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South Platte Non-Irrigation Season Administration July 27,2006 Page 2 this will help us avoid the potential disputes that may occur as a result of "paper filling" a reservoir, as discussed in the example attached as Appendix A. Note: While our office believes 37-80-120 C.R.S. does not have much practical effect without the concept of "paper filling" and that "paper filling" will not injure the senior reservoir user as it will guarantee the senior its water, we wish to promote agreement amongst water users to the extent possible. Our office will provide a written response to the proponent of the plan, to parties who comment on the proposed plan, and to users who the proponent would store out of priority against. Our response will also be posted on the Internet. If our office approves the proposal, we will include conditions of approval if necessary. In determining which reservoir must release water stored out of priority, our office will require the most junior right that stored water out of priority to release the full amount so stored prior to the next most junior right which stored out of priority releasing any out of priority storage. The use of such plans is experimental. We will revisit the decision to use such plans and the listed requirements, including posting the plan and our response on the Internet, to determine the efficacy and helpfulness of such. As such we may choose not to follow such procedure in the future. The decision by the Division Engineer's Office for Division 1 to utilize the procedure outlined herein is entirely discretionary to the Office and does not guarantee that the Division Engineer's Office will follow this process in the future. Other Out of Priority Storage 37-80-120 C.R.S. does not allow out of priority storage in reservoirs if the user cannot promptly release water. Nevertheless, as my October 6, 2005 letter states, users have been allowed to store water out of priority without this ability. While historically this has been allowed under the "gentleman's agreement", there is no clear statutory basis for allowing this practice to continue. Most respondents to our letter commented that they did not believe we should continue this practice. Without renewed basin wide cooperation, we agree with these respondents that we cannot allow this practice in the future as the cooperation under which it occurred appears to no longer exist. Some users, who may not be able to meet the requirements of 37-80-120 C.R.S., proposed the use of an alternative supply to provide replacement of out of priority diversions if necessary. For instance, a user may propose that they would replace out of priority diversions from a lined gravel pit if storage users senior to the out of priority storage did not receive their full entitlement. We appreciate the argument that this should be allowed because it helps assure the maximization of use. It also assures that junior storage rights fill prior to the diversion by more junior priority diverters downstream. On the other side, it is not clear we have the authority to approve this absent specific court or legislative direction. Thus, we will not approve out of priority storage based on replacement of diversions with an alternative supply unless directed by the court. Aggregation of Well Depletion Replacement In our October 6, 2005 letter, we stated: Concerning winter time replacement of depletions by well user groups, the Division has taken the position in the past that, if the user has resources to make aggregated replacement, then that replacement only need be made if the senior right does not fill or the lack of replacement will impact water rights junior to the senior calling right, but senior to the priority of the wells being augmented. Others with rights junior to the wells have argued that replacement must be made any time that the senior is short water. Under the latter approach, these junior water rights may come into priority more quickly if the senior reservoirs fill more quickly. The Division has resisted this argument in the past. However, upon further review, the Division has decided to reconsider, after public input, whether wells should augment any time there is a shortage, regardless of the fact that this may only benefit water rights with priorities junior to the wells and may cause loss of water to all Colorado users in certain circumstances. It should be noted that recent augmentation plans approved by the court upon stipulation by the parties already require real time winter replacement unless the court approves agreements between the augmenting party and one or more of the reservoir owners to allow delayed aggregated replacement, if necessary.