Cottonwoods support the banks of New Mexico’s Gila River, and sycamores shade endangered Southwestern willow flycatchers and threatened loach minnows. For those who live near it, the Gila – the state's last free-flowing river – is both a source of water and a font of contention.

In 2004, the Arizona Water Settlements Act re-distributed some water rights to the Colorado River, including an award for the Gila, a tributary that flows into Arizona. The growing New Mexico counties of the upper Gila got a minimum of $66 million for water-supply projects and 14,000 acre-feet annually of the river’s water. Area residents have been squabbling about what to do with the millions, and the water, ever since. The state says more study is needed to decide how to use the water. But environmentalists fear that it’s taking a single-minded approach – to dam or divert the river.

In mid-March, Gov. Bill Richardson, D, made more waves on the Gila, vetoing a $945,000 appropriation that would have funded planning for the water-supply projects. The governor nixed the funds for the state engineer’s office and the Interstate Stream Commission, said spokesman Jon Goldstein, because the appropriation’s language (specifically the word “development”) alarmed many environmental groups.

Organizations such as Amigos Bravos and Environment New Mexico celebrated the veto, and believe it sent a strong message to the state: Go back to the table. “Our main complaint with the Interstate Stream Commission is that we feel they should give equal weight to other alternatives. They’ve focused all their attention, and studies, on a diversion project,” says Dutch Salmon, a member of the Gila Conservation Coalition. The coalition has proposed using the $66 million for water-conservation projects, including drip irrigation, repairs to leaky infrastructure, and watershed restoration. Coalition members also believe the area’s growing water needs can be met by drilling wells rather than by damming the river.

Craig Roepke, deputy director of the Interstate Stream Commission, says that the state has not yet decided on a specific water-supply project. “The appropriation would have funded an integrated plan of ecological studies,” he says, to collect baseline data on the river to find out how much, if any, water can be diverted.

The veto has changed the future course of the Gila River once again. Planning efforts are on hold; both the state and environmental groups are looking to the governor for their next steps. And Richardson, says Goldstein, will be seeking consensus -- on both the best way to supply water, and on how much water is needed for future growth.