♪.

TED: COMING UP NEXT ON "ARIZONA HORIZON," A LOOK AT THE ECONOMY BY WAY OF THINGS LIKE INVENTORY LEVELS, WAREHOUSING CAPACITIES AND TRANSPORTATION COSTS.

>>> ALSO TONIGHT, A WAIT LIST IS REINSTATED FOR FAMILIES SEEKING STATE CHILD CARE ASSISTANCE.

>>> AND ENCOURAGING NEWS ON WATER LEVELS AT LAKE POWELL.

THOSE STORIES AND MORE NEXT ON "ARIZONA HORIZON."

GOOD EVENING, AND WELCOME TO "ARIZONA HORIZON."

I'M TED SIMONS.

GOVERNOR KATIE HOBBS WILL AGAIN SEND NOMINEES FOR STATE AGENCY HEADS TO THE STATE SENATE FOR APPROVAL ACCORDING TO AGREEMENT THAT ENDS A LAWSUIT FILED BY SENATE PRESIDENT WARREN PETERSEN WHO SUED THE GOVERNOR OVER APPOINTMENT OF EXECUTIVE DEPUTY DIRECTORS AS A WAY TO GET AROUND CONTENTIOUS SENATE APPROVAL PROCESS THAT THE GOVERNOR DESCRIBED AS POLITICAL CIRCUS.

THE AGREEMENT COMES BEFORE ORAL ARGUMENTS WERE SET TO BEGIN.

THEY WILL STAY IN CHARGE UNTIL THE CONFIRMATION PROCESS BEGINS WITH THE NEXT LEGISLATIVE SESSION.

>>> FORMER ARIZONA GOVERNOR DOUG DUCEY RAISED EYEBROWS BY ENDORSING DONALD TRUMP AND U.S. SENATE CANDIDATE KARI LAKE FOR NOVEMBER'S ELECTION.

THIS DESPITE TRUMP RELENTLESSLY MOCKING AND CRITICIZING DUCEY FOR CERTIFYING THE LAST PRESIDENTIAL VOTE AND THIS DESPITE DUCEY SAYING THAT TRUMP HAD, QUOTE, BETRAYED THE PEOPLE OF ARIZONA.

AS FOR LAKE, SHE DESCRIBED DUCEY AS A DOORMAT AND ESTABLISHMENT HACK, AND DUCEY CALLED HER CAMPAIGN AN ACT AND SHOW AND ELECTION DENIALISM, QUOTE, MISLED VOTERS WITH NO EVIDENCE, BUT DUCEY TODAY SAID THERE WAS TOO MUCH ON THE LINE IN NOVEMBER SO HE'S VOTING STRAIGHT REPUBLICAN INCLUDING TRUMP AND LAKE.

>>> STATE SUPREME COURT JUSTICES CLINT BOLICK AND KATHRYN KING, UP FOR RETENTION VOTES THIS YEAR RECUSED THEMSELVES FROM A LAWSUIT THAT COULD DIRECTLY AFFECT THEIR FUTURE ON THE COURT.

THE SUIT CHALLENGES A BALLOT MEASURE REFERRED BY THE LEGISLATURE THAT WOULD END MOST JUDICIAL RETENTION ELECTIONS IN ARIZONA.

THE LAWSUIT SEEKS TO KEEP THE MEASURE FROM APPEARING ON THE BALLOT CLAIMING THAT THE MEASURE IS DECEPTIVELY TITLED AND BREAKS A SINGLE SUBJECT RULE FOR CONSTITUTIONAL AMENDMENTS.

THE LOWER CURE THE RULED AGAINST THOSE CLAIMS BUT IT WAS APPEALED TO THE STATE SUPREME COURT PROMPTING RECUSALS FROM JUSTICES BOLICK AND KING.

>>> HEALTH NEWS HERE, A NEW STUDY FROM THE JOURNAL OF AMERICAN MEDICAL ASSOCIATION FINDS A DIET OF WHOLE GRAINS CAN LOW ARE THE RISK OF DEMENTIA BY A THIRD AND THAT INCLUDES DIABETES AND HEART DISEASE.

THE STUDY IS OBSERVATIONAL AND CAN'T MAKE A DIRECT CORRELATION BETWEEN A HEALTHY DIET AND HEALTHY BRAIN BUT THE RESULTS MIRROR EXISTING RESEARCH THAT LINKS DIETARY INFLAMMATION AND BRAIN HEALTH.

