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, <br />PRRIP - ED OFFICE FINAL 07/16/2008 <br />45 <br />46 The water right being offered includes a well that is located close to the river, with a high <br />47 depletion factor. There would be a conservation easement eliminating future use of the well, <br />48 restricting the future land use, thus providing credit to the river. A preliminary estimate of <br />49 accretions to the river is 38 to 40 acre-feet (average annual), according to the Central Platte NRD <br />50 (based on COHYST model information). There is another well located approximately 200 yards <br />51 from this well, across the county line, that has been purchased by Central Platte NRD. However, <br />52 the well in question for the Program could not be acquired by Central Platte NRD due to its <br />53 location. Central Platte NRD has an established water bank program, which is potentially <br />54 available to the Program. The fair market value is about $2,500 per acre-foot of net water to the <br />55 river, based on recent similar transactions. <br />56 <br />57 Jerry Kenny requested consensus from the WAC to present this opportunity to the GC, continue <br />58 negotiations with the land owner and work out the details with Central Platte NRD with respect <br />59 to the water bank. <br />60 <br />61 Ted Kowalski expressed that it may be good to move forward, but did bring up the question <br />62 related to cost. Duane Woodward indicated the price is probably not negotiable because this <br />63 seller has already been paid a similar amount for the other well. Kent Miller indicated this is <br />64 probably as cheap as this kind of water will ever get. Twin Platte NRD is looking at establishing <br />65 a water bank and with prices of corn, expects that these water rights purchase costs will continue <br />66 to increase. <br />67 <br />68 Mike Besson suggested the LAC should possibly revisit the question of whether or not this <br />69 should count toward the 10,000 acre land acquisition target in consideration of its potential value <br />70 as a buffer. <br />71 <br />72 Mike Drain expressed issues to be resolved with respect to the water banking. This land is not <br />73 inside Central Platte NRD's boundaries, and although Tri-Basin may not be concerned at this <br />74 time, it is a fairly new water bank. There could also be issues related to using COHYST for this <br />75 purpose in that the model may be updated and is subject to change in the future so the yield <br />76 projections could change. Kent Miller recommended the Program get an agreement from Tri- <br />77 Basin to allow use of the water bank for this specific purpose. <br />78 <br />79 Frank Kwapnioski asked whether there is a critical timeline. Jerry explained that assuming the <br />80 Program could get an agreement from Tri-Basin, the transaction could probably be completed <br />81 quickly because seller has already agreed to terms of the transactions from the other well. <br />82 <br />83 Jon Altenhoffen asked about the 40 acre-foot estimate and if it occurs when there is a shortage to <br />84 target flows. Duane Woodward explained how the COHYST model has been developed and <br />85 how it could be used to address that question. Jon asked if this was in an area where the water <br />86 table is high. Jerry said yes, but the conservation easement would restrict what could be grown <br />87 on this land in the future and consequently control the consumptive use. <br />ss <br />Page 2 of 5