DALLAS (AP) — Lt. Gov. David Dewhurst suggested on Thursday that lawmakers consider using $1 billion from the state's rainy day fund to help pay for reservoirs and other new sources of drinking water in an effort to deal with Texas' spiraling population growth.
Speaking in Dallas, Dewhurst proposed a "water infrastructure development bank" to help cities and counties pay for environmental studies, permits and other groundwork for new construction, he said. Local governments could eventually pay back the bank through their construction budgets, he said.
New water projects "could cost tens of millions of dollars, and for some smaller cities and counties, that's difficult," Dewhurst told reporters afterward.
He suggested the rainy day fund might also be used to fund new roads. He said the Texas Department of Transportation would need "additional dedicated revenue," which could come from a number of different sources.
"I think, as a fiscal conservative, we could draw down a little bit and still keep a very healthy balance in the rainy day fund," said Dewhurst, who as lieutenant governor serves as president of the Texas Senate.
Business and conservation groups have long warned that Texas is already beginning to run out of drinking water. During last year's record-worst drought, some communities ran out of water and parts of several rivers ran dry, said Luke Metzger, director of Environment Texas.
A water plan approved last year by the Texas Water Development Board said the state should eventually spend $53 billion over the next half-century on new reservoirs, dams, pipelines and wells.
The plan estimated that Texas' population would grow 82 percent by 2060. Combined with a series of droughts that is expected to continue and the effects of climate change, Texas will run out of water without several immediate investments both in new projects and in conservation, Metzger said.
"We think the crisis is already here, but it's already going to get worse," he said.
Bill Hammond, president of the Texas Association of Business, said he welcomed Dewhurst's announcement as a "down payment."
"Water is essential for economic development, and right now we're headed toward significant shortages in the future, which will harm the economic development of Texas," Hammond said.
The rainy day fund's current balance is approximately $8 billion, according to the comptroller's office.
Catherine Frazier, spokeswoman for Gov. Rick Perry, called Dewhurst's proposal "one of many good ideas" and said Perry looked forward to reaching a solution on water.
Lawmakers used more than $3 billion from the fund to close a budget deficit in 2011. That came at the end of a legislative session in which $4 billion in cuts to public education were made to help balance a multibillion-dollar revenue shortfall.
Lawmakers already will have to find ways to close a $4.7 billion budget deficit caused by underfunding of Medicaid when they meet again in January. Lawmakers will have to pass a supplemental spending bill to cover that shortfall by March or the program will run out of money.
They may also have to spend more money on education, depending on the outcome of the school finance trial currently under way in Austin state court.
Dewhurst said he was warily watching the ongoing negotiations over the package of year-end tax increases and spending cuts that have been dubbed the "fiscal cliff." The uncertainty over whether a deal on the cliff would be reached by January affected how much new spending Dewhurst would support.
"If we were an island completely separated from the other 49 states, we might be willing to spend a little more money on some projects," Dewhurst said. "But we're not."
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