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<br />AGUA — Water Rights Purchase/Recharge Project Agenda item 5c
<br />September 22-23, 2003
<br />certifying that of the 429 ballots mailed, 262 were returned (61.1 % of ballots mailed), with 168 (64.1 %)
<br />of ballots returned voting in favor of the purchase of 785 shares of EIC and enlargement of the recharge
<br />facilities. AGUA's Bylaws state, "A vote by a majority of the members present in person or by proxy
<br />shall constitute a quorum for the transaction of business at any annual or special meeting."
<br />Security - As security for the loan, AGUA will pledge revenues, including membership fees,
<br />augmentation water fees and other incidental operating fees, backed by a rate covenant, as well as
<br />the acquired 785 EIC shares. This is in compliance with CWCB Loan Policy #5 (Collateral).
<br />Arkansas River Augmentation Loan Account — The proposed loan meets the criteria for the use of
<br />this account, as set forth in CRS 37-60-130, in terms of: reliability of the water rights supply, security
<br />and collateral for loan repayment, AGUA's ability to collect assessments and to repay the loan,
<br />provision of service to a broad user group, and maintaining agricultural viability of the Arkansas River
<br />Valley. In addition, AGUA, as part of its annual Application and Membership Agreement, obtains
<br />the necessary commitments from its members to ensure compliance with CRS 37-60-130 (3) (g)
<br />and (h), pertaining to the Arkansas River Augmentation Account criteria. This requires that members
<br />who fail to make payments in accordance with the loan agreement shall cease pumping, and
<br />requires that members comply with State Engineer rules governing the measurement and use of
<br />groundwater in the Arkansas River Basin.
<br />Recommendation
<br />Staff recommends a CWCB loan, not to exceed $970,448, (which includes $960,840 for project
<br />costs and $9,608 for the 1% Loan Service Fee) to Arkansas Groundwater User Association, to
<br />purchase 785 shares of Excelsior Irrigating Company for use as a replacement water source to offset
<br />out-of-priority depletions from well pumping and to construct groundwater recharge facilities.
<br />Approximately $761,327, or any amount available at the time the CWCB and AGUA enter into a loan
<br />contract, shall be made from the Arkansas River Augmentation Loan Fund and the balance of the loan
<br />shall be made from the Construction Fund as a Small Project Loan. The recommended term of the loan
<br />is 30 years and the recommended lending rate is 2.50% per annum. As security for the loan, AGUA
<br />will pledge revenues, including membership fees, augmentation water fees and other incidental
<br />operating fees, backed by a rate covenant, and the acquired 785 shares. This is in compliance with
<br />CWCB Loan Policy #5 (Collateral).
<br />Staff also recommends that final approval of the loan be conditioned upon all other standard
<br />contracting provisions of the CWCB. Further, staff recommends that as part of this loan approval,
<br />the CWCB rescind the remainder (years 2004 and 2005) of the 4-year deferral on Loan No.
<br />C153808 granted by CWCB in July 2002. The revised payment for the term of the loan would be
<br />$27,964.19, with next payment due April 1, 2004. In addition, the CWCB finds that the portion of
<br />the loan to be funded from the Arkansas River Augmentation Loan Account meets the criteria as set
<br />forth in CRS 37-60-130.
<br />cc: Mr. Tom Dines, Vice-President, AGUA
<br />Mr. Dick Evans, Vice-President, Excelsior Irrigating Company
<br />Michelle Matthews, Tetra Tech RMC
<br />Linda Bassi, AGO
<br />Attachment
<br />Action Taken bv the CWCB on September 22, 2003
<br />The CWCB approved the Staff Recommendation, with the addition the statement listed in italics
<br />above regarding the Arkansas River Augmentation Loan Account criteria.
<br />Page 8 of 9
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