Plans for this year's proposed $1,780,000 culinary water project are now in disarray because of a funding problem.

The city has a commitment for $917,000 from the state's Safe Drinking Water committee, has raised water rates to provide for its match of $54,000 and thought it was in line to get $863,000 from the Board of Water Resources.The Board of Water Resources, however, has notified the city that it can't provide the $863,000 this year and that it will have only $2 million available in 1992, with more than that amount already appropriated.

What to do about it? City administrator Vern Fisher has suggested that the city divided the project into two phases and proceed with the construction of the first phase.

Councilman Steven Rosenlund said he is opposed to that proposal since it would not benefit all residents equally. But Councilman Lyle Klotz said the city owes it to its residents to get started as soon as possible since higher rates have already gone into effect. The increase amounts to an addition of $8 per month to the minimum rate.

The City Council passed a resolution in February providing for revenue bond issues to cover the Safe Drinking Water and Board of Water Resources no-interest loans.

The city will now explore possible funding approaches before reaching a decision on the project, Fisher said.