>>> A SCIENCE NOTE, ASTRONOMERS FOUND A ZOMBIE STAR FROM A SUPERNOVA THAT APPEARED IN THE NIGHT SKY A THOUSAND YEARS AGO IT WAS AS BRIGHT AS SATURN IN THE NIGHT SKY AND RECORDED AS A SO-CALLED GUEST STAR IN CHRONICLES FROM JAPAN AND CHINA.

THE REMNANT OF THE SUPERNOVA PUZZLED ASTRONOMERS UNTIL A NEW STUDY ATTRACTED THE EVOLUTION FROM IMMEDIATELY AFTER INITIAL OUTBURSTS WHICH REVEALED THE ZOMBIE STARS'S TRUE NATURE.

>>> THE LOGISTICS MANAGERS INDEX OR LMI IS A MONTHLY LOOK OF SUPPLY CHAIN COMPONENTS INCLUDING WAREHOUSE LEVELS AND TRANSPORTATION COSTS.

THE LMI IS IN EIGHTH MONTH OF EXPANSION.

WHAT DOES THAT MEAN FOR THE OVERALL ECONOMY?

WE ASK DALE ROGERS OF W.P.

CAREY'S SCHOOL OF BUSINESS, OUR GO-TO GUY WHEN IT COMES TO SUPPLY CHAIN ISSUES.

GOOD TO SEE YOU AGAIN.

>> GOOD TO SEE YOU.

TED: BEFORE WE GET STARTED, THE LMI, LOGISTICS MANAGERS INDEX, WHAT IS IT?

>> A MONTHLY SURVEY OF SENIOR LOGISTICS SUPPLY CHAIN MANAGERS AND LOOK AT THREE COMPONENTS, THREE ON TRANSPORTATION, THREE ON WAREHOUSING AND A COUPLE ON INVENTORY AND COME UP WITH A SCORE, DIFFUSION INDEX SO ANY SCORE BELOW 50 IS DECREASING, ANY SCORE ABOVE 50 IS INCREASING WITH 0 AND 100 BEING THE POINTS.

WHAT WE THINK IT DOES.

IT SEEMS LIKE IT HAS DONE IS THAT IT WILL TELL THE FUTURE BECAUSE BEFORE SOMETHING GOES INTO GDP, BEFORE ECONOMIC ACTIVITY GOES INTO GDP, WHICH IS A LAGGING INDICATOR, LIKE ACCOUNTING, SUMMING THINGS UP AT THE END OF A QUARTER OR SOMETHING.

IT GOES ON A TRUCK, IT GOES ON A TRAIN, IT GOES IN A WAREHOUSE AND INVENTORY.

SO WE CAN SEE A COUPLE OF MONTHS, AT LEAST AHEAD OF WHAT'S GOING TO HAPPEN.

TED: AND FOR THE EIGHTH STRAIGHT MONTH THE NUMBERS ARE UP.

WHAT'S THAT MEAN?

WHAT'S GOING ON?

>> WELL, IT'S REALLY INTERESTING.

IT'S KIND OF LIKE WE'RE IN 2019, AGAIN, TO SOME EXTENT, WHICH WE DON'T WANT TO GO INTO 2020, BUT YOU KNOW, WE'RE SEEING A STRONG CONSUMER, NOT AS STRONG AS WHAT IT WAS A FEW MONTHS AGO, BUT A STRONG CONSUMER.

YOU KNOW, WITH ALL THE STUFF THE FED HAS DONE, THEY REALLY HAVE NOT BROKEN CONSUMERS YET.

I MEAN THEY'RE DOWN A LITTLE BIT BUT HAVEN'T BROKEN UP, AND THE BACK END OF THE SUPPLY CHAIN, THE REAL UPSTREAM SUPPLY SIDE IS PRETTY HOT RIGHT NOW.

IT'S A VERY INTERESTING TIME.

TED: BUT YOU GOT INVENTORY LEVELS DOWN FOR THE THIRD STRAIGHT MONTH, RETAILERS MAYBE HOLDING ON A LITTLE BIT WAITING FOR THE END OF THE YEAR?

HOW MUCH DOES THAT FACTOR IN?

>> THE FOURTH QUARTER IS GOING TO BE BILL.

SOME RETAILERS DON'T BELIEVE CONSUMERS ARE GOING TO SHOW UP.

THERE'S A LOT OF TALK ABOUT A RECESSION IS COMING.

WE CAN'T SEE THAT BASED ON THE ECONOMIC ACTIVITY.

