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Limitations on Share Use <br />Shares in the Company are "tied" to specific lands lying within the Company service area. This <br />means that lands cannot be dried up and moved to lands that have never been irrigated in the <br />system, and that no new lands can be added. Although the sale of shares is permitted, owners <br />cannot transfer fractions of share unless they are already outstanding. This limitation prevents <br />further break-up of the Company into share fractions. Share movement between owners has been <br />fairly limited in recent years. <br />Water Rights of the Company <br />The Company owns four different water appropriations on the Rio Grande, totaling 89.70 cfs. <br />Two of these rights are some of the most senior on the Rio Grande. <br />Priority Number Amount Cumulative <br /> (cfs) Amount <br />74 8.40 8.40 <br />163 45.70 54.10 <br />249 6.20 60.30 <br />262 29.40 89.70 <br />The Excelsior Canal typically begins the irrigation season by diverting between 20 and 30 cfs to <br />flush their system. If water demand by share owners is not yet sufficient, they will then decrease <br />river diversions. The Company often then calls for 54.10 cfs (through priority number 163) when <br />demand increases by about May 10th. The Company is usually able to divert its full 89.7 cfs from <br />May 15th until about the middle of July, when they cut back to 54.1 cfs. The Company diverts at <br />54.1 cfs through about the end of August, depending on haying operations, and shuts down <br />entirely by the end of October. <br />The Company recently sold 4.5 shares to the Costilla Ditch Company. Water delivered under <br />these shares can be dumped into the Costilla Ditch at the point where is crosses the Excelsior <br />Canal. <br />Water Right Changes, Transfers and Agreements <br />There are no important legal actions that affect water supply and operations of the Company. <br />Drainage Water Rights <br />The Company does not own any drainage or seepage ditch water rights. <br />Diversion Structures <br />The diversion structure for the Excelsior Canal is located on the Rio Grande in Section 6, <br />Township 38 North, Range 9 East. The diversion structure consists of a concrete diversion dam <br />with a steel check structure and two 48 inch gates. <br />Capacity Problems <br />There are no problems or concerns related to diversion or carrying capacity of the Excelsior <br />Canal. There is adequate canal capacity to divert the full 89.7 cfs of decreed rights at the Rio <br />C:Acdss\EXCanal.doc Excelsior Canal Company Interview July 16, 1999- Page 2 of 5 <br />