Report of the State Auditor 1993

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2 Water Conservation Board Construction Fund Performance Audit-February 1993 . Assisting local governments with floodplain mapping. . Managing the State's program for protecting instream flows and natural lake levels. . Encouraging water use efficiency and conservation. . Providing a forum for the evaluation of water resource conflicts among Colorado communities. The Board's policies are set by a governing body of 14 members. Nine Board members are appointed by the Governor with the consent of the Senate. These members are selected geographically to represent different water basins. Tpere are five ex officio members of the Board: the executive director of the Department of Natural Resources, the Attorney General, the State Engineer, the director of the Division of Wildlife, and the staff director of the Board. The staff director is the chief administrati ve head of the Board and is under the direction and supervision of the Board's governing members. Description of the Construction Fund The Colorado Water Conservation Board Construction Fund was established in 1971. The General Assembly enacted legislation that authorized the Board to assist, financially in the development and maintenance of water projects. Th~ first priority of the Fund is to undertake projects which will increase the beneficial consumptive use of Colorado's undeveloped compact entitled waters. This is water that is under one of the compacts that allocates water between Colorado and other states and is not put to use' in Colorado. The balance of the monies available to the Fund are for projects for the repair and rehabilitation of existing water storage and delivery systems and for investment in water management projects. Low-interest loans are granted for engineering and construction project costs. Loan amounts can vary from 50 to 100 percent of the project costs. The Fund is a continuing cash fund and balances do not revert to the State's General Fund at the end of the fiscal year. The balance in the Construction Fund available for new projects and other activities was about $8.3 million at the end of FY 1992. Interest earned from the balance of Construction Fund monies deposited with the State Treasurer are credited to the Fund. Up until last year, loan interest rates were usually set at a minimum of 5 percent. Currently, statutes authorize the Board to recommend interest rates of 0 to 7 percent on project loans. The Construction Fund has enabled the Board to finance the development of water resources within the State. The Board has provided over 583 million in financing for 124 water projects since the Fund was established in 1971.