BOARD00364

• Board Meeting Date: 5/16/2006
• Description: CF Section - New Project Loans - Riverside Irrigation - Water Rights Purchase
• Board Meetings - Doc Type: Memo

Riverside Irrigation District
May 16,17. 2006

Agenda Item 11b

years, due to increases in value of CST water, The current assessment levy is $10 per acre, In
2004, the total revenues for RID were $780,845,

Following adoption of a budget resolution in October, the RID certifies the required levy to the
Morgan County Commissioners, with copies to the State Treasurer and Department of Local Affairs,
State revenue laws pertaining to the assessment, levying, and collection of properly taxes
(including enforcement of penalties and forfeiture for delinquent taxes) are applicable to RID, RID
may also refuse delivery of water to lands until all past due or delinquent assessments have been
paid in full. (C,RS 37-43-143,) Because this loan contract exceeds $75,000, the Irrigation District
Law of 1905 requires the RID to hold a special election of the legal electors in the district to
authorize and ratify the contract. C.R.S. 37-41-113(4). The election must follow the same
procedures that the district would follow to authorize the issuance of a bond, (See the election
procedure in C.R.S, 37-41-117,)

Election - RID held an election on February 3, 2006 on the question of incurring debt. The ballot
question as voted on by the District members stated: "Shall the Riverside Irrigation District Board of
Directors be authorized to borrow up to $3,000,000 for the purchase of water rights, until July 1,
20061" The ballot question passed 56 - yes and 8 - no, Staff has received a copy of an opinion
letterfrom RID attorney, Mark Wagner, Hill & Robbins, P,C" stating that RID has complied with
statutory prerequisites for obtaining a loan. This letter was supplied to the Bank of Colorado in
Brush when RID obtained their "interim" financing for the water purchase,

.

Water Riqhts

RID has a long list of storage rights, a direct flow right and numerous recharge rights that they
control. The water for purchase is decreed as follows:

Riverside Reservoir

Decree Date
04/01/1902

Estimated Deliverv
16 AFIRight (gross)
8 AF/Right (consumptive)

The total gross delivery of the purchased rights is 736 acre-feet. All water will be used for irrigation,

Proiect Description

A range of alternatives were considered on how to acquire control of RRLC water not owned by
RID, including:

1, No-action alternative - don't actively pursue any water purchase
2, Pursue trade agreements with any new owners of GASP's RRLC water
3, Purchase the RRLC water at the GASP auction

Alternative 1, No-action alternative - This alternative would mean that the GASP water would sell
to other entities and would no longer be under the control of RID, There is no direct cost with this
alternative but losing control of the GASP water may lead to reduced water supply to RID farms and
cause dry-up of productively irrigable land, This alternative was unacceptable to RID,

e

Alternative 2, Pursue trade agreements - This alternative would give control of the GASP water
to RID, in the same fashion by which they have used the water for the past twenty years, There is
also no direct cost with this alternative, This alternative has great uncertainty not knowing who the
new owners of the GASP water might be and if they would even be willing to make a trade
agreement. This alternative was unacceptable to RID, '

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