BOARD01632

• Board Meeting Date: 9/13/2004
• Description: ISF Section - Proposed Water Right Acquisition - Elkhead Reservoir Enlargement
• Board Meetings - Doc Type: Memo

DRAFT 9-1-04
n.B.2.a. herein) within one hundred twenty (120) days of the River District giving
notice thereofto the Recovery Program. In the event that the River District does
not receive a commitment to pay the full Pro-Rata share of the actual Reservoir
Enlargement Cost of Construction within one hundred twenty (120) days, the
CWCB shall receive a reduced amount of storage and associated water rights as
provided for in paragraphs n.B.1.b. or II.B.2.b herein.

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C. The rights the River District intends to convey to the CWCB, pursuant to
paragraph II.A. herein, are expressly subject to the provisions in paragraphs II.A.7. and 8.
of the Acquisition Agreement. .

D. The water storage easement and water storage rights conveyed herein are subject
to the terms and conditions of the Amended and Restated Agreement, the terms of which
are incorporated herein. The CWCB's use of the water storage easement and water
storage rights herein to be conveyed shall be exercised consistent with the provisions of
the Amended and Restated Agreement.

III. Recovery Program Obligation

A. Reclamation on behalf of the Recovery Program shall fund a portion of the
Recovery Program Obligation to the River District through a separate Grant Agreement
(Grant Agreement No. ) with the River District. The Grant to the River District is
subject to the execution of this Reservoir Enlargement Agreement.

1. If the final Reservoir Enlargement Cost of Construction estimate
generated from detailed engineering or construction bids is more or less than the
current estimate of $20,498,787.00, or the actual Reservoir Enlargement Cost of
Construction is more or less than the current estimate of $20,498,787.00, then the
Recovery Program Obligation and River District Obligation shall be adjusted
using the Pro-Rata Formula. However, except as provided in paragraph n.B.
herein, the Recovery Program Obligation shall not be exceeded by more than 5
percent of the Recovery Program Obligation estimate of $8,722,888.00, or a total
of$9,159,032.00.

B. The parties acknowledge that a portion of the Recovery Program Obligation is
anticipated to be paid by the Colorado Department of Natural Resources pursuant to a
separate non-reimbursable expenditure contract between DNR and the River District,
executed on the _ day of ,200_ ("DNR Cost Share Contract"). The River
District hereby consents to a portion of the Recovery Program Obligation under this
Reservoir Enlargement Agreement to be paid by DNR and agrees to reduce
Reclamation's obligation to pay a portion of the Recovery Program Obligation
accordingly. Nothing in this Reservoir Enlargement Agreement shall be construed as
limiting the CWCB, Reclamation, the Service, the Recovery Program, or any other entity
from providing replacement funds for any amount payable under the DNR Cost Share

C:\Docwnents and Settings\amj.DWR\Local Settings\Temporary Inteme~J<f.~oir Enlargement Agreement,9-1-04 clean.doc