WEST DIVIDE WATER CONSERVANCY DISTRICT109 West Fourth StreetRifle, Colorado 81650

MINUTES OF BOARD OF DIRECTORS MEETINGJanuary 21, 2010

ATTENDANCE ROSTER

Directors & Staff PresentSamuel B. Potter, PresidentKelly Couey, Vice PresidentBruce E. Wampler, TreasurerRobert J. Zanella, SecretaryDan R. Harrison, DirectorJanet Maddock, Office ManagerKerry D. Sundeen, HydrologistTyler Benton, GRCCEdward B. Olszewski, AttorneyDirectors and Staff AbsentLyndie Pearson, CPAMaria Pastore, Hydrologist

GuestsWilliam West, Water CommissionerEddie Rubin, Water Commissioner

CALL TO ORDERThe regular Board of Directors meeting was called to order at the District office at9:00 a.m. by President Samuel B. Potter.

MINUTESRobert J. Zanella moved the minutes of the December 10, 2009, meeting be approved asreceived; Bruce E. Wampler seconded; motion carried.

FINANCE REPORTBills to be Paid: Robert J. Zanella moved the attached list of bills be paid; Bruce E.Wampler seconded; motion carried.

Financial Statements: Bruce E. Wampler moved the December 2009, FinancialStatements as prepared by Barnes, Pearson & Associates, LLC be accepted; Robert J.Zanella seconded; motion carried.

NEW OFFICE UPDATEThe President reported that the remodeling was mostly completed and furniture is on itsway. The current landlord has been given notice and the move will take place the lastcouple days of the month.

1

Robert J. Zanella moved execution of the new office lease at 818 Taughenbaugh Blvd,Suite 101, Rifle, Colorado; Bruce E. Wampler seconded. Roll call. Samuel B. Potter--yes;Kelly Couey-yes; Bruce E. Wampler-yes; Robert J. Zanella-yes; Dan R. Harrison-yes.The motion carried.

WATER CONTRACTS

Metcalf Property Management, LLC assignment from Pioneer Glen Homeowner's

Association: Robert J. Zanella moved acceptance of this assignment; seconded byBruce E. Wampler; motion carried.

RNI Trucking (formerly Dalbo Inc.): Robert J. Zanella moved approval of thisamendment from 40 af to 18 af, Direct Hauling; seconded by Bruce E. Wampler; motioncarried.

Old West Oil Field Services, LLC: Robert J. Zanella moved approval ofthis amendmentfrom 20 af to 3 af, Direct Hauling, seconded by Bruce E. Wampler; motion carried.

Roaring Fork Water and Sanitation District: Robert J. Zanella moved approval of thisamendment from 15.5 af to 8.5 af; Domestic, Colorado River Area B Contract; secondedby Bruce E. Wampler; motion carried.

ROUNDTABLE REPORTNo report. Roundtable did not meet.

WATER RESOURCES'S REPORT

Water Commissioners will be allowed to continue releases from Alsbury.Brian Romig is the new Fourmile Commissioner.

HYDROLOGISTS' REPORT

Kerry Sundeen reported he had a long conversation with a representative of EnCanaregarding EnCana' s water contract for diversions south of the Colorado river. EnCana istaking the position that it only has to pay for water when there is a call on the river. EnCanahas been arguing about paying for the 2010 contract.

Discussed attached memorandum regarding the Crystal River Contracts.

Samuel B. Potter attended the Water Task Force meeting in Maria Pastore's stead. Hereported a thorough review of the database.

ATTORNEY'S REPORT

Discussed the investment policy sent by the auditor, Pete Blair. It is a direct quote of thestatute. We are required by law to act under the statute so don' t see the point. Whorequires us to have a policy? Janet will follow up with Pete.

2

Discussed the easement agreement between West Divide and the Prehm Ranch.Directors not interested in paying a large amount to secure the easement. More interestedin around $20,000 to payoff the outstanding attorney fees owed Prehm Ranch and tie upaccess to the pipeline until build out, then discuss additional payment for easement.

Zilm Metering: Directed Kerry Sundeen to draft the specifics of what he needs. Counselwill follow up with Zilm' s attorney. If Zilm doesn't comply, the contract will be cancelledand the Division of Water Resources notified.

Need to begin working on diligence activities now. Filing must be done by May 2011.Counsel fears that most of West Divide's conditional rights could be lost. Counselrecommends forming a work group with the River District to meet at least quarterly toundertake diligence planning and outline activities that can be completed prior to the filingdate. Counsel will contact the River District to set up a workshop to follow the next Boardmeeting on February 18.

ADJOURNMeeting adjourned at 11:30 a.m.

