11d

• Board Meeting Date: 1/22/2008
• Description: CF Section – Construction Fund and Severance Tax Trust Fund Perpetual Base Account – New Loans - Republican River Water Conservation District - Republican River Compact Compliance Pipeline Project
• Board Meetings - Doc Type: Memo

STATE OF COLORADO

Colorado Water Conservation Board
Department of Natural Resources
1313 Shennan Street, Room 721
Denver, Colorado 80203
Phone: [phone]
Fax: [phone]
\\v/\v. c\vcb.state. co. us

Bill Ritter, Jr.
GovelTIOr

TO:

Colorado \Vater Conservation Board Members

Harris D. Sherman
DNR Executive Director

FROM:

Kirk Russell, PE
Mike Serlet, PE, Chief
Water Supply Protection Section

Jennifer L. Gimbel
CWCB Director

Dan McAuliffe
CWCB Deputy Director

DATE:

January 14,2008

SUBJECT:

Agenda Item lId, January 22-23, 2008 Board Meeting
Water Supply Planning and Finance Section - New Project Loans
Republican River. Water Conservation District - Compact Compliance Pipeline

Introduction

The Republican River Water Conservation District (District), acting by and through its Water Activity
Enterprise, is requesting a loan from the CWCB in the amount of $60 million to finance the engineering,
construction and water acquisition related to the Compact Compliance Pipeline Project (Project). The loan
represents approximately 85% of the estimated total cost of $71 million for the Project. The Project is needed
to meet the State's Republican River Compact (Compact) delivery requirements, as well as maintain a vital
agricultural economy in the eastern plains of Colorado. The major components of the Project are $50 million
for water right purchase and $21 million in a water delivery system. Final design is expected to start in
January, 2008 and construction is scheduled for 2008 & 2009. See attached Project Data Sheet for a location
map and a project summary.

Background

In December 2002, the State of Colorado entered into a Final Settlement Stipulation (Stipulation) with
Kansas and Nebraska to end the U.S. Supreme Court case of Kansas v. Nebraska and Colorado. In the
Stipulation, the States agreed to the development of a ground water model to determine stream flow
depletions caused by well pumping in the Republican River Basin and to base Compact delivery
requirements on a five-year running average. The first five-year period ended in 2007.

The District was established by statute in 2004 to assist the State of Colorado to comply with the Compact.
The District imposed a use fee on water diversions in the basin. This fee provides revenues for District
programs to retire irrigated acreage and to assist the State with the Compact compliance.

Since December 2002, the State has exceeded its annual allocations of beneficial consumptive use under the
Compact by an average of 11,350 AF /yr. For that reason, the District focused its effOlts until recently on
providing local cost-sharing for federal programs to voluntarily retire irrigated acreage in the basin. When

Water' Supply P,'otection . Wate,'shed Protection & Flood Mitigation' Stream & Lake P,'otection . Water' Supply Planning & Finance
'Vater Conse,'vation & Drought Planning' Int,'astate Water Management & Development