Lawmakers reject attempt to narrow costs of proposed $574 million canal

Amendment would have reduced scope of canal and cut costs by $125 million, freeing funds for other needs

By: and - May 4, 2023 7:32 pm
Perkins County Canal

Work on the Perkins County Canal near Ovid, Colorado began in 1894, but the project halted after running out of money. (Courtesy of the Perkins County Historical Society)

LINCOLN — Nebraska lawmakers rejected a proposal Thursday to reduce the cost of a multimillion-dollar canal that supporters say would protect the state’s water rights from Colorado.

State Sen. John Cavanaugh of Omaha had questioned why Nebraska was planning to build a larger Perkins County Canal than permitted under a 1923 compact with Colorado over the use of water from the South Platte River.

Cavanaugh said that rather than spending the full $574 million requested by Gov. Jim Pillen and advanced by the Appropriations Committee, a lower-volume canal should be built, cutting costs by $125 million.

That money, he said, could be better spent on other state needs.

State Sen. John Cavanaugh of Omaha. (Zach Wendling/Nebraska News Service)

“This is a mistake,” Cavanaugh said, adding that the larger canal would “invite” an expensive lawsuit with Colorado — a lawsuit he figured Nebraska likely would lose.

‘Serious money’

The Perkins County Canal, abandoned decades ago due to a lack of funds, would divert water from the South Platte in Colorado to farmland across the border in Nebraska and eventually to increase flows in the Platte River across the state.

Former Gov. Pete Ricketts resurrected the project, arguing that Nebraska needed to claim water guaranteed under its compact with Colorado before it is snapped up for Front Range development in that state. The only way to do that under the compact, he said, is to build the canal.

Pillen, in his budget request, asked lawmakers to set aside $574 million to build a canal that could divert up to 1,000 cubic feet per second (cfs) of water, as well as build two or three dams to store the water for irrigation and to enhance flows in the Platte River.

But Cavanaugh pointed out Thursday that the compact allows Nebraska to divert only 500 cfs of water from the South Platte during non-irrigation season, not the 1,000 cfs Pillen requested.

The smaller-capacity canal, the senator pointed out, would cost $125 million less.

“That’s serious money,” he said.

‘We’re in a desert out here’

The larger canal is designed to capture water from high-water events, which Cavanaugh said happens only once every seven years. Such water would flow down the South Platte into Nebraska anyway, so the larger canal is unnecessary, he argued.

Perkins County Canlal
Then-Gov. Pete Ricketts and other state officials during a September visit to the area of the proposed Perkins County Canal. (Courtesy of Nebraska Governor’s Office)

But two members of the Legislature’s budget committee defended the larger, more expensive canal, which would be one of the state’s most expensive construction projects.

State Sen. Rob Clements of Elmwood, chair of the Appropriations Committee, said the larger canal costs about 28% more than originally planned and provides 100% more benefits, so it was a good deal.

State Sen. Steve Erdman of Bayard, whose district includes where the canal would be built and the area that would get most of the benefits of the canal, said that you only have to look at Lake McConaughy — which is down by 50% of capacity — to know how precious water is for his area.

“We’re in a desert out there basically, and any time you can gather more water when it’s flooding, it’s an appropriate time to do that,” Erdman said.

State Sen. Bruce Bostelman of Brainard, chair of the Natural Resources Committee, also defended the project adding that while the cost is large, the benefits would be greater.

Senators recently toured area

The debate came after nearly a dozen senators toured areas last weekend that would be part of the Perkins County Canal project. Cavanaugh and another group visited in the fall, as did Ricketts.

While some landowners in that area have expressed concerns about their farm ground being taken for canals and retention dams, supporters said the area would benefit by recharge to groundwater and increased access to water for irrigation.

Erdman reminded senators Thursday that about 7% of the flows from the South Platte River reach Lincoln and Omaha, which tap groundwater fed by the Platte for their respective drinking water.

Steve Erdman
State Sen. Steve Erdman of Bayard (Courtesy of  Unicameral Information Office)

In addition to irrigation for farmers and ranchers, supporters argue the project would enhance wildlife and recreation on the Platte River as well as boost hydropower production.

Project may only ‘break even’

But others question if the canal is worth the money.

Anthony Schutz, a University of Nebraska law professor who specializes in water law, said the benefits of the canal have not been clearly explained, and, from the data available, is likely to only “break even.”

“It loses when you get realistic about volume, complexity, delay and time value of money,” Schutz said in a Thursday tweet.

He added that construction of the project, if it is ever built, is probably more than a decade away.

In an interview with the Examiner on Monday, Joe Frank, general manager of the Lower South Platte Water Conservancy District in Sterling, Colorado, questioned how much water would be available to Nebraska.

Nebraska’s right to South Platte flows, while clear in the compact, is “junior” (or behind) a reservoir in Colorado, Frank said.

Canal would ice up

The Perkins County Canal would be capturing water during the coldest months of the year, he said, and icing would prevent the full amount from flowing down the canal and into storage dams in Nebraska.

Both Frank and Schutz said that the canal would likely just shift irrigation water from northeast Colorado to farmers across the border in Nebraska. It would not, they said, impact development on the fast-growing Front Range.

After a lengthy debate, lawmakers rejected Cavanaugh’s amendment on the Perkins County Canal on a 32-11 vote.

Clements said that although benefits of the canal would be delayed for years because of construction, approving the full allocation sends a message to Colorado.

“They didn’t think we’d ever do it,” he said. “Without allocating money, they wouldn’t really believe that we’re serious about it.”

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Paul Hammel
Paul Hammel

Senior Reporter Paul Hammel has covered the Nebraska state government and the state for decades. Previously with the Omaha World-Herald, Lincoln Journal Star and Omaha Sun, he is a member of the Omaha Press Club's Hall of Fame. He grows hops, brews homemade beer, plays bass guitar and basically loves traveling and writing about the state. A native of Ralston, Nebraska, he is vice president of the John G. Neihardt Foundation.

Nebraska Examiner is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.

Zach Wendling
Zach Wendling

Zach rejoins the Nebraska Examiner after studying abroad in Antigua, Guatemala, following a yearlong Examiner internship. His coverage focus areas have included politics and government, health and well-being and higher education.

Nebraska Examiner is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.