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Trickle-Down Economics

Last October, two women accused former Durango mayor Jeff Morrissey of making lewd comments. His apparent inspiration: bumper stickers on the women's cars opposing the proposed Animas-La Plata water project.

One sticker boasted the acronym A-LP with a red slash
through it. The other read "A-LP sucks." Did that mean the women would give
him blow jobs? asked Morrissey, a member of the pro-project Animas-La Plata Water Conservancy Board.

After the women complained to police, Morrissey was arrested and cited for disorderly conduct. He has denied making off-color remarks; his lawyer, whose firm works for the conservancy district, contends that whatever Morrissey said about "the offensive bumper stickers" was protected by the First Amendment.

Under a plea agreement, in exchange for a six-month deferred prosecution, Morrissey resigned from the board in December and wrote letters of apology to the two women. However, he still denies any guilt. Morrissey quit the board, his attorney says, because he did not want "the personal controversy surrounding his case to detract from the substantive considerations of the Project...as he believes in his heart that the Project is vitally necessary to the welfare of the community."

And the Morrissey incident came after the first meetings sponsored by Governor Roy Romer and chaired by Lieutenant Governor Gail Schoettler, meetings designed to bring together opponents and proponents of the controversial project for meaningful, well-behaved talk. Under the terms of an agreement worked out by Schoettler, representatives of the various groups were supposed to "recognize that each party deserves, and indeed must, be treated with dignity and respect for fruitful discussions to progress.

"During the course of the...process, each party agrees to refrain from publicly voicing or publishing personal attacks on the characters or motives of the other parties."

Noting that there are few things more personal than a public official asking for fellatio, A-LP opponents gleefully seized on the Morrissey arrest as evidence that the other side was unwilling to negotiate in good faith. But at the same time, project proponents were throwing charges of their own--including the claim that their opponents, in fighting the project, were willing to break a treaty with the Indian tribes in southwestern Colorado.

Funding for the A-LP water project might have dried up entirely by now were it not for the 1988 Indian Water Rights Settlement Act, negotiated by the feds, the states of Colorado and New Mexico, and the Navajo and two Ute tribes on the southwestern border of Colorado.

Only the last-ditch efforts of its proponents--most notably Senator Ben Nighthorse Campbell, the Ute tribal councils and the white Durango-area developers, ranchers and farmers who stand to benefit the most from this "Indian project"--have kept the $740 million Animas-La Plata proposal alive.

Meanwhile, the opposition--an unlikely coalition of environmentalists, anti-tax and anti-growth organizations and a grassroots Ute group that opposes the project on cultural and economic grounds--keeps trying to pull the plug.

Through lawsuits and lobbying, they've stalled the bulldozers long enough for public sentiment against government spending to take hold in Congress. During the past two sessions, the annual appropriations request for the A-LP project has been cut by the House--only to be restored in the Senate through Campbell's efforts, along with his reminder that failing to fund the project would "break another treaty with the Indians."

Closer to home, the rhetoric has gotten no more respectful than it was last fall when Morrissey mouthed off. In fact, Schoettler recently called off the A-LP meeting scheduled for this week--at which both sides were to present possible alternatives to the project. Since then, she says, proponents and opponents have each agreed to come up with a proposal.

Sage Remington, who heads SUGO, the Southern Utes Grassroots Organization, thinks his group has devised an ideal compromise. One that would not only satisfy treaty obligations, but would do so for a fraction of the cost of the proposed project, mollifying taxpayer groups. One that would not move a clump of dirt, pleasing environmentalists. And one that would right old wrongs by returning prime land on the Southern Ute reservation to the tribe, keeping a promise made to the Indians a century ago.

In 1879 the approximately 8,000 Utes still remaining in the West were moved off the vast expanses they'd once roamed. The northern bands were assigned a bleak, arid part of Utah. The southern bands were "given" lands along the Colorado-New Mexico border, in the Four Corners area. Sixteen years later the U.S. government decided to keep the nomadic Utes in place by turning them into farmers. The Utes, who then numbered only about 2,000, were offered a new deal: 160 acres for the head of every household.

