BF to lease water rights to Mechenbier

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After some discussion and explanation, the village council decided to lease 100 acre feet of water rights for agricultural use in Socorro County.

The five-year lease was made to Roy D. Mercer, LLC, a company owned by local farmer and developer Mike Mechenbier. The water was leased for $52 per acre foot per year.

Through his representative, water rights consultant Karen McAda, Mechenbier agreed to pay for all the costs of permitting and drawing up the lease.

McAda serves on the village's planning and zoning commission.

The water would be used on agricultural property just north of Louis Lopez in Socorro County, McAda told the mayor and councilors. The water is available for lease due to the village's return flow credits, something Councilor Wayne Ake asked be explained further.

"What can the village do with them?" Ake asked.

Basically, the village can pump more water, McAda said.

"Let's say if you are permitted to pump 100 acre feet and you are putting 50 acre feet into the river, as return flow, you can then pump an extra 50 acre feet for a total of 150 acre feet annually," McAda said, using those figures as an example. "It does give you more water to lease, because in the eyes of the Office of the State Engineer, you are pumping less."

Ake said a report prepared by McAda in 2007 showed the village had 431 acre feet available.

"Has that increased since then?" he asked.

Village Clerk/Administrator Gayle Jones said if it has increased, it's been "very minimal."

Mayor Bob Knowlton said in 2012 the village pumped 346 acre feet of what it was permitted, which was actually three acre feet less than what was pumped in 2007.

The village consumed a little less than 175 acre feet because of the return flow credit, McAda noted.

"Fifty percent pumps through to the sewage treatment plant and then is released into the river," Knowlton said. "So with the 174 acre feet of credit, we have about 600 acre feet. We could lease 167 acre feet of pre-1907 rights we have with OSE approval."

McAda said the approval for the lease would take a minimum of four months.

"Basically, we are not using all the water and have the opportunity to make a little money," Knowlton said. "And $52 per acre foot is the going rate for San Juan Chama water."

Knowlton offered what he called a little perspective on the value of water in New Mexico, saying that it was recently reported that the city of Rio Rancho wants to buy 400 acre feet and is willing to pay $12,000 per acre foot, a total of $4.8 million.

McAda said the current permitted place and type of use for those water rights were the village of Bosque Farms for municipal water services.

"The lease would be a temporary change to the point of diversion for place and purpose of use," she said. "It would go from the village wells for municipal use to the Mechenbier well for irrigation."

Village attorney David Chavez said he would like a provision included in the lease that allowed for the transfer of the water rights back to the village at any point in the term of the lease.

McAda said that could be incorporated and noted that if the lease runs the full five years the way it is planned, when the lease terminates, the rights will automatically revert to the village.

Councilor Dolly Wallace asked how often payments would be made. McAda said she thought there would be an annual payment made prior to the start of the irrigation season.

Chavez also asked for a provision in the lease that would allow the village to cancel the agreement due to unforeseen circumstances.

McAda said there was the ability for mutual cancellation of the lease before the irrigation season starts.

"It's hard to say when an emergency will occur," Chavez said. "It may not be before the season starts."

McAda said she wasn't sure Mechenbier would want a lease under which he could lose water mid-irrigation season.

"In the broader picture, I can't see the village needing the majority of its rights," she said.

Mechenbier's farm manager, Harvey Crowley, said he felt there was "no issue we can't mutually overcome."

Ake said the cancellation clause would also protect Mechenbier if there was a time during the lease period during which he no longer needed the water.

The property has been in agricultural on and off over the years, McAda said.

"It's under the ditch and it is hard to get surface water to it for irrigation," she said.

Crowley said the property was around 200 acres total and the water leased from the village would be supplemental to the irrigation water from the ditch.

"The farm has some pre-1907 rights and would lease from the (Middle Rio Grand Conservancy District) water bank," Crowley said. "This is an attempt to do what makes sense in these drought conditions so we have enough water to irrigate."

Ake moved that the village proceed with the lease and Wallace seconded.

Village resident Lee Wharton said since the state was in drought conditions, five years seemed like a long term for the lease, suggesting a shorter term with the possibility of renewal.

Knowlton said with the emergency cancellation clause in the lease, the village would "have an out."

The motion passed 3-0. Councilor Bill Kennedy was not at the meeting. The village council will consider the contract Thursday at its regular meeting.


-- Email the author at jdendinger@news-bulletin.com.