The Water Information Program

In 1968, the state of Arizona and Congress agreed to build the Central Arizona Project, or CAP, a 336-mile system of canals and pumps that lifts water more than 3,000 vertical feet from the Colorado River to Phoenix, and then on to Tucson. The feds picked up much of the cost, but there’s been lots of squabbling about how large Arizona’s share of the tab is — especially as the price of the project dramatically overran original estimates. When CAP was finished in 1993, at a cost of $4.7 billion, the federal government pegged Arizona’s payback at $2.3 billion. When the Central Arizona Project first started delivering water in 1983, Phoenix and Tucson weren’t using anywhere near their share. In order to use its full allocation, and prevent California from taking the unused water, the state of Arizona essentially gave the water away to farmers at slightly more than cost. Phoenix and Tucson, in turn, underwrote the farmers’ purchases of that water until the cities needed it themselves. But in 1998 — at about the same time that settlement talks were heating up between the Gila River Indian Community and the federal government — Arizona took the federal government to court over the state’s share of the bill. Arizona agreed to give the federal government the 200,000 acre-feet of CAP water it needed to settle the Gila River community’s demands, plus 67,000 additional acre-feet for future tribal settlements. In return, the federal government reduced the state’s payback cost to $1.65 billion, saving the state $700 million over the 50-year payback period, and also waived farmers’ obligations to repay $73 million borrowed to build distribution systems. Farmers also get a two-thirds discount on leases of excess CAP water through 2030 — water allocated either to tribes that, so far, lack the infrastructure to put it to use, or to cities that don’t yet need it.

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