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<br />Red Mesa Ward Reservoir - Red Mesa Ward Res. Rehab. and Enlarl!. <br />(The above spelling of Redmesa was taken directly from HB95-1155) <br /> <br />e <br /> <br />In November of 1994, the Board approved a Construction Fund loan of $2,250,000 at 4.1 <br />percent for 30 years for the rehabilitation and enlargement of Redmesa Ward Reservoir <br />upon condition of submittal of a completed feasibility study. The loan was subsequently <br />authorized in HB 95-1155. The project includes a reservoir enlargement of about 3,000 <br />acre-feet, a spillway enlargement and repairs to the outlet tower at an estimated cost of <br />$3,000,000 in 1995. <br /> <br />The authorization for the project did not identify a project sponsor. Please see Agenda <br />Item No. II g. for a recommended change in the authorization. <br /> <br />In March 1994, the Board approved a loan of$15,000 from the Construction Fund to the <br />Redmesa Ward Reservoir and Ditch Company for a feasibility study of the project. The <br />feasibility study loan was approved with the condition that it would be repaid as part of <br />the construction loan for the project or that it would be forgiven altogether if it is <br />determined that the project is not feasible. <br /> <br />Harris Water Engineering submitted a draft feasibility report in January 1995. A final <br />report with an opinion of feasibility has not yet been submitted and the Company does <br />not feel that it is ready to make such a determination at this time. <br /> <br />The feasibility study contract and the feasibility ofthe proposed project were discussed at <br />the September 1999 Board meeting. The Board tabled this item in September pending <br />further discussion of the feasibility of the project and the question of possible <br />deauthorization. <br /> <br />e <br /> <br />Since the September Board meeting, the staffhas discussed these issues with a <br />representative of the Company and their consultant. The discussion focused on water <br />rights and project financing, the reasons why the Company does not wish to have the <br />project deauthorized at the present time and actions to be taken in the next year. <br /> <br />The Company is requesting that the project not be deauthorized. Attached is a letter from <br />Trent Taylor, vice president of the Company. The letter states that the Company will <br />retain an attorney to begin addressing the water rights issues and will complete the <br />feasibility study by September 2000. <br /> <br />In addition, the letter mentions the regional water supply study currently in progress to <br />include the La Plata Basin. Redmesa Reservoir is one of the storage sites under <br />consideration in that study. The letter also notes that the Redmesa enlargement has been <br />allowed a 997 acre-foot depletion from the San Juan River by the US Fish and Wildlife <br />Service and has received a 404 Permit from the US Army Corps of Engineers. <br /> <br />Based upon our discussion with the project sponsor and upon the information in the <br />attached letter, staff recommends that the Redmesa Ward Reservoir project, as authorized <br /> <br />e <br />