September 19 , 2007 Minutes-Board Meeting
The regular monthly meeting of the Lower Arkansas Valley Water Conservancy District Board of Directors was held on Wednesday, September 19, 2007 at 10:00 AM, at 801 Swink Avenue, Rocky Ford, CO 81067.
Chairman Singletary announced a quorum was present with all Directors’ present.
DIRECTORS PRESENT:
John Singletary-Chairman
Pete Moore-Vice Chairman
Wayne Whittaker-Treasurer
Melissa Esquibel-Secretary
Loretta Kinnedy
Leroy Mauch
Lynden Gill
DISTRICT STAFF PRESENT:
Jay Winner - General Manager
Bill Hancock - Conservation Program Manager
Bart Mendenhall - Attorney
Kim Chavez -Financial Officer
Peter Nichols - Attorney
Carla Aragon-Quezada - Administrative Assistant
MOTION TO ENTER INTO WATER ACTIVITY ENTERPRISE:
Director Moore moved that the Board convene into the Water Activity Enterprise, seconded by Director Kennedy. Motion unanimously carried.
At the conclusion of the Water Activity Enterprise meeting Director Whittaker moved to reconvene the District Meeting at 10:07 A.M., seconded by Director Moore. 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 CSU-Pueblo; Karen Dietrich, La Junta Tribune Democrat; Virgil Cochran, SE Land and Environment; Tom Simpson Aurora; Bob Sakaguchi, Stantec Consulting; Alan Ward, Pueblo Board of Water Works; Chris Woodka, Pueblo Chieftain; Brenda Fillmore, Arkansas Ground Water Users Association (AGUA); Fred Heckman, Fort Lyon Farmer; Jim Valliant, CSU; Dan Henricks, High Line Canal; Gerry Knapp, Aurora; Tom Musgrove, USBR; Roy Vaughan, USBR; Joe Kelly, City of La Junta.
APPROVAL OF MINUTES:
v August 15, 2007 Monthly Board Meeting Minutes- Chairman Singletary asked if the Board members had reviewed the minutes for the August 15, 2007 Board meeting and whether there were any corrections or additions. Director Esquibel moved to approve the minutes for August 15, 2007, seconded by Director Whittaker. Motion unanimously carried.
TREASURER’S REPORT:
Chairman Singletary reported that the financial report for the month of August was included in the Board’s Monthly Meeting Packet. Director Whittaker reported August total revenues $55,422.43 and total expenditures $104,854.77 with total net <49,432.34>. Director Whittaker moved to accept the July Financial Statement, seconded by Director Kennedy. Motion unanimously carried.
BUDGET DRAFT REPORT:
Chairman Singletary reported that the budget draft report for 2008 was included in the Board’s Monthly Meeting Packet. Budget draft report for 2008 is Total revenues $2,699,553.85, total Expenditures $2,650,017.16 with Estimated Fund Balance $49,536.69. Director Whittaker moved to accept the budget draft report, seconded by Director Esquibel. Motion unanimously carried.
GM REPORT:
General Manager Winner introduced Tom Musgrove with United States Bureau Reclamation.
PRESENTATIONS:
Tom Musgrove provided a power point presentation on Bureau Reclamation.
RECLAMATION: Managing Water in the West - Contracting with the US Bureau of Reclamation - Pueblo Reservoir
Ø Constructed 1970 – 1975
Ø 250 foot high concrete and earth fill dam
Ø Storage capacity of 349,940 acre feet
Ø Only project reservoir with flood control authorization
Contracting with the ECAO
Studies indicate that annually there is an average of 130,000 acre feet of space available to store non-project water.
Contracting
All revenue from excess capacity contracts is used to repay the construction obligation for the Project.
Contracting with the ECAO
Ø Reclamation offers contracts for the storage of non-project water on an “if and when space is available” basis.
