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<br />
<br />The following is a summary of some of the signifi-
<br />cant terms and provisions of the Construction Agree-
<br />ment and the Operation and Maintenance (0 & M)
<br />Agreement for Grand Valley Irrigation Company's
<br />
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<br />...--.-..........................................-.-..
<br />
<br />(GVIC) participation in the Salinity Control Program.
<br />Copies of the agreements are available for inspection
<br />at the GVIC office.
<br />
<br />..I.QVE:R.VIEW,
<br />...- .._-'-'-'....-,, "" ,.-,.
<br />
<br />
<br />The Construction Agreement and the 0 & M Agree-
<br />ment envision that willing, eligible, participating lat-
<br />eral groups will enter into the Salinity Control Pro-
<br />gram by a 3-step process consisting of first taking
<br />necessary action to legally qualify the participating
<br />lateral; secondly, obtaining and making available all
<br />necessary easements and rights-of-way for construc-
<br />tion and 0 & M; and finally, entering into a written
<br />agreement with GVIC for the construction and 0 & M
<br />of salinity control improvements. Once that process
<br />occurs, the Bureau of Reclamation (Reclamation) with
<br />the participation and approval of GVIC and the par-
<br />ticipating lateral will develop designs for the salinity
<br />improvements. When the designs are approved by
<br />GVIC and the participating lateral groups, construc-
<br />tion will commence and be scheduled so as to not
<br />interfere with the delivery of irrigation water. Recla-
<br />mation will provide advance funding for all costs of
<br />construction. The expenditure offunding for construc-
<br />tion activities will be regulated by written procedures
<br />referenced in the Construction Agreement.
<br />
<br />Once the salinity improvements have been con-
<br />structed, tesied, seasoned, and deficiencies corrected
<br />and accepted by Reclamation, GVIC will undertake
<br />the long-term 0 & M of the completed improvements.
<br />0& M may include GVIC's apportioning or allocating
<br />
<br />water among the participating lateral users if the
<br />participating lateral and GVIC agree that GVIC per-
<br />form this role. Each participating lateral will have a
<br />base cost assigned to its system according to a formula
<br />contained In the 0 & M Agreement. The base cost will
<br />be adjusted annually according to increases and de-
<br />creases in the Producer's Price Index (crude materials
<br />for further processi ng, foodstuffs and feedstuffs). The
<br />participating laterals will pay 0 & M costs up to and
<br />including base cost. Reclamation will reimburse GVIC
<br />for 0 & M costs above base cost. 0 & M costs will not
<br />be borne by GVIC shareholders as an assessment
<br />against their GVIC shares. Replacement of improve,
<br />ments required because of design or construction in,
<br />adequacies or the expiration of the normal, useful life
<br />of the improvement is allowed under the 0 & :\I"
<br />agreement.
<br />
<br />The GVIC service area is divided into five sections
<br />or "increments."Three increments, as defined in the 0
<br />& M Agreement, are currently eligible for participa-
<br />tion in the Salinity Control Program. The other two
<br />increments, referred to as "deferred increments," be-
<br />come automatically eligible for participation in the
<br />Salinity Control Program if GVIC is able to construct
<br />the initial three increments at a savings of25% or more
<br />ofReclamation's indexed cost estimates.
<br />
<br />The Federal Government (Bureau of Reclamation)
<br />will provide advance funding
<br />for all costs of construction.
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