2017 #COleg: Governor signs two water bills, including @CWCB_DNR construction fund

Colorado Capitol building

From The La Junta Tribune-Democrat (Bette McFarren) via the The Ag Journal:

The Lower Arkansas Valley Water Conservancy was honored to host Gov. John Hickenlooper’s signing of HB17-1248 on Wednesday after the regular meeting of the board of directors. The bill concerns the funding of Colorado water conservation board projects, and in connect with this undertaking, making appropriations. Hickenlooper said there is $25 million of support attached to the bill, making projects of LAVWCD and other water projects possible. He also alluded to HB17-1233, signed in Denver the same day, which allows farmers and ranchers practicing conservancy not to lose their water rights.

Hickenlooper was very complimentary to LAVWCD Manager Jay Winner, whose novel ideas have helped to keep the water on the land in southern Colorado. He said he wished he had a dozen Jay Winners to preserve the water for he state. Winners and John Stulp will be very happy, he said, putting their ideas into practice, made easier with these acts. One look at how Crowley County is struggling, he said, is sufficient to know southeastern Colorado cannot survive with dryland farming.

Also present at the signing was State Senator Larry Crowder, whom Hickenlooper commended for always voting for what he considers right, despite party lines. Hickenlooper also expressed his admiration for Lt. Gov. Donna Lynne, who has done a lot for the organization of the administration, drawing on her experience in the private domain in a much higher-paying position.

He is proud of the Colorado Water Plan and looks forward to its implementation. Thirty thousand individuals contributed to the formation of the plan. Although it does not yet have full funding, water rights of individuals are protected and the plan will keep the water on the land.

Senator Crowder said he represents 15 counties with average income at or below poverty level and he intends to do everything he can to promote economic opportunities for the area. He will work with people of differing viewpoints to make this possible. Hospitals are stable financially in the Denver area, he said, but not in rural Colorado, and everything possible must be done to maintain them.

@COWaterPlan Implementation Update

Photo by Havey Productions via TheDenverChannel.com

Click here to read the update. Here’s an excerpt:

Where now with Alternative Transfer Methods in CO?

This special report, released by the Colorado Water Institute, summarizes the discussions, conclusions, and recommendations from three meetings held in the fall of 2016 to address Colorado’s Water Plan’s measurable objective to provide at least 50,000 acre-feet of agricultural water to municipal water providers through voluntary, compensated Alternative Transfer Methods (ATMs) by 2030. These meetings convened water stakeholders from across the state, representing the interests of diverse sectors of the water community – agricultural, urban, and environmental. The report is intended to provide a foundation on which further progress toward meeting Colorado’s Water Plan’s ATM goal can be built. The report was co-authored by Anne Castle, MaryLou Smith, John Stulp, Brad Udall, and Reagan Waskom and is available on Colorado’s Water Plan website under Implementation.

#Colorado Springs: Arkansas River Basin Water Forum, April 26-27

Here’s the release from the Arkansas River Basin Water Forum (Jean Van-Peldt):

Denver Water lawyer to share message of cooperation

Water agreements are always tricky, a matter of give and take.

Most importantly, they require cooperation.

That’s the message Patricia Wells, general counsel for Denver Water, will bring to the Arkansas River Basin Water Forum when she kicks off the second day of the forum on April 27 at Hotel Elegante, 2886 S. Circle Drive, Colorado Springs. The two-day forum will feature panels and tours to discuss water issues of concern to the Arkansas River basin, and El Paso County in particular.

“We’ll be talking about examples of how, when you’re dealing with the supply gap, you need to deal with others,” said Wells, who is also a member of the Colorado Water Conservation Board. “Multiple parties can accomplish more.”

Wells has represented Denver Water since 1991, coming on board just after the EPA veto of Two Forks. It changed how the state’s largest water provider dealt with the growth of its system, as well as the way it treated its neighbors. Wells came superbly prepared for the job, with her background as Denver City Attorney and as a staff attorney for the Environmental Defense Fund.

“The Two Forks veto came as a result of the environmental laws in the 1970s and ‘80s and was a paradigm shift,” Wells said. “Most large water organizations have gone through a metamorphosis in the last 30 years.”

