Arizona Water Banking Authority 2014 Annual Report and Ten-Year Plan AWBA Quarterly Meeting June 17, 2015 Presented by Virginia O’Connell, AWBA Manager

Arizona Water Banking Authority 2014 Plan of Operation Initial Plan – 64,753 AF Final Deliveries – 77,021 AF – 72,021 AF storage – 5,000 AF Southside Replenishment Bank – No Interstate storage Arizona Consumptive Use – 2.77 MAF – On-river 1.14 MAF – Central Arizona Project 1.63 MAF

Arizona Water Banking Authority Monies Expended for LTSCs Development in 2014 Funding Source Phoenix AMA Pinal AMA Tucson AMA Total 4-Cent Tax$4,313,466$937,200$3,406,414 $8,657,080 Withdrawal Fees$534,584$924,000$431,834 $1,890,418 General Fund--- $0 Shortage Reparation--$1,499,993 Intrastate Total $0 Interstate - Nevada-- - $0 TOTAL$4,848,050$1,861,200$5,338,241$12,047,491

Arizona Water Banking Authority Number and Location of LTSCs Accrued in 2014 (AF) Funding Source Phoenix AMA Pinal AMA Tucson AMA Total 4-Cent Tax 23,435 6,584 17,977 47,996 Withdrawal Fees 3,144 6,429 2,314 11,887 General Fund Shortage Reparation - - 7,750 Intrastate Total 26,579 13,013 28,040 67,632 Interstate - Nevada TOTAL 26,579 13,013 28,040 67,632

Arizona Water Banking Authority ObjectiveFunding SourceGoal (AF)Credits Accrued (AF) Progress Toward Goals/Oblig. M&I Firming Phoenix AMAMaricopa 4 ¢ 1,566,0001,358,82587% Pinal AMAPinal 4 ¢ 243,000205,21484% Tucson AMAPima 4 ¢ 864,000422,29249% W/Fees 60% Groundwater Mgmt Phoenix AMAWithdrawal Fees232,366 Pinal AMAWithdrawal Fees188,136 Tucson AMAWithdrawal Fees97,685 On-River M&I FirmingGeneral Fund420,00096% Percentage of AWBA Goals Achieved through 2014

Arizona Water Banking Authority Percentage of AWBA Goals Achieved through 2014 ObjectiveObligationGoal (AF) Non- LTS Credit Obligation Achieved Credits Accrued (AF) Progress Toward Goals/Oblig. Indian Settlements: GRIC Firmingup to 15,000 AF/YR 350,000105,39030% Future Settlements up to 8,724 AF/YR 200,00000% Federal Assistance$3,000,000 34,102100% Southside Replenishment Bank 15,000 AF Direct Delivery 10,00067%

Arizona Water Banking Authority ObjectiveObligationGoal (AF) Non-Credit Obligation Achieved Credits Accrued (AF) Progress Toward Goals/Oblig. Interstate Water Banking - NV 601, % Other: Shortage Reparation $8,000,000$6,000,00098,97075% Pinal Redirect Credits 14,125 Percentage of AWBA Goals Achieved through 2014

Arizona Water Banking Authority Indian Firming Program Gila River Indian Community – Firm up to 15,000 AF/yr when CAP NIA Priority supplies are insufficient to meet demand – Intergovernmental Agreement Agreement executed by AWBA in March of 2015 Expect final agreement executed by both parties in 2015 White Mountain Apache Tribe – Firm up to 3,750 AF/yr

Arizona Water Banking Authority Indian Firming Program - SSRB AWBA Required to Deliver 15,000 AF to Gila River Indian Community to Establish Southside Replenishment Bank Requires Minimum Delivery of 1,000 AF per Year Can Be Used to Offset a Replenishment Obligation in Protection Zones 2014 delivery costs total $830,000 Southside Replenishment Activities 2014 Deliveries (AF)Cumulative Deliveries (AF) Replenishment Obligations00 Replenishment Bank5,00010,000 Total Direct Deliveries5,00010,000

