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<br />to' <br /> <br />Mr. William Stanton <br />Page Two <br /> <br />responsibilities of each party as is related to the ownership transfer. The agreements <br />are somewhat complex. The required conditions for ownership transfer were not met <br />within the original five years. The agreements were extended for another five years, <br />and it is now unlikely that the conditions will be met by the year 2000. Copies of these <br />agreements are available from the City. <br /> <br />Between 1990 and 1993, a study known as the "Yampa River Basin Alternatives <br />Feasibility Study" was initiated for the Colorado Endangered Fish Recovery Program by <br />the Colorado River Water Conservation District (CRWCD) and the Colorado Water <br />Conservation Board. The study was performed by Hydrosphere and personnel now <br />employed by Ayres Associates. The study examined current and projected future water <br />needs in the basin and evaluated a number of sites for development of water storage. It <br />concluded upon expansion of Elkhead and Stagecoach Reservoirs as short term and <br />long term water storage options, respectively. <br /> <br />In 1995, the "Yampa River Basin Recommended Alternative Study" was completed by <br />the same Hydrosphere team. The objectives of this study were to follow up on the <br />recommendations of the previous study, specifically the enlargement of Elkhead <br />Reservoir. Following the 1995 feasibility study, Ayres Associates completed a detailed, <br />inflow design flood (IDF) hydrology study of Elkhead Dam/Reservoir for CRWCD in <br />preparation for addressing the raise, the inadequate spillway, and other rehabilitation <br />issues. This study was completed and filed with the State Engineer in April 1997. A <br />subsequent decision was made not to pursue enlargement of Elkhead. This left the <br />inadequate spillway issue and other current rehabilitation needs unresolved. <br /> <br />The "storage enlargement" based hydrology report (100% PMP based IDF) was <br />withdrawn from consideration in 1997 and replaced with a "non-storage enlargement" <br />dam rehabilitation hydrology report (75% PMP based IDF). A rehabilitation project was <br />still needed since the spillway enlargement and other defined improvements would not <br />now be accomplished as part of an "enlargement" project. Review of that hydrology <br />report was subsequently placed on "review hold" pending resolution of certain technical <br />issues and because of the renewed institutional negotiations between the City, DOW <br />and the Yampa Participants. In order to objectively revisit the "non-storage <br />enlargement" options, Ayres completed "Elkhead Dam/Reservoir Projects Updating" in <br />September of 1998 (copy separately mailed to you by Ayres Associates). This report <br />updates concepts and costs of previous relevant studies on a comparable basis to allow <br />the City, DOW and the Yampa Participants to each revisit the ownership transfer <br />agreement to confirm its continued validity (or to set the stage for mutually acceptable <br />modifications to be made to it) and to extend the agreement for a sufficient time to <br />enable its conditions to be finally completed. That review process is currently underway. <br />Once it is confirmed that the transfer will proceed (expected to be decided in the next <br />several months), the hydrology report will be revised (has already been accomplished) <br />to meet the OSE requirements and resubmitted. The hydrology report will document <br />that the spillway is actually adequate and request the OSE concurrence. If the OSE <br />concurs, design will proceed with the project without an auxiliary spillway; otherwise, the <br />design will proceed with a left bank auxiliary spillway much the same as the option which <br />