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<br />I <br /> <br />I <br /> <br />The necessary work was nearing completion on the environmental draft <br />study, and then the greatest boon was the President's budget message <br />including his request for $1,921,000 for the Dallas project, including <br />the funds that had been frozen, with the additional information that <br />$400,000 was being released this spring for use in continuing the planning <br />and construction of the project. <br /> <br />I am sure that you board members will recall that on the twentieth day <br />of March, in this state of euphoria, we received a letter from the <br />Governor of the state of Colorado asking this board to reconsider the <br />project and to work with Tri-County in an attempt to reformulate the <br />project to exclude the 24,000 acre-feet of industrial water for the <br />Kemmerer Coal Company, and change that use to an agricultural use. <br /> <br />The following week we met with the Governor in Denver and presented our <br />position, particularly the fact that we had an option agreement with <br />Kemmerer Coal Company by which we were to deliver 24,000 acre-feet if <br />they exercised this option, and if, of course, the project was con- <br />structed. We were particularly emphatic in pointing out the legal <br />liability of the Tri-County Water Conservancy District to furnish this <br />water. We emphasized that this was not an agreement entered into in <br />secrecy in any manner. It was open and above board. We did not seek <br />out Kemmerer. Kemmerer Coal Company came to the Bureau inquiring for <br />available water. The Bureau, cognizant of the Dallas project, suggested <br />that the coal company contact our district. <br /> <br />We were contacted. This was in 1971, and the contract was negotiated <br />and executed. We advised the Governor that it was our position that we <br />had a moral as well as legal obligation to perform our contract. <br /> <br />There were further meetings between the staff of the Governor and Tri- <br />County and representatives for Tri-County. On April 25, the Tri-County <br />Water Conservancy District received a letter from Regional Director <br />Dave Crandall in which there were certain enclosures, a letter from the <br />Governor to Commissioner Stamm, a letter from Stamm to the Regional <br />Director advising, in effect, that -- well, first, the Governor's letter <br />advising that it was the policy of the state of Colorado not to devote <br />water to the production of power, and it was the policy of the state of <br />Colorado to use this water for agricultural purposes. The letter from <br />Commissioner Stamm advised that the Bureau was constrained to follow <br />the policy as initiated by the Governor of the State, and that the <br />project would be reformulated and then we were so advised by Dave <br />Crandall. <br /> <br />At our request, copies of this correspondence have been placed with your <br />packet on the table. Upon receiving this letter, we immediately con- <br />tacted Washington, made an appointment to meet with the Commissioner of <br />the Bureau of Reclamation, and three days later we were in Washington. <br />We, in writing and orally, protested the change in the project, or in <br />the allocation of the water of the project, and asked for reconsideration, <br />emphasizing and pointing to our legal position under our contract with <br />the Kemmerer Coal Company. At the same time we requested Mr. Romer, who <br />was also in Washington as a representative of the Governor, that he <br /> <br />-35- <br />