One of the bands, the Weminuche, refused the offer, deciding that their lands would be held in common. They moved to the southwesternmost corner of Colorado and became the Ute Mountain Utes. With only one river, the Mancos, on the reservation and so little potable water that it had to be brought in, most of the Ute Mountain Utes settled at their capital, Towaoc.

 

Two of the bands--the Moache and Capota--accepted the government's offer and settled on land near Ignacio, fifteen miles south of Durango. This Southern Ute reservation was blessed with six rivers--the La Plata, the Animas, the Florida, the Pine, the Piedra and the San Juan--that flowed through the land and on into the Colorado River.

But with the blessing came a curse: White men coveted the Utes' water. Seeing that there was unclaimed land on the Southern Ute reservation, the government opened it to white homesteaders, who were allowed to claim their own 160-acre parcels. They settled on the best land along all of the rivers except the Pine, where the Utes were already living near Ignacio. Today, of the reservation's 720,000 acres, 4,000 have been allotted to tribal members and another 308,000 are in a tribal trust. The rest of the land is held by government agencies and non-Indians, mostly farmers.

A few years after the land grab, the National Reclamation Act of 1902 established what is now the U.S. Bureau of Reclamation. The bureau's mission was to build water projects to irrigate the bone-dry West, where water was, and is, a precious commodity.

Although the water users--initially farmers, and then, after the act was amended, municipal and industrial interests--were supposed to pay for the construction of the projects, as well as their maintenance and operation costs, they rarely did.

"From 1902 to 1939, the bureau sent blue-ribbon team after blue-ribbon team out to look into the economics of the projects it had built," says Phil Doe, who researched the financial history of the projects for the bureau two decades ago. "They all came to the same conclusion: Even if the farmers could make a living off the land, they wouldn't be able to if they had to pay for the water."

Under a policy dubbed "ability to pay," the bureau began excusing farmers from paying their water debts. As time went on, agricultural interests began to look on this free water as a birthright, even as the "family" farms gave way to large corporate enterprises.

According to a 1992 report from the Congressional Budget Office, the "free" agricultural water alone had cost taxpayers more than $70 billion in subsidies since the start of the century.

But the sorry economic realities did not stop the bureau from building. During the first half of this century, agency engineers looked at all of the major--and some not-so-major--rivers in the West for potential water projects. The ideal site was where a river plunged from a wide basin through narrow canyon walls--essentially a giant bathtub with a convenient place to put a stopper at the lower end. But far-from-ideal spots were also studied.

The bureau listed the project possibilities from best to worst, with the best being both economically feasible and easy to build. Near the bottom of the list were several smaller rivers that cut across the southwest border of Colorado--rivers like the Dolores, the San Juan, the Florida, the Pine and the Animas.

Southern Ute elders recall meeting with Bureau of Reclamation officials in the Fifties to discuss the allocation of water from the rivers that ran across their reservation ("Rivers Run Through It," June 13, 1996). But after that, the tribes heard nothing publicly for years, By the Sixties, all the best projects had been built, and the bureau began to eye some of the lesser possibilities. Soon every river in southwestern Colorado would be dammed--with the exception of the Animas.

The first official proposal for the Animas-La Plata project surfaced in 1968. It called for a diversion of the vigorous Animas River north of Durango. As initially presented to Congress, A-LP was an irrigation project designed to help "dryside" farmers working the land by the La Plata, which is hardly more than a desultory creek surrounded by arid high plains; there was no mention of Indian water rights.

But the bureau had run into so much opposition to the earlier Dolores River project from whitewater rafters and environmental groups, which didn't want a dam on another river, that it soon altered its plan for the Animas. In 1978 the bureau proposed putting a pumping station on the Animas downstream from Durango instead. The station would take water out of the river, pump it 500 feet uphill, and then dump it into the yet-to-be-built Ridges Basin Reservoir. From there, another series of pumping stations, pipes and canals would get the water over to the La Plata drainage.

