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<br />WHEREAS, the Colorado River Basin Salinity Control Act <br />.specifie"s that the Secretary of the Interior may fund non-federal <br />" entities- to organize lateral owners into organizations with which <br />"the Bureau may contract for the long-term operation and <br />mairi"tenance of improved laterals: and <br /> <br />WHEREAS. ~eclamation has made a $197.436 grant available to <br />" the_ Sta-te. acting through the Colorado Water Conservation Board. <br />"pursuant to the Colorado River Basin Salinity Control Act in <br />order that the State might fund all activities which the <br />Contractor must carry out in order to prepare itself to obtain <br />the ownership of the laterals under its system: and <br /> <br />WHEREAS. the State. acting thtough the Colorado Water <br />Conservation Board. has the authority. pursuant to section <br />37--60-106. C.R.S.. to foster. encourage. and assist local <br />"irrigation entities; and <br /> <br />"WHEREAS. the Colorado Water Conservation Board is the lead <br />agency for the State"ls participation in the Colorado River Basin <br />salinity control program. <br /> <br />-NOW THEREFORE. the State and the Contractor agree that: <br /> <br />1. The Contractor will perform the fallowing activities <br />preliminary to the conduct of Stage II activities: <br />a. Preparation of estimates of the time and costs that <br />will be incurred to conduct a review of its legal <br />authorities and accounting procedures" and to <br />negotiate a contract with Reclamation for the <br />long-term operation and maintenance of the laterals <br />to be acquired and improved. <br />b. Negotiation of a contract with the State which will <br />make additional federal funds available to the " <br />Contractor to perform the said Stage II activities. <br />and <br />c. Such other tasks as are necessary to ~repare the <br />Contractor to negotiate the said contract with the <br />State. <br /> <br />2. The State shall reimburse and compensate the Contractor <br />for actual expenses paid or incurred in performing the <br />preliminary activities set forth in paragraph 1. not to <br />exceed $ll,OOO.Op including the following: <br />a. Time and expenses of the members of the <br />Contractor's board of directors. <br />b. Time and expenses of the Contractor1s salaried <br />employees and administrative personnel. and <br />~. Time and expenses of the Contractor's attorneys and <br />accountants. <br /> <br />The Contractor agrees that these preliminary"activities <br />shall be completed within the aforementioned sum. <br /> <br />3. The Contractor shall submit to the State written. <br />certified statements which detail the expenses paid or <br />incurred for the preliminary activities undertaken by <br />the Contractor pursuant to paragraph 1 for which <br />reimbursement is due the Contractor. The State shall <br />promptly review and process for payment all statements <br />received. Payment shall be made to the Contractor at <br />the address first above given. <br /> <br />4."" The Contractor is an independent contractor. not an <br />employee of the State. and as such it. its employees. <br />and its agents are not entitled to any of the benefits <br />of the personnel sy~tem of the State. <br /> <br />Page 2 of 5 Pages <br />