Agenda Item 12

• Board Meeting Date: 3/18/2008
• Description: CF Section - Review of Porposed Policy #18 - Water Management Partnership Program
• Board Meetings - Doc Type: Memo

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provided for the costs of a project attributable to traditional water supply, tlhe financing
mechanism should be a reimbursable loan under a separate, existing CWCB program.
Regardless of what non-traditional value of statewide concern the CWCB is financuig,
there should be a requirement that all projects that receive financing under Policy 1 E. have
a demonstrable benefit for the environment and that such benefit outweighs any adverse
environmental, social or economic impacts of the project. Further, Policy 18 should.
require mitigation for any adverse environmental, social or economic impacts of projects,
if not measures beyond mere mitigation, such as active restoration of an environmental
value or interest.
• If the local proponent of the water development is a municipal water provider, there
should be a requirement that the provider has achieved a predetermined per capita water
usage target. The per capita target, which might vary depending on the character or
location of the population being served, would be intended to assure that the provider has
achieved conservation goals and is using water efficiently.
• Before providing financing for a project under Policy 18, the CWCB should require that
the local pxoponent examine the feasibility ofrehabilitating or expanding Amy existing
water supply projects. If rehabilitation or expansion of an existing project is feasible,
Policy 18 dollars should only be available to the new project if it has less f;nvironm~ental,
social or economic impact than rehabilitating or expanding the existing project.
In addition to these conditions on the CWCB's expenditures of Policy 18 dollars, there
should be a dollar figure limitation on the amount of funds available under Policy 18 each ;year.
Currently, the policy provides that the CWCB could set aside 20% of annual Sevf:rance Tax
Perpetual Base Account ("STPBA") revenues for Policy 18 expenditures. For Fri' 2007-08,
projected STPBA revenues are approximately $80 million. Our concern is not so much that $16
million annually is excessive for Policy 18, but rather that this figure could increase dramatically
as STPBA revenues rise. Therefore, we would suggest an annual limitation on Policy 18
expenditures of $16 million. If the program proves to be successful, we could be supportive of
increasing this (imitation in the future.
Finally, we suggest that financing under the policy should not be limited to traditional,
structural water supply methods. Rather, the policy should provide financing to, and
affirmatively promote, other methods of addressing water demands, such as interruptible supply
agreements, dry year leases, joint operating agreements and the like. These nonstructural tools,
which could be used independently or in combination with a structural project, tend to meE;t
water demand with fewer financial costs and adverse environmental, social and economic
impacts.
The undersigned wish to highlight that we view Policy 18 as an exciting opportunity to
finance and promote projects with broad, diverse values and with multiple beneficiaries. 7:'he
existing draft of the policy, however, does not accomplish this goal. We look forward to
working with you to craft a policy that will truly benefit all of Colorado.