Water Supply and Demand Study 1/13/11

Animts -La Plata Water Marketing Supply and Demand Study Section 2
OM6 R activities, together with the Association, as described in the agreement transferring OM &R
resp nsibilities from Reclamation to the Association.
Asso ociation Management Committee and Voting
Eact of the Association members appoints a representative and an alternate to serve on the
Ass iation's Management Committee. To a reasonable extent, the members of the Association have
agre d to minimize Association administration and overhead costs (IGA, Section 2.4) by providing in -kind
servi es. The powers, duties and operation of the Management Committee are described in detail in
Sect. n 3 of the IGA. In considering the costs of being a member of the Association, the State of
Colot ado would need to plan for the cost of in -kind services in a manner that will allow its representative
to the Management Committee to fully participate in the regular meetings (at least quarterly with a
pote tial to be monthly); certain contract negotiations; and the hiring and supervision of a general
manE ger and other appropriate staff, such as the Management Committee Secretary and Treasurer. The
IGA a so provides that the Chairmanship of the Association's Management Committee rotate among its
mem ership on an annual basis. Therefore, the State will need to allow for extra costs and time every
sevei th year to assume this responsibility, including, as necessary, sending out appropriate notice of
mee igs and materials for consideration at the meetings. The State would be last to serve in this
rotation, as described in Section 3.3.4 of the IGA.
Each nember of the Management Committee, acting through its representative, has one vote on all
mattE rs coming before the Management Committee. Each vote is equal and is not weighted in the event
a me ber transfers all or a portion of its interest in A -LP Project water to more than one transferee, the
trans rring member and the transferees are to determine how to cast the member's one vote and who
the M inagement Committee representative and alternate will be (IGA section 3.2.2). As long as the
State ias an interest in A -LP Project water, it will be the Management Committee representative and will
have I o determine how it will consult with any parties to whom it transfers water. Any transferee
contri puting funds will want a significant say in matters and how the State votes.
A quot im is defined in Section 3.2.3.3 of the IGA as "representatives or alternates of a majority of the
memb 3rs," and is required in order for the Management Committee to take action. Any Committee
action requires the affirmative vote of the majority present. Committee representatives may participate
by phc ne, but no proxy voting is allowed. Section 3.2 of the IGA (Appendix C) describes Management
Comm ttee operations in detail. It is our understanding that the Association is seeking to operate as a
tax ex mpt organization (501 c3 possibly) and, therefore, further guidance for the Association will occur
throug policy development.
Fixed LM&R Costs
Fixed M &R costs for the A -LP Project include the costs of labor, materials and equipment required to
maint n all pumps, dam and reservoir, inlet conduit and other transferred project features. Fixed OM &R
costs a so include project administration and overhead, costs incurred by the Association to protect joint
project interests and appropriate reserve funds. Fixed OM &R costs also include energy consumption
and th appropriate share of power demand costs attributed to the pumping of water to Lake Nighthorse
to repli ce evaporation and seepage losses. The negotiated percentages the Association agreed on for
sharing fixed OM &R costs are shown in Table 2 -3, below. These percentages will not change without
renego iating the IGA, specifically Exhibit A, unless all or a portion of the State's Water reverts to the
Tribes. If the State's Water reverts to the Tribes, an adjustment in the percentages should occur based
on the proportionate share of the water reverting to the Tribes as shown in Table 2.3.
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FINAL ALP R port_1_13_11_LL.Docx