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Alternative Agricultural Water Transfer Methods -Grant Application Form <br />January 2008 <br />help document the economic and technical impacts of fallowing for different periods. When deciding <br />whether to enter a lease arrangement, farmers need this information in order to accurately calculate the <br />market value of their water shares, relative to the value of continuing to farm in a time when we see corn <br />prices steadily on the rise. <br />Technical Elements. One variant on a question growers typically ask is, "How will fallowing my ground for a <br />period of years affect the yields, nutrient needs and profitability of my land when I decide to farm it again?" <br />The proposed activities will quantify the changes in yield, nutrient needs and profitability that result on <br />irrigated fields when they are brought back into production after fallowing. Farmers in the Arkansas Valley <br />have expressed a need for such assessments in order to consider water rights leasing arrangements <br />individually or under the auspices of brokers such as the Super Ditch Company. <br />Institutional Elements. The proposed activities will operate in coordination with the Super Ditch Company, <br />which has agreed to help identify candidates for demonstration farms. This company is a consortium of <br />several major ditch companies that will collectively market their water as a group, especially during times of <br />drought. It is effectively a bargaining agent for irrigators who are interested in leasing water for temporary <br />non-agricultural use, but still retaining water ownership. This strategy offers stable water transfer <br />agreements for municipal and industrial (M & I) interests, while guaranteeing income to water rights <br />holders. The Super Ditch Company was recently formed with leadership from the Lower Arkansas Valley <br />Water Conservancy District (LAVWCD) to offer agricultural water rights owners an alternative to the outright <br />sale of these rights to M & I users. Farmers would continue to own their water rights, thereby generating a <br />separate form of income while production on the land would only be ceased temporarily. The Rocky Ford <br />High Line and Holbrook Canal Companies have been selected as cooperators due to their statuses, <br />respectively, as senior and junior water rights holders. <br />Legal Elements. The legal elements of water leasing in this project are commensurate with Colorado House <br />Bill 03-1334 and Colorado House Bill 06-1124. The first of these legislations was passed into law on June 5, <br />2003, authorizingthe state engineerto approve interruptible watersupplyagreements withoutthe <br />requiring adjudication in Colorado Water Court. These agreements are limited to arrangements in which <br />water rights are transferred for 3 years (or fewer) out of 10 years. The proposed activities will provide <br />information for fallowing land up to 3 years in accordance with the 3 in 10 year legislation outlined in <br />Colorado House Bill 03-1334. The legal aspects of any water transfers would be included in the leasing <br />agreement between the farmer orwater-right owners, the lessee, and the leaser, possibly a municipality <br />working in cooperation with the Super Ditch Company. <br />Colorado House Bill 06-1124 was then signed into law on May 25, 2006, granting water court judges the <br />authority to adjudicate rotational crop management contracts for land with associated water rights. These <br />contracts are defined as a written contract in which the owners of irrigation water rights agree to implement a <br />change of the rights to a new use by foregoing irrigation of a portion of the lands historically irrigated, and <br />provides that the owners may rotate the lands that will not be irrigated as long as there is no injurious effect on <br />other water rights. Administrative duties are assigned to the State Engineer, who is also granted authority to <br />approve temporary operation of such contracts. This legislation applies the same approval criteria to rotational <br />crop management contracts as are applied to changes of water rights and plans for augmentation, including <br />plans of exchange. <br />This project will be coordinated with the Super Ditch Company, which will be responsible for engineering, <br />drafting, filing and adjudicating the changes of water rights for the leases involved in both demonstration <br />projects (CRS § 37-92-305(3)). <br />6