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Alternative Agricultural Water Transfer Methods -Grant Application Form <br />January 2008 <br />3. Description of the Alternative Water Transfer Method. Please describe the type(s) of water transfers that will <br />be examinedlutilized (i.e., conceived transfer methods include, but are not limited to: 1) interruptible water <br />supply agreements; 2) long-term agricultural land fallowing; 3) water banks; 4) reduced consumptive use through <br />efficiency or cropping changes while maintaining historic return flows; and 5) purchase by end users with <br />leaseback under defined conditions). In addition, please describe how the transferable consumptive use will be <br />calculated and quantified, and how return flow patterns will be addressed/maintained. <br />Types of Water Transfers. The demonstration projects will incorporate land fallowing and interruptible water <br />supply agreements, depending on the preferences of cooperating farmers. Both strategies allow agricultural <br />shareholders to transfer the historical consumptive use of an absolute water right for application to another <br />type or place of use on a temporary basis without permanently changing the water right (Colorado House <br />Bill 03-1334, Colorado House Bill 06-1124). <br />Rotational fallowing allocates a specified fraction of irrigation water (linked to agricultural land) for leasing <br />to M & I interests in order to provide additional water for meeting new demands or replacing non- <br />renewablegroundwater supplies. A rotational land fallowing program temporarily removes irrigated parcels <br />from production on a periodic basis, once every three or four years for example, and transfers the associated <br />right to consume water to an economically higher-valued use. For example, not irrigating a certain percentage <br />of cropland for a prescribed period of years makes available a transferrable water right that would have <br />been used for agricultural crops. A major advantage of rotational fallowing agreements is that they <br />guarantee a predictable supply of water to the buyer, the disadvantage being that the land does not <br />produce crops for that year. <br />Interruptible supply agreements are defined as contracts between two water users where the owner of a water <br />share temporarilystops usingthe water, and allow another partyto usethe historical consumptive use portion <br />of that water right. There could be times that awater-need emergency arises, for example, with a contracting <br />water group and a ditch company or broker could identify several farmers who could forgo their water in order <br />to supply that need. This would probably befor ashort-time period such as the latter part of the irrigation <br />season. The advantage of interruptible supply agreements is that a farmer can risk cropping the land with the <br />chance of profiting from both the crop and the lease arrangement. The disadvantage is obviously that irrigated <br />crops may be lost ifthe M & I lessee exercises their option to use the water right. <br />Calculation of Consumptive Use. Since there will always be at least 4 acres in corn production (2 acres at each <br />demonstration site), these fields will provide a control for quantifying and calculating the irrigation application <br />that would otherwise occur on the fallowed fields. <br />Return Flow Patterns. Under Colorado Law, he water transfers allowed will reflect only that portion of the water <br />share that is historically consumptively used by crops, as is typical with other water transfer arrangements in the <br />region. We recognize that there are significant issues related to the Arkansas River Compact (with Kansas), <br />which specifies that flow regimes in the Arkansas River are to be managed in concert with the operation of <br />irrigation systems in the Arkansas Valley. Furthermore, changes in water rights cannot be injurious to other <br />appropriators on the river, meaning that historical return flows must be maintained. Because the <br />demonstrations sites will be coordinated with Super Ditch Company, plans will be followed for commissioning <br />engineering studies for determining historical return flows when preparing applications for changes in water <br />rights to be filed in water court. <br />11