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Mr. Jared Dains Page 5 <br />May 11, 2011 <br />W-9332-78, the Court found that 4,200 acre-feet, or more per year, will be available from Fort <br />Collins to the PRPA to be used primarily for cooling purposes in connection with its Rawhide <br />Energy Facility. Pursuant to the decree in case no. W-9332-78, if PRPA does not require the <br />water for its own purposes, PRPA, Fort Collins, or other water users may utilize the water for any <br />other beneficial purpose including augmentation. In addition, PRPA has entered into an <br />Agreement with the North Poudre Irrigation Company ("North Poudre") dated November 15, 1979 <br />which grants PRPA the right to store surplus water (which is surplus water beyond the needs of <br />the Rawhide Energy Facility) in Fossil Creek Reservoir and lease such water to others who can <br />use such water from Fossil Creek Reservoir through direct delivery. As required by the <br />Agreement, North Poudre and the water commissioner were informed of the PRPA lease with <br />Lafarge. In addition, according to the Agreement, releases of leased water to others shall be <br />made in the months of September, October, November, February or March. Since the existing <br />lease will also make replacements for months other than the months listed above, PRPA and <br />North Poudre mutually agreed to lease the water for April 2011 and the water commissioner <br />agreed to make the releases during this month. The releases will be made from Fossil Creek <br />Reservoir to the Cache La Poudre River downstream of the estimated point of depletions from the <br />three sites included in this combined plan. The subject lease was signed on November 15, 2010 <br />and a copy of the lease is attached to this letter. <br />During 2011, a lease from the City of Greeley ("Greeley") will make replacements for <br />depletions not covered by the recharge program. A lease of 66.37 acre-feet of fully consumable <br />water from Greeley will make replacements in June and July 2011. <br />Also, during 2011, a lease from the LCRC will make replacements for depletions not <br />covered by the recharge program. A lease of 161.0 acre-feet of fully consumable water from <br />LCRC will make replacements from July 2011 through October 2011. A copy of the LCRC lease <br />was submitted to this office with the SWSP request and is attached to this letter. The source of the <br />replacement water will be from Gray Lakes, which can deliver water to Box Elder Creek and from <br />there to the Cache La Poudre River. Approximately 6.6 acre-feet of water (0.25 percent per stream <br />mile) from the Gray Lakes are estimated to be required to replace transit losses. The water <br />storage right for the Gray Lakes owned by LCRC is not presently decreed for augmentation, <br />therefore a change of use application for the Gray Lakes water storage right was filed with the <br />Division 1 Water Court in case no. 2006CW276. A detailed historical consumptive use analysis <br />was performed by TZA Water Engineers, Inc. (`TZA") in support for case no. 2006CW276. <br />According to the analysis LCRC water rights have historically been used to provide supplemental <br />water to irrigated lands within the Lake Canal Service area. Based upon the crop mix, irrigated <br />acreage and water available for irrigation, TZA concluded that the Lake Canal system is water <br />short. TZA also noted that a historical consumptive use of 65% is not uncommon for the use of <br />supplemental reservoir water within water short ditch systems. For the purposes of this plan, the <br />consumptive use associated with the Gray Lakes water was assumed to be 45%. This also means <br />55% of the delivered water constituted historical return flows, which must be maintained. <br />Therefore, in addition to the 69.5 acre-feet of water to be released for replacement purposes, an <br />additional 84.9 acre-feet (for a total storage release of 161.0 acre-feet) representing the return <br />flow component shall be release from Gray Lakes to maintain the historical return flow regime. <br />In accordance with the letter dated April 30, 2010 (copy attached) from the Colorado <br />Division of Reclamation, Mining, and Safety ("DRMS"), all sand and gravel mining operators <br />must comply with the requirements of the Colorado Reclamation Act and the Mineral Rules <br />and Regulations for the protection of water resources. The April 30, 2010 letter from DRMS