Texas voters Tuesday overwhelmingly approved taking $2 billion out of the state’s savings account to finance water projects, but it will be more than a year before officials decide where that money will go.
By approving Proposition 6, voters created the State Water Implementation Fund of Texas using money from the state’s rainy day fund, a move a broad range of supporters said would help the economy, large cities, rural communities and the environment.
But money won’t begin flowing to water projects until 2015 at the earliest. In the meantime, local officials around the state will begin to prioritize projects for funding and state officials will write rules on how to spend the money. Despite recent rains, most of the state is still in a prolonged drought that has strained lakes, aquifers and reservoirs.
“We have a big challenge ahead. What comes next is the work of the (Texas) Water Development Board in actually implementing a water plan for Texas that has been on the shelf for decades,” House Speaker Joe Straus, R-San Antonio, told reporters at a Proposition 6 election party on the deck of the Rattle Inn bar in downtown.
Standing outside in a soupy Austin evening, Straus joked that the passage of the amendment made it rain just as polls closed at 7 p.m. He joined a relaxed crowd of dozens of supporters including lobbyists and several lawmakers, such as state Sen. Troy Fraser, R-Horseshoe Bay, and state Rep. Justin Rodriguez, D-San Antonio.
“Today, the people of Texas made history, ensuring we’ll have the water we need to grow and thrive for the next five decades, without raising state taxes,” Gov. Rick Perry said in a statement.
Some opponents, however, said the state shouldn’t tap its savings account for infrastructure, while others said the money could be misused.
“We didn’t expect to beat … every corporate interest in real estate and oil and gas that was pushing this amendment in the middle of the drought,” said Linda Curtis, director of the advocacy group Independent Texans.
Still, Curtis said, “We’re going to be watching how they spend this money.”
Carlos Rubinstein, chairman of the water development board, said officials are ready to move ahead.
First, the regional groups will develop uniform standards by Dec. 1 that will be used to score water projects in order to prioritize them. Then, by September 2014, the regional groups will finalize their lists of prioritized water projects from the state’s 2012 water plan, essentially a list of 562 projects that would cost $53 billion to build. And finally, the board — whose three members are appointed by Perry — will develop rules about how to spend the money on projects by March 2015.
“That’s certainly a full plate, but an exciting plate,” Rubinstein said, adding that all of the steps will occur publicly, and each stage should be detailed on state websites.
Creating the two funds will put the state at the center of financing water projects in the state water plan, written every five years, most recently in 2012. Investment proceeds from SWIFT, the $2 billion from the rainy day fund, will go into a second fund, the State Water Implementation Revenue Fund of Texas. As money is paid back, it can be loaned out again, and advocates have said the funds could pay for as much as $30 billion in water infrastructure.
Projects in the state water plan span a wide range, as large as building new reservoirs and as small as helping fund small cities’ conservation efforts. At least 20 percent of the money must go to water conservation projects and 10 percent must go to rural communities.
“It’ll be highly competitive because people will be wanting those low-interest loans,” said John Burke, who chairs the regional group that includes Austin.
Payments on the loans can be deferred for 10 years, Burke said. This is useful for utilities building a project that will increase how much water it can sell. That work typically takes several years to complete, so deferring payments allows them to start making money before paying off the loan, Burke said.
The regional committees will spend the first half of 2014 going through a “practice run” of setting priority projects and sending them to the board for rankings, Burke said. Officials will then review how the process went and adjust.
Voters also approved the eight other proposed constitutional amendments, including an expansion of reverse mortgages, and tax credits for disabled veterans and the surviving spouses of veterans killed in the line of duty.