Town of Castle Rock Agreement for Aquisition

facility modifications and any required mitigation for the reallocation of storage
space in the Chatfield Project.
1.10. The Colorado General Assembly provided the CWCB the authority and
ability to hold storage space in the Chatfield Project and to contract with, and
allocate storage to, local entities who will utilize the reservoir storage space among
other powers and duties established in section 37-60-120.1, C.R.S. Over time, the
Colorado General Assembly has appropriated approximately $62 million for the
CWCB to retain Orphan Shares in the Reallocation Project.
1.11. The implementation costs for the Reallocation Project are 100% non-
federal. The current estimate of all project implementation costs is approximately
$134,000,000 ("Total Project Costs").
1.12. The non-Federal sponsor, CDNR, is responsible for construction and
operational costs associated with the Reallocation Project. The Colorado Division of
Parks and Wildlife currently operates and manages Chatfield State Park and
associated facilities around the reservoir. The Water Providers, working
collaboratively with the CDNR, will bear all costs of the mitigation and
modiiication, and will take the lead role in design and construction. The
Government's involvement in these efforts will be limited to oversight, review, and
approval.
1.13. The annual Operation, Maintenance, Repair, Rehabilitation,
Reconstruction and Replacement (O&M-RRR&R) payments for the project are
based on estimates by the Government for a present worth total amount of
$59,262,600 for the full 20,600 acre-feet over the 50 year Reallocation Project life. A
portion of the payments will go to the U.S. Treasury for normal operations based on
the Reallocation Project storage space calculated as 8.99% of the total storage space
available in Chatfield Reservoir. Other portions will be directed to a separate
escrow account, managed by the State and the Water Providers, for maintaining the
environmental mitigation work and recreation infrastructure related to the
Reallocation Project. O&M-RRR&R payments will be evaluated and adjusted every
five years based on actual need and expenditures.
1.14. Purchaser has relinquished a total of 1,300.339 acre-feet in the
Reallocation Project to the CWCB pursuant to paragraph 5.a of the Letter of
Commitment. Purchaser relinquished 913.158 acre-feet held in its own name and
387.181 acre-feet held by the South Metro Water Supply Authority, of which
Purchaser is a member. Purchaser retained 200 acre-feet in the Reallocation
Project.
1.15. Purchaser wishes to acquire long term future storage for its renewable
water supplies.
Page 3 of 13