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<br />. 2.0 ACTIVITIES AND ACCOMPLISHMENTS <br /> <br />2.1 Changes in Statutory Guidelines for the CWCB Construction Fund <br /> <br />Change in Interest Charges <br /> <br />Section 3 of SB 92-87 amended 37-60-119 (2), CRS, such that the interest charges <br />recommended by the Board shall be between zero and seven percent on the basis of the project <br />sponsor's ability to pay and the significance of the project to the development and protection of <br />the water supplies of the state. Interest charges were previously required to be assessed at no <br />less than five percent. Through its experience with a wide range of facility owners, the Board <br />believed that the minimum interest charge of 5 percent was too restrictive and that the Board <br />should have the flexibility to establish a percentage for repayments which takes into account the <br />ability of the project sponsor to repay. <br /> <br />Change in the Criteria for Expenditures from the Fund <br /> <br />. <br /> <br />Section 4 of SB 92-87 amended 37-60-121 (I), CRS, such that the first priority of the moneys <br />available to the fund shall be used devoted to projects which will increase the beneficial <br />consumptive use of Colorado's undeveloped compact entitled waters. The previous criteria in <br />37-60-121(1)(b) required the Board to devote approximately two-thirds of the monies for new <br />projects and the remainder to repair and rehabilitation. The Board no longer believed that it was <br />desirable to make such an allocation between new storage facilities and project repairs and <br />requested that allocation be removed to increase the flexibility in the application of funds to <br />identified needs. <br /> <br />Water Management Demonstration Grant Program <br /> <br />. <br /> <br />Section 3 of SB 92-87 added a new paragraph (3) to 37-60-119 CRS, authorizing the Board <br />to expend up to $500,000 as demonstration grants on a 50 percent cost sharing basis for projects <br />to improve water management or to reduce the operational costs of such systems. The Board <br />believed that management improvements are essential if existing facilities are to be maintained <br />and productive into the future. Many water users have accomplished significant improvements <br />in the operation of their systems, yet others, for lack of technical assistance, or financing have <br />not been as progressive. The Board recommended that it be authorized to undertake a new <br />category of activity under the construction fund to promote and assist in the accomplishment of <br />management demonstration efforts. The Board acknowledged that grant funds represent a <br />permanent drain on the construction fund revolving balance, consequently the Board requested <br />an authorization for only $500,000 for this category of activity. Mter those funds are invested <br />and the results known, the Board will report to the General Assembly on the experience gained. <br />The staff has prepared draft guidelines and criteria for administering the program for agricultural <br />or multipurpose water systems modeled after the Office of Water Conservation Grant Program. <br />The recommended procedures were considered by the Board at its November 1992 meeting. <br /> <br />CWCB Annual Report, page 5 <br />