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. STATE c1' COLORADO ~ ~ , Colorado Water Conservation Board Department of Natural Resources 721 Centennial Building 1313 Sherman Street Denver, Colorado 80203 Phone, 13031 866.3441 fAX, 13031 866-4474 MEMORANDUM Roy Romer GuvernOI (Updated July 22, 1997) James S. Lochhead Executive Director, DNR D.-Hies C. lile, PE. Director, eWeB TO: Colorado Water Conservation Board Members FROM: John Van Sciver DATE: July 11, 1997 SUBJECT: Agenda Item 15a., July 21-22, 1997, Board Meeting-- Rodney Preisser Approval of a Construction Fund Loan in maximum amount of $90,000 to Purchase Water Rights. BACKGROUND Rodney Preisser is the owner of a farm in the Horse Creek Basin. The farm is located in Lincoln County, about 12 miles east of the Town of Rush. Mr. Preisser has submitted an application for a loan to purchase water rights for augmentation. The requested amount is $90K (35% of the $260K total cost to purchase water rights and settle with all parties). Mr. Preisser is requesting a loan term of 40 years, and an interest rate be 3 %. The CWCB revised the Construction Fund Guidelines in November 1996 to allow a loan for the purchase of water rights, when no project exists. The conditions are that the purchase must be to satisfy an existing need or shortage, and the purchase price must be supported by an appraisal. The CWCB "Horse Creek Basin Account" was established in 1997 for the purpose of making loans for the purchase of augmentation water rights to replace out-of-priority depletions to surface water rights within the Horse Creek Basin. $915K was placed in the account, of which $825K has been designated for the Horse Creek Water Users Association (HCWUA). The remaining $90K was envisioned by the Board to cover a loan to Mr. Preisser. See attached Minutes of the January, 1997 Board meeting and legislation creating the Horse Creek Basin Account.