June 20, 2007 Minutes-Board Meeting

The regular monthly meeting of the Lower Arkansas Valley Water Conservancy District Board of Directors was held on Wednesday, June 20, 2007 at 10:00 AM, at 801 Swink Avenue, Rocky Ford, CO 81067.

Chairman Singletary announced a quorum was present with Directors Esquibel, Whittaker and Kennedy having been excused.

DIRECTORS PRESENT:
John Singletary-Chairman
Pete Moore-Vice Chairman
Lynden Gill
Leroy Mauch

DIRECTORS EXCUSED:
Wayne Whittaker-Treasurer
Melissa Esquibel-Secretary
Loretta Kennedy

DISTRICT STAFF:
Jay Winner-General Manager
Bart Mendenhall-Attorney
Bill Hancock-Conservation Program Manager
Kim Chavez-Financial Coordinator
Carla Aragon-Quezada-Administrative Assistant

MOTION TO ENTER INTO WATER ACTIVITY ENTERPRISE:

Director Mauch moved that the Board convene into the Water Activity Enterprise, seconded by Director Moore. Motion unanimously carried.

At the conclusion of the Water Activity Enterprise meeting Director Moore moved to reconvene the District Meeting at 10:08 A.M., seconded by Director Mauch. Motion unanimously carried.

INTRODUCTION OF VISITORS:

Chairman Singletary welcomed each of the visitors to the meeting, asked them to introduce themselves and identify the organization which they represent.

VISITORS PRESENT:

Del Nimmo, Colorado State University (CSU) – Pueblo/Biology; Ken Weber; Tim Gates CSU; Virgil Cochran, SE Land and Environment; Rich Kienitz, Aurora, Tom Simpson Aurora; Tabitha Fleming, La Junta Tribune Democrat; Tim Macklin, RC&D;Alan Ward, Pueblo Board of Water Works; Chris Woodka, Pueblo Chieftain; Brenda Fillmore, Arkansas Ground Water Users Association (AGUA); Kelly Roesch, High Plains/Pure Cycle; Fred Heckman, Fort Lyon Farmer; Pat Edelman, USGS; Rebecca Mitchell, Jerry Kenny HDR Engineering; George Oamek, Economic Consultant; Enrique Triana, CSU; Ken Weber; Jim Valliant, CSU; Dan Henricks, High Line Canal; Greg Woodward, Stantec; George Alan Frantz, Farmer; Dennis Caldwell, Farmer; Wesley Eck, Manny Torrez, and Mike Spady, Ft Lyon Canal; Doris Morgan, Sen. Allard’s Office.

APPROVAL OF MINUTES:

TREASURER’S REPORT:

Chairman Singletary reported that the financial report for the month of May was included in the Board’s Monthly Meeting Packet. He reported May total revenues of $363,497.32 and total expenditures of $245,524.76. Director Moore moved to accept the May Financial Statement, seconded by Director Gill and carried unanimously.

GM REPORT:

General Manager Winner introduced Tim Gates with Colorado State University(CSU)

PRESENTATIONS:

Tim Gates, Professor at Colorado State University(CSU): Gates told the Lower Arkansas Valley Water Conservancy District, “In the last 2-3 years, issues have been emerging and coalescing that we weren’t ready for 10 years ago.” “Now we have 8 years of good data and tools we can use.”

Gates stated, “Our research goals are to provide water users and managers with a sound database and reliable modeling tools to support water management practices.

Gates is studying salinity and groundwater levels in the large farming areas of the Arkansas Valley with the aim of improving agricultural efficiency and improving water quality in the river.

The use of River-Basin Model to analyze impacts of Super Ditch to heightened by the extensive database and calibrated modeling tools that have already been developed to date by CSU. These models have been greatly enhanced over the last year. They require further refinement and expansion toward the attainment of a comprehensive set of tools supporting rational water management decisions.

Models, calibrated and supported by extensive field data, provide a picture of the extent and severity of existing problems of water availability and quality in the Arkansas River watershed. Methodology for systematically assessing alternative means to address these problems. Indication of the prospects for achieving marked improvements to the land and to the river when these solution strategies are implemented.

Much progress has been made in the development and testing of the Arkansas River GeoDSS, a spatial decision support model for predicting river basin-scale impacts of alternatives for managing the irrigated stream-aquifer system of the lower Valley.

The study also includes Polyacrylamide to reduce canal seepage losses. Polyacrylamide (PAM) application to canals to reduce seepage is being field tested. Significant seepage reduction on three canals reaches (39%, 58%, and 87%) with low cost and environmental impact. Studies will continue throughout the year.

Gates stated, “PAM may come into play as a way to increase the ability to move water all the way to the end of the canals.”

Chairman Singletary asked Gates if the study would also look at how to improve the value of land during fallowing years, such as installing field drains. “We need to discover a plan to make the land a richer piece of ground,” Singletary said.

Gates replied, “Fallowing has been done in rainy areas for the benefit of the land.” “Southern Colorado is dry and available farmland is planted to maximize its use.”

