Committee approves water user agreement

By Kathy Helms
Diné Bureau

WINDOW ROCK — Resources Committee Chairperson LaVern Wagner cast the only dissenting vote during a meeting this week to approve a "Large Water User Master Agreement between the Navajo Nation and Diné Power Authority."

The legislation sponsored by Roy Dempsey was presented by Resources Committee member and co-sponsor Norman John II, Twin Lakes, who also is a member of the Diné Power Authority Board of Directors. It was approved following lunch break after being tabled temporarily by Wagner to give DPA representatives time to show up.

At the table were representatives of Sithe Global Power LLC and DPA's attorney. During the afternoon session, Sithe representatives turned their seats over to DPA, the legislation was amended to add a signed Signature Approval Sheet, and then the main motion approved 5-1.

Delegate Amos Johnson was absent and Delegate Nelson Begaye returned late from lunch and missed the opportunity to vote. Voting for the legislation were John, Resources Chairman George Arthur and members Herman Daniels, Harry Goldtooth, and Larry Noble.

Earlier in the day, Wagner attempted to up the price of the water from $1,000 per acre foot to $1,500. However, Arthur said that because the dollar amount "is a negotiated item, that probably would have to go back to the negotiating table."

Noble said the average rate for industrial use water was $290 an acre foot. Sithe Global Executive Vice President Dirk Straussfeld said the company last paid $800 an acre foot in Las Vegas.

Where's Diné Power?
After the morning session, Wagner (Pueblo Pintado/Torreon/Whitehorse Lake) said she moved to table the legislation for two reasons: "Number 1, the legislation says Navajo Nation and DPA. But where is DPA? None of them's there, just one board member," and she questioned whether his vote might be considered in conflict because he also is a member of Resources.

"Sithe Global is there representatives but where is Stephen Begay? Where is the DPA president? He wasn't there. So that's why I tabled temporarily to get those people rounded up. I mean, this is a major approval. The legislation says between Diné Power Authority and Navajo Nation.

"Where is the other party? If they're serious about the agreement, they want water from the Navajo Nation, I believe they have to be present at this very important meeting," Wagner said.

Chairman Arthur said Thursday that there was no conflict of interest because John was representing the Resources Committee and voted as a Resources Committee member.

Wagner said her second reason for the tabling motion was because the committee needed more information on a report that Sithe would be getting a sizable tax break. "We're not informed of that either. I understand just through the media that there's a large tax break. Many of my constituents are concerned about that. It's being done below surface, and that's the wrong way to do negotiations. That's not proper.

"This is for the future; so I don't feel comfortable making a decision if we have to deal that way. It should be done out front with the right, key people at the table making this agreement.

"We represent a large number of Navajo people in the future and we have to make the right decisions on their behalf," Wagner said.

Regarding the reported tax break for Sithe, Wagner said she wanted to get that matter clarified with the Navajo Tax Commission. "It's the people's money, people's future, people's water that we're talking about and we have to be very careful whenever we make those decisions.

"Right now, it's really political pressure. If Salt River Project down there gave them (Sithe) a deadline to say yes or no to their possible future business, that shouldn't pressure us. That's not the Nation's problem. They can't pressure us like that. That's bad business. We don't appreciate those kinds of businesses," she said.

Permission debatable
In an all-day work session Jan. 20, Sithe Global and Diné Power presented a status report on the Desert Rock Energy Project and fielded questions from delegates.

The meeting occurred just prior to Council's Jan. 23 Winter Session, during which Diné Power received $2 million from the Undesignated Reserve through amendment to another piece of legislation.

The Large Water Master Agreement legislation approved Tuesday apparently only had to receive approval from Economic Development and Resources Committee; however, Navajo Department of Justice's Stanley Pollack, assistant attorney general of the Water Rights Unit, said in a Jan. 5 letter to SAS reviewers that "The SAS package is silent with respect to whether Resources Committee approval is necessary."

Pollack said that because the agreement is "somewhat unique," it was not clear whether it fit within the agreements that require Resources Committee approval.

"However," he said, "I strongly recommend that the agreement be approved by the Committee" for several reasons, including the fact that it has oversight authority over the activities of the Division of Natural Resources and specific authorities concerning large water user permits.

Pollack said the agreement (DNR-11184) sets forth an understanding for how water use permits will be issued for the Desert Rock Energy Project, "however, the Agreement does not constitute a water use permit per se or grant any specific rights to any particular water use permit."

He said concerns he expressed in an Aug. 11, 2005, memorandum concerning the originally proposed water use permit were either no longer relevant or had been satisfied through the agreement. Nevertheless, he said, he would still like to address the committee at the agreement's presentation.

What's in a name?
In a Jan. 10 letter to Chief Legislative Counsel Raymond Etcitty from DPA General Manager Steven Begay, DPA submitted SAS No. DNR-11184: "Large Water User Master Agreement between the Navajo Nation and Diné Power Authority for the Development of the Water Supply for the Desert Rock Energy Project."

The title of the legislation approved Tuesday did not include mention of Desert Rock.

Begay said DPA was requesting "4,500 acre-feet of water per annum from the Morrison aquifer for the operation of the Desert Rock Energy Project" which will use about 5 to 6 million tons of Navajo coal per year from BHP Billiton's Navajo Mine, which will be expanded and employ about 200 people at the new mine and about 200 at the plant. It also will provide about $50 million a year in benefits to the Nation.

During the Jan. 20 presentation, delegates were told it would cost the Nation about $198 million to buy into the project. No one questioned where the cash-strapped Nation would get the buy-in money.

Begay said the agreement was the result of work efforts on the part of the Division of Natural Resources, Water Resource Department, Water Code Department and the Department of Justice in conjunction with DPA and Sithe Global Power.