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<br />. <br /> <br />. <br /> <br />during all months of the year except for September when the flow amount is established at 1.0 cfs . <br />or the natural inflow, whichever is less. The measurement point is the USGS gaging station <br />located about 4 miles downstream of the dam. <br /> <br />The 2.0 cfs by-pass flow amounts to approximately 1,400 acre-feet per year, or 23% of <br />the reservoir's current capacity of 6,203 acre-feet. However, in order to achieve 2.0 cfs at the <br />prescribed point located 4 miles downstream of the dam, it is sometimes necessary to release up <br />to 4.0 cfs at the turn-out in the ditch. Although the by-pass has been a requirement since 1986, <br />the summer of 1994 was the first year water had to be turned back to the stream. <br /> <br />The water that is by-passed in the winter causes the Overland Reservoir to fill very late. <br />The company must then operate the ditch below capacity for 10 to 20 days while the reservoir <br />fills. The water that is by-passed during the irrigation season reduces the volume of water <br />available in the reservoir which reduces the flows and shortens the season. <br /> <br />The company is attempting to rectify the by-pass flow issue, and has filed suit against the <br />Forest Service (Civil Action No. 96-N-797) to validate their historic easement rights. As <br />indicated by letter dated July 22, 1996, from Wesley Signs, the Colorado River Water <br />Conservation District is in support of the company's position and has committed $10,000 for legal <br />fees. The company has also requested financial support from other western water users (see <br />attached letters). <br /> <br />. <br /> <br />Discussion <br /> <br />The staff is concerned that the by-pass n:quirement in combination with dry years and the <br />anticipated litigation expenses related to the suit will have a long term adverse affect on the <br />company's future ability to payoff its CWCB loans. The Board has an interest in the Overland <br />case because these imposed by-pass flows artificially limit the ability of Colorado water users to <br />maintain the historical yield of their water delivery systems. Other Construction Fund borrowers <br />could have similar fmancial difficulties if by-pass flow conditions are imposed through renewal <br />of their special use permits, <br /> <br />In November 1994 the Board approved the company's first request for fmancial relief by <br />granting a deferment of their December 1994 payment in the amount of $31,076 based on a <br />fmding that the company has encountered significant and unexpected financial difficulties, and that <br />it had been duly diligent in its efforts to comply with the repayment provisions of its contract with <br />the Board. A second request for a deferment of their December 1996 payment will be under <br />consideration at the November 1996 meeting (see agenda item 15a). <br /> <br />The company has been working in cooperation with the Department of Natural Resources <br />over the last two years to resolve this issue with the Forest Service with no success. The company <br />has also asked for fmancial assistance from the state through the Litigation Account created in the . <br />Construction Fund. However, the Attorney General has determined that they do not meet the <br />requirements set up for use of the account. <br /> <br />2 <br />