The Lower Arkansas Valley Water Conservancy District has reviewed the legal, corporate, engineering and economic studies surrounding the Super Ditch. The district has spent $500,000 studying the concept. Lower Arkansas Valley Water Conservancy District is seeking a $700,000 state grant for more studies.

At this time only seven ditch/canal companies are being considered for this program. Bessemer Ditch, Rocky Ford Highline Canal, Oxford Farmers Ditch, Otero Canal, Catlin Canal, Holbrook Canal and Fort Lyon Canal. They have not agreed to form the “Super Ditch”, although two members from each canal/ditch company have had some meetings to see if they could form the “Super Ditch.”

The cooperative association would be run by shareholders, not the Lower Arkansas Valley Water Conservancy District, but the Lower Arkansas Valley Water Conservancy District wants to give irrigators a better bargaining position with large municipal interests and prevent permanent agricultural dry-ups.

George Oamek, Economic Consultant, stated, “It stands to reason that the purchasers of the water are talking to each other,” “What’s wrong with offsetting that by collectively working together?”

General Manager Winner introduced Jerry Kenny, Project Manager with HDR, Engineering, Inc.

Jerry Kenny with HDR presented “Super Ditch”, Land Fallowing- water Leasing Program

Historical Buy and Dry-up

• Land permanently dried up

• Cities (purchasers) realize the appreciating value of the water

Land Fallowing-H2O Leasing

Engineering Studies Underway

Primary Ditch Systems within Area of Interest
Ditch Systems Investigated

Consumptive Use Factors

What Fallowing-Leasing must do:

Avoided costs, $/AF/year

Potential approach

Potential water volumes (65 % participation)

Water available for lease, based on 65% participation rate, frequency, exchange factors, and no additional storage

Illustration of Potential Revenues based on current assumptions

Pipeline Alternatives

Regional Economic Impacts

Legal Issues Analyzed

“Super Ditch Company”

Issues to work through with potential participants

Summary - Land Fallowing-H20 Leasing

Conclusion

President’s Report:

Chairman Singletary stated, “Greg Kolomitz, Lobbyist with Solutions West, LLC will have an update report at the July Board Meeting.

Chairman Singletary mentioned on July 26th and July 27th the Board Directors and staff will have their annual retreat at Bent’s Fort Inn in Las Animas, Colorado.

Chairman Singletary stated, we haven’t heard from Bureau of Reclamation on the 40 year contract with Pueblo Reservoir and Aurora.

Chairman Singletary said, The Lower Arkansas Valley Water Conservancy sponsored the Phase I demonstration of a bed load/sediment collection and removal technology from Streamside Systems on June 11-16. It was very impressive. Lot’s of people came out to support this demonstration. I feel it’s a giant step.

Phase 1 is a near term demonstration of two small, man-portable (two- foot by four-foot) bed-load monitoring collectors to provide stakeholders and regulators an opportunity to observe the collector technology first hand and provide visual validation of the Colorado State University, Engineering Research Center, Hydraulics Laboratory controlled flume test facility results.

Bill Hancock Conservation Program Manager presented four (4) Resolutions.

Resolution 07-01
The Lower Arkansas Valley Water Conservancy District has offered Temporary Water Storage Contracts #07XX6C0023 (400 acre feet temporary storage of non-project municipal and or domestic water) and contract 07XX6C0034 (400 acre feet temporary storage of non-project irrigation water). Lower Arkansas Valley Water Conservancy District –Fryingpan Arkansas Project, Colorado by the United States Department of Interior, Bureau of Reclamation, and, the execution of said contract will further the objectives of the Lower Arkansas Valley Water Conservancy District to provide a water supply to the residents and lands of the District. Motion was made by Director Mauch, seconded by Director Moore, motion unanimously carried on Resolution 07-01.

Resolution 07-02
Where the Lower Arkansas Valley Water Conservancy District holds a conservation easement donated by Cuerno Verde, LLC in 2005 and Cuerno Verde, LLC has respectively proposed a conservation easement to be donated to the District in 2007, consisting of irrigated farmland in Pueblo County, Colorado, and the easement property is within the boundaries of the District, located in the drainage of the Arkansas River, and the proposed easement has irrigation water rights appurtenant to them, and the district believes this conservation easement falls within the District mission statement, which will protect agricultural lands, wildlife habitat, open space, scenic beauty and other diminishing natural and historical resources. Acceptance of this easement will further the purpose of the District in that it will preserve the water rights associated with the real property and irrigated agriculture in the District. Motion was made by Director Mauch, seconded by Director Moore, motion unanimously carried on Resolution 07-02.

Resolution 07-03
Gary DiTomoso has respectively proposed a conservation easement to be donated to the District in 2007, consisting of irrigated farmland in Pueblo County, Colorado, and the easement property is within the boundaries of the District, located in the drainage of the Arkansas River, and the proposed easement as irrigation water rights appurtenant to them, and the District believes this conservation easement falls within the District mission statement, which will protect agricultural lands, wildlife habitat, open space, scenic beauty and other diminishing natural and historical resources. Acceptance of this easement will further the purpose of the District in that it will preserve the water rights associated with the real property and irrigated agriculture in the District. Motion was made by Director Moore, seconded by Director Gill, motion unanimously carried on Resolution 07-03.

