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The 404 permit is the most critical permit to obtain for this project. The requirements of the Clean Water Act allow for review by the Corps of Engineers which is in charge of issuing these permits. The U.S. Fish and Wildlife Service and the EPA have the opportunity to make comments and review permit applications and make recommendations to the Corps of Engineers. The most critical part of the review process is based on what are called 404 (b) 1 guidelines. These guidelines require an extensive alternatives analysis that look at other potential locations, different configurations of the project, as well as a "no project" alternative. A persuasive argument has to be presented that show to the satisfaction of the reviewing agencies that the proposed project and configuration is the best and most reasonable one. The proposed project will be reviewed under the Three States Agreement between Colorado, Nebraska and Wyoming. During this interim period when the Environmental Impact Statement (EIS) is being prepared, all new depletions to the river are supposed to be mitigated by a one for one replacement. However, GASP did file a water rights application for the project prior to the signing of the agreement. Therefore, since the project was contemplated prior to the agreement, it may not be required to replace depletions. Even if mitigation is a requirement for this project, it will not be imposed until the project actually comes on -line. A possible mitigation supply for the project could be the Tamarack Project, which was constructed prior to the Three States Agreement. It has the ability to supply up to 10,000 acre- feet of recharge credits to the river and is scheduled for additional enlargement in the near future. GASP could pursue this as a potential augmentation source to offset projected depletions. Once the EIS is completed for the Three States Agreement, there could be additional requirements imposed on this project. However, speculation on what these might be is beyond the scope of this report. We estimate that up to 50 acres of low quality wetlands may exist on the reservoir site. All of the wetlands exist solely because of irrigated agriculture. A detailed wetlands delineation will need to be completed and approved by the Corps of Engineers prior to proceeding with permitting activities. The Corps of Engineers has visited the site and reviewed the preliminary concepts of the proposal. The first indications from Corps staff were that the project would be environmentally beneficial to the river, that the wetlands were of low quality and could be mitigated, and that they would probably be supportive of an application for a permit depending on how it is configured. Baseline information on groundwater levels needs to be collected as a part of the project. This will require measuring the six piezometers installed by EEC. We would recommend taking bimonthly readings for the first 4 months. An evaluation of the results will be made at the end of 4 months to determine the appropriate time interval for future measurements. The location of the groundwater table is critical to the determination of the jurisdictional wetlands. It is anticipated a mitigation plan will be necessary for obtaining a 404 permit for the project. The extent will be based on the wetlands acreage disturbed. The fact that there are wetlands on the property is significant in the fact that it shows the soils to be poorly drained. This supports the technical basis of building a reservoir that would have a relatively water tight bottom. The remaining permits listed in this section are technically based permits. The dam safety review has specific criteria that must be met to allow for construction of the dam. The permits through the Colorado Department of Health are straightforward ones based on construction activities. We have not identified any concerns associated with this project that would indicate any problems in obtaining these permits. 10