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<br />-2- <br /> <br /> <br />.' <br />means of financing" as part of their project feasibility studies, Section 31 of this year's Construction a <br />Fund bill, HB 02-1152, deleted 37-60-121(1)(b)(V) of the Colorado Revised Statutes that stated, .. <br />with reference to the Construction Fund, that "All other means of financing shall be thoroughly <br />explored before use is made of fund moneys," <br /> <br />The Authority further states that the MOD served a useful purpose at the time of signing, <br />however in light of current actual practices of the CWCB and the Authority and recent legislative <br />changes, the MOD has virtually no value at this time, <br /> <br />Discussion <br /> <br />Staff does not share the Authority's belief thaHhere is no reason to continue the MOD, We <br />are further concerned that the Authority has made ,the detennination that the MOD should be <br />tenninated without consultation with the CWCB, It is our feeling that the MOD continues to be a <br />vital link between the two agencies since the Authority no longer participates in basin-wide general <br />water planning studies, It is important that the two agencies work together since the CWCB is the <br />state water planning agency and can provide the Authority with infonnation about site specific <br />projects or other regional planning infonnation, <br /> <br />The Authority is concerned that the CWCB's way of doing business will change because the <br />statute regarding the exploration of all other means of project financing before use is made of <br />Construction Fund money has been deleted, That is not the case, The purpose for deleting that <br />clause was to eliminate an historical mis-interpretation of the use of the Construction Fund, The <br />clause had been incorrectly interpreted as meaning that the Construction Fund should be the "lender e <br />of last resort". Since the inception of the Construction Fund, loans have been made to borrowers <br />who qualify for loans from other financial institutions, The purpose of the fund is not to be the <br />lender of last resort but rather to provide a service to the water users of the state in helping develop <br />the state's compact entitlements. The administration of the Construction Fund will not change <br />simply by the deletion of the clause, <br /> <br />Finally, staff does not dispute that reVlSlons should be made to the MOD, however, <br />tennination of a symbol of cooperation between two state water agencies should not be considered. <br /> <br />Recommendation <br /> <br />Staff recommends that the Board detennine that the existing Memorandum of Dnderstanding <br />with the Colorado Water Resources and Power Development Authority should not be terminated and <br />direct the CWCB Director to commence negotiations with the Authority's Director to make the <br />appropriate revision to the MOD, <br /> <br />Flood Protection. Water Project Planning and financing. Stream and Lake Protection <br />Water Supply Protection. Conservation Planning <br /> <br />e <br />