|
<br />~
<br />
<br />Dolores Water Conservancy District - WETPACK II
<br />January 25-26, 2004
<br />
<br />Agenda Item 20a
<br />
<br />and wildlife purposes, and has approximately 8000 AF for Municipal/Industrial (M & I) uses. In .
<br />addition, the Project stores and deliyers non-Project water for irrigation and M & I uses.
<br />
<br />The current WETPACK project was formulated in the WETPACK Reconnaissance Study completed
<br />in November 1998. The intent of the project is to better manage the available resources of the
<br />Dolores Project, and project components include providing an additional 3,300 acre-feet of water for
<br />the fishery below McPhee Dam, increasing municipal water supplies, and providing water for the
<br />irrigation of additional lands. In 1999 the DWCD received petitions from landowners to add
<br />approximately 13,000 acres of dryland to irrigation, but it was determined that only about 7400
<br />acres could be reasonably developed. The first priority of WET PACK has been to serve as much
<br />land as possible adjacent to the existing "Full Service" irrigated area from the Doye Creek Canal
<br />facilities. Landowners selected for inclusion pay $250 per acre up front, plus water usage fees.
<br />
<br />In Noyember 2000, the CWCB approved a loan of $7,260,000 to the DWCD for the irriqation portion
<br />of the WETPACK project (90% of the total estimated project cost of $8,067,000.) The terms of the
<br />loan approval were 3.5% (agricultural lending rate) for 30 years. At the time, the project
<br />contemplated the purchase of 1500 shares of MVIC (Montezuma Valley Irrigation Company) Class
<br />B water shares (6000 acre-feet per year) along with the acquisition of Totten Reservoir (3,300 acre-
<br />feet storage capacity with only junior water rights to fill it), and the construction of facilities
<br />(pipelines, pumping plants, etc.) to irrigate approximately 4000 acres of land. Subsequently, the
<br />DWCD entered into a contract with the CWCB in December 2002 for a reduced loan amount of
<br />$5,461,200 at 3.5% for 30 years (90% of the total estimated project cost of $6,068,000.) The loan is
<br />secured by an annuity with MBIA, Inc. that will provide $296,333 per year beginning in December
<br />2008, dedicated for CWCB loan repayment. The revised loan was to purchase the 1500 MVIC
<br />Class B Shares and acquire the Totten Reservoir facility, but to construct reduced distribution .
<br />facilities to irrigate approximately 3.000 acres using only the Class B Shares. The decision to
<br />reduce the loan amount was made by the DWCD Board based on the financial capability of DWCD,
<br />and also based on conservatiye decisions about the current lack of firm supply from Totten
<br />Reservoir.
<br />
<br />Under the current CWCB loan contract (No. C150058A), the DWCD has acquired the 1500 MVIC
<br />Class B Shares (loan amount of $2,052,900), and is in the process of constructing the 440-acre
<br />Sandstone West irrigation project (loan amount of $477,100.) With these two project components,
<br />the anticipated draw from the existing loan is $2,530,000, leaving a remaining unused available
<br />balance on the loan of $2,931 ,200 for future construction. In addition, as part of the overall project
<br />DWCD is able to irrigate 252 acres along the Dove Creek Canal without any significant construction
<br />cost. DWCD would like to be able to irrigate approximately 2,200 acres in the Yellow Jacket East
<br />and Pleasant View East areas, using approximately 4,400 acre-feet of the water ayailable from the
<br />MVIC Class B shares. With a total project cost of $3,692,000 a loan of $3,323,180 (90% of total
<br />project cost) is required. Construction at this leyel would very nearly utilize the remaining MVIC
<br />water.
<br />
<br />To date, no part of the Yellow Jacket or Pleasant View East areas have been constructed under the
<br />existing contract. There are several key factors that haye led DWCD to request the new loan:
<br />
<br />1. The DWCD Board delayed construction of the WETPACK irrigation facilities from late 2002
<br />through 2003 due to the drought conditions following 2002. The active capacity in McPhee
<br />Reservoir was near empty after 2002 resulting in the Board being cautious about expending
<br />additional funds for new irrigation. The DWCD Board decided in early 2004 to proceed with .
<br />WETPACK construction.
<br />2. The cost of pipe increased approximately 40% in the first 4 months of 2004 requiring that
<br />the Yellow Jacket East and Pleasant View East lands be reconfigured, thus delaying
<br />construction in those areas.
<br />
<br />Page 2 of 6
<br />
|