 

It still was not billed as an Indian water project. "There was a small mention of some of the water being for the Indians, if someone could figure out how to get it to them, but it was not a big concern," says Doe, who'd been hired by the bureau in 1974 to write Environmental Impact Statements, the documents required to fully disclose the environmental impact of any federal construction project.

Whatever it was called, Doe remembers thinking the proposed $358 million project was "a nightmare." For one thing, A-LP would use power, not generate it, adding substantially to the project's anticipated costs. And since the area to be irrigated was of little agricultural value--it was mostly used to raise alfalfa for livestock feed--the water users' "ability to pay" would be slight.

When he voiced his concerns to his boss in the bureau's Salt Lake City office, Doe says he was told, "Shut up and finish the report. It'll never be built."

Indeed, by the late Seventies, the era of massive water projects was drawing to a close. Project after project had been plagued by cost overruns, some double and triple the original projections; few projects had ever paid their own way. And frequently, the projects had wound up benefiting not family farms, but land speculators who made fortunes at the public's expense.

"Since the beginning, the bureau has tried to find a way to stop the land speculation that occurs when you bring a little water to what was uninhabitable land," says Doe. "Unfortunately, they never tried very hard. It is the dark side of the Reclamation Act."

Doe quit the bureau a few years after he finished his damning report on the economics of the Western water projects--and after a series of run-ins with bureau bosses over the feasibility of pending proposals, such as the Animas-La Plata project. He has since become a strong--and extremely knowledgeable--opponent of A-LP.

But proponents of Animas-La Plata, which included not only southwestern Colorado farmers but also developers, kept pushing to find a way to get the project through. They found it in 1986, when the Indian Water Rights Settlement Act was being negotiated to resolve disputed "senior water rights" claims. In exchange for A-LP water, the Utes agreed not to take their old water claims to court.

In what Doe calls "a stroke of genius," the original proponents of the project "hitched a ride on the Indian pony."

There was just one catch: In order to satisfy the Utes, the Animas-La Plata water project had to be completed by shortly after the turn of the century.

Animas-La Plata was now an Indian water project. Conservative white farmers and ranchers, as well as "good ol' boy" developers in Durango, started championing Native American rights like born liberals.

Gail Schoettler, however, says the project's new billing benefited both groups. "The Indians had been told that there was no way that Congress was going to fund an 'Indians-only' water project," she explains. "Other users had to be brought in."

The final plans for the A-LP project, approved in 1988, call for taking 157,000 acre-feet of water per year out of the Animas River. Under the 1988 water-rights agreement, the Southern Utes are entitled to 26,500 acre-feet of water per year for municipal-and-industrial use and another 3,300 acre-feet for agriculture. The Ute Mountain Utes are entitled to 6,000 acre-feet of water for municipal-and-industrial use and another 26,400 for agriculture. Although the tribes do not have to pay anything for their agricultural allotment, they are required to pay the full cost of the municipal-and-industrial water. But none of the water may ever reach them.

As it stands, the A-LP project is scheduled to be built in two phases. The first phase would construct the pumping station on the Animas, the Ridges Basin Reservoir, and the pipes and ditches that would deliver two-thirds of the water to the dryside farmers and development interests. The Indians' third would be stored in the reservoir, ten miles from the nearest Indian land.

Phase I would be paid for by the federal government and the State of Colorado; the bureau isn't even trying to make water-users pay for this phase. The bureau estimates the federal government's share to be more than $565 million; Colorado has set aside another $60 million from its general fund.

Only under Phase II would the Indians receive their water. But there is no funding in place for this second phase, nor any obligation under the settlement agreement for the feds to provide funding.

