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<br />. <br /> <br />January 11, 2006 Draft <br />MEMORANDUM OF AGREEMENT <br /> <br />This Agreement dated this _ day of , 2006, is between the United States of <br />America, Department of Interior, Bureau of Reclamation ("Reclamation") acting through the <br />Secretary of Interior, and the State of Colorado, Department of Natural Resources, acting <br />through the Colorado Water Conservation Board ("CWCB"). <br /> <br />Recitals <br /> <br />I. Reclamation operates the Paradox Valley Unit ("the Unit"), which is located adjacent to <br />the Dolores River near Bedrock, Colorado. The Dolores River picks up an estimated 205,000 <br />tons of salt annually as it crosses Paradox Valley, primarily from the surfacing of natural brine <br />groundwater. The Unit is designed to prevent this natural salt load from entering the river and <br />degrading the water quality of the main stem of the Colorado River. The Unit intercepts the <br />brine groundwater before it enters the Dolores River and disposes the brine by deep well <br />injection. Major project facilities include a brine production well field, brine surface treatment <br />facility, injection facility, a 15,932 feet deep injection well, and associated roads, pipelines, and <br />electrical facilities. <br /> <br />2. The CWCB has an instream flow water right on the Dolores River for 78 cfs from <br />McPhee Dam to the confluence with the San Miguel River, decreed by the Division 7 Water <br />Court on September 29,1975 in Case No. W1346-75 ("Dolores River ISF") with an <br />. appropriation date of May 1, 1975. <br /> <br />3. The Dolores Water Conservancy District ("District") operates McPhee Reservoir as part <br />of the Dolores Project, using water stored in McPhee Reservoir for irrigation, municipal and <br />industrial use, recreation, fish and wildlife, and production of hydroelectric power. The Dolores <br />Project was authorized by the Colorado River Basin Act of September 30, 1968 (Public Law 90- <br />537), as a participating project under the Colorado River Storage Project Act of April 11, 1956 <br />(Public Law 84-485). <br /> <br />4. To enable full operation of the Unit, Reclamation applied for and obtained a decree for a <br />change of water rights and plan for augmentation in Case Nos. 83CW45 (Water Division 7) and <br />83CWI4 (Water Division 4). Reclamation sought to change several surface water rights from <br />irrigation to replacement storage for salinity control and fish and wildlife propagation in McPhee <br />Reservoir. The Colorado Supreme Court ordered the Division 4 Water Court to hear both <br />applications, and the Division 4 Water Court entered a decree in both cases on February 5, 1986 <br />("1986 Decree"). <br /> <br />5. The Division 4 Water Court found that the changed water rights' average annual <br />consumptive use was 924 acre-feet. The 1986 Decree provides that Reclamation may store the <br />consumptive use amount of the changed water rights in McPhee Reservoir and use that water to <br />replace out-of-priority depletions in the Dolores River resulting from out-of-priority pumping of <br />one or more wells at the Unit. Releases will be made from McPhee Reservoir to replace said <br />depletions along with the necessary transportation losses as required by the Division Engineer <br />for Division 4. However, the decree permits Reclamation to store the changed water rights in <br /> <br />. <br />