Hays County's search for water led to its deal with Forestar Real Estate Group for water pumped from the Carrizo-Wilcox Aquifer in Bastrop County. That deal failed to clear a major hurdle when the Lost Pines Groundwater Conservation District, the entity in charge of permitting water rights in the area, denied Forestar's request Jan. 15 for an additional 33,000 acre-feet of water annually. According to a contract with Hays County to reserve 45,000 acre-feet of water annually from the company, Forestar has committed to using administrative and judicial means to secure the full contracted amount. Steve Box, executive director of the Bastrop-based advocacy group Environmental Stewardship, said he was pleased with the district's decision and is ready to support the district if Forestar decides to contest the decision in court. "It's what I call a bittersweet victory because we're going to face the big hammer next," Box said in reference to Forestar's possible legal contest. Forestar issued a statement saying the permit was intended to address Central Texas' water needs. "We are disappointed for Forestar, but more importantly for all landowners within the conservation district, whose private property rights have been adversely impacted by this decision," the company's statement read. "We are also concerned for the citizens of Central Texas, as they seek long-term sustainable solutions to the ongoing drought and their future water needs." Despite the setback to Forestar's agreement with Hays County, two other entities are at work on projects aimed at addressing the demand for water in Hays County. Hays-Caldwell Public Utility Agency The Hays-Caldwell Public Utility Agency received approval to move forward with a project that will bring about 22,300 acre-feet of water to San Marcos, Buda and Kyle from Caldwell County when it is fully built out. The project will be brought online in two phases. The first phase will bring about 10,300 acre-feet of water to Hays County each year, and the second phase will add about 12,000 acre-feet of water annually to the region's supply. HCPUA General Manager Graham Moore said the agency is also considering adding permits from the Plum Creek Conservation District, which could increase the first phase's amount to 15,000 acre-feet annually. Those supplies are expected to meet demand in San Marcos, Kyle and Buda until 2055. Moore estimated that the project would not be built out for 10 to 15 years, when the area's water demand is expected to eclipse the current supply. "I think our area has really been on the forefront of conservation. Particularly the municipalities in Hays County have done a really good job of looking at all avenues of conservation. So that's one of the reasons we've been able to push back the need for additional water supply sources," Moore said. Guadalupe-Blanco River Authority Bill West, general manager of the Guadalupe-Blanco River Authority, which supplies water to San Marcos, Buda and Kyle, said his organization's Mid-Basin project is aimed at supplying water to high-growth areas along I-35, including San Marcos, Buda and Kyle. Initial project plans call for use of groundwater and surface water to be delivered from Gonzales County mostly to cities along I-35. According to the project's proposed timeline, construction on the pipeline and other project components is expected to begin in 2014. The GBRA is hoping to utilize some of the money from the voter-approved Proposition 6. The proposition allowed the state of Texas to pull $2 billion from its Rainy Day Fund to create the State Water Implementation Fund of Texas, or SWIFT, which is intended to address water projects throughout the state. Money will begin to be loaned out in 2015, and as they are repaid, more projects will be funded. "We are working on the process with the [Texas] Water Development Board to get ready for the arm wrestle that's coming forward as to which project is going to get selected for the Prop 6 funding," he said. The Texas Water Development Board released an initial draft of the uniform standards it will use to determine which projects get a piece of the $2 billion pie. Entities wishing to have their project funded through SWIFT will be graded based on whether their projects meet the standards. The standards take into account the projects' decade of need, feasibility, viability, sustainability and cost effectiveness. Conservation Hays County Judge Bert Cobb has said the deal with Forestar is intended to work as part of a four-pronged plan that includes new water supplies, conservation, reuse and rainwater collection. In January, Hays County commissioners heard a presentation about a proposed rainwater collection incentive program. The program would allow Hays County residents to receive loans to fund construction of rainwater catchment systems. The loans would be repaid along with ad valorem taxes over a term not to exceed 10 years. "[The loan program] came from the fact that conservation is something that this county is going to have to be very serious about because in the area we live in, the physical boundaries of Hays County lay within two of the water planning regions for the state of Texas," Precinct 4 Commissioner Ray Whisenant said. "If Hays County, along with our regional members, are going to be effective members in and participators in the state water plan, conservation is a very important part of that." Whisenant and Precinct 3 Commissioner Will Conley are formulating the program. A final decision on whether to approve the rainwater initiative is expected later this year.