In the case of Denver Water, that has meant two of the most far-reaching agreements in the history of Colorado Water, both occurring during Wells’ tenure at the legal helm. They were very different types of negotiations.

The first was the Colorado River Cooperative Agreement, which brought together 40 parties, primarily on the Western Slope, which had fought for decades over Denver’s appropriation of Colorado River water. Denver sought the support, or at least lack of opposition, from the communities in order to enlarge Gross Reservoir, a key supply for Denver Water located in Boulder County.

“We did all the right things,” Wells said. “But we’re still in the 13th year of permitting on Gross Reservoir. If we can’t get Gross Reservoir done then water projects can’t be done in Colorado.”

The second was the WISE (Water Infrastructure and Supply Efficiency), which looked at how Denver, Aurora and water providers in the South Metro Water Supply Authority could pool resources.

They were far different negotiations, but the common thread was the need to work together for common interests and to overcome operational hurdles.

“The state Water Plan talks about CRCA and WISE as how projects should be developed,” Wells said. “But I don’t think there’s a single way to do things.”

The Upper Arkansas River Voluntary Flow Management Program, which will be discussed in one of the workshops at the forum, is an example of multiple parties working together in the Arkansas River basin. That program has been in effect since 1991.

“These agreements take a lot of time to put together and a long time to get organized,” Wells said. “It’s about how you work with other people and why you work with other people.”

Registrations and information about this year’s forum are available at http://www.ARBWF.org.

Arkansas River Basin — Graphic via the Colorado Geological Survey

The next @CWCB_DNR Water Availability Task Force meeting, April 18

Stagecoach Dam and Reservoir via the Applegate Group

From email from the Colorado Water Conservation Board (Ben Wade):

The next Water Availability Task Force meeting will be on Tuesday, April 18, 2017 from 1:00p-3:00pm at the Colorado Parks & Wildlife Headquarters, 6060 Broadway, Denver in the Red Fox Room.

An agenda will be posted at the CWCB website. In the event you are unable to attend the meeting in person, please email Ben Wade at ben.wade@state.co.us for call in & web conference information.

The latest @CWCB_DNR “Confluence” newsletter is hot off the presses

Click here to read the newsletter. Here’s an excerpt:

Platte River Recovery Implementation Program (PRRIP)

PRRIP is working to recover four threatened and endangered species (the whooping crane, interior least tern, piping plover and pallid sturgeon) in Nebraska, which in turn, allows water use and development to continue on the Platte River by addressing ESA compliance. The States of Colorado, Wyoming, and Nebraska, federal agencies, and several water, power and environmental interests, all participate in PRRIP. Learn more.

Durango: “Solving the Water Funding Puzzle” conference recap

Animas River through Durango August 9, 2015, after the Gold King Mine spill. Photo credit Grace Hood

From The Cortez Journal (Jim Mimiaga):

The Southwestern Water Conservation District hosted a conference titled “Solving the Water Funding Puzzle” at the DoubleTree Hotel in Durango to confront the budget crisis.

Colorado’s overriding challenge lies in how water management is funded, said Bill Levine, budget director for the state Department of Natural Resources.

Much of the state’s revenue stream for water-supply management is tied to federal energy, including severance taxes from the oil and gas industry, which exposes Colorado to the ebb and flow of the volatile oil and gas industry.

“When energy values drop, so does the revenue stream, so it is by nature volatile,” Levine said. “Revenue that is not tied to the energy industry is needed.”

Because of a weak energy market and a costly court ruling, the state’s revenues from severance taxes dropped from $271 million in fiscal year 2015 to $67 million in fiscal year 2016.

And in 2016, the state lost a lawsuit brought by British Petroleum over severance taxes. The state is refunding energy companies – $113 million so far – after the Colorado Supreme Court ruled that the companies qualify for a deduction the Department of Revenue had been denying them.

State and local agencies have paid a price.

The drop in revenues from federal minerals caused program budgets for the Colorado Water Conservation Board to drop from $14 million in 2015 to $8 million in 2016.

The cuts wiped out funding for boat inspection programs needed to stop invasive quagga and zebra mussels, which has limited boating at McPhee Reservoir and Totten Lake in Montezuma County.

Grant programs of the Department of Local Affairs also were cut, because they too depend on severance tax revenues.

