Natural Resources needs to devote more staff and resources to the state's water use database. A request to the Legislature for additional resources will be necessary to satisfy this important objective," the report states.

Local water agencies also need to invest in well-trained staffers and the state agency needs to be more clear on the collection of the data it needs.

"The person responsible for submitting the data does not always have the training or expertise to report the data accurately," auditors wrote. "For example, one water system manager explained that large differences in their water use from one year to the next were due to misunderstandings by city staff regarding how to interpret the city's water metering systems."

Another reason for inaccurate reports was the perception that cities may lose water rights for unused portions. That leads to an overstatement of water use for fear the state engineer could revoke water rights, auditors found.

While the state is charged with coming up with suitable plans for future water needs, it seems some agencies are not taking the per capita use number seriously. Auditors suggested the Legislature grant the division statutory authority to validate the data sent in from various local water agencies.

The report points out that conservation is major part of the agency's mission and responsibilities, but meeting that goal is a challenge.

"To some extent, promoting the full development and utilization of water in the state is at odds with promoting conservation. In fact, in a legislative committee, one member questioned whether Utah should wait to promote conservation until after the state has developed its full allocation of interstate waters," the report states.

Conservation groups have been saying for decades that Utah's thirst for water is an artificial need facilitated by an undervalued price that promotes waste.

Auditors suggested metering of all service connections to validate the value of water and encouraged the Legislature to consider "adopting policies that will require the phasing in of universal metering."

Many secondary water systems throughout the state do not require metering and offer low price options for sometimes unlimited use.

"Utahns have the highest [per-person] water use in the U.S. in part because the Division has been discouraging water conservation for decades," Frankel said in a release Monday. "It is high time we made sure the agency pushing for billions in new tax spending is held accountable."

Water managers at the state and local levels maintain that Utah's demand for water will exceed its supply in a little more than two decades. Auditors said that hypothesis needs to be flushed.

"This projection is based on the assumption that per capita water use will not decline after the year 2025, when the state is expected to reach its current goal to reduce water use by 25 percent," they wrote. "However, we believe, current trends suggest per-person water use in Utah should continue to decline for the next several decades. If use does decline further, then the date when water demand exceeds supply may be delayed."

The auditors also suggested the state water agency is "understating" growth in water supply as agricultural lands are converted from farmland to housing development, strip malls and roads.

Agriculture is by far the biggest drain on the state's water resources — fully 82 percent of the water used each year. With the inexorable transition of farmland to homes, auditors noted, the amount of water used on the land is greatly reduced. That, they said, is a net gain in future water supply the state currently does to recognize.

"Local supplies may also grow as cities develop the remaining capacity of existing groundwater and surface water sources. By excluding this added water supply, the projections accelerate the timeframes for developing costly, large-scale water projects," auditors wrote.

They recommended developing better regional plans.

Then state policymakers can better decide whether to pursue major water projects like the Bear River and Lake Powell projects.

brettp@sltrib.com

Twitter: @BrettPrettyman













































Attachment(s):
Utah Governor's 2016 budget water recommendations.pdf
Economics Professors LPP Letter.pdf