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.. 00l~ol AZ Dept. of Water Resources: Recent Announcem... Page 2 of 11 recognized that a limited window of opportunity existed on the Lower Colorado River. It recognized that for a limited number of years, Arizona would not fully use its Colorado River apportionment. However, through the Central Arizona Project, the State could bring that unused water into the State to be stored underground in the State's aquifers. Thus, the State enacted the Arizona Water Banking Authority Act, creating the A WBA and providing funding for the off-mainstream storage of the State's unused Colorado River apportionment for the State's future use. In the Arizona Water Banking Authority Act, the State of Arizona allowed its fellow Lower Division States, under certain conditions, also to take advantage of this limited window of opportunity to make use of currently unused water. The mechanism contemplated for such arrangements was for Arizona and another Lower Division State to enter into an agreement under which the other State would fund the delivery and storage of unused Colorado River water in Arizona. See A.R.S. ~ 45-2471. In exchange, the A WBA would agree that in the future, when the other State called upon the A WBA, the A WBA would use that stored water to replace water that Arizona would otherwise J divert from the mainstream Colorado River. The Intentionally Created Unused Apportionment would M then be available for delivery by the Secretary to the other Lower Division State pursuant to Article II(B)(6) of the Decree. See A.R.S. ~ 45-2472. Ifthe use of the terms "redemption" and "storage credits" in the proposed rule is intended to be used as shorthand terms for the concepts described above, their use leaves the proposed rules unclear as to f 11 the exact mechanism intended. If implementing the mechanisms described above is intended by the proposed rules, more precise language describing those concepts should be utilized; if other ~t mechanisms are intended, it is unlikely the A WBA would be authorized to participate in such ""- mechanisms. i ~ In addition, ambiguity results from potential confusion between transactions addressed by the J proposed rule and the actual off stream storage and recovery of mainstream water in the Storing State. There are a number of instances throughout the proposed rule where the terms could be - 0 J construed as referring to the actual storage and recovery within and by the Storing State for later 'fa_ Interstate Storage Agreement will allow an authorized entity in a Storing State to store unused {.. entitlement and/or unused apportionment for the credit of an authorized entity located in a " c:J'l , Consuming State and will provide for the subsequent redemption of the credit.) This ambiguity i \II) :J unnecessary and could be cured by more precise language describing the proposed interstate mechanism. For these reasons, the A WBA recommends that the terms "Storage Credit" and "redeem" or "redemption" be eliminated from the title of the proposed rule and from the proposed rule itself. Proposed Amendment: PART 414--0FFSTREAM STORAGE OF COLORADO RIVER WATER AND CREATION AND DELIVERY OF INTENTIONALLY CREATED UNUSED APPORTIONMENT INTERST~A....TE REDEl\IPTION STOR..:\CE CREDITS IN THE LOWER DIVISION STATES * * * .... Rule Section: ~ 414.1 Purpose Comments: As explained above, use of the terms "redemption" and "Storage Credit" results in lack of clarity and ambiguity. The lack of clarity is further demonstrated by citation to Article II(B)(6) of the Decree as legal authority to "develop and redeem storage credits." If the reader of the proposed rule has considerable understanding of how the interstate mechanism is intended to work, the legal http://www.adwr.state.az.us/annclbankrule.html 3/12/98