I JUST CAN'T SEE IT.

YOU NEVER KNOW FOR SURE IF ONE'S COMING OR NOT COMING, BUT RETAILERS ARE BEING CAUTIOUS, AND IF YOU'RE WALKING AROUND MALLS THESE DAYS, YOU CAN TELL THERE'S A LOT OF SALES AND NORMALLY AT THIS TIME, YOU'D BE, IN AUGUST, YOU'D BE RAMPING UP INVENTORY.

THAT WAS FOR JULY.

WE'LL SEE IF IT CHANGES IN AUGUST AND SEPTEMBER, GETTING READY FOR CHRISTMAS SALES.

TED: TRANSPORTATION COSTS, HOW DO THEY FACTOR INTO ALL THIS?

>> YOU KNOW, THIS IS REALLY INTERESTING, BECAUSE WE HAD FOR THE TRANSPORTATION GUYS, THE GREATEST NUMBERS EVER DURING THE PANDEMIC BECAUSE THEY COULD CHARGE SO MUCH, AND PARTICULARLY ON OCEAN SHIPPING COMING INTO THE U.S., NUMBERS WERE WAY UP.

THEN WE HAD THAT CRASH, AND THE TRUCKING GUYS AND TRANSPORTATION GUYS ARE COMING UP WITH ALL SORTS OF WAYS TO INCREASE THE PRICING WITH THE STUFF THAT'S HAPPENING IN THE MEDITERRANEAN, THE PIRATES AND STUFF.

IT DOESN'T HAVE A LOT TO DO WITH U.S. AND U.S./WEST COAST, HONESTLY IT DOESN'T.

BUT USING THAT AS A LEVER TO INCREASE PRICES.

>> AND WAREHOUSING OVERALL, STRONG?

>> YEAH, ACTUALLY.

SO WE SAW A NEW MODEL IN WAREHOUSING, ABOUT SIX OR SEVEN YEARS AGO, START WHERE FOR ALL OF MY CAREER, YOU SAW CONSOLIDATION OF WAREHOUSING.

YOU MIGHT GO FROM 20 TO FOUR WAREHOUSES IN THE U.S. AND MIGHT BE BIG ONES.

NOW WE'RE SEEING WAREHOUSING LOCATE CLOSER TO THE CONSUMER.

WHAT WE CALL THE AMAZON EFFECT, AND SO THERE'S BEEN A LOT OF FOLKS RUNNING AFTER WAREHOUSING SPACE BECAUSE THE OLD IDEA OF CLOSER TO THE CONSOLIDATING AND LONG TRANSPORTATION RIDES IS KIND OF OVER A LITTLE BIT.

TED: INTERESTING.

INTERESTING.

OVERALL, LET'S FOCUS IN ON INFLATION, WE TALKED ABOUT THE ECONOMY.

MOST FOLKS WANT TO TALK ABOUT PRICES AND INFLATION.

WHAT DOES ALL OF THIS MEAN REGARDING INFLATION, AND REGARDING WHAT THE FED, I THINK, ALMOST EVERYONE AGREES IS GOING TO HAVE TO CUT RATES SHORTLY HERE.

DO YOU AGREE WITH THAT, AND OVERALL SCENARIO?

>> YEAH, YEAH, IF YOU THINK ABOUT WHAT THE FED DOESN'T HAVE THAT MANY TOOLS TO DEAL WITH A MODERN ECONOMY, THEY CAN RAISE INTEREST RATES AND LOWER THEM AND A COUPLE OTHER THINGS BUT CAN'T DO VERY MUCH.

THE INFLATION, WE'VE MOSTLY SEEN THE LAST FEW YEARS IS SUPPLY DRIVEN INFLATION, WHICH IS DUE TO INABILITY TO GET STUFF.

IT WAS REALLY BAD DURING THE PANDEMIC, I MEAN, IF YOU LOOK AT INFLATION LIKE BEFORE THE SHOW WE WERE TALKING ABOUT GHANA, THIS AFRICAN COUNTRY, AND INFLATION IN JANUARY WAS LIKE 52% FOR THE MONTH THERE.

THAT'S NOT BECAUSE OF OVERHEATED DEMAND IN AFRICA.

THAT'S BECAUSE OF DIFFICULTY OF GETTING PRODUCT.

