PROJ00223

• Contract/PO #: C153723
• Contractor Name: Orchard Mesa Irrigation District
• Contract Type: Loan
• Water District: 0
• County: Mesa
• Bill Number: HB 95-1155
• Loan Projects - Doc Type: Feasibility Study

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G,

114 locally-sponsored projects have received loans for planning and
construction from the Construction Fund. In addition, the staff has provided
technical assistance on about 80 water projects funded through the Department
of Local Affairs.

A more complete description of the CWCB program regulations and guidelines
is provided in Appendix A,

CREATION OF MUTUAL MESA LATERAL ENTERPRISE

L Purpose of Formation

The District's general counsel has opined to the District that the District is not
subject to the provisions of Article X, Section 20 of the Colorado Constitution
("Amendment 1"), subject to certain qualifications. The basis for this opinion
is the general counsel's conclusion that the District is fundamentally non-
governmental. Because Amendment 1 applies only to the State or local
government entities, the general counsel concluded that the District was not
subject to Amendment 1.

During discussions with the CWCB regarding the borrowing of funds
necessary for the Mutual Mesa Project, it became apparent that the CWCB
believes the District is generally subject to Amendment 1. Because the
District's election authorizing the Mutual Mesa Project was conducted in
conformance with the provisions of Articles 42 and 43 of Title 37, Colorado
Revised Statutes, rather than in conformance with the provisions of
Amendment 1, the CWCB indicated that it would not directly loan the District
the funds necessary to perform the Mutual Mesa Project. However, the
CWCB indicated that it would loan the necessary funds to a Water Activity
Enterprise formed by the District pursuant to Article 45.1 of Title 37,
Colorado Revised Statutes, to undertake the Mutual Mesa Project. Mutual
Mesa Lateral Enterprise ("MMLE") was formed for that purpose, The
CWCB's legal counsel supported and concurred in this action.

2, Formation,

The District adopted a resolution (the "MMLE Resolution") on October 3,
1996, to form MMLE as a water activity enterprise under Article 45.1 of
Title 37, Colorado Revised Statutes. A copy of that resolution is included in
Appendix B. The CWCB's legal counsel indicated that an enterprise so
formed would not be subject to the provisions of Amendment 1, MMLE is
wholly owned by the District. Pursuant to C.R.S, ~ 37-45.1-103, the Board
of Directors of the District serves as the Governing Board of MMLE,

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