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(4) Consideration of proceeding with the appraisal of lands <br /> and water rights . <br /> Each of the these items is discussed below. <br /> Change in Purpose and Scope of Project <br /> In order to obtain the remainder of the financing needed for <br /> the project, the Upper Yampa Water Conservancy District has made <br /> application to the Bureau of Reclamation for funding under the <br /> Small Reclamation Projects Act. The District is advised that the <br /> project would be eligible for a grant in the amount of about $3 <br /> million if at least half of the capacity of the reservoir is <br /> dedicated to recreation and fish and wildlife enhancement. This <br /> would entail dedicating about 15, 000 acre-feet of the reservoir ' s <br /> total capacity to a permanent pool for recreation and fish and <br /> wildlife uses . Another 15 ,000 acre-feet of capacity would remain <br /> available for water supply purposes and about 4, 000 acre-feet <br /> would be dedicated to a sediment pool. <br /> In contrast, the project approved by the Board and <br /> recommended to the General Assembly contemplated that the <br /> sediment pool of about 4, 000 acre-feet would serve as a permanerk <br /> pool and that the balance of the reservoir ' s capacity ( i.e. , <br /> about 30 ,000) would be entirely devoted to water supply <br /> purposes. As a consequence, I am concerned that the project as <br /> • now contemplated is significantly different than the project <br /> proposed by the Board to the General Assembly. <br /> In particular, the purposes of the construction fund are <br /> limited to the construction of new facilities which will develop <br /> water for benefical consumptive use. Having half of a project ' s <br /> yield devoted to a permanent recreation pool raises the question <br /> of whether or not such a project is in compliance with the <br /> criteria which govern expenditures from the construction fund. <br /> So long as the Board does not finance more than half of the total <br /> cost of the project, it seems to me that the statutory criteria <br /> will have been complied with on the grounds that the Board is <br /> contributing to that portion of the project which will serve <br /> water supply purposes . <br /> Accordingly, I recommend that the Board continue with its <br /> participation in the project, subject to the specific statutory <br /> conditions sited in the introduction to this memo. However, when <br /> the Board enters into contracts with the Upper Yampa Water <br /> Conservancy District, I recommend that the Board require of the <br /> District that not less than 15,000 acre-feet of the reservoir ' s <br /> capacity be devoted to water supply purposes and further require <br /> of the District an operating plan for the reservoir that will <br /> recognize water supply, storage and regulation as the primary and <br /> overriding purpose for the reservoir . <br /> • <br /> MEMORANDUM -3- March 9, 1984 <br />