Ø In district M&I cost is $24.10 per acre feet
Ø Out of district M&I or irrigation cost is $43.76 per acre feet
Ø Exchange contracts cost the same as the storage rate
Ø The cost of storage is reduced by the probability of spill
Ø There have been 5 spills in the last 30 years for a discount of 16.67%
Pueblo Reservoir – Present Operations
Total capacity 349,940 acre feet
Flood control pool—92,991 acre feet
Ø Maintained for exclusive flood control from April 15 to October 31 – May use 66,000 acre feet of Joint-use Pool from November 1 – April 14
69,828 acre feet of space for storage of agriculture’s Project water, Winter Water; Includes out of the district, Pueblo West, and all other short term excess capacity contracts.
| Fountain Valley Entities | Pueblo | East of Pueblo | West of Pueblo |
| 78,000 acre feet of Storage For Project Wate | 31,200 acre feet of storage for Project or non Project water | 37,400 acre feet of storage for Project water | 12,400 acre feet of storage for Project water |
| (6,000 acre feet np) | |||
_______________________Total 159,000 acre feet____________________ |
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Minimum Pool and Dead storage—28,121 acre feet, Maintained for recreation & protect fishery
Operations with Long-term Contracts
Total capacity 349,940 acre feet
Flood control pool—92,991 acre feet
65,728 acre feet of space for the storage of agriculture’s Project water,
Winter Water short term if & when contracts. Includes long-term contract’s
For entities without carry-over capacity, out of district, and Pueblo West
| Fountain Valley Entities | Pueblo | East of Pueblo | West of Pueblo |
| 79,900 acre feet of Storage For Project or non-project water | 32,000 acre feet of storage for Project or up to 15 Kaf of non Project water | 38,400 acre feet of storage for Project or non-project water | 12,800 acre feet of storage for Project or non-project water |
_______________________Total 163,100 acre feet____________________ |
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Minimum Pool—28,121 acre feet
Spill Priorities
Ø Article 13(a) of the SECWCD/United States Contract. Whenever water is evacuated from Pueblo, Twin Lakes and Turquoise Reservoirs to meet the necessities of Project flood control, generation purposes, storage of trans-mountain Project water, or native Project water, and operational requirements; except as provide in Sub article 13(b) below, the water evacuated shall be charged in the following order:
- Against water stored under contracts for if- and when available storage space for entities which will use the water outside the District boundaries
- Against water stored under contract for if-and-when available storage space for entities which will use the water within the District boundaries.
- Against any winter storage water in excess of 70,000 acre feet.
- Against water stored under contracts with municipal entities within the boundaries of the District, which water is neither Project water nor return flow from Project water and which is limited to 163,100 acre feet, less any project water purchased and stored by municipal users. This evacuation will be charged pro rata against all water stored under such like contracts at the time of evacuation.
- Against winter storage water not in excess of 70,000 acre feet.
- Against Project water accumulated from the Arkansas River and its tributaries.
Long – Term Excess Capacity Contracts
Ø Municipal entities that are eligible to utilize carryover storage in Project reservoirs for their Project water allocations may contract for storage space with a spill priority of 4;
Ø Municipal entities with long-term excess capacity contracts will be able to decide how they wish to use the carry-over space (i.e., for Project or non-Project water storage, or both);
Ø FVA entities may use carry-over space within the 78,000 acre feet of space available for their Project storage;
Ø Eligible entities Wes of Pueblo may use the carry-over space within the 12,400 acre feet of space available for their Project water storage;
Ø Pueblo may use the carry-over space within the 31,200 acre feet of space available for its Project water storage.
Ø Demand for long-term excess capacity storage contracts may require the SE District to make additional distributions of storage space within the current allocations for the entities located both East and West of Pueblo; and,
Ø Long-term contracting will not impair the ability of contractors or other eligible entities from securing annual If & When storage contracts, as space is available, under the terms as established by Reclamation.
Bart Mendenhall, Attorney presented four (4) Resolutions for acceptance for conservation easements.
