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<br />. <br /> <br /> <br />, <br /> <br />AGRICULTURAL WATER TRANSFERS IN A VOLATILE MARKET: <br />A THREADBARE APPROACH TO MUNICIPAL WATER SUPPLY <br />OR PART OF A TAPESTRY? <br /> <br />by Gregory J. Hobbs, Jr. <br />Davis, Graham & Stubbs <br />Denver, Colorado <br />Associate counsel, Northern Colorado <br />Water Conservancy District <br /> <br />for <br /> <br />"Water Marketing: Opportunities and <br />Challenges of a New Era" <br />university of Denver <br />Lowell Thomas Law Center <br />Denver, Colorado <br />September, 1986 <br /> <br />INTRODUCTION <br /> <br />The right to buy and sell a water right on the open <br />market, and to effectuate a change to the water right, has long <br />been fostered by Colorado water law, see Lower Latham Ditch <br />Co. v. Bi;ou Irriqation co, 41 Colo. 212, 93 P.483 (1907). As <br />early as 1891, the Colorado Supreme Court held that an <br />agricultural water right can be sold to a city apart from the <br />land which it has historically irrigated, Strickler v. colorado <br />sorinqs, 16 Colo. 61, 70, 26 P. 313 (1891) <br /> <br />The consideration paid by a buyer to a seller in a <br />Colorado water rights transaction is wholly determined by the <br />parties to the transaction. Factors which typically influence <br />the purchase price paid for a water right include (1) the <br />priority of the water right relative to other water rights having <br />a common source of available supply, (2) the ability to <br />effectuate a change of the water right, if needed, (3) the amount <br />of water yield which can be realized following a change-of-water- <br />righ~ proceeding, (4) the need of the purchaser, (5) the <br />alternative sources of supply available to the purchaser, <br />(6) competition between potential purchasers, and (7) the ability <br /> <br />APPENDIX C <br />