The Lower Colorado River Authority Board of Directors voted today to settle a $1.2 billion lawsuit with the San Antonio Water System over a proposed water supply project dating back nearly a decade.

“The greatest benefit of this settlement is that it allows both LCRA and SAWS to focus on the most important part of our jobs – finding and developing new water supplies for Texas,” said LCRA Board Chair Tim Timmerman. “If this state is to continue flourishing, we must work together to develop new supplies of water.”

SAWS Board Chairman Berto Guerra agreed.

“We can look back on the constructive work that was performed by the talented SAWS and LCRA staffs,” Guerra said.  “The SAWS-LCRA project reminds us of the enormous challenges we face as a state to develop necessary water supplies.  We are still committed to doing that on a cooperative, regional basis in the future.”

In the settlement, LCRA and SAWS agree to work together to find new water supplies.

 “Texas is being savaged by a terrible drought,” said LCRA General Manager Becky Motal. “These historically hot temperatures and low inflows into our lakes provide a clear indication of where our priorities should be placed – working with entities like SAWS to find water to help us through dry times like these. Continuing this protracted legal battle between LCRA and SAWS would not produce a single drop of water for the people of Texas.”

In addition to ongoing cooperation in the water development arena, LCRA agrees to reimburse SAWS $18.8 million right away, and then $1.4 million a year for eight years. The agreement will officially terminate the contract and end the lawsuit.

“Through this settlement, San Antonians will recover a significant portion of their investment in the LCRA water supply project, and avoid ongoing legal fees,” said Robert R. Puente, President/CEO of SAWS.

The LCRA Board unanimously voted to accept the settlement at its meeting today. The SAWS Board is scheduled to consider the measure at its next regular meeting on Tuesday, Nov. 1.

LCRA and SAWS signed an agreement in 2002 to study the feasibility of a water-sharing project to determine if such a project could provide for water needs in both basins while meeting requirements set by the Texas Legislature.

Generally, the agreement allowed LCRA to study whether water from the Colorado River downstream from Austin could be captured and stored in a reservoir. The water would have been piped to San Antonio.

Preliminary study findings indicated that the project – given updated growth projections – would not meet all of the legislative requirements, meaning no water would be available for San Antonio.

In May 2009, the SAWS Board of Trustees claimed that LCRA’s use of updated water need projections in the ongoing project studies breached the agreement and a lawsuit was filed. LCRA responded that it had not breached the contract and the case was dismissed in 2010.  However, the dismissal was overturned on appeal.

Leaders from the two organizations were brought back to the table last week by Sen. Jeff Wentworth.

“We are grateful for the mediation efforts of Senator Jeff Wentworth, who actively and successfully pursued the settlement of this case,” said Puente.