Maverick County Water Control & Improvement District No. 1 Board rejects water rights sale
By: Jose G. Landa
Copyright 2013 Eagle Pass Business Journal, Inc.
The Maverick County Water Control and Improvement District No. 1 Board of Directors held a special meeting on Friday, October 25, 2013, at 10 A.M. at its headquarters in the Maverick County Industrial Park at the Radar Base in Eagle Pass, Texas, and unanimously rejected Jerry Ahrens and Agricultural Investment Associates, Inc. proposals to purchase 2.3 percent of the local water district Rio Grande River water rights for $3.5 Million and to become the exclusive agent to sell 2.3 percent of the district’s water rights in the private market.
Jerry Ahrens, Vice-President of Agricultural Investments Associates, Inc. of Kerrville, Texas, made a presentation to the Maverick County Water Control and Improvement District No. 1 Board of Directors to purchase 2.3 percent of its Rio Grande River water rights for the sum of $3.5 Million, estimated to be between 800 to 3,000 acre feet of water, to be allegedly used for oil and gas drilling operations utilizing horizontal drilling methods known as “fracking” in the Eagle Ford Shale region in Southwest Texas.
Ahrens stated that he had previously done 10 similar water purchase and sale transactions before during the past four years with other water districts in the Rio Grande Valley with the last transaction being with the Mercedes Water District No. 9 for two purchases, one for $3 Million and a second for $3 Million plus. Ahrens stated that his proposal to the Maverick County Water Control and Improvement District No. 1 is probably his last proposal. Ahrens spent one week meeting with Cynthia Maritnez, General Manager of the MCWC&ID No. 1, reviewing the numbers of the water rights of the local water district to determine a price and availability of water rights for purchase. Ahrens and his company, Agricultural Investments Associates, Inc., then made a written proposal to offer to buy 2.3 percent of the water district’s water rights, estimated to be between 800 to 3,000 acre feet of water and to be named the exclusive agent of the local water district to be able to sell these water rights.
Ahrens represented to the Board of Directors that he was unaware of the controversial dispute to build and open an open surface coal mine in Eagle Pass, Texas by Dos Republicas Coal Partnership and the local community’s opposition to this coal mine. Ahrens stated that he added two restrictions to his proposed written agreement that any water he purchased could not be used for coal mining and that any purchaser of his water rights could not use it for coal mining use.
Ahrens told the Board of Directors that his intended use of the water was for oil and gas fracking operations, mostly in Webb County. Ahrens stated that each oil and gas well drilled uses approximately 13 to 20 acre feet of water and that each fracking well costs approximately $7-8 Million to develop and produces between $15 to $20 Million in oil and gas. “It’s a very productive use of water. This opportunity will last only 10 to 15 years. It won’t last forever,’ said Ahrens.
Cynthia Martinez, General Manager of the M.C.W.C.&I.D. No. 1, told the Board that once they agreed to sell the 2.3 percent of water rights, the sale was forever, permanent-including the right to their water storage supply. This point raised concerns among the Board members.
Ahrens replied that the sale of water rights is like a real estate transaction requiring a contract, a title examination, and approval by the Texas Commission on Environmental Quality (TCEQ). The total process takes about 4 to 5 months because it has to go through approval by TCEQ’s Commissioners at one of their meetings.
Board President Travis Kelly told Ahrens that the M.C.W.C.&I.D. No. 1’s purpose is to provide water for farmers and ranchers for agricultural use. Kelly told Ahrens that the water district has to protect its agriculturers and water users.
Board member Xavier Mancha asked Ahrens if the water district had requested him to submit a proposal for the purchase of water rights? Ahrens replied, “No.” Ahrens stated that he was simply making a proposal to the water district on his own.
M.C.W.C.&I.D. No. 1 water user, Glenna Purcell, told the Board that she grows pecans and that the sale of 2.3 percent of the local water district’s water rights may mean whether her pecan trees survive and whether there will be enough hay for her cattle to survive. Purcell told the Board not to sell the water rights, but that if they wanted to do something about it to consider leasing the water rights but do not sell them.
M.C.W.C.&I.D. No. 1 water user, Walter Herring, stated his father and family had been farming in Maverick County for a very long time and that he opposed the sale of the water rights. Herring told the Board that “without water, you have no agriculture. Without agriculture, you have no food supply.” Herring told the Board that without agriculture, the United States would have to purchase food from Brazil, China, and other countries.
Martha Baxter, a member of the Maverick County Environmental and Public Health Association, stated that local citizens vehemently opposed the sale of water rights because they can always be used for coal mining regardless of any restrictions in a written agreement.
George Baxter, Vice-President of Maverick County Environmental and Public Health Association, told Board members that the Texas Open Meetings Act required the Board to take action in open session, not in closed session.
Board President Travis Kelly told Ahrens that he favored tabling the agenda items to allow the district more time to review his proposals, but Board member Xavier Mancha told Kelly that the Board had had sufficient time to review the proposals and should vote on it. Mancha made a motion to reject or not accept Ahrens and Agricultural Investment Associates, Inc.’s two proposals to purchase 2.3 percent of water rights for $3.5 Million and the granting of exclusive rights to them to sell the water district’s water rights. Board member Yolanda Mauricio seconded the motion. Kelly called the motion for a vote and the Board members unanimously approved the motion.
M.C.W.C.&I.D. No. 1 Board of Directors include President Travis Kelly, Marcelino Perez, Xavier Mancha, and Yolanda Mauricio. One Board seat is vacant.