Severance tax revenues have funded the Southwest Basin Roundtable grant program that supports water projects in southwest Colorado. Funding will suffer, and there will be less grant money, said roundtable chair Mike Preston.

In La Plata County, the basin fund helped to finance an inlet from Lake Nighthorse as part of a plan to provide municipal water for Fort Lewis Mesa, which includes the communities of Breen and Kline.

It’s been tapped to support a project improving water supply at Lake Durango, which serves Durango West communities. And the grants have supported an Animas River community forum, which is establishing emergency response protocols to protect water users in the event of a toxic spill such as the 2015 Gold King Mine disaster.

Finding funding solutions
Several potential sources of revenue for water-related infrastructure and programs were presented at the packed conference.

Emily Brumit, of the Colorado Water Congress, gave an update on legislative proposals and a ballot initiative that would support water-related budgets, including the struggling boat-inspection programs.

For example, Senate Bill 259 proposes to replace lost severance tax revenues with $10 million from the general fund to support forest restoration, species conservation and boat inspection programs. House Bill 1321, introduced this week, would create a revenue stream through a sticker fee to fund boat inspection programs.

And Initiative 20 focuses on oil and gas severance taxes. Its primary goal is to increase the severance tax rate, eliminate the severance tax credit that is based on property taxes, eliminate the stripper well exemption and require that a portion of severance tax revenue be paid for specific purposes…

Legislators are considering asking voters to approve a container tax on beverages to raise $100 million to $200 million per year for water-related needs. A vote could end-run the Taxpayers Bill of Rights, exempting it from TABOR revenue caps.

Other ideas presented at the conference included a new water fee paid by residential consumers, new water tap fees and new tourism fees…

Government specialist Christine Arbogast said the idea of private-public partnerships is popular for new money. But she does not believe they are a viable local solution locally.

“The expected rate of return of 5-8 percent from private investors is too much for the tax base of smaller communities,” she said.

La Plata County Commissioner Brad Blake urged the crowd to take a long-term vision on solving the budget crisis, like previous generations did.

“We have good water rights, but don’t have a way to move it around well,” he said. “The pioneers built dams, ditches and levees. Now we are tasked with looking ahead to provide water infrastructure in our area. We need more public involvement so we get all the help we need to overcome this monumental task.”

HB16-1228 Agriculture Protection Water Right Transfer Mechanism meeting recap

Flood irrigation — photo via the CSU Water Center

From The Sterling Journal-Advocate (Jeff Rice):

The Colorado Water Conservation Board and the Colorado Division of Water Resources is holding a series information and input meetings on the new Agricultural Water Protection Water Right law. A handful of local farmers and other interested parties attended the session on Wednesday at the Sterling Public Library.

The new law, which was sponsored by both Rep. Jon Becker, R-Fort Morgan, and Sen. Jerry Sonnenberg, R-Sterling, installs safeguards in the event that irrigators want to change part of their water right to a new beneficial use.

Deputy State Engineer Kevin Rein conducted the session, first walking through the process of writing rules and regulations to put the new law into effect, and then encouraging questions and discussion of the new rules.

Much of the discussion centered around whether the new program was even feasible for individual irrigators or would be a better fit for irrigation districts and ditch companies. It was generally agreed that, because of costs and the intricacies of water law, the larger the entity managing the lease, the better the plan would work. Individual irrigators could pledge a certain number of their water shares toward the ditch company’s AWPWR program and let the company worry about return flows, legal fees, and other details based on the total amount of water leased.

Don Ament, who represents Colorado in the South Platte Recovery Program, said he wants to follow up to see whether irrigators in the South Platte River Basin would, by virtue of being part of the SPRP, be automatically part of a conservation program, as required by the new law. He was told during the meeting that “Title 38” of Colorado Revised Statutes might prohibit that. It’s possible the wrong CRS was cited, since Title 38 has to do with tenant and landlord rights, while Title 37 is about water and irrigation. Ament said he would have to look into the law…

There also was significant discussion of just how much water a farmer could lease. The new law limits the amount of water an irrigator can lease out to half of his consumptive use right. That’s to help make sure most of the irrigation water still goes to irrigate crops.

