State engineers outline $17M leasing program and $150M purchase estimate tied to Texas v. New Mexico settlement

State Engineer Elizabeth Anderson and Interstate Stream Commission officials told the Senate Finance Committee that implementing the recently negotiated Texas v. New Mexico settlement will require immediate short-term leasing and longer-term water-rights acquisitions.

Leasing as bridge: Director Wisely (Interstate Stream Commission) described a three-year voluntary leasing program budgeted at $17 million to reduce groundwater use by an estimated 16,000–20,000 acre-feet per year while the state prepares to purchase long-term water rights required by the settlement.

Purchase estimate and schedule: ISC staff said a recent market study supports an initial estimate of roughly $150 million for purchases needed under the settlement (which calls for acquiring rights associated with about 18,200 acre-feet per year), and that the agency is updating the study to inform a solicitation this summer. The settlement gives New Mexico up to 10 years to complete acquisitions, though agency officials said they prefer to complete purchases sooner and are designing leasing and acquisition steps to avoid driving up prices.

Metering and program design concerns: Senators asked how program costs and market impacts would be managed and pressed for metering and monitoring to ensure compliance. Officials cited metering orders in the Middle Rio Grande and said metering is essential to administration.

Why it matters: Agencies warned that delay can raise acquisition costs and that inadequate planning risks harming local agricultural economies. Lawmakers expressed strong interest in detailed market analysis, cost estimates and program safeguards to avoid unintended consequences observed in prior state buyouts.

Next steps: ISC said it will finalize updated market studies, outline solicitation rules intended to avoid price escalation, and return with more detailed cost and implementation plans.