THE UKRAINE WAR KILLED THOSE GUYS OVER THERE, AND SO MOST INFLATION ISN'T REALLY COMBATTED VERY WELL BY THE FED, AND THE FED AT THE SAME TIME IS TRYING TO HIT IT JUST RIGHT AND HAVE A SOFT LANDING, WHICH IT'S LIKE TRYING TO LAND A PLANE INSTEAD OF AT THE AIRPORT, ON A VERY SMALL AIRCRAFT CARRIER IN ROUGH SEAS BOBBING UP AND DOWN.

IT'S A ROUGH THING TO DO.

AND IT LOOKS TO ME, AND WE'LL KNOW LATER, BUT IT LOOKS TO ME LIKE THEY PROBABLY HELD ON TOO LONG TO HIGH INTEREST RATES.

TED: YEAH, SO WITH THAT IN MIND, WE GOT HOLIDAY SEASON IS COMING UP, THE END OF THE YEAR, THE BIG FOURTH QUARTER IS COMING UP HERE.

ARE YOU OPTIMISTIC ABOUT THE ECONOMY?

>> YES, I AM.

NOW WE'VE GOT AN ELECTION COMING UP.

TED: YES.

>> AND IT CAN REALLY GET SCREWED UP IF WE PUT THE TARIFFS ON THAT HAVE BEEN THREATENED BY PRESIDENT TRUMP.

THAT WOULD BE A DISASTER FOR THE SUPPLY CHAIN BECAUSE THE TRUTH IS THAT, AT SOME POINT IN THE SUPPLY CHAIN, MAYBE NOT THE FIRST HERE, NOT THE FIRST SUPPLIER, BUT EVERYTHING KIND OF HAS SOME LINK TO CHINA.

WE REALLY ARE A CONNECTED ECONOMY GLOBALLY, AND TO TEAR THAT APART IS BOTH FOOLISH AND EXPENSIVE.

TED: AND WE SHOULD MENTION A 10% ACROSS-THE-BOARD TARIFF.

>> AND THE 2018 TARIFFS WERE BAD FOR THE ECONOMY.

YOU KNOW, AND THE OTHER THING THAT'S INTERESTING.

DO YOU REMEMBER THUNDERBIRD, WHICH IS THE OTHER BUSINESS SCHOOL, NOT THE ONE I'M FROM, BUT THUNDERBIRD, THE OTHER BUSINESS SCHOOL AT ASU, THE GUY THAT STARTED THUNDERBIRD SAID BORDERS FREQUENTED BY TRADE SELDOM NEED SOLDIERS.

TED: YEAH.

>> IT WAS SOMETHING HE FIGURED OUT IN THE 40s AND LED TO THE DEVELOPMENT OF IT.

ALL OF A SUDDEN WE WANT TO TEAR THAT APART, THAT DOESN'T MAKE SENSE TO A SUPPLY CHAIN GUY.

TED: SUPPLY CHAIN GUY, DALE ROGERS.

ALWAYS A PLEASURE.

>> THANK YOU.

.

TED: ARIZONA IS REINSTATING A WAIT LIST FOR FAMILIES SEEKING STATE CHILD CARE ASSISTANCE.

THE MOVE COMES AFTER THE LEGISLATURE FAILED TO REPLACE EXPIRING PANDEMIC FUNDS TARGETING THE SUBSIDY PROGRAM.

TO LEARN MORE, WE WELCOME BARBIE PRINSTER, EXECUTIVE DIRECTOR OF ARIZONA EARLY CHILDHOOD EDUCATION ASSOCIATION.

WELCOME TO "ARIZONA HORIZON."

GOOD TO HAVE YOU HERE.

>> THANK YOU SO MUCH FOR HAVING ME.

TED: THIS IS A WAIT LIST THAT NOW WASN'T THERE, AND NOW IT'S THERE, WHAT'S GOING ON HERE?

>> SO, BEFORE COVID HAPPENED, WE DID HAVE A WAIT LIST, AND THEN WHEN THE CHILD CARE AND DEVELOPMENT BLOCK GRANT WAS AUTHORIZED, WE WERE ABLE TO SOMETIMES LET PEOPLE IN THROUGH ATTRITION, BUT WHEN COVID HAPPENED, WE RECEIVED $1.2 BILLION, ARIZONA RECEIVED, IN FEDERAL FUNDING TO HELP STABILIZE THE INDUSTRY.

AND SO WHEN ALL OF THE -- DURING THE LAST YEAR, SOME OF THE FUNDS EXPIRED AND REST OF THE FUNDING EXPIRED THE END OF JUNE, SO WE DON'T HAVE ENOUGH FUNDING AS A STATE TO CONTINUE ALL OF THE PROGRAM INITIATIVES THAT THE DEPARTMENT OF ECONOMIC SECURITY PUT IN PLACE.