Early in the discussion, Rein displayed a graphic that showed a water right that allowed 10 cubic feet per second of water flow through an irrigator’s head gate. If his historic return flow was four CFS, that meant his consumptive use is six CFS. He would then be allowed to lease half of the six CFS, or three CFS, under the AWPWR program. That would leave him a total of seven CFS of ditch flow to irrigate with. Because he would be running less water on his land, his return flow would naturally diminish. That’s why the law requires a substitute water supply plan; it would show how the irrigator would maintain his historic return flow of 4 CFS.

But that, it turns out, is the simple part. To complicate matters, irrigators don’t actually measure their water rights in a ditch company in cubic feet per second, but in shares. And farmers typically wouldn’t want to lease half of their total shares as part of an alternative transfer, even temporarily.

If, for instance, a farmer owns 100 shares in a ditch company, he may want to commit half of that, or 50 shares, to the AWPWR program. Because he would have only 50 shares in the program, he could lease only half of those 50 shares. But return flow still needs to be calculated, and return flow is measured in acre feet of water per year or in cubic feet per second. The irrigator (or his ditch company) would have to show how that return flow would be maintained.

To further complicate matters, shares don’t necessarily mean a specific amount of water. The amount of water a farmer’s 50 shares contains depends on how much water is available, who else is taking water with a higher, or older, priority, and other factors.

Rein said all of those factors would be up to the state engineer’s office to determine…

While discussion moved into the more esoteric realm of hypothetical legal matters, John Stulp, who serves as Gov. John Hickenlooper’s special policy advisor for water, reminded the group of the purpose of the new law.

“Keep in mind that the spirit of the law was to protect agriculture, and to give farmers the chance to participate in some of those revenue opportunities that are available through ATMs,” he said. “You need to be getting ready; it may not be your generation (that participates) but you need to do the groundwork for being flexible with your water right.”

Joe Frank, manager of the Lower South Platte Water Conservancy District, is known to be skeptical of ATMs because there is rarely any mention of how the water is to be stored for transfer and what kind of infrastructure will be needed to transfer it. He said after the meeting that, while he thinks flexibility in determining the end user on an ATM is a good thing, the new law still doesn’t address some of his concerns.

“There are still the inherent question marks about ATMs,” Frank said. “This just gives somebody who’s thinking about ATMs the ability to go to court once, change their water right, and be able to be flexible in who they lease the water to.

“But ATMs in general still have the issues that I brought up; you need a place to store it, you need a way to get it to the end user, you need a way of bringing multiple users together, so there are still those inherent issues.”

Frank said ATMs still represent a “drying up” of some farmland because the water is being diverted from irrigation to other consumptive uses.

“My alternative to ‘buy and dry’ is new supply,” he said. “We need to capture unappropriated water and store it, and maybe plug in ATMs. In my perfect world the best way to plug in an ATM is as part of a new project that takes advantage of available water supplies.”

Here’s the summary from the Colorado General Assembly website:

The act authorizes an owner of an absolute decreed irrigation water right in water division 1 or 2 that is used for agricultural purposes to seek a change-in-use decree in water court to obtain an agricultural water protection water right.

Under the changed water right available in water division 1 or 2, the water right owner may apply for a renewable one-year substitute water supply plan through which the water right owner may lease, loan, or trade up to 50% of the historical consumptive use portion of the water subject to the water right without designating the specific beneficial use for the leased, loaned, or traded water. The one-year substitute water supply plan authorizing the lease, loan, or trade of water may be renewed twice without reapplying if the terms and conditions of the plan remain unchanged. A new application is required every 3 years to maintain the substitute water supply plan.

Pursuant to rules developed by the state engineer and reviewed by the water judge for water division 1, the state engineer may approve a one-year renewable substitute water supply plan authorizing the lease, loan, or trade of water subject to an agricultural water protection water right in water division 1 or 2 if the following conditions are met:

  • The remaining portion of the water subject to the water right must continue to be used for agricultural purposes;
  • The water right must be protected by the owner’s participation in an agricultural water protection water program, for which the Colorado water conservation board will establish minimum criteria and guidelines;
  • The owner shall not lease, loan, or trade water subject to the water right outside of the water division with jurisdiction over the location of historical consumptive use; and
  • The transferable portion of the water subject to the water right must be delivered to a point of diversion that is subject to an existing water court decree.