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. . . Final PSOP Implementation Committee Report Page 11 of 23 to better serve their needs. 2278 As a part of the operation of enlarged storage space in Pueblo Reservoir, entities west of Pueblo that choose to participate in the enlargement of Pueblo Reservoir (entities with an allotment contract as described below) may be given the option, under the discretion of Reclamation, to trade their new storage space in Pueblo Reservoir for Project Storage space in Turquoise or Twin Lakes Reservoirs. Or, they may be entitled to execute an exchange contract with Reclamation that would allow them to take delivery of their water at their point of diversion. Similar agreements may be possible with other entities that hold storage contracts in upper-basin reservoirs. These options are subject to appropriate terms and conditions as established by Reclamation; however, such exchanges should be made at no cost (up to annual maximum of 1000 acre-feet) for the benefit of water users entities west of Pueblo. Entities east of Pueblo that develop storage space in Turquoise Reservoir, when additional storage space is developed under the PSOP, should be given the option to trade their storage space in Turquoise for space in Pueblo Reservoir. These options are being modeled so as to determine the extent of availability of exchange in the upper Arkansas. The results of this modeling effort should be available by May 1, 2001. 3.4 Ownership-The Federal Government will retain ownership of Project facilities, including the enlarged space at Pueblo Reservoir and Turquoise Reservoir. 3.5 Contracting-The District's Water Activity Enterprise will execute a master contract with Reclamation for the construction and the use of enlarged space in Project facilities. Participating entities will then execute a firm-storage contract (an allotment contract) with the Enterprise and/or Reclamation that will include any and all requirements from Reclamation and limitations and obligations as stated in section 3.9 of this report. 3.6 Allotment Contracts-An allotment contract will entitle the contracting entity to firm storage in the enlarged space. The exact amount will be based upon the entity's request for storage, the limitations as documented in the federal-level feasibility study, and final federal authorization and NEPA-based decisions. Entities that need firm storage space should sign an MOA and declare their intent to participate in the enlargement project to meet their storage needs. If entities choose not to participate in the Implementation Phase of the enlargement project, they will still be eligible to secure an allotment contract if they sign an agreement to participate in the construction project, before congressional authorization of the Project, which is prior to commencement of contract negotiations and the NEPA compliance process (estimated January 1, 2004). A certain date will be established for signing such an agreement. Entities that choose to participate in this way will be required to reimburse a proportionate share of the original implementation costs, including interest charges, to the Enterprise. Subject to a first-right-of-refusal option held by the Enterprise, the rights and obligations under an allotment contract may be sold by the original contract-holder to another in-District entity, but only when the subsequent use of the enlarged storage space serves in-District needs. The terms of the Enterprise's purchase of allotment contracts will be negotiated. 3.7 Enterprise Water Management Storage (EWMS) Allotment Contracts-EWMS is set aside for agricultural needs and temporary M&I needs as described in this EWMS Section of the Report. If EWMS is greater than 7,500 acre-feet, there will be a limited opportunity for entities to secure an allotment contract from the Enterprise, after the Project is constructed, in 3/20/02