20 ‎(2)‎

• Board Meeting Date: 11/18/2007
• Description: ISF Section - Porposed Legislation Concerning the ISF Program
• Board Meetings - Doc Type: Memo

STATE OF COLORADO
Colorado Water Conservation Board
Department of Natural Resources
1313 Sherman Street, Room 721
Denver, Colorado 80203
Phone: [phone]
Fax: [phone]
wuu . o~n cU. state. co.us
Bill Ritter, Jr.
Governor
TO: Colorado Water Conservation Board Members
H:uris D. Sherman
DNR Executive Director
FROM: Linda Bassi, Chief
Stream and Lake Protection Section Dan NlcAnliffe
Acting CWCB Director
DATE: November 5, 2007
SUBJECT: Agenda Item 20, November 14-15, 2007 Board Meeting
Stream and Lake Protection -Proposed Legislation
The Colorado Water Conservation Board ("CWCB") staff is recommending statutory revisions
to protect water rights owners who lease or otherwise contractually allow the CWCB to use all or
a portion of their water rights as instream flows to preserve or improve the natural environment
to a reasonable degree. These statutory revisions would apply to long term loans or leases of
water and would provide the same protection that HB 07-1012 provided to water rights owners
who temporarily loan or lease their water rights to the CWCB under section 37-83-105(2),
C.R.S.
Background
Section 37-92-102(3) authorizes the CWCB to "acquire, by grant, purchase, donation, bequest,
devise, lease, exchange, or other contractual agreement, from or with any person, including any
governmental entity, such water, water rights, or interests in water in such amount as the board
determines is appropriate for stream flows or for natural surface water levels or volumes for
natural lakes to preserve or improve the natural environment to a reasonable degree."
In addition to accepting numerous permanent donations of water for instream flow use, the
CWCB has entered into leases and other contractual arrangements for approximately 4, 150 acre-
feet and 13.5 cfs of water for instream flow use. Under most of these agreements, the water right
owner retains ownership of and the ability to use the subject water right for its original decreed
use. The potential loss of value of the original water right has emerged as a potential stumbling
block for lease transactions. The problem arises because, unlike more traditional beneficial uses
of water, which involve diversions and consumptive use, instream flow uses simply leave water
in the stream to preserve or improve the natural environment. Under current Colorado water
law, periods of zero diversions and no consumptive use are counted when establishing the
historic use of a water right which, in turn, determines the value of that water right. Because
instream flow uses do not involve a diversion or consumptive use, absent statutory protections,
water rights owners who loan or lease their water for instream flow use risk a decrease in the
value of their water rights if they apply for a change of water right. Earlier this year, the General
Water Supply Protection • Fluud Protection • Stream & Lake Protection • Water Supply Planning & Finance
Water Conservation & Drought Planning • Intrastate ~F'ater Management & Development