1. Resolution 07-05
The Lower Arkansas Valley Water Conservancy District holds a conservation easement donated by Douglas L. And Sharon K. Carlson has respectively proposed a conservation easement to be by donated to the District in 2007, consisting of 1,094.60 acres of native rangeland used for cattle ranching in Pueblo County, Colorado. Motion was made by Director Esquibel, seconded by Director Kennedy, to adopt Resolution 07-05 motion unanimously carried.
2. Resolution 07-06
Where the Lower Arkansas Valley Water Conservancy District holds a conservation easement donated by Shaun Douglas Carlson has respectively proposed a conservation easement to be donated to the District in 2007, consisting of 602.09 acres of native rangeland used for cattle ranching in Pueblo County, Colorado. Motion was by Director Esquibel, seconded by Director Kennedy, to adopt Resolution 07-06, motion unanimously carried.
3. Resolution 07-07
Where the Lower Arkansas Valley Water Conservancy District holds a conservation easement donated by Max and Linda Lee Wills owners of the Long Gulch Ranch Road Property has respectively proposed a conservation easement to be donated to the District in 2007, consisting 216 acres of mountain property used as part of a family cattle ranch in Fremont Count, Colorado. Motion was made by Director Esquibel, seconded by Director Kennedy, to adopt Resolution 07-07, motion unanimously carried.
4. Resolution 07-08
Lower Arkansas Valley Water Conservancy Districts holds a conservation easement donated by David J and Tisha L Mauro has respectively proposed a conservation easement to be donated to the District in 2007, consisting of irrigated farmland in Pueblo County, Colorado. Motion was made by Director Esquibel, seconded by Director Kennedy, to adopt Resolution 07-08, motion unanimously carried.
General Manager Winner state, “All of the easements will help preserve agricultural ground, wildlife habitat and open space. The Mauro easement also ties water to the land in perpetuity.”
Peter Nichols, attorney presented a statement of opposition;
Ø Counsel recommends filing a statement of opposition in Tri-State Generation & Transmission’s application to change the use of Amity Canal shares from agricultural to industrial (power plant). This will be the first application in the state that will come under the new water quality law (H.B. 07-1132; Rep McFadyen) enacted last spring with the District’s support.
Peter Nichols, Attorney stated, the board needs to authorize a statement of opposition. Director Esquibel Motion that we authorize Peter to file statement of opposition for Tri-State Generation & Transmission’s, Seconded by Director Moore. Motion unanimously carried.
Director Mauch, stated, “I want to make the point that this is informational, so we know what’s going on, not that we’re opposed to the project.”
Peter Nichols, Attorney reported that board compensation was discussed in Executive Session. Director Esquibel, I moved to authorized Peter Nichols to file the statutory report for board compensation, Seconded by Director Moore. Motion unanimously carried.
PRESIDENT’S REPORT:
Chairman Singletary stated, “There is important group of people who have to be convinced a Super Ditch is the way to keep water in the Arkansas Valley and that group of people is our farmers.”
Chairman Singletary stated, “The Lower Arkansas Valley Water Conservancy District has spent more than $500,000 to do studies to help start the Super Ditch. Super Ditch Company will consist of seven ditch systems east of Pueblo to form a land fallowing, and water lease Management Corporation. The company would combine resources and improve bargaining power with cities or other potential water purchasers?
Director Gill stated, “We have to emphasize the importance of it for our future.” “The Super Ditch affects how our water is used, and it’s our economic base. We have to manage this thing and make it work. Things are great this year, but we have to remember where we were in the drought.”
COMMITTEE REPORTS:
Personnel: Director Kennedy stated, “She will stay on the board after she begins working for U.S. Rep. John Salazar, D-Colo. She received legal opinion and the blessing of her new boss to retain the appointed position on the Lower Arkansas Valley Water Conservancy District board.”
Liaison: Director Kennedy had nothing to report.