WITH THAT, WE KNEW WE WERE GOING TO HAVE A WAIT LIST.

ONE THING I'D LIKE TO SAY IS WE DID GET $12 MILLION IN STATE FUNDING THROUGH THE GENERAL FUND.

THAT IS HISTORIC, WE HAVE NOT HAD THAT IN WELL OVER 12 YEARS, AND DES WAS ABLE TO REAUTHORIZE OR APPROPRIATE FUNDING TO THE LEGISLATURE THAT WE GET TO THE FEDERAL GOVERNMENT.

TED: YOU GOT SOME BUT NOT NEARLY ENOUGH?

>> NOT ENOUGH.

OUR ASK FROM THE GOVERNOR'S OFFICE AND SHE INCLUDED IN THE BUDGET $100 MILLION.

WE KNEW WE WERE NOT GOING TO GET THAT AMOUNT DUE TO THE BUDGET DEFICIT WE'RE FACING AT THE STATE BUT WE DID GET 12 MILLION, AND THAT'S HISTORIC, AND WITH THE COMBINATION OF THE FUNDING THAT WE GOT FROM THE FEDERAL GOVERNMENT, OUR LEGISLATURE PASSED APPROPRIATE FOR DES TO BE ALLOWED TO BE ABLE TO USE IT.

IT WASN'T ENOUGH TO AVOID A WAIT LIST AND WE KNEW THAT WAS COMING, SO IT DID GO INTO EFFECT AUGUST 1.

TED: YEAH, BUT DES APPARENTLY MADE THE ANNOUNCEMENT ABOUT 24 HOURS BEFORE IMPLEMENTATION.

THAT DOES NOT SOUND OPTIMAL?

>> IT IS NOT OPTIMAL.

ANYONE THAT RECEIVED A JOB OFFER, THAT THEY HAVE CHILDREN THAT THEY NEED CHILD CARE FOR, MAYBE YOU NEED A TEACHER IF YOU ARE A PROVIDER.

UNFORTUNATELY, IF YOU DID NOT GET THE APPLICATION IN THAT DAY ON THE 31st OF JULY, YOU WERE PUT ON THE WAIT LIST.

TED: THE WAIT LIST IS FOR NEW APPLICANTS, CORRECT?

>> CORRECT.

TED: ARE THEY LOCKED OUT INDEFINITELY?

HOW LONG IS THIS GOING TO HAPPEN?

>> WE DON'T KNOW.

UNTIL WE RECEIVE ADDITIONAL FUNDING, WHEN THEY FINALIZE THEIR BUDGET OR IF WE, YOU KNOW, LOBBY THE LEGISLATURE FOR ADDITIONAL FUNDING IN THE NEXT SESSION, WHICH WE WILL BE ASKING FOR ADDITIONAL FUNDING, AT LEAST ANOTHER $100 MILLION.

TED: THIS INCLUDES LOW-INCOME WORKING PARENTS, INCLUDES PARENTS IN SHELTERS?

>> NO.

TED: DOES NOT INCLUDE PARENTS IN SHELTERS?

>> SO THERE ARE SOME FAMILIES THAT ARE NOT INCLUDED IN THIS.

THE CHILDREN THAT ARE INVOLVED WITH THE DEPARTMENT OF CHILD SAFETY, DDD FAMILIES, HOMELESS, THIS WILL NOT AFFECT THEM.

BUT IF YOU'RE A LOW-INCOME WORKING FAMILY, WANTING TO GO TO WORK, PAY TAXES, IT'S KIND OF A -- IT DEFEATS THE WHOLE PURPOSE, RIGHT?

WE WANT PEOPLE TO BE ABLE TO GO TO WORK AND BE A PART OF THE SOCIETY.

WE WANT TO BE ABLE TO HIRE TEACHERS AS WELL, AND THAT COULD BE A REAL PROBLEM.

TED: SO WHAT ARE THEIR OPTIONS?

>> SCARY, RIGHT?

TED: YES.

>> IF YOU'RE A SINGLE MOM, SOMETIMES YOU HAVE TO MAKE TOUGH DECISIONS, MAYBE UNSAFE DECISIONS AND WE DON'T WANT ANYBODY PUT IN THAT SITUATION.

TED: WHAT KIND OF REACTION HAVE YOU HEARD SO FAR, HAVE YOU SEEN?

