NATURAL RESOURCES : GOP Victory Proves a Watershed for Controversial Reservoir Project : Animas-La Plata dam will cost $687 million. Critics cry pork, but Republican backers are newly empowered.

No matter that critics call it economically unsound, environmentally damaging and a water project with few peers as a blatant example of pork-barrel federal largess.

The U.S. Bureau of Reclamation, which has touted its new environmental sensitivity, is moving ahead with plans to build a dam project known as Animas-La Plata, a $687-million reservoir complex near this booming high-desert resort community in southern Colorado.

Conceived more than 45 years ago as a means of supplying water to the region’s dry-land farms, this last big project on the bureau’s drawing boards will now largely support commercial and urban growth in southern Colorado and secure rights to water that Native Americans want to use some day for coal extraction or to sell to thirsty cities in California and Nevada.

But at a time of crushing federal budget deficits, government investigators say the cost of building Animas-La Plata outweighs the benefit by a 2-1 ratio, and even some federal dam builders say the bulk of the benefit may go to “hobby hay farmers” and developers wanting to build subdivisions for “equity exiles” from California.

“I call it Jurassic Pork,” said Phil Doe, a Bureau of Reclamation environmental compliance officer in Denver. “They say it’s for the Indians, but it’s clearly a developer’s project, and taxpayers are going to pay for it.”

Charles Howe, a professor of economics at the University of Colorado at Boulder, has studied the project for years. He said: “It’s a horrible project--ridiculously expensive and blatantly inefficient.”

Some Democratic lawmakers and federal officials had hoped to dramatically scale back or even kill the project during congressional committee hearings.

Those hopes may have been dashed, they concede, because the GOP sweep of Congress has empowered Republicans in Colorado’s congressional delegation, who support the project.

Now Bureau of Reclamation Director Dan Beard says he has no choice but to proceed with what he calls the last major dam complex to be built in the West.

His reason: a 1988 congressional mandate to restore 130-year-old Native American water rights on seven regional rivers.

Congress ordered construction of the oft-delayed project to settle a legal dispute with the Southern Ute and Ute Mountain Ute tribes of southern Colorado. If the project is not under construction by the year 2000, the tribes can take their case back to federal court.

If the tribes would prevail in court, which most experts believe is likely, some proponents of the project argue that the entire region’s water supply could come under tribal control, possibly drying up farmland and paralyzing growth in a place in desperate need of more housing and higher-paying jobs to accommodate newcomers.

Opponents are waging a fierce campaign to derail the project that has been in the works since 1968, when former Rep. Wayne Aspinall of Colorado, now deceased, swapped his support for the massive Central Arizona Project in return for Arizona lawmakers’ approval of five smaller water projects in his district. Animas-La Plata is one of those projects.

Critics say the project will require the equivalent of the electricity needed to power a city of 60,000 people in order to pump water out of the Animas River and up a 500-foot mountain into a ridge-top basin where elk and deer now forage amid clumps of cedar and rabbit brush.

It will also require a vast system of canals and pipelines to deliver water to irrigate 68,000 acres of farmland and provide municipal and industrial water for Durango and the New Mexico cities of Farmington, Aztec and Bloomfield.

The problem is that the project, which is estimated to take 12 years to build, will be constructed in two phases, only one of which will be federally subsidized.

In the first phase, the federal government will pick up most of the estimated $400-million tab for the reservoir-and-pumping complex, to be built just south of Durango, and for a system to deliver water to about 43,000 acres of farmland, water officials said.

It is yet to be determined who will pay for the second phase, which calls for a smaller reservoir near the New Mexico border and a system to deliver water for irrigating about 25,000 acres of farmland.

Critics say the cost to the tribes for all this could exceed $160 million--a sticking point that has deeply divided the Southern Utes, who are supposed to be primary beneficiaries of the project.

“We’ll have a dam full of water and won’t be able to afford to do a damned thing with it,” said Southern Ute tribal councilman Ray Frost, an opponent of the project. “Because it’s a cost-sharing deal, I’m afraid we’ll only be saddling our future generations with an enormous bill.”

The water district, however, recently hired a Denver consulting firm to produce a new cost analysis of the project. That study, which cost $45,000, shows that the project will more than pay for itself, a water district official said.

Meanwhile, the Sierra Club Legal Defense Fund has filed a federal lawsuit alleging that the project will alter flows in the Animas River needed by endangered fish downstream--a problem under study by the U.S. Fish & Wildlife Service and the Bureau of Reclamation.

But Durango historian and fly-fishing enthusiast Richard Ellis said lower water levels may be a necessary sacrifice to ensure the region’s economic future.

“If indeed the city of Durango is facing an impending water shortage,” Ellis said, standing hip-deep in the Animas River and casting into a trout-laden pool in sight of downtown office buildings, “then Animas-La Plata is probably its solution.”

Separately, the project has been put on hold pending completion of a Bureau of Reclamation effort to comply with federal requirements. The National Environmental Policy Act requires detailed studies of how federal actions will affect wilderness lands, water quality and endangered species.

Congress will weigh those studies in June. If the bureau passes that hurdle, construction is expected to begin in 1996.

Beyond economic and environmental concerns are allegations that the project has been politically driven for more than 30 years by an influential Durango attorney representing dozens of clients who some say have seemingly conflicting interests.

Attorney Frank E. (Sam) Maynes, 61, is an expert on water law in the region. He represents the Southern Ute Tribal Council and its chairman, Leonard Burch; the powerful Southwestern Water Conservancy District and the Animas-La Plata Water Conservancy District.

The bottom line, Maynes said, is that “you can’t put a value on the United States fulfilling its obligations to Indian tribes that have been unfairly deprived. A deal’s a deal.

“If the Indians go back to court, it could cost the government hundreds of millions of dollars and a hell of a lot more than that in terms of relations between Indians and non-Indian neighbors in Colorado and New Mexico, to say nothing of the government turning its back again on Indians.”

State Republican leaders and local water authorities hope for progress now that Democrats are no longer heading the House and Senate committees they claim have deliberately stalled Colorado water projects for years.

“Now reason is going to bring more balance into the formula,” said Rep. Scott McInnis (R-Colo.), a project supporter who has a seat on the House Natural Resources Committee.

“If we don’t build it, the Indians should and will sue the government, and we will lose that lawsuit--only after spending millions of dollars in litigation costs,” McInnis said. “Then the court may order that it be built anyway. Meanwhile, inflation will make it even more expensive than it already is.”

Project supporter Wayne Cook, executive director of the Upper Colorado River Commission and former head of project development for the Bureau of Reclamation, is not so optimistic.

“What we have now is a soft bureau that can’t stomach environmental problems, a Congress that’s out of money and groups that hate the project--all of which adds up to tough sledding ahead.

“I believe the strength and leadership to get it built will not come from the bureau but from locals, the tribes and the state--or it’ll never happen,” Cook said.

Not so, according to Interior Secretary Bruce Babbitt.

“Congress had made it clear,” Babbitt said. “My instructions are to go forward with Animas-La Plata, and I intend to do that.”