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<br />AGUA - Water Rights Purchase/Recharge Project <br />September 22-24, 2003 <br /> <br />Agenda Item 5c <br /> <br />Election - The purchase agreement between AGUA and the seller requires that AGUA's membership . <br />approve the purchase. AGUA has conducted a me~bership proxy vote by mail, with voting required <br />on or before September 10, 2003. A letter from AG,UA Secretary Clifford Walter has been received <br />certifying that of the 429 ballots mailed, 262 were returned (61,1% of ballots mailed), with 168 (64.1%) <br />of ballots returned voting in favor of the purchase of 78p shares of EIC and enlargement of the recharge <br />facilities. AGUA's Bylaws state, "A vote by a majority of the members present in person or by proxy <br />shall constitute a quorum for the transaction of business at any annual or special meeting," <br /> <br />Security - As security for the loan, AGUA will pledge revenues, including membership fees, <br />augmentation water fees and other incidental operating fees, backed by a rate covenant, as well as <br />the acquired 785 EIC shares. This is in compliance y,;ith CWCB Loan Policy #5 (Collateral). <br /> <br />Arkansas River Augmentation Loan Aqcount - The proposed loan meets the criteria for the use of <br />this account, as set forth in CRS 37-60-130, in terms of: reliability of the water rights supply, security <br />and collateral for loan repayment, AGUA's ability to collect assessments and to repay the loan, <br />provision of service to a broad user group, and maintaining agricultural viability of the Arkansas River <br />Valley. In addition, AGUA, as part of its annual Application and Membership Agreement, obtains <br />the necessary commitments from its members to ens~re compliance with CRS 37-60-130 (3) (g) <br />and (h), pertaining. to the Arkansas River Augmentation Account criteria. This requires that members <br />who fail to make payments in accordance with the loan agreement shall cease pumping, and <br />requires that members comply with State Engineer rules governing the measurement and use of <br />groundwater in the Arkansas River Basin. . <br /> <br /> <br />. <br /> <br />~ Staff recom ends a CWCB loan, not to exceed $:970,448, (which includes $960,840 for project <br />,~costs and $9,608 for the 1% Loan Service Fee) tp Arkansas Groundwater User Association, to <br />'~/I~urchase 785 shares of Excelsior Irrigating companYi.for use as a replacement water source to offset <br />l/~ <{~ut-of-priority depletions from well pumping and i to construct groundwater recharge facilities. <br />til .. Approximately $761,327, or any amount available at the time the CWCB and AGUA enter into a loan <br />l' 0ll contract, shall be made from the Arkansas River AU91')1.' entation Loan Fund and the balance of the loan <br />, shall be made from the Construction Fund as a Small Project Loan. The recommended term of the loan <br />is 30 years and the recommended lending rate is 2.50% per annum. As security for the loan, AGUA <br />will pledge re\(enues, including membership fees, laugmentation water fees and other Incidental <br />operating fees, backed by a rate covenant, and the Ejcquired 785 shares. This is in compliance with <br />CWCS Loan Policy #5 (Collateral). ' <br /> <br />Staff also recommends that final approval of theiloan be conditioned upon all other standard <br />contracting provisions oUhe CWCB. Further, staff1recommends that as part of this loan approval, <br />the CWCS rescind the remainder (years 2004 a~d 2005) of the 4-year deferral on Loan No. <br />C153808 granted by CWCB in July 2002. The revised payment forthe term of the loan would be <br />$27,964.19, with next payment due April 1 , 2004. <br /> <br />cc: Mr. Tom Dines, Vice-President, AGUA i <br />Mr. Dick Evans, Vice-President, Excelsior Irrigating Company <br />Michelle Matthews, Tetra Tech RMC <br />Linda Bassi, AGO <br /> <br />. <br /> <br />Page 8 o~9 <br />