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. , ," STATE OF COLORADO ~ Ju U~ ~ \,,J OFFICE OF THE STATE ENGINEER Division of Water Resources Department of Natural Resources 1313 Sherman Street, Room 818 Denver, Colorado 80203 Phone (303) 866-3581 fAX (303) 866-3589 Roy Romer Governor January 10, 1997 James S. Lochhead Executive Director Mr. Kenneth Carter, President Box Springs Canal & Reservoir Company Star Route 1, Box 15 22044 Hwy 71 North Ordway, CO 81063 Hal D. Simpson State Engineer Horse Creek Water Users Association clo Mr. Donald Johns High Mesa Farm 4689 County Road 2A Rush, CO 80833 Re: Results of mediation session held January 9, 1997 Gentlemen: I thought it would be useful to place in writing the major points that the parties agreed to during yesterday's mediation session. I thought the session went well and everyone is to be commended for their efforts. The agreed to points as of this date are as follows: I. The Horse Creek Water Users Association (HCWUA) would acquire a portion of the senior priority from the Box Springs Canal & Reservoir Company (Box Springs) as a means to augment their well use in the basin. The amount of the water right that would be acquired in return for consideration has yet to be determined, but will be examined by the parties. Box Springs has requested that a portion of the water right remain in their possession for their use and/or augmentation needs. 2. The HCWUA agrees to deal with the owners of the Reid and Smith water rights internally at the appropriate time, dependent upon the speed with which documents are prepared and a final negotiated settlement is made. 3. As to whether the Box Spring water right is transferred to the individual wells or is used as part of an exchange, etc., (there are numerous options), the parties will examine the scenarios and determine which scenario works best in the drafting of any plan to be submitted to the State Engineer.