NAVAJO - GALLUP WATER SUPPLY PROJECT QUARTERLY REPORT: OCTOBER - DECEMBER, 2014 February 11, 2015 Navajo Nation Water Management Branch
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1 NAVAJO - GALLUP WATER SUPPLY PROJECT QUARTERLY REPORT: OCTOBER - DECEMBER, 2014 February 11, 2015 Navajo Nation Water Management Branch I. Background/Purpose/Beneficiaries a. Authorized for construction in March 2009 (Public Law ) as part of Navajo Nation New Mexico San Juan River Basin Water Rights Settlement Agreement. Project beneficiaries include the Navajo Nation, Jicarilla Apache and City of Gallup. b. Purpose is to construct water transmission pipelines capable of conveying treated San Juan River water to Navajo Nation communities in New Mexico and Window Rock; the southwest area of the Jicarilla Apache reservation, and the City of Gallup for domestic, commercial, municipal and light industrial purposes. II. Scope a. Two main laterals (pipelines) i. Cutter Lateral Starts at Cutter Reservoir and will serve eastern Navajo communities and provide a connection to serve the Jicarilla Apache Nation. ii. San Juan Lateral Starts at the San Juan River and will extend south, roughly following US Hwy 491 through Gallup, with extensions toward Window Rock, AZ, and Crownpoint, NM. b. Two water treatment plants, numerous pumping plants and storage tanks c. Designed to serve a 2040 population of approximately 250,000 III. Construction Schedule a. Project has been divided into 27 Reaches for construction. (see map) b. Construction has begun (first contract awarded April 2012 on Reach 12a) c. Legislated deadline to complete construction is December 31, 2024 IV. Construction Sequencing a. In order to meet legislated deadline, simultaneous construction will occur at sections (Reaches) throughout the Project area by various Project Participants including U.S. Bureau of Reclamation, Navajo Nation, City of Gallup and Navajo Area Indian Health Service (IHS). Reclamation is the lead construction agency and has developed Financial Assistance Agreements with partners to assist in construction. b. Agreements with Project Participants have been developed to: i. Provide for a flexible approach for project design and construction to deliver water to existing or planned future distribution systems. ii. Provide for structured process for making modifications. iii. Maintain costs within the indexed Congressional authorized ceiling. iv. Identify responsibilities of the Project participants for design, construction and operation for various reaches. c. Initial facilities will be constructed to convey water to areas that have immediate needs. Demands will be met in short term by existing groundwater wells. i. In 2012, Reclamation started construction near Twin Lakes, north of Gallup to eventually deliver short-term groundwater from Twin Lakes to Churchrock, NM 1
2 through the City of Gallup. In order to accomplish this, portions of Reaches 12, 13, and 14 and the Tohlakai Pumping Plant have to be constructed. ii. Navajo Nation and Reclamation are working to complete the Cutter Lateral to provide Project water to the communities on the eastern portions of the Navajo Reservation. In order to deliver water through the Cutter Lateral, Reaches 21, 22, 24, 25 and 26 are to be constructed along with associated pumping plants, storage tanks and electrical power facilities. d. The Project Construction Committee has agreed to work on constructing the remaining San Juan Lateral northward from Twin Lakes, NM and southward from the San Juan River at the same time. V. Construction Status a. Reach 1: The pilot water treatment plant completed testing for treating San Juan River water in Hogback irrigation diversion structure underwent water quality testing and is being modeled as an alternative for intake for the San Juan Lateral. b. Reach 12a: Construction is complete. Consists of 4 miles of 42-inch water supply pipeline from community of Twin Lakes to top of Tohlakai hill. c. Project 4: Construction complete. The City of Gallup, Navajo Tribal Utility Authority (NTUA) and Navajo Nation coordinated the construction of Project 4 near Tohlakai, NM using New Mexico Water Trust Board funds. A storage tank was constructed on the west side of Highway 491 at the top of Tohlakai hill. City of Gallup was the fiscal agent. The project and right-of-way will be transferred to NTUA after construction. Project 4 is an extension of the Twin Lakes NTUA system that will receive water from the Project s Tohlakai Pumping Plant. d. Tohlakai Pumping Plant: Currently Reclamation s contractor, Moltz Constructors, Inc., is constructing the Tohalakai Hill Pumping Plant after being awarded the $19.6 million contract in April The pumping plant will be located on the east side of highway 491 between Reaches 12a and 12b (see map). Construction will continue into e. Reclamation anticipates awarding construction contracts for Reach 12b in 2015, Reach 22a in 2015, and Reach 12.1 in FY 2015, Reach 12.2 in 2015 (see map). f. Navajo Nation awarded a $9.2 million construction contract to Navajo Engineering Construction Authority (NECA) for Reaches 24.1 and 25 in September Construction began in December 2014 and completion is scheduled for December g. City of Gallup will be upgrading portions of its system (Reaches 13 and 27). i. Reach 27.5 construction began in November 2013, consisting of three large storage tanks at just north of Gamerco, NM. Construction is almost complete. ii. Reach 13 ($5.1 million) construction began on in July 2014 consisting of pipe from Yahtahey toward Gamerco, NM. Construction is almost complete. h. Reach 14: IHS has been moving forward with investigations and design data collection for Reaches 14.1 and Reach Construction is anticipated to begin in May New Interagency Agreement between IHS and Reclamation was drafted and under review for design and construction of Reaches 14.3a, 14.6a, 14.7a, and 14.8a south of Gallup. i. Reaches 2-11: Planning, design and preconstruction surveys ongoing. VI. Predecessor to Construction Documents a. Completed Agreements/Contracts 2
