Memorandum of Understanding for Settlement of Case No. 04CW129 May 2006

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herein as "Limited Future Exchanges "). In the event Chaffee County's exercise of the RICDs otherwise would reduce the ability to fully exercise the Limited future Exchanges, Chaffee County agrees to implement a Reduced RICD Call (as described in paragraph 5 below) during the 30 -Day Period in order to help facilitate the Limited Future Exchanges. Limited Future Exchanges are further limited by the conditions set forth in paragraphs 4 and 5 below. a. Southeastern has existing decrees and exchanges for the use and benefit of Fryingpan- Arkansas Project ( "Project "), as authorized by Public law 85 -590, 87h Congress, and the operation thereof. as decreed in Case 5141 and changed in 80CW6, including rights to exchange Project water and return flows therefrom into. Twin lakes and Turquoise Reservoirs per said decree, which are senior to Chaffee County's RICDs. Southeastern contemplates the need to conduct future exchanges of other (non - Project) water on the Arkansas River into Twin Lakes, Turquoise Reservoir (including any future enlarged capacity thereof) and/or Clear Creek Reservoir (including any future enlarged capacity thereof) for the benefit of public or private entities within Southeastern's District boundaries that will be junior to Chaffee County's RICDs. At wiy time and to the extent these Limited Future Exchanges by Southeastern are or will be called out by Chaffee County's RICD's, Southeastern may request and Chaffee County shall observe a Reduced RICD Call (described below at paragraph 5), subject to the conditions and limitations set forth below in paragraph 4. A meeting of the Flow Coordination Committee (described below at .paragraph 6) will promptly be arranged in order to determine the extent of the needed Reduced RICD Call consistent with this Agreement and to help facilitate such exchanges under the Reduced RICD Call. b. Projected population growth upstream of Salida in Chaffee County for the year 2030 indicates a possible increase in water demand of 3,810 acre -feet. Water supply entities serving areas within Chaffee County ("Chaffee County Water Suppliers ") may need to conduct exchanges or make ether new appropriations upstream of the RICDs to meet these ;anticipated demands within Chaffee County. To the extent these limited Future Exchanges (or other new appropriations) are to help satisfy this water demand within Chaffee County and are called out by Chaffee County's RICDs, the Chaffee County Water Suppliers needing such upstream diversions may request, and if requested Chaffed_ County shall observe.,. a Reduced... RICD Call (described below at paragraph 5) to help facilitate such Limited. Future Exchanges, subject to the conditions and limitations set forth below in _paragraph 4. If needed, a meeting of the Flow Coordination Committee (described below at paragraph 6) will promptly be .arranged ed to determine the extent of the needed Reduced RICD Call consistent with this Agreement to help facilitate such exchanges. C. BWWP has conditional and absolute exchange rights decreed in Cases No. 84CW 177 ( sewered and non - sewered phase) and 84CW 178 that may affect the flows in the County's RICDs, These exchange rights are senior to the RICDs. To supplement these senior decreed exchanges, BWWP may operate in the. future, additional exchanges which will be junior to Chaffee County's RICDs. To the extent that these Limited Future Exchanges by BWNVP are called out by Chaffee County's RIM, EWWP may request and Chaffee County shall observe, a Reduced RICD Call (described below at paragraph 5), subject to the conditions and limitations set forth below in paragraph 4. A meeting of the Flow Coordination Committee (described below at paragraph 6) will promptly be arranged in order to determine the extent of the needed Reduced RICD Call consistent with this Agreement and to help facilitate such exchanges under SB2341