Resolution 07-04
Stealey’s Wild Rose Ranch has respectively proposed a conservation easement to be donated to the District in 2007, consisting of the first one- third of a staged conservation easement of a working cattle ranch in Fremont County, Colorado, and the easement property is not within the boundaries of the District, it is located in the drainage of the Arkansas River, on or near to the Arkansas River, and Whereas, the preservation and protection of the Arkansas River Drainage is in the best interest of the inhabitants of the Lower Arkansas Valley Water Conservancy District, and the District believes this conservation easement falls within the District mission statement, which will protect agricultural lands, wildlife habitat, open space, scenic beauty and other diminishing natural and historical resources. The preservation of this property will aid in the conservation of native water on the Arkansas River and its tributaries and preserve a portion of the historic Stirrup Ranch. This easement will preserve scenic views; provide open space as well as significant wildlife habitat. Through regional conservation, this property will yield significant public benefit to the citizens of Pueblo, Otero, Crowley, Bent and Prowers Counties. Motion was made by Director Gill, seconded by Director Moore, motion unanimously carried on Resolution 07-04.

General Manager Winner, brought to our attention that on Resolution 07-04 the property is 1200 acres and worth 4.5 million dollars.

COMMITTEE REPORTS:

There were no committee reports to be presented since the Directors with these reports were excused from the meeting.

LEGAL REPORT:

Bart Mendenhall reported the Pueblo Conservation Easement workshop was held on May 23. It was not well attended compare to previous workshops. However, one woman came up after the workshop, and said, “It was the most useful workshop she had ever attended.”

There was a meeting with the attendees from Palo Verde on June 15, 2007. The participants were asked to bring any of their Board members. Ft. Lyon board had to meet the same day, so they did not come, but sent regrets. Tony Van Westrum attended, and some discussion was had concerning the form of an entity that should be used, and governance in general. A good discussion was had, but it was generally agreed that the group was too large to be effective. It was agreed to ask each ditch company Board to appoint two members of a committee to work more intensely towards an entity. While there were some concerns, there was no one who do did not want to continue.

One thing that the Palo Verde Irrigation District tour brought out was that there are tax implications for the irrigators entering into a land fallowing-water lease. How the Super Ditch Company is set up and operated may substantially affect irrigators’ bottom line benefits from leasing. Counsel and Tony Van Westrum met with a tax attorney consultant with water rights and ditch companies, and learned that there are ways to organize the Super Ditch Company that would provide significant tax advantages to irrigators, in comparison to other possible approaches. Counsel recommends authorization to retain Denis Clanahan of Kris Boyle P.C. to assist the District and irrigators with the taxation aspects of the formation of the program.

Motion was made by Director Mauch, seconded by Director Moore to hire Kris Boyle P.C. on an hourly basis.

Chairman Singletary stated, “Tax issues need to be researched, so farmers don’t lose out.”

Chairman Singletary asked Del Nimmo (CSU), if he had any updates. He reported that the filtration system seemed to remove approximately 100 part per million of the E. coli bacteria. “Since the results were perfect, you hate to repeat it, but we will have to test again.” Studies on Fountain Creek so far have not looked at the sediments as a source of the high E. coli counts, although researchers have speculated bacteria could be harbored in the loose material in the stream bed. Both the CSU-Pueblo study and state –funded USGS study are tying to determine whether the source of the E. coli is human or animal. Not all E. coli bacteria are harmful, but high counts are a marker for other types of bacteria that may be in the water. Fountain Creek is a concern because it has a high concentration of treated effluent from Colorado Springs and other wastewater treatment plants.

The Streamside Systems demonstration was funded by a $19,000 grant from the Lower Arkansas Valley Water Conservancy District, and is seeking a $250,000 grant through the Arkansas Basin Roundtable and Colorado Water Conservation Board to do a larger test.

Last Week’s test involved a 2-foot by 4-foot collector made of metal. Phase II will be a month long demonstration of a full-scale, 20-foot-wide collector made of concrete.

Phase II is an up-scaled in situ demonstration of the portable 20 foot pre-cast concrete collector at or near the Phase I demonstration site. This demonstration will serve as a research tool to gage the transport rates of sediment captured by a full-sized collector, and will verify the system’s ability to remove and classify by granule size the sediment for beneficial re-use. This demonstration phase is to run for one month. As before, interested stakeholders will have an opportunity to observe the system in operation and ask questions.

PUBLIC COMMENT:

Chairman Singletary asked if there were any comments.

Jim Valliant with CSU invited everyone to attend the Corn and Weighing Lysimeter Fallowing Program which will be held at the CSU Research Center after the Board Meeting on July 18, 2007.

Chairman Singletary thanked everyone for attending Lower Arkansas Valley Water Conservancy District Board Meeting.

ADJOURNED:

Chairman Singletary asked if there were any other matters to come before the Board. Hearing none, motion was made by Director Gill, seconded by Director Moore to adjourn the meeting. Motion unanimously carried. Meeting was adjourned at 11:50 A.M.