06 ‎(2)‎

• Board Meeting Date: 11/18/2007
• Description: IWMD Section - Alternative Agricultural Water Transfer Methods - Grant Program
• Board Meetings - Doc Type: Memo

leaseback under defined conditions. The board, in consultation with the basin water users,
shall develop the detailed grant program design.
(2) The moneys appropriated in subsection (1) of this section shall remain available for
the designated purposes until the project is completed.
Background
Traditional agricultural water transfers have historically been, and continue to be, an
important component of most Municipal and Industrial (M&I) water providers' strategic
plans toward meeting growing water demands. Generally, in areas of the state where
urbanization and transfer of water are occurring concurrently there is less concern over
economic and social impacts as other industries and benefits ultimately accrue to the
local community. However, one could argue that the loss of open space and diverse
landscapes can be detrimental to the area.
In contrast, when water is, or may be, transferred from more remote and rural areas that
have limited development potential, there is a deeper concern over the impact to the local
economy and the long-term viability of the community. This can result in a division
between the benefits that can accrue to the seller of the water rights versus potential
impacts to the overall community.
In both of the above cases there may be circumstances where alternatives to traditional
agricultural water transfers may be advantageous to all parties to the transfer, while
mitigating impacts and providing community or other third party benefits. Such
alternatives to traditional water purchases may allow more rural areas that are heavily
reliant on an agricultural economy to remain economically viable while providing water
in some or all years for other uses. Alternatives to traditional agricultural transfers may
also present opportunities for local governments desiring to increase the reliability of
their water supply system as well as establishing areas for open space, trails, parks,
wildlife habitat or other uses within and between communities. Ideally, the alternatives
may facilitate the ability for some irrigated agriculture to remain active among and
between existing and future municipal boundaries.
It is recognized that exploring "transfer" alternatives that are not entirely market driven
raises questions not easily answered. Such questions run the spectrum -from quantifying
the 'quality of life' some Coloradoans equate with having local irrigated agriculture, to
concerns over interfering with property rights, the market price of water, and the future
plans of local water providers for meeting their future water needs. It is further
recognized that alternatives that deviate from traditional approaches may be more costly
but may also have a broader array of beneficiaries. As a result, a conventional cost-
benefit analysis is difficult. It is hoped that this competitive grant program can advance
our understanding of these complex and interrelated issues.
The grant program authorize under S.B 07-122 is not intended to interfere with or
criticize traditional transfers of agricultural waters, since these are a recognized property
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Draft
November 3, 2007