Special Report of the Operations Secretary

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PWWSP Storage Account 2 October 21, 2003 Sections 3 & 4. These sections have been constructed to allow Kansas access to the withheld 35% storage charge under some very specific conditions. These sections also do not provide any directions on how or when transfers to the Colorado Section II accounts will be made. Section 5. It has been the practice of the Operation Secretary to use a "winter water account." The result of this practice was the spill of transit loss water, according to your CY 2000 accounting. Based on your accounting, approximately 1,500 AF of water that should have been transferred to the transit loss account was lost. Though we don't agree with the overall resolution, it is good to see that this problem has been recognized. Section 6. It is my understanding from our discussions, that you were not particularly interested in the exchange of water from the PWWSP winter water holding account out of JMR. It is also my understanding, that the exchange ability has not been needed in the history of the PWWSP. The authorization of exchanging water stored under the PWWSP from JMR is not acceptable to Kansas. Additionally, the draft Colorado Resolution does not address evaporation charges or spill order for the winter water account. It would be my position that since this account would be one of several in JMR, it would be charged evaporation on a pro rata basis as is the case for all other accounts. This document, as written, is a stand alone resolution; therefore the winter water account does not fit into Section II.G. of thel980 Operating Plan that addresses spill order. On a related note, you asked if Kansas has ever called for an account release before April 1St Without exhaustive review, it appears that Kansas has called for water before April 1St on four (4) occasions in: 1986, 1988, 1996, and 1997. During the last two (2) years river conditions have been adverse to summer delivery; therefore we are considering an early call next year to take advantage of possibly more favorable river conditions that may be present. I would think that the Kansas delegation might consider an amendment of the 1980 Operating Plan to include a PWWSP winter water holding account. It may also be appropriate for such an amendment to address other issues related to Section III. If so, I expect such a resolution will need to Provide for assessing the 35% charge as soon as water is delivered to th - new "holding account" and then immediately distributing such water to the appropriate accounts. Should you have any questions, please feel free to call. Sinc Kevin L. Salter, P.E. Arkansas River Team KLS :kls Enclosures pc: Jim Rogers, ARCA Dave Brenn, ARCA