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4 <br />designation of a large portion of the designated basin that has the potential to shut <br />down up to 1,300 high capacity wells. This is a great achievement given the <br />potential for severe economic harm in the basin. <br /> <br />The parameters of the settlement are broad and incorporate most of the surface <br />water right users on the North Fork. Some of those water users were not part of the <br />case, however, in this manner a long-term solution to the ongoing dispute between <br />surface and ground water users in the area can better be served. <br /> <br />The case was initiated in 2005 when the Pioneer and Laird Ditch owners filed suit <br />with the Ground Water Commission, requesting ground water wells in the basin be <br />shut down in order to provide water to what they deem to be “senior” surface water <br />rights. The surface water right owners felt their rights were being injured by the <br />junior wells and therefore, the wells should be administered based on the “first in <br />time, first in right” priority system, rather than a modified system as allowed for under <br />the designation of the Northern High Plains ground water basin. <br /> <br />In general, the terms of the agreement call for a lease/buyout of the surface water <br />rights for $20 million including a lease in 2008 of these water rights for $500,000. <br />Funding is contingent on financing of approximately $5 million by the RRWCD for a <br />20-year lease and approval of up to $15 million bond issue by the voters this <br />November. The Yuma County Water Authority will be seeking approval of the bond. <br /> <br />I am very pleased with all of the hard work of the parties in the case, as well as the <br />willingness of the RRWCD and the Yuma County Water Authority to step up and <br />help. Without their support and creative thinking, we certainly were heading down a <br />litigation path. <br /> <br />Lastly, our staff remains very active addressing the issue of expanded acres but it <br />remains limited by availability of staff. Additional efforts have been put forth on this <br />issue in response to a request from the Arikaree Ground Water Management <br />District. We have identified approximately fifteen sites with expanded acres greater <br />than 10% allowed by permit within this district that we will inspected in addition to our <br />ongoing efforts in the other ground water management districts. <br /> <br />Water Division 2 <br /> <br />We are moving ahead with the adoption of the Surface Water Irrigation Consumption <br />Rules. I have appointed a 32 member advisory committee. They have made great <br />strides in proposing amendments to the draft rules and I hope that we can complete <br />this process by November and have a draft set of rules for the Arkansas River <br />Compact Administration to review at their December meeting. I will then file them <br />with the water court and they should then be effective in late 2009 or early 2010. <br /> <br />The lawsuit filed by the State of Kansas in 1985 appears to be approaching a <br />conclusion. Arthur Littleworth, the Special Master appointed to oversee the case by <br />the United States Supreme Court issued his Fifth and Final report to the United <br />States Supreme Court in January 2008. The Final Report includes a proposed <br />Judgment and Decree, which, he states, “is crafted with the firm intent to end the