>> IT'S SCARY.

SCARY FOR PROVIDER AS WELL.

LOW-INCOME WORKING IS THE LARGEST BUCKET, WHEN WE TALK ABOUT CHILD CARE SUBSIDY RIGHT NOW.

WE'RE SERVING AROUND 22,000-ISH CHILDREN IN THAT BUCKET, AND SO WHEN YOU THINK ABOUT ALL OF THOSE CHILDREN IN ARIZONA THAT ARE SOMEWHERE BEING CARED FOR BY A PROVIDER, WE DON'T WANT THEM TO LOSE CARE, SO YOU KNOW, FOR ANOTHER FAMILY THAT'S LOOKING FOR CHILD CARE, THEY'RE GOING TO HAVE TO LOOK OUT, MAYBE GRANDMA AND GRANDPA OR AUNTIE CAN TAKE CARE OF THEM, BUT IT'S TOUGH.

TED: AND WE SHOULD MENTION TEEN PARENTS IN SCHOOL, INCLUDED AS WELL?

>> YOU KNOW WHAT?

I'M NOT SURE.

I WOULD HOPE THEY ARE ELIGIBLE AS WELL.

THAT IS ONE CATEGORY I'M NOT SURE ABOUT.

TED: LAST QUESTION HERE, AS FAR AS THE NEXT LEGISLATIVE SESSION, ARE THERE SIGNALS?

OBVIOUSLY, THIS SHOULD HAVE BEEN SEEN COMING DOWN THE PIKE WITH THE BUDGET PROBLEM AND WITH SOME OF THE FEDERAL FUNDING GOING AWAY.

>> EXACTLY.

TED: WHAT ARE YOU SEEING DOWN THE NEXT BEND HERE?

>> THIS IS A WORKFORCE ISSUE, RIGHT?

WE WANT PEOPLE TO BE ABLE TO GO TO WORK WHEN THEY WANT TO.

ARIZONA IS KNOWN FOR BOOMING BUSINESS, ECONOMY, CHIP MANUFACTURING, ALL OF THESE GREAT THINGS.

HOW MANY PEOPLE MOVE HERE, 35, 40 PEOPLE MOVE HERE EVERY DAY BUT WANT TO GO TO WORK AND MIGHT NOT MAKE ENOUGH MONEY, BUT WE'RE TOLD YOU CAN'T HAVE CHILD CARE.

THE MESSAGING DOESN'T MATCH UP.

WE WANT TO HAVE A STATE WHERE EVERYBODY IS WELCOME, EVERYBODY HAS AN OPPORTUNITY TO GO TO WORK AND HAVE SAFE AND SECURE CHILD CARE.

TED: WE'LL SEE HOW THE LEGISLATURE DOES THIS NEXT GO-AROUND.

BARBIE PRINSTER, GOOD TO YOU HAVE ON, THANK YOU SO MUCH.

>> THANK YOU SO MUCH.

.

TED: LAKE POWELL IS AT ITS HIGHEST LEVEL IN MORE THAN THREE YEARS.

THAT'S ENCOURAGING NEWS AND FOLLOWS WET WINTERS IN THE WEST, BUT A LA NINA IS FORECAST FOR THIS WINTER AND SPRING WHICH USUALLY MEANS LESS RAIN AND SNOWPACK IN THE STATE.

JOINING US IS KATHRYN SORENSEN DIRECTOR OF RESEARCH AT THE KYL CENTER FOR WATER POLICY.

LAKE MEAD, LAKE POWELL, 42% FULL NOW FOR LAKE POWELL?

>> LET'S TAKE GOOD NEWS WHEN WE CAN.

TED: YES.

>> A COUPLE OF THINGS ARE HAPPENING HERE THAT ARE GOOD AND ENCOURAGING.

ONE IS WE HAD GREAT SNOWPACK THIS LAST YEAR.

THERE WAS ACTUALLY ALSO QUITE A BIT OF RAIN IN PARTS OF COLORADO OVER THE SUMMER THAT MADE A MATERIAL DIFFERENCE IN LAKE POWELL AND THAT'S REALLY GOOD NEWS.

THE OTHER THING IS THAT THE STATES OF CALIFORNIA, ARIZONA AND NEVADA ARE USING HISTORICALLY LOW AMOUNTS OF WATER OUT OF LAKE MEAD IN EFFORTS TO BOLSTER THE WATER LEVELS AND AVOID FURTHER SHORTAGES.

