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000484 ranches reap the benefits of plentiful irrigation water that sustains a multi-billion dollar agricultural economy in the state. Cities and their economies flourish, sustained in part by adequate supplies of high quality water. Extensive fishing opportunities provide fun, adventure, and relaxation to hundreds of thousands of anglers each year, and annually pump millions of dollars into the state's economy. The two Departments believe that management of Colorado's water-related natural resources is at a critical juncture. Unless the problem of declining aquatic species is faced with the same foresight, creativity, and energy which has been applied to the development of the state's water-dependent resources, the citizens of Colorado are likely to be confronted with successive controversial and expensive regulatory and legal actions that constrain economic activity, may sacrifice the ability to determine the short and long-term uses to .be made of the State's water and wildlife resources, and risk losing- a unique part of their natural heritage. 3. WHAT CAN BE DONE TO ADDRESS THESE CllAU.ENGES? The protection of declining aquatic species is likely to become increasingly expensive if their decline is a allowed to continue. This is due in large part to the often iDflexible and costly requirements of the .- federal Endangered Species Act (ESA), and to the inherent difficulties of recovering species whose h.1 populations grow smaller and smaller and whose habitats become less and less suitable. n The conservation of these species may require the preservation or improvement of water quality and physical habitat, as well as modifications in the management of water resources. The ESA is not, however, the best means to achieve these goals. There are many reasons for this. The ESA is invoked omy after a given species has declined to the point of near-extinction. The ESA therefore functions as the ultimate -safety net-, a regulatory tool of last resort, ~though it does nothing to prevent a species from reaching this critical.point in the first place. Once a species is listed, efforts to recover it might either be ignored (which OCCI.JIS all too often due to severe funding constraints on ESA programs), or become the center of vast and intensive bureaucratic, regulatory, and legal processes marked by confrontation and significant expense for all parties. . These time-consuming and costly processes are.driven by the stringent regulatory requirements of the ESA, and often do not allow for the flexibility necessary to accommodate both species protection and economic activity. Finally, due to their traditional focus on individual species, protection efforts carried out under the ESA often ignore the needs of other species, leaving open the door for possible future listings and a further layering~n of bureaucratic and regulatory obligations. I ~ ~ The State of Colorado has participated in some notable successes in recent years in efforts to roinimi7.e the confrontation which often.attends endangered species protection efforts, includiDg the Upper Colorado River HM::lngered Fish Recovery Program. The regulatory requirements of the ESA have been effective in causing state agencies, local governments, special districts and other interests in Colorado to seek: more compatible and proactive alternatives for protecting our natural environment. However, DNR and DPHE believe that ESA regulatory programs are primarily effective as a -management regime of last resort" and, more importantly, that local or regional partnerships which include representatives of all affected interests can be substantially more effective in fulfilling our environmental protection priorities while avoiding unnecessary confrontation and expense. These partnerships can ensure that the protection of -natural values" associated with Colorado's lakes, rivers, and streams can be integrated, to the maximum 2