3 VII. i. Environmental Impact Statement and Record of Decision ii. Navajo Nation New Mexico San Juan River Basin Water Rights Settlement Agreement. iii. Settlement Contract Between the United States and the Navajo Nation iv. Cost Share Agreement Between the United States and the State of New Mexico v. Repayment Contract with the City of Gallup vi. Water Delivery Contract Between Jicarilla Apache Nation and City of Gallup vii. Repayment Contract with the Jicarilla Apache Nation viii. Cultural Resources Programmatic Agreement for the Project with various federal agencies, states and tribes. ix. Financial Assistance Agreement with Navajo Nation for Reaches 24, 25 and 26 x. Financial Assistance Agreement with Navajo Area IHS for Reach 14.1 and xi. Financial Assistance Agreement with City of Gallup for Reaches 13 and 27 b. Rights-of-Ways with NEPA and Cultural Resource Compliance i. A Programmatic Agreement (PA) was signed to ensure compliance with the National Historic Preservation Act during construction that will guide the agencies and tribes in the proper handling of the cultural resources. Cultural Resources contractor has been hired and working in accordance with the PA. Additional contracts are being compiled as needed for Project. ii. Environmental and Biological Survey are conducted as needed. iii. Right-of-way applications contain necessary land permissions, design data, permits and surveys required for construction. Budget/Funding a. Project Authorization Ceiling was $870 million at 2007 price level (subject to adjustments as indicated by engineering cost indices) b. Current Project Authorization Ceiling in October 2014 dollars is $1.095 billion. c. U.S. Discretionary (Appropriated) Funding i. Through FY $ million ii. FY2013: $ million iii. FY2014: $ million iv. FY2015: $81 million (cumulative = $ million) v. FY 2016 Request: $ million d. State of New Mexico Cost Share - $50 million i. Anticipate the State applying for a credit of approximately $30.8 million for pipelines constructed using State funding. ii. Reclamation provided State with a preliminary approval for $8.824 million in credit for Eastern Navajo Pipeline and needs additional documents to finalize. iii. Additional credit request in the amount of $6.355 million was approved on December 4, 2014 (Gallup Regional System). iv. Cost share funds in the amount of $13.6 million have been received to date. v. Current total approved for cost share: $22.4 million e. Mandatory Funding i. P.L provides for total of $180 million in FY 2012 through FY The Project has received the full amount authorized under this authority 3
4 2. Funds are available until expended. ii. P.L provides for mandatory funding of $500 million starting in FY 2020 f. SUMMARY: i. Total funding through 2015 (including approved NM cost share): $410 million ii. Total expenditures through fiscal year 2014 by Reclamation: $69.3 million iii. Total funding received through 2015 plus future mandatory: $910 million iv. The Project partners need to support fiscal years U.S. discretionary funding requests to acquire sufficient funds for the indexed Project cost. VIII. Federal Infrastructure Projects Permitting Dashboard a. NGWSP is one of the 14 original high-priority infrastructure projects identified by President Obama in 2011 to be expedited through the permitting/review process to create jobs. i. Reclamation is working with other federal agencies (BLM, BIA, IHS), Navajo Nation and other Project Participants to explore ways to streamline the permitting and review processes associated with the Project. ii. Progress on the permitting and review process can be tracked on Federal website: iii. The expediting process will not relieve responsibilities to comply with environmental laws and regulations. IX. Operation, Maintenance & Replacement a. NTUA will operate the Project, as agreed in the Operations MOU of 2012, not including portions the City of Gallup will operate (Reaches 13 and 27). b. Through the OMR Transfer Contract (pending), it is envisioned that the Project will be brought on-line as facilities and reaches are completed. This will allow groundwater to be delivered to certain communities that have immediate needs for the water. c. The right of way and project facilities that will be transferred to the Navajo Nation/NTUA or City of Gallup depending on Reaches through title transfer agreements. d. Navajo Nation coordinating with NTUA to establish an emergency reserve and replacement fund that will need approval by the Navajo Nation Council. X. Public Outreach / Coordination with Project Participants a. In addition to the Project Construction Committee and Project Operations Committee, Reclamation conducts regular (individual) coordination meetings with the Navajo Nation Division of Natural Resources Departments and programs, the City of Gallup, Bureau of Indian Affairs, and Bureau of Land Management, respectively. b. Reclamation participates in Navajo chapter outreach meetings to provide information relating to ongoing or planned construction work associated with the Project. c. Reclamation conducts tours of ongoing construction for Project Participants, other interested agencies, and the media. d. Additional information: e. Contact information: i. Jason John, Branch Manager, Navajo Nation Water Management Branch, P.O. Box 678, Fort Defiance, AZ 86504, jasonjohn@navajo-nsn.gov, ii. Pat Page, P.E., Deputy Construction Engineer, Bureau of Reclamation Four Corners Construction Office, ppage@usbr.gov, (505)
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