CT2017-913 Approval Letter

• Contract/PO #: CT2017-913
• Contractor Name: Union Well Augmentation Group
• Contract Type: Loan
• Loan Projects - Doc Type: Approval Letter

Union Well Augmentation Group Agenda Item 21b
May 18-19, 2016 Board Meeting(Updated May 20, 2016)
Page 3 of 5
The Augmentation Group's By-laws (2004) provide the five-member Board of Directors with all power
with respect to management, control, and determination of the policies of the Corporation, including
the power to set and levy annual assessments for each fiscal year. All assessments become a lien on the
lands of the shareholders and the Augmentation Group may enforce the lien by foreclosure and sale of
the share and the land.
Water Rights
The water rights of the Augmentation Group include:
TABLE 1: WATER RIGHTS
Appropriation Adjudication Water Court
Name Amount Date Date Case No.
Miller Recharge Pond 9.3 CFS 12/19/2003 12/31/2003 03CW404
40.7 CFS (conditional)
Miller Recharge Pond 112.3 AF 12/19/2003 12/31/2003 03CW404
387.7 AF(conditional)
Union Ditch Company 1 Share Various Various 03CW404
(change case)
Additionally, the Augmentation Group has three leases: 5.75 Reservoir Company shares from the Ditch
Company, reusable effluent from Longmont, and reusable effluent from Aurora.
Project Description
The goal of this Project is to acquire additional water for the Augmentation Group's augmentation
plan. Rising lease costs have demonstrated the need to rely less on leased water and more on owned
water.
Alternative 1 - No Action: This alternative was considered unacceptable as it leaves the Augmentation
Group dependent on water leases, the costs for which are anticipated to rise out of the its control in
the near future. Additionally, this alternative doesn't allow the issuance of a higher well pumping
quota.
Alternative 2 - Lease additional water: Although this alternative would allow an increase of the well
pumping quota, rising lease costs show this cannot be a long-term solution. The Augmentation Group
may continue to lease water for the short-term.
Selected Alternative 3 - Purchase Available Union Reservoir Shares: This alternative will purchase
2.0 shares of the Union Reservoir Company that are currently available for purchase. In the short term
the Augmentation Group will lease these shares to Longmont in exchange for effluent. Longmont
changed all Union Reservoir Shares in water court case no 87CW222 and can use these shares without
additional water court proceedings. Additionally, the Augmentation Group can legally use Longmont's
effluent in the augmentation plan as it's the same water they have been leasing from Longmont. In the
future the Augmentation Group may elect to directly use the Reservoir shares in its augmentation plan
following the procedure laid out in its decree.
The Augmentation Group has entered into an agreement with the water right owner at a purchase cost
of $250,000. TZA's water analysis shows each share to have an average historical consumptive use (CU)
of 7.65 AF per share, along with the ability to store and regulate the average annual divertible yield of
15.3 AF per share. It is anticipated that these shares will add an average of 0.53 AF per share per year
to the augmentation plan. TZA appraised each share to be between $168,300 and $174,000.