Legal: Director Esquibel stated, “We have a lot on our hands and we just have to move forward.”
LEGAL REPORT:
Peter Nichols Attorney, reported on,
Land Fallowing-Water Leasing Program. The purpose of this action is to develop a viable alternative to the permanent transfer and dry-up of agricultural water rights for municipal use.
Ø Counsel redrafted an application to the Arkansas Basin Roundtable for a $150,000 grant to support development of the fallowing-leasing program. The Roundtable approved the request 30 to 2 after a presentation by Counsel and General Manager Winner on September 12. The grant, if approved by the Colorado Water Conservation Board (CWCB) in December, will support detailed economic modeling of supply and demand, analysis of storage needs and opportunities, engineering of Ditch Company operating issue, and evaluation of the potential for injury to other water rights.
Ø The LAVWCD staff and counsel held a third organizational meeting for the Super Ditch Company on August 22nd. All of the ditches participated, except Bessemer, which has opted out at this time. The focus of the meeting was on potential lease terms developed by Tony van Westrum, which generated a lot of discussion. The next step will be to develop and model various leasing scenarios of potential municipal/water user leases. Members of the Steering Committee will help develop the scenarios, and participate in evaluating the economic model runs on a real time basis at a meeting to be scheduled. George Oamek of Honey Creek Resources (“HCR”) will use the economic model he developed and the hydrological model developed by GDR to run the scenarios. MaryLou Smith of Aqua Engineering will assist with facilitation. Denis Clanahan, Esq., the tax attorney retained to help develop the Super Ditch Company, will participate to ensure the modeling properly analyzes the tax consequences of various lease alternatives.
Ø Counsel are participating by invitation on a committee to develop the criteria for the CWCB’s $1.5 million grant program to develop alternatives to agricultural transfers, such as fallowing-leasing. Initial grant application will be due November 30 for award during the first quarter of 2008. The Super Ditch Company should be the leading candidate for funding because the Statewide Water Supply Investigation (“SWSI”) identified fallowing-leasing as the most promising alternative to traditional agricultural to municipal transfer.
PSOP. The purpose of this action is to negotiate a comprehensive settlement of water related issues that threaten the economic future of the Lower Arkansas Valley.
Ø Chairman Singletary, General Manager Winner and Counsel continue to negotiate with Aurora over outstanding issue involving only Aurora and the District.
Peter Nichols, Attorney, explained the Florida case involves preserving water quality by preventing salt water infiltration during pumping near Lake Okeechobee. In such cases east of the Mississippi River, the issue is too much water, while Western states lack water. Nichols requested that Lower Arkansas Valley Water Conservancy District donate $1,000.00 to support lawyers in a Florida water case, who are arguing that the Clean Water Act should defer to Western water law in similar cases? Motion was made by Director Mauch, seconded by Director Whittaker to donate $1000.00 to support lawyers in Florida water case. Motion unanimously carried. Director Kennedy amends motion to include Director Esquibel to assist with Peter Nichols, Attorney.
Peter Nichols, Attorney, explained that Colorado would be affected if water quality permits we’re required for transmountain transfer. The permits would mean either halting transfers or building treatment plants to accommodate periodic water quality fluctuations such as a muddy ditch draining into a clean river. The Lower Arkansas Valley Water Conservancy District’s interests in Larkspur Ditch, which imports water from the Gunnison River basin, might be affected, as well as its shares in Twin Lakes. Fryingpan-Arkansas water also could be affected. He also stated, “The cost of plants to treat the water is expensive, and it could reduces transfers.
Chairman Singletary stated, wouldn’t this be the case of Criteria Water Rights trying to put some of their standards in probation form.
Peter Nichols, Attorney responded that’s a good analysis John.
Chairman Singletary, stated, “If you look at the criteria rights no one will know what’s right. They’re not playing with the same difficulties as we have. The reason is the probation. We have a problem out here because we don’t have enough. Back East they have criteria. Our District has been forth right, steadfast on supporting Water Quality. I don’t want people to think we‘re not doing that, it’s just the standard’s were based on repairing.