3

West Divide Water Conservancy District-General FundBills to be PaidJanuary 21, 2010

~

Num

Name MemoAccountAmount- 3717Club 20 2010 membership dues5240 . Dues/Registration200.00

3718

Xcel Energy November & December 20095392 . Utilities110.00

3719

CNA Surety 2/7/10-2/7/11 Blanket Bond5600 . Ins.--Officers' Bond451.06

3720

Barnes, Pearson & Associates, LLC Review interest comparisons5150· Accounting125.003720

Barnes, Pearson & Associates, LLC 2010 Budget preparation5200 . Budget Preparation2,650.00

3721

Potter, Samuel B. Janet's Christmas certificates5230 . Directors' Expenses100.00

3722

Olszewski, Massih & Maurer, P.C. Report to Board5280 . Legal420.003722

Olszewski, Massih & Maurer, P.c. Prepare for/attend Brd Mtg5280 . Legal480.003722

Olszewski, Massih & Maurer, P.C. General5280 . Legal384.00

3723

Mountain Clear Water Company Inc.bottled water5100 . Office Supplies13.95

3724

Capital One, F.S.B. Postage5300 . Postage/Box RentJEtc.220.51

~3725 BookcliffProfessional Building, LLCFebruary rent5395 . Rent677.25

3725BookcliffProfessional Building, LLCDeposit5395 . Rent750.00

3726

Colo. Special Districts Property & Liab.(2010) Ins--Prop & Liability1550· Prepaid Expenses570.003726

Colo. Special Districts Property & Liab.(2010) Ins - E&O1550· Prepaid Expenses497.243726

Colo. Special Districts Property & Liab.(2010) Ins - Auto1550· Prepaid Expenses197.00

3727

Grand River Consulting Corp. Prepare /attend Brd Mtg. (2009)5260 . Hydrology775.00

3728

Maddock, Janet E $4328.44-459.19 Ins.=$3869.255221 . Salary3,869.253728

Maddock, Janet E 2227 . Simple IRA Payable-1,166.663728

Maddock, Janet E 2205-FICAIMED/FWT Payable-1,100.003728

Maddock, Janet E 2205-FICAIMED/FWT Payable-296.003728

Maddock, Janet E 2210-Colorado With. Payable-300.00

3729

Alpine Bank Payroll deductions2205-FICAIMED/FWT Payable1,692.00

3730

Edward Jones Investments Employer2227 . Simple IRA Payable116.073730

Edward Jones Investments Employee2227 . Simple IRA Payable1,166.66

,1

Wampler, Bruce E. July, Aug., Sept. Replace Ck5020· Director Fees300.003131

Wampler, Bruce E. July, Aug., Sept. Replace Ck5230 . Directors' Expenses60.60

3732

Tammy S. Keenan January5396 . Janitorial60.00

West Divide Water Conservancy District-General FundBills to be Paid

January 21, 2010

')733 CEBT Employee January5222 . Medical Ins-Employee438.653733

CEBT Family January5223 . Medical Ins Dependent459.19

3734

Qwest Dec.5390· Telephone160.29

3735

Remington Square Dec. utilities5392 . Utilities90.26

3736

Skybeam December5393 .. Internet25.00

3737

Colorado Department of Revenue Colo payroll tax221O-Colorado With. Payable900.00

3738

Colorado State Treasurer 4th 1/4 Unemploy Tax (2009)5226 . Unemployment Tax23.22

3739

BookcliffProfessional Building, LLCFebruary rent (balance)5395 . Rent70.00

3740

Xcel Energy Balance of December5392 . Utilities

~ 114)0t ,

~' ~'

West Divide Water Conservancy District-General Stored WaterBills to be Paid

. January 21,2010

Num-1816

1817

1818

1819

1819

1819

1819

1820

Name-Garfield County Road and Bridge

Collins, Betty J.

DOLA Grant Restricted Funds

Olszewski, Massih & Maurer, P.C.

Olszewski, Massih & Maurer, P.C.

Olszewski, Massih & Maurer, P.C.

Olszewski, Massih & Maurer, P.C.

Colo Special Dists Property & Liab.

Memo-GarCo Rd & Brdge

deposited to GSW

Betty Collins deposited to GSW

Move incorrect GSW

deposit to DOLA checking acct

Contracts (2009)

02CW123 Umbrella Plan (2009)

Crystal River (2009)

Alsbury Diligence (2009)

Alsbury Liability Ins. (2009)

Account

1200 . Accounts Receivable

1200 . Accounts Receivable

4655 . Transfer pymts btwn funds

7045 . Legal

7045 . Legal

7082 . Grant Adm-Crystal River R.

7045, Legal

7040 . Ins-Alsbury Liability

Amount

70Q.00

300.00

21,380.47

60.00

660.00

24.00

144.00

2,628.99

1821

1821~1

"-lg21

1822

Grand River Consulting Corp.

Grand River Consulting Corp.

Grand River Consulting Corp.

Grand River Consulting Corp.General Fund

Alsbury (2009)

End of year acctg/adm (2009)

Water Task Force (2009)

Meetings (2009)Pitkin Tax

7030 . Hydrology

7030 . Hydrology7078 . DOLA - In-Kind