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<br />Appropriate letters and forms are mailed to eligible entities offering them the opportunity <br />to apply for an allocation of Project water. Shortly thereafter, the U.S. Bureau of <br />Reclamation notifies the District as to the amount of water available to the District that <br />year. The Allocation Committee then meets to review the applications, and prepare <br />recommendations concerning the applications received as related to the amount of water <br />available. All recommendations of the Allocation Committee must be approved by the <br />Board of Directors of the District. Recommendations from the Allocation Committee are <br />considered at the next meeting of the Board of Directors of the District, and appropriate <br />allocations are made. Applicants are afforded the opportunity to appear before the Board <br />to request consideration of adjustments. The Allocation Committee also may meet at <br />times to discuss possible changes to the Water Allocation Policy, and any changes in the <br />process which is followed. <br /> <br />As directed by the District's Policies, Project Water for use by irrigation ditches is <br />allocated based upon an acre-foot per irrigated acre basis. Therefore, when demand <br />exceeds supply each ditch receives a proportionate share of available Project Water. This <br />allocation is made only after the municipal requests are met up to 51 % of the annual <br />Project yield. <br /> <br />While the District allocates Project Water, the Bureau is responsible for the accounting of <br />the delivery of Project Water. The District provides the Bureau and the State Division 2 <br />Engineer's Office with the a listing of the annual allocation of Project Water. Deliveries <br />are then coordinated by the Bureau in communication with the Division No.2 Engineer's <br />Office as requests are made by ditch companies and municipalities. <br /> <br />The price for Fry-Ark Project water is determined by the Bureau of Reclamation as <br />directed by Bureau policy and the Project Repayment Contract. Rates are subject to <br />adjustment depending upon the Ability to Pay Study and Repayment Analysis, which are <br />conducted by the Bureau every 4 years. <br /> <br />Use and Reuse of Project Water- <br /> <br />Pursuant to its repayment contract with the United States, the District retains dominion <br />and control over Fryingpan-Arkansas Project water return flows. The District has made <br />return flows from the use Project water available for use by eligible entities within the <br />District boundaries, primarily for augmentation purposes, since the first deliveries of <br />Project water occurred. The District, by resolution, created the Southeastern Colorado <br />Water Activity Enterprise to administer the sale of Project water return flows. On <br />February 15, 1996 the Enterprise approved a "Policy Concerning the Sale of Return <br />Flows From Fryingpan-Arkansas Project Water", a copy of which is attached to this <br />report. <br /> <br />The sale of the Project water return flows are controlled by the provisions of the policy as <br />quoted in part below: <br />