Utah audit shows millions to go to proposed pipeline costs

SALT LAKE CITY (AP) — Washington County is expected to pay hundreds of millions of dollars to build and operate a proposed water pipeline, according to a Utah legislative audit.

The audit found it will require a large fee, rate and tax increases for a southern Utah county to pay for a proposed pipeline that would pull water from Lake Powell and cost at least $1.4 billion over the next 50 years, The Salt Lake Tribune reported Wednesday.

The 140-mile (225-kilometer) line would supply the St. George metro area by diverting water from the Colorado River across southern Utah each year to the Sand Hallow Reservoir in Washington County.

The audit did not study whether the region needs the water or if Utah's cost estimates were reliable, officials said.

A population increase is central to the audit's conclusion that the district could repay the state and cover its bills, audit supervisor August Lehman said.

Washington County's population is projected to rise from 173,000 to 509,000 by 2065, while the per-capita use is projected to drop between 15% and 25% due to increased rates, according to the audit.

"There is no way they could increase (wholesale water) rates 357% and see a drop in use of only 25%," said Zach Frankel, Utah Rivers Council executive director. "If water use drops through the floor, then so do the revenues used to repay Utah taxpayers."

The council concluded in an independent study that the project could cost up to $3.2 billion, not including financing costs, Frankel said.

If Washington County residents reduce water use, the pipeline would not be needed, Frankel said. Residents could automatically reduce use in response to planned rate hikes.

Utah has already spent $38 million on engineering, design, permitting and environmental reviews, Lehman said. The project is undergoing reviews by the Federal Energy Regulatory Commission and other agencies and is expected to begin construction between 2023 and 2028.

The pipeline would support sales and income tax revenues in excess of $20 billion between 2026 and 2060, supporting 102,000 jobs, 106,000 businesses and $9 billion in personal income, the district said.

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Information from: The Salt Lake Tribune, http://www.sltrib.com