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recognized that there was limited recharge to the Ogallala Aquifer in the basin relative to the large amount of water in storage in the aquifer and authorized controlled mining of ground water in the basin based on a rate of depletion of 40% over 25 years. This was later amended to be 40% over 100 years. In 1974, the Colorado Supreme Court ruled that ground water taking over a century to reach a surface stream was not part of the water subject to appropriation under the Colorado Constitution and could be managed separately as designated ground water. Kuiper v. Lundvall, 529 P.2d 1328 (Colo. 1974). At that time, no one thought that ground water in the Ogallala Aquifer had been apportioned by the Republican River Compact or that withdrawals from the aquifer were subject to the Compact. In 2005, the Pioneer Irrigation District -Colorado Board, and certain owners of the Laird Ditch water right filed a petition with the Colorado Ground Water Commission seeking to redraw the boundaries of the Northern High Plains Designated Ground Water Basin to exclude ground water that is allegedly tributary to the North Fork of the Republican River and to require wells that would be excluded from the Basin to curtail pumping that was alleged to injure their senior surface rights. Many well owners and ground water management districts within the Basin opposed the petition, which was scheduled to go to trial in June 2008. The State Engineer made an effort to mediate the dispute, and Yuma County and the surface owners reached a settlement agreement in June 2008, in which Yuma County agreed to purchase the water rights from the surface owners, subject to a successful election to approve the issuance of bonds to pay for the water rights. As part of the settlement agreement, the RRWCD WAE agreed to lease the surface water rights for compact compliance for 20 years for a one time, up-front lease payment of $5 million which will be paid to the surface owners at closing if the bond election is successful. Copies of the Purchase and Sale Agreement between Yuma County and the surface owners and the proposed Lease Agreement are attached. 2.0 WATER DEMANDS AND WATER RIGHTS INCLUDED IN THE NORTH FORK LEASE 2.1. Water Supply Demands In 1978, withdrawals of ground water in the Republican River Basin reached approximately 1,040,000 acre-feet per year. In 2005, ground water pumping was approximately 750,000 acre-feet per year. Ground water impacts from ground water diversions in Colorado included in the RRCA Compact Accounting averaged approximately 25,370 acre-feet per year over the period 2002-2006. These impacts are primarily due to ground water diversions that occurred decades ago. Starting in 2003, Colorado has exceeded its compact allocations by an average of approximately 10,500 acre-feet per year. Some reduction in the amount that Colorado has exceeded its compact allocations is expected in the future as the result of irrigated acreage retirement programs supported by the RRWCD. However, it is projected that the deficit will increase gradually to approximately 15,000 acre-feet in 2039. 4