29 ‎(3)‎

• Board Meeting Date: 5/21/2008
• Description: IWMD Section - Alternative Agricultural Water Transfer Methods - Arkansas and South Platte Basins Competitive Grant Program
• Board Meetings - Doc Type: Memo

1lvater ri hts owners-lessors. Irrigators may participate with ~gD percent of their
irrigated land, or same lesser percentage, as they individually choose. All participating land
will be not be irrigated the same percentage aver the long term, although irrigatars will have
considerable flexibility to decide which land not to irrigate. Irrigators can participate
individually, as part of a family group, or part of another forrr~al or informal group, e.g., LLC,
or ditch lateral. Parkicipating irrigators will be responsible far weed and erosion control on
their followed land. Land irrigated by participating irrigatars must be followed to make the
historical consumptive use of their water rights available far other uses, Fallowing may be
on a rotatiar~al or other basis.
vllater users~lessees. MCI users that could lease water through the Super Ditch
Company may include among others the fallowing: Pikes Peak Regional water Authority,
Colorado Springs Utilities, Aurora, Pueblo Board of llvater vlJorks, Pueblo ~lvest, Fountain
Valley Authority, Canon City, Security, 1lvidefieldr St. Charles Mesa, Arkansas Malley
Conduit, other municipalities, Colorado State Parks, Colorado Division of ~Illildlife, the
Colorado water Conservation Board, energy and industrial users, and other agricultural
users. In order to avoid undermining the potential far the success of the program, a
condition ofi leasing water is expected to be a voluntary agreement by the Municipality or
other 1lvater User not to purchase and transfer irrigation water rights out of the Lower Valley
for so long as they are receiving the benefits of water leased from the Company.
Municipalities or other 1lVater Users would not, however, be expected to fivrga the purchase
of irrigation water rights while the program is operating, although they would be expected to
make those water rights available for lease through the program -- dust like any other
irrigation water right owner -~ so that every water owner would be treated alike.
Son1e MB~I users have voluntarily entered into intergovernmental agreements
~"IAs"~ that address, among other things, the use and transfer of irrigation water rights for
municipal purposes. Other agreements concern flows below Pueblo Reservoir. The
Rotational Land Fallowing-v1later Leasing program would necessarily operate within the
confines of such agreements for so long as they are in effect.
C eratianal details. ~n behalf of the irrigators, the Super Ditch Company will
negotiate leases with M&I users, including lease terms and conditions, including the price of
water per acre-foot abase price}, periodic price escalation factors inflation and r~arket
adjustments}, length of lease, payment terms, delivery points, and delivery schedule.
Irrigators will then decide whether to participate or not.
The Super Ditch Company will be responsible far administering the leases with M&I
users. For example, the Company will necessarily determine which lands will be followed
each year based an lease demand and hydrology. In addition, the Super Ditch Company
will be responsible for lease accounting and reporting under MVPs and water court
decrees.
Leases will provide that irrigators receive revenues directly frarn the water user-
lessee~ This will avail double taxation, i.e., taxation of income to the Company and to the
irrigator.