NAVAJO - GALLUP WATER SUPPLY PROJECT QUARTERLY REPORT: APRIL JUNE, 2014
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1 NAVAJO - GALLUP WATER SUPPLY PROJECT QUARTERLY REPORT: APRIL JUNE, 2014 July 21, 2014 Navajo Nation Water Management Branch (Modified from USBOR Update) I. Background/Purpose/Beneficiaries a. Authorized for construction in March 2009 (PL ) b. Cornerstone of Navajo San Juan River in New Mexico Water Rights Settlement between the Navajo Nation, the State of New Mexico, and the United States of America. c. Will provide a long-term, sustainable water supply from the San Juan River to over 40 chapters on the Navajo reservation; the southwest area of the Jicarilla Apache reservation, and the City of Gallup, New Mexico. II. Scope a. Two main laterals (pipelines) i. Cutter Lateral Serving the far eastern side of the Navajo Reservation and providing a tap to serve the Jicarilla Apache Reservation near Highway 550. ii. San Juan Lateral Starting at the San Juan River near Nenahnezad, NM and extending southward, roughly following US Hwy 491 through Gallup; with extensions to Window Rock, AZ, and near to Crown Point, NM. b. 2 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. Groundbreaking was June 2, d. Legislated deadline to complete construction is 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. Reclamation is the lead construction agency and has developed Financial Assistance Agreements with partners to assist in construction various Reaches. b. Memorandums of Understanding have been developed with Project Participants that accomplish the following: i. Provide for a flexible approach to project design and construction to allow for consideration of delivering water to existing or future distribution systems. ii. Provide for structured process for making modifications. iii. Require that costs must be maintained within authorization ceiling. iv. Identify responsibilities of the Project participants, designers, and construction entities 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. Reclamation starting near the Navajo community of Twin Lakes, north of Gallup 1
2 ii. City of Gallup will be upgrading portions of their system in order to deliver Project water through City facilities to neighboring Navajo communities, and eventually to receive Project water from the San Juan River to meet their projected water demands. iii. IHS will be constructing Reach 14 which will take Project water delivered through the City of Gallup s system and deliver it to communities east, south, and west of Gallup. Interagency Acquisition awarded to IHS in May 2013 for construction of Reach 14.1 and Reach IHS is moving forward with additional Reaches for construction in coordination with Project participants. iv. Navajo Nation will be extending the Project on the Cutter Lateral side by tying into their existing Eastern Navajo Pipeline Project to provide Project water to the communities on the eastern portions of the Navajo Reservation. d. The PCC has agreed to work on constructing the San Juan Lateral from Twin Lakes, NM north and from the San Juan River south at the same time and meet in the middle. V. Construction Status a. The pilot water treatment plant completed testing for treating San Juan River water during the Information gained from the pilot project will be used in the procurement and final design process of the water treatment plant. Hogback Irrigation Intake may be the suggested location for the San Juan Lateral. b. On April 16, 2012, a contract for $10.75M was awarded to McMillen, LLC, for the construction of Reach 12A consisting of 4 miles of 42-inch water supply pipeline c. The City of Gallup, NTUA and Navajo Nation are cooperating on the construction of Project 4 near Tohlakai, NM using NM funds. A storage tank is being constructed on the west side of Highway 491. The City of Gallup is the fiscal agent but the project and rightof-way will be transferred to NTUA after construction. Project 4 is an upgrade of the Twin Lakes NTUA system that will receive water from this Project via Reach 12A and Tohlakai Pumping Plant. d. Currently Reclamation s contractor is constructing of Tohalakai Hill Pumping Plant, located on the east side of highway 491 between Reach 12A and 12B (see map). 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). e. Construction contracts are anticipated to be awarded in FY2014 for other project reaches to be constructed by the Navajo Nation, Indian Health Service and the City of Gallup under respective financial assistance agreements with Reclamation. i. Navajo Nation will issue a request for bids for Reaches 24.1 and 25 in July ii. City of Gallup will be upgrading portions of their system (Reaches 13 and 27). Portions to begin construction in iii. IHS has been moving forward with investigations and design data collection for Reach 14.1 and Reach Construction is anticipated to begin in FY VI. Predecessor to Construction Documents a. Completed Agreements/Contracts i. Environmental Impact Statement and Record of Decision ii. San Juan River Basin in New Mexico, Navajo Nation Water Rights Settlement Agreement 2
3 VII. VIII. 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 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. Right of Ways with NEPA and Cultural Resource Compliance Cultural Resources Compliance a. A Programmatic Agreement 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. b. The Programmatic Agreement has been transmitted to consulting agencies and tribes who have the opportunity to sign as concurring parties. c. Cultural Resources contractor has been hired and working in accordance with the PA. In September 2011, a contract for $5.5 million was awarded to Paleo West for cultural resources work necessary to support construction of the Project. Work continues under this contract in the form of pre-construction surveys, ethnographic studies, monitoring during construction, and data recover and treatment of cultural sites. Additional contracts are being compiled as needed for Project. d. The PA requires Reclamation to fund an independent Project Manager to assist with the coordination of all reviews and deliverables required under the terms of the PA. e. The Project Participants are requesting a congressional technical correction to amend the amount allocated for cultural resources from 2 percent to 4 percent. Budget/Funding a. Project Authorization Ceiling was $870 million at 2007 price level i. Subject to adjustments as indicated by engineering cost indices b. Current Project Authorization Ceiling at the October, 2013 price is $1.041 billion. c. U.S. Discretionary (Appropriated) Funding i. Through FY $38.1 million; FY 2013: $ million ii. FY 2014 Budget Request: $ million d. State of New Mexico Cost Share i. To date, the State has contributed approximately $44 million toward its agreed $50 million cost share by applying for a credit of approximately $30.2 million for pipelines constructed using State funding and sending $13.6 million in cash to Reclamation. e. Mandatory Funding Project is eligible to receive i. P.L provides for total of $180 million in FY 2012 through FY FY 2014 will be last year of mandatory funding under this authority. 2. Funds are available until expended. ii. P.L provides for mandatory funding starting again in FY
4 iii. Navajo Nation and partners need to lobby for funds for Fiscal Years IX. Federal Infrastructure Projects Permitting Dashboard a. NGWSP is one of the 14 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. X. Operation, Maintenance & Replacement a. Navajo Tribal Utility Authority (NTUA) has been identified as the operator for the Project through the Operations MOU of 2012, with the exception of the portion of the Project that the City of Gallup will operate (Reaches 13 and 27) will be operated by the City. b. Through the OMR Transfer Contract (pending), it is envisioned that the Project will be brought on-line as facilities and reaches are completed (rather than waiting until the entire pipeline is completed). This will allow groundwater to be delivered through the pipeline in the interim to certain communities that have immediate needs for the water. c. The right of way and project facilities that are will be transferred to the Navajo Nation/NTUA or City of Gallup depending on Reach through a title transfer agreements. d. The Navajo Nation is working in coordination with NTUA to establish an emergency reserve and replacement fund for this project and other NTUA facilities that will need approval by the Navajo Nation Council. XI. Public Outreach / Coordination with Project Participants a. In addition to the Project Construction Committee (PCC) and Project Operations Committee (POC), Reclamation conducts regular (individual) coordination meetings with the Navajo Nation Division of Natural Resource programs, the City of Gallup, Bureau of Indian Affairs, and Bureau of Land Management, respectively. b. Reclamation staff participates in Navajo chapter meetings to provide information relating to ongoing or planned construction work associated with the Project. c. Reclamation can conduct 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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