Under the original terms of the Indian Water Rights Settlement Act, the tribes could have had their own funding source for Phase II. The settlement would have allowed the Utes to sell their water in the reservoir to downstream users (San Diego currently pays about $400 an acre-foot for new water), and the tribe could have used the money to fund Phase II or whatever other project the tribe wanted to pursue. Doe estimates the tribes could have made $28 million a year from such sales.

 

But between 1986, when the settlement was negotiated, and the act's passage in 1988, one major change was made. Representatives of the lower basin states, where Colorado River water currently flows for free, complained that A-LP would take away some of their water and threatened to fight the settlement agreement unless the Indians were prohibited from selling their water out of state.

The feds agreed, and the act was passed with the Indians' right to sell their water removed. At the time, Ben Nighthorse Campbell, who has a ranch on the Southern Ute reservation and was then a state representative, didn't complain about the government breaking another treaty with the Indians. "We had to bite the bullet on that one," says Leonard Burch, a staunch project supporter who was chairman of the Southern Ute council for twenty years. "But it was worth it."

As they began to study the A-LP proposal, though, other members of the tribe came to disagree. Many say that they were kept in the dark about the settlement terms when they were changed and that they only recently discovered the project's pitfalls. Disillusioned, A-LP's Indian opponents banded together two years ago and formed SUGO.

Ute Mountain Ute chairwoman Judy Knight-Frank has been the project's most vociferous defender. She contends that her tribe would find a way to pay for their part of Phase II, perhaps through gaming revenues.

The Ute Mountain Utes, however, already have rights to water from another project that they're not using because they've been unable to raise the money to get the water to their reservation. They're entitled to 23,000 acre-feet of agricultural water and another 1,000 acre feet of municipal-and-industrial water from the Dolores project.

Combined with the municipal-and-industrial water from the A-LP project, that's enough to take care of a city with a population of 35,000; the Ute Mountain Ute reservation holds only 2,000 people.

SUGO and other opponents point out that the Ute Mountain Utes have a more short-term interest in getting A-LP built. One of the largest employers on the Ute Mountain reservation is the tribe's construction company, which bureau insiders say will likely be the primary contractor on the project. The company happens to be run by Knight-Frank's brother.

Officially, both tribes still support the project. Their elected tribal councils have voiced hope that if Phase I is built, something can be worked out to get Phase II funded.

Citing promises made to the Indians, Campbell says he'll use his position as chairman of the Senate Indian Affairs Committee to make sure the project goes through as originally proposed. But even the senator doesn't have a specific plan for funding the crucial second phase. If A-LP is approved, says spokesman James Doyle, it will be up to Colorado's governor to provide leadership for funding of Phase II, and Campbell will "wait and see" what Romer comes up with.

Campbell also sits on the committee that oversees funding for the Department of the Interior, including the Bureau of Reclamation, which is slated to put $6 million into A-LP next year. In 1988 the Department of the Interior released an audit report that concluded the proposed A-LP project was neither financially feasible nor economically justifiable--and that's when the quoted cost was considerably lower than the current $740 million price tag. (Doe estimates that costs could run as high as $2 billion.)

In February, Interior Secretary Bruce Babbitt raised new concerns about the feasibility of A-LP. In a hearing before the Senate Energy and Natural Resources Committee, Babbitt said he understood the desire of the Indian tribes to have water on their land, but he refused to fully commit to moving the project forward.

Campbell responded by accusing the Clinton administration of breaking faith with the Indians. He repeated that charge last month, when yet another bill to cut project funding was introduced in both the House and the Senate.

In the face of increasingly rancorous debate, last fall Schoettler began holding a series of meetings between both sides, looking for some feasible alternative to A-LP that would still satisfy Indian water-rights claims. It's clear, she says, that the original version of the project will not get built.

From the start, the process has been "frustrating," Schoettler says. As many as seventy alternatives have been brought up, from a version called A-LP Lite to no project at all. Schoettler had set a deadline of early this week for both sides to present new proposals. Last week she postponed that meeting because neither side could settle on a proposal to present to the group. Since then, Schoettler says, both the proponents and the opponents have agreed to come up with one proposal each, to be discussed at a meeting that has yet to be scheduled.