THOSE ARE ALL WINS, WHICH IS NICE.

TED: YEAH, I WANT TO GET TO THE CONSERVATION METHODS AND EFFORTS IN A MOMENT HERE.

AS FAR AS LAKE POWELL IS CONCERNED, WHAT, HIGHEST LEVEL IN THREE -- JUST LAST YEAR, IT WAS ALMOST HALF AS FULL AS IT IS NOW?

>> YOU KNOW, IT'S GOOD NEWS BUT NEED TO TAKE IT IN MEASURE BECAUSE IT'S STILL ONLY 42%, RIGHT?

TED: YES.

>> AND THE COLORADO RIVER SYSTEM CAN BE VOLATILE.

LIKE YOU SAID, THERE'S A LA NINA YEAR COMING UP, WE DON'T KNOW WHAT THAT WOULD MEAN FOR SNOWPACK.

IF WE'RE NOT CAREFUL, IT'S VERY EASY TO USE MORE WATER AND GO BACK TO SQUARE ONE WHERE WE ARE SEEING DEEP SHORTAGES.

TED: VOLATILITY, IT WAS DOWN BIG FROM 2021 TO 2023 AND THE LAST YEAR OR SO, IT'S UP.

THESE ARE BIG CHANGES HERE.

>> THESE ARE BIG CHANGES, AND THEY'RE NECESSARY, RIGHT?

IT IS REALLY IMPORTANT THAT THE LOWER BASIN STATES USE LESS WATER ON THE WHOLE TO FORESTALL DEEPER SHORTAGES IN LAKE MEAD.

IT'S ALSO IMPORTANT THAT THE UPPER BASIN STATES -- COLORADO, WYOMING, NEW MEXICO, UTAH -- THAT THEY CONTRIBUTE TO SOLVING THE PROBLEM AS WELL.

WE'RE ALL DEPENDENT ON THIS RIVER AND NEED A SOLUTION THAT BENEFITS ALL OF US.

TED: YOU MENTIONED LAKE MEAD, THIS STORY IS ABOUT LAKE POWELL WE WANT TO FOCUS ON.

THE NUMBERS SHOW 42% COMPARED TO WHERE IT'S BEEN.

WHAT ABOUT LAKE MEAD?

>> YEAH, SO LAKE MEAD LOOKS OKAY, NOT GREAT.

LAKE MEAD WAS FALLING AS WELL.

PRECIPITOUSLY, BECAUSE WE'VE BEEN USING LESS WATER AND HAD A DECENT YEAR OF SNOWPACK, WATER LEVELS ARE WHAT I WOULD CALL MIDDLING.

THEY COULD BE WORSE, THEY'RE NOT GREAT.

TED: WHY AREN'T THEY AS GOOD AS LAKE POWELL?

>> THE TWO ARE MANAGED, THEY ARE CAREFUL TO RELEASE CERTAIN AMOUNTS OF WATER OVER THE COURSE OF THE YEAR AND THE RELEASES ARE BASED ON HOW HIGH LAKE MEAD IS AND HOW HIGH LAKE POWELL IS.

WHEN THERE'S TOO MUCH WATER IN LAKE POWELL OR RELATIVELY LARGE AMOUNT OF WATER IN LAKE POWELL, THEY'LL RELEASE MORE INTO LAKE MEAD AND WHEN THERE IS LESS, THEY RELEASE LESS.

IT IS CRAZY AND IT IS POSSIBLE WE'LL GET A RELATIVELY SMALL RELEASE OF WATER FROM LAKE POWELL AS WELL.

TED: AND THE LA NINA WILL BE A FACTOR, A DRY WINTER.

>> PROBABLY WILL BE.

TED: ALL RIGHT, AS FAR AS CONSERVATION MEASURES, WE TALK SO MUCH ON THE PROGRAM ABOUT IT, SEEMS LIKE ARIZONA, NEVADA AND CALIFORNIA ARE DOING THEIR PART.

IT IS MAKING A DIFFERENT, IS IT NOT?

>> IT IS.

IT'S IMPORTANT TO RECOGNIZE THAT.

THAT COMES FROM A LOT OF HARD WORK, A LOT OF NEGOTIATING, A LOT OF HAND WRINGING.

NO ONE WANTS TO GIVE UP THEIR WATER USE, RIGHT?

THESE ARE VALUABLE ENTERPRISES.

PEOPLE GROW CROPS WITH THE WATER, HAVE INDUSTRIAL ENTERPRISES, NO ONE WANTS TO DO THAT.

