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It should be noted that the following discussion addresses the merits of projects on a conceptual level only. Virtually all new water supply development projects will have some level of project - specific environmental and recreational impacts. Identification or discussion of such project - specific impacts is beyond the scope of this document, but we assume that all projects will meet the conditions of the Platte River Cooperative Agreement and the Colorado River Recovery Implementation Program. 1. Arkansas Basin There are several commendable aspects to the Preferred Storage Options Plan (PSOP) process in the Arkansas basin, as conducted by the Southeastern Colorado Water Conservancy District and water users within the District. From an in -basin perspective, the process has been open and inclusive, it has taken into account the effects of some level of water conservation, and its analysis of structural alternatives has generally been sensitive to environmental, recreational and agricultural values. The storage options that have emerged from the process are focused on re- operation of existing Frying Pan - Arkansas project reservoirs and enlargement of Pueblo Reservoir rather than construction of new reservoirs. However, the total identified storage need of 122,000 acre -feet appears to be significantly overstated for several reasons. First and foremost, this amount of storage need is based on growth projections and associated water demands that were described in the PSOP itself as "high" and "optimistic" even in the context of the late 1990's economic boom when they were made. No analysis was made of storage need based on more realistic projections, and it is likely that a realistic storage need would be much smaller. Second, 15,000 acre -feet of this total 122,000 acre -foot amount is earmarked for meeting a mixture of agricultural needs and facilitating interruptible supply arrangements between farmers and cities. The agricultural need - based portion of this 15,000 acre -feet storage volume is questionable on economic grounds, while the municipal portion appears to be duplicative of cities' individual storage needs, which comprise the remaining 97,000 acre -feet. Third, the PSOP modeling analysis did not justify 29,000 acre -feet of the 97,000 acre -feet of the new storage individual cities claim to need. Thus, almost one quarter of the `need' warrants further scrutiny. Finally, the PSOP should be expanded to incorporate Aurora's need to maximize the delivery of its already acquired Arkansas basin irrigation rights to its service area. While Aurora may be seen as an "outsider" from the Arkansas basin's internal perspective, this view does not justify the risk of increased expenditure of public resources to build duplicative facilities. Additional transfers of water from agriculture to cities are likely to continue given the large disparity between the values of water for agricultural versus M &I use, and the increased financial pressures placed upon both sectors. However, additional transfers should focus on cooperative arrangements with farmers and farming communities that reasonably mitigate local economic impacts, even in the case of outright acquisitions. 2. South Platte Basin — Southern Portion It is clear that the southern portion of the metro Denver area should not grow in population from 200,000 to over 600,000 while continuing to rely almost exclusively on groundwater pumped 44