 

But James Doyle, who attended meetings as Campbell's representative, claims the process has broken down entirely. "I didn't even attend the last two," he says, "because it was clear that the opponents only wanted to stall and weren't trying to come up with reasonable alternatives."

Doyle blames Schoettler's lack of leadership for things getting out of hand. "She's shown no ability to get authority over either side," he says, "although I think the proponents have been more forthcoming."

Among the alternatives that have been mentioned is one that would give the Indians water from existing projects on the other southwestern Colorado rivers. But that would require taking water away from current users--a notion that inspired one rancher at a recent meeting to proclaim that any attempt to "steal" his water would send him running for his guns.

Another possible alternative to building A-LP would pay the Indians for the power their allotment of water generates as it passes through the turbines of the dams on the Colorado river. Knight-Frank and Burch, among others, scoff at this proposal, claiming that their people want "wet water" so that they can farm and ranch on the reservations.

Under A-LP, that "wet water" would still be held in a reservoir many miles away from the reservations. But Schoettler says the tribal councils have agreed to consider that water close enough to satisfy the terms of the agreement.

SUGO, however, says water in a reservoir that they can't sell downstream--and can't pump to their own reservations--is worse than no water at all.

Doyle argues that SUGO is just another special-interest group that has a right to be heard but does not represent the majority on either Ute reservation.

In response to such criticism, Remington notes that his group counts among its supporters the heads of a hundred households. These people discuss the issues with their families and clans, he says, which means that SUGO's support is many times stronger than it may appear.

Campbell, who only discovered his Northern Cheyenne heritage in mid-life, is at best a "heritage" Indian who doesn't understand the Indian way of doing things, says Remington, a full-blooded Ute.

Any proposal that cuts into the Indian allotment--which means just about any A-LP proposal other than the original--technically breaks the agreement with the Indians, which means the water-rights settlement would have to be renegotiated. But Remington thinks SUGO has come up with an acceptable alternative: the Ute Legacy Land and Water Fund.

Under this proposal, the federal government would put an estimated $100 million in a trust. Over the next thirty years, on a willing-seller basis, money from the trust would be used by the Southern Utes to buy back water rights and land on their reservation from the current, non-Indian owners. The Ute Mountain Utes could use money from the trust to develop revenue-generating projects such as their own version of Mesa Verde park. Money from those projects could in turn pay to bring the already allocated Dolores project water to the Ute Mountain Ute reservation.

This alternative would allow the Southern Utes who want "wet" water to farm and to do so on land regained by the tribe. And SUGO would also press for a change in the law that would allow the tribe to sell its water down-river. Not only would that bring in close to $30 million a year, Remington says, "we also estimate that we could get another $3 million, maybe higher, from the power generated."

Under this alternative proposal, though, most of the water would remain in the river--where Utes like it best, Remington adds. "Western civilization has never placed much value on water in a river. We do.

"This proposal would give us the right to decide what to do with our living water, instead of it sitting in a reservoir, dead, where it does nothing for us," he says.

Remington thinks the rest of the project's opponents will sign off on this plan. They'll have to, Schoettler says, if SUGO wants its alternative to be the opposition plan considered at her next meeting. Along with the proposal, SUGO will suggest that both tribes begin a six-month educational push, encouraging public debate on the pros and cons of assorted alternatives. After that, the tribes would vote to support the A-LP project as currently proposed, another alternative or the Ute Legacy Land and Water Fund.

 

"We have never voted on or approved the Animas-La Plata project as a people," Remington says. "If, after the education process and the vote, the people want the water project, we'll stop fighting it and give it our blessing."

Still, Remington is convinced the Utes will go for SUGO's proposal. In fact, he suggests, the only people who won't like it are the development and white agricultural interests. "And if this is really about Indian water rights," he asks, "what have they got to complain about?


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