BOARD01574

• Board Meeting Date: 3/11/1981
• Description: CWCB Meeting
• Board Meetings - Doc Type: Meeting

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Mr. J. William McDonald
March 9, 1981
Page Two

4] Goals one through thre~ may best be met and balanced
with one another by using different interest rates
and payback periods on Board recommended loans as opposed
to a uniform 4% rate and 40 year payback. Lower priority
projects could be fund~d at a higher interest rate
and shorter payback period while higher priority projects
could be fundpn on the traditional terms.

We strongly support the dir~ction in which the Board appears
to be moving and are well aware of the concerns that propel the
Board in that direction. We feel compelled, however, to comment
on the policy proposals currently under consideration from our
own perspective as water and land use counsel for numerous municipal,
industrial and agricultural clients in both the Colorado and
Platte River Basins. In general we believe that the Board should
be encouraged to continue in the direction outlined above. At
the same time, we believe that in furthering its primary goal
of promoting storage projects, the Board should give primary
approval to those projects that ~re conceived as part and parcel
of comprehensive multiple use pl~ns that involve successive use
of water for irrigation, municip~l and then industrial purposes.

Article III, section (el of the Colorado River Compact of
1922 provides that Upper Basin states may not withhold water
"which cannot reasonably be applied to domestic and agricultural
uses". One interpretation of this language is that mere storage
of water does not entitle the Upper Basin to withhold water from
the Lower Basin unless the water is continuously applied to beneficial
use. This language may require current beneficial use of water,
or at least a concrete plan for applying water to beneficial
use on a definitive schedule. In light of this possible inter-
pretation, it is essential that a storage project be tied to
immediate and successive uses ultimately resulting in 100% beneficial
consumption of the stored water.

In addition, unless the return flow is likewise consumed
as part of the original project, Colorado may not be entitled
to withhold these return flows from the Lower Basin under the
Compac-t. Return flows may already be subject to re-use within
Colorado and may be subject to Such re-use at sometime in the
future. But unless such re-use is a part of the original project,
it will not add to the credit which that project will create
against the Lower Basin. We submi-t that there must be no return
flow from the storage projects. This can be accomplished by funding
projects designed from their inception to meet a definite need,
rather than merely building fortuitous storage projects.