This bill amends repayment terms for the Arkansas Valley Conduit in Colorado to ensure domestic water supply by setting contractor payments at 35% of the total cost.
Lauren Boebert
Representative
CO-4
The Finish the Arkansas Valley Conduit Act amends existing law to establish new, favorable repayment terms for the Arkansas Valley Conduit in Colorado. This bill mandates that 35% of the conduit's total cost must be covered by non-Interior Department entities during construction. The remaining balance can be repaid over up to 75 years at a reduced interest rate, contingent upon a finding of financial hardship for the contracting parties. Additionally, the responsible parties must assume all future operation and maintenance duties.
Water Project Funding Shift: New Bill Fixes Local Share at 35% But Dumps All Future Maintenance Costs on Communities
The “Finish the Arkansas Valley Conduit Act” aims to finally secure the funding structure needed to complete the Arkansas Valley Conduit in Colorado, a project intended to bring reliable domestic water to several communities. This bill isn’t about building the pipe itself; it’s about changing the rules of who pays for it and when, overriding some previous federal agreements (Public Law 87-590).
The New Financial Blueprint
This legislation sets a hard number for local contribution: the repayment contract must cover exactly 35 percent of the conduit’s total cost. This 35 percent must be secured and provided during construction from entities other than the Secretary of the Interior—meaning local governments, private sources, or state funding need to front that cash while the project is being built. This fixed percentage is a major change, as it clears up the cost-sharing ambiguity but locks local parties into a substantial upfront commitment.
For the remaining 65 percent, the bill offers a potential lifeline. If the Secretary of the Interior determines the contracting parties are facing “financial hardship,” they can qualify for an extended repayment period of up to 75 years. Even better, the interest rate on that balance would be cut in half, set at 50 percent of the standard Treasury rate. This provision is significant for budget-strapped towns, as it makes a massive infrastructure investment manageable over generations. However, that “financial hardship” determination is the Secretary’s call, introducing a layer of uncertainty and political discretion into the process.
The Long-Term Catch: Who Owns the Headache?
Here’s the part that needs a closer look, especially for the local communities signing the dotted line: The bill explicitly requires the contracting parties to assume all care, operation, maintenance, and replacement responsibilities for the conduit. Think of it like this: the federal government is helping finance the car, but the moment you drive it off the lot, every oil change, every flat tire, and every major engine replacement is 100% your problem.
For a massive piece of water infrastructure like the Arkansas Valley Conduit, this is a huge, indefinite financial obligation. While the upfront construction costs are eased by the long-term, low-interest repayment option, the long-term operations and maintenance (O&M) costs are entirely shifted to local entities. If a major pipe section needs replacement 30 years from now, the local water districts—and subsequently, the rate-paying citizens—will bear the full, uncapped cost. This shift means that while the bill helps finish the project, it creates a permanent, potentially massive, financial responsibility for the communities that rely on it.