WE SHOULD RECOGNIZE HOW IMPORTANT IT IS THAT PEOPLE HAVE CUTBACKS.

TED: AND LEAVING WATER IN LAKE MEAD OBVIOUSLY IS A BIG DEAL, BUT THERE IS COMPENSATION, IS THERE NOT?

>> THERE'S A LOT OF COMPENSATION, THAT'S THE OTHER SIDE OF THIS IS THAT THE FEDERAL GOVERNMENT STEPPED UP BIGTIME AND BASICALLY IS COMPENSATING PEOPLE -- TRIBES, FARMERS, CITIES, MINING COMPANIES, THE GAMUT OF STAKEHOLDERS ARE BEING COMPENSATED TO INTENTIONALLY LEAVE SOME OF THEIR WATER IN LAKE MEAD.

THAT'S A REALLY INTERESTING POINT.

THAT FEDERAL MONEY WON'T LAST FOREVER, DEPENDING ON THE FEDERAL GOVERNMENT FOR CONTINUED BAILOUTS IS ALWAYS A DICEY PROPOSITION.

TED: AND WE'VE GOT 2026 COMING ON.

AND WE HAVE A WHOLE NEW FEDERAL PAC, RIGHT?

>> THE OPERATIONAL GUIDELINES FOR LAKES POWELL AND MEADE.

SEVEN STATES PLUS THE REPUBLIC OF MEXICO, 30 TRIBES, A LOT IN THE MIX.

TED: A LOT IN THE MIX, AND AS YOU REFERRED TO EARLIER, THERE IS A STRUCTURAL DEFICIT, IS THERE NOT?

>> YEAH.

TED: HOW CAN YOU FIX THAT?

HOW MUCH CONSERVATION CAN FIX THAT?

>> WE CAN FIX IT, AND WE HAVE TO.

THE ALTERNATIVE IS THAT WE RUN THESE RESERVOIRS DRY, OR THAT THE FEDERAL GOVERNMENT INTERVENES AND PICKS WINNERS AND LOSERS AND YOU KNOW, MAYBE ARIZONA COMES OUT THE WINNER IN THAT, BUT MAYBE NOT.

TED: WE CAME CLOSE TO THAT, IF I REMEMBER DIRECTLY.

THE GOVERNMENT SAID GET YOUR ACT TOGETHER OR WE'LL DO IT FOR YOU?

>> YEAH, THAT IS AN IMPORTANT ROLE FOR THE GOVERNMENT TO PLAY.

TO COME IN AND BULLY PEOPLE AROUND AND SAY HEY, MAKE THIS HAPPEN.

THE FEDERAL GOVERNMENT DOESN'T WANT TO MAKE THIS DECISION EITHER, RIGHT?

PARTICULARLY NOT IN AN ELECTION YEAR.

THEY DON'T WANT TO BE IN THE BUSINESS OF SAYING WHO GETS WATER AND WHO DOESN'T, THEY VERY MUCH WANT FOR THE STATE AND THE REVENUE MEXICO TO COME TO A SOLUTION, AND BEHOOVES ALL OF US THAT THEY DO.

TED: LAST QUESTION, I ASKED THE LOGISTICS MANAGER DALE ROGERS IF HE WAS OPTIMISTIC ABOUT THE ECONOMY AND HE SAID YES, ARE YOU OPTIMISTIC ABOUT THE COLORADO RIVER?

>> I'M NOT.

ACTUALLY I'M NOT.

I THINK THAT THE DISCUSSIONS ARE AT A VERY DIFFICULT PLACE.

THEY APPEAR TO BE SOMEWHAT STUCK, I THINK IT IS IMPORTANT THAT THE FEDERAL GOVERNMENT COME IN AND PLAY A LARGER ROLE.

I THINK THAT'S NEEDED RIGHT NOW, AND WE'RE COMING INTO A LA NINA YEAR, SO THINGS LOOK KIND OF TOUGH.

I'M NOT AN OPTIMIST TODAY.

I NORMALLY AM.

TED: ENCOURAGING NEWS WENT RIGHT DOWN THE RIVER.

KATHRYN SORENSEN, KYL CENTER, THANK YOU SO MUCH.

>> THANKS FOR INCLUDING ME.

TED: THAT'S IT FOR NOW.

I'M TED SIMONS.

THANK YOU SO MUCH FOR JOINING US.

YOU HAVE A GREAT EVENING.