Director Esquibel, stated, “I think the important point made is that I don’t think there’s ever any legislative intent to have this particular committee issue to apply to these water transfer.
Bart Mendenhall, Attorney, reported that on August 20, 2007, Counsel participated in a meeting with the Super Ditch Steering Committee. All of the ditch companies sent representatives, except the Bessemer, which has opted out for the time being. The sated purpose of the meeting was to discuss entity options as presented by Tony Van Westrum. There was much talk about the structure of the company. Additionally, it was apparent that the participants wanted to get some grip on the dollar value of the leases. To that end, we are preparing scenarios that use some realistic givens values, starting with the numbers received by the shareholders in the Highline-Aurora lease as well as other, hopefully achievable lease terms. We are also preparing comparisons between leasing and selling, beginning with the purchase price of the water purchased by High Plains. These scenarios will give the owners some realistic numbers to compare. In addition, it was suggested that it was time to inform all shareholders what was happening. To that end I have prepared a draft letter from the Committee to all shareholders for consideration of the Committee at this next meeting.
On August 29, 2007, Counsel participated in a small meeting of some of the Committee members and some of the potential end users. The purpose of this meeting was to reinforce to the members that real buyer’s existed, and interested in dealing with the project. The meeting appeared to be useful both to the members and to the possible lessees.
We appear to have finally gotten the Ullom releases straightened out. Kim Chavez, Financial Officer found the original option, and we think we have everyone satisfied.
There is continuing work on conservation easements. We have been working with donor’s counsel towards completion of easements.
DIRECTOR’S COMMUNITY REPORT:
Director Whittaker reported, “We had perfect weather, also the Arkansas Valley Fair last month was successful.”
Director Esquibel reported, “The community of Pueblo is having their Annual Chile Festival this weekend. This should help the economy.”
Director Moore reported, “Crowley County has several nice looking alfalfa fields, good looking bales and with lots of rain Crowley will have new cash crops.”
Director Gill reported, “Good looking crops. We’re having a good year, which is giving us the opportunity to make money for this area and the valley.”
Director Mauch reported, “It has been a good year so far in Prowers, Corn looks good. Also, new business is coming to town the first of next year.” “Getting the Super Ditch to come together will be good.”
Director Kennedy reported, “I will be a judge at the Annual Chile Festival in Pueblo this weekend.”
Chairman Singletary reported, “People are getting ready to plant winter wheat. It’s been a good year for agriculture. Agriculture puts a lot back into the economy.”
Chairman Singletary stated, “One other thing I want to mention is that I really don’t understand and I’m not trying to get under the turf with the Upper District. There was an article printed in the Pueblo Chieftain just a few days ago. It couldn’t be further away from the truth. It was misinformation. On the Super Ditch we’ve not discuss taking water out, at least out of Pueblo Reservoir and they made some assertion that wasn’t true. With the case against the Reclamation is to protect the upstream flows, we consider those exchange contracts a potentially damage in stream flows of the Arkansas. We concentrate on Water Quality and the upper District is opposed.
We don’t want anybody to think that we’re misrepresenting the fact. We have a mission and that is to acquire, retain and conserve water flowing in the Arkansas River and its tributaries, to insure that all water will remain in the Valley.
PUBLIC COMMENT:
Chairman Singletary asked if there were any comments.
Jim Valliant of CSU expressed that he was looking forward to the outcome of the Super Ditch.
This is a very good thing for the Valley.
Del Nimmo, CSU presented each board member with a Colorado State University-Pueblo magazine. Nimmo stated, “There is an article on Lower Arkansas Valley Water Conservancy District.”
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 Esquibel, seconded by Director Whittaker to adjourn the meeting. Motion unanimously carried. Meeting was adjourned at 11:52 A.M.