Arizona Water Banking Authority Joint Recovery Plan ADWR, CAWCD, and AWBA staff continued to work collaboratively to develop a recovery plan Final Plan released on May 6, 2014 Parties continue to work on next steps CAWCD is primary recovery agent – Developing recovery agreements with partners – Evaluating recovery infrastructure Parties continue to model Colorado River conditions and potential shortage impacts

Arizona Water Banking Authority Purchase of LTSCs Legislative authority secured – Use any monies in the Water Banking Fund Use of ad valorem tax – Subject to approval by CAWCD Board – Governed by Amendment No. 1 of IGA among ADWR, AWBA and CAWCD 2015 included ~29,000 acre-feet of credit purchase in the Phoenix and Tucson AMAs

Arizona Water Banking Authority Inter-AMA Firming AMWUA/SAWUA proposal Process – AWBA stores Excess CAP water in Tucson AMA – Stored water is paid for with Maricopa funds and is applied toward Phoenix AMA goal – Stored water is recovered during shortages and delivered to Tucson AMA subcontractors – M&I Pool water is delivered to Phoenix AMA subcontractor treatment plants Similar arrangement for non-AWBA firming between CAP M&I subcontractors

Arizona Water Banking Authority 2015 Plan of Operation Total Supplies Available to Pool – 58,726 AF – CAGRD Reserve 3,245 AF – Federal 5,033 AF Projected AWBA Deliveries – 45,448 AF deliveries for storage (no interstate) – 5,000 AF Southside Replenishment Bank – Least amount available for storage since 1997

Arizona Water Banking Authority Credits Distributed or Extinguished in 2014 Cumulative Credits MAF – Arizona Uses MAF – Nevada.601 MAF No credits distributed or extinguished No development of Intentionally Created Unused Apportionment

Arizona Water Banking Authority Ten-Year Plan: Today’s Agenda Background Highlighted Plan Components Conclusions Recommended Actions

Arizona Water Banking Authority Purpose of Ten-Year Plan Support development of Annual Plan of Operation governing AWBA annual activities Support policy development Create strategy for meeting goals over time

Arizona Water Banking Authority Key Plan Assumptions Excess CAP will not be available 2015 credits estimated WMAT enforceable in 2016 Firming requirements jointly modeled by CAP and ADWR CAWCD adopted rate schedule 4¢ tax continues throughout plan and are made available for credit development Budget is based on projected cost of developing credits as though AWBA received Excess CAP water directly

Arizona Water Banking Authority Water Available to AWBA No Excess CAP water If water available in 2016 expect normal operations

Arizona Water Banking Authority If normal conditions prevail…

Arizona Water Banking Authority Funding Groundwater withdrawal fees Water Storage Tax – Extension of tax through planning period General fund appropriations

Arizona Water Banking Authority Credit Development Plan

Arizona Water Banking Authority Credit Development Plan

Arizona Water Banking Authority Credit Development Plan

Arizona Water Banking Authority Credit Development Plan

Arizona Water Banking Authority Results of Credit Development Plan

Arizona Water Banking Authority Results of Credit Development Plan

Arizona Water Banking Authority Results of Credit Development Plan

Arizona Water Banking Authority Results of Credit Development Plan

Arizona Water Banking Authority Firming Plan

Arizona Water Banking Authority Top conclusions… Excess CAP water no longer available (except in 2016) Credits will likely be distributed by 2021 but volumes small Extension of 4¢ tax is big impact Withdrawal fees must be relied upon for Indian firming

Arizona Water Banking Authority Recommended actions… Focus on Indian firming goals – Finalize and implements agreements with Gila River Indian Community – Develop, negotiate and implement agreements with White Mountain Apache Tribe

Arizona Water Banking Authority …more recommendations Coordinate with CAWCD and ADWR – Modeling – Credit purchases – Annual Plan of Operation – Ten-Year Plan – Extension of joint IGA – Recovery planning

Arizona Water Banking Authority …a few more Focus on credits development independent of Excess CAP water Explore options for offsetting firming obligations without using existing credits Establish policy for use of shortage reparation credits Continue evaluating inter-AMA firming Develop public outreach program

Arizona Water Banking Authority 2014 Annual Report and Ten-Year Plan AWBA Quarterly Meeting June 17, 2015 Presented by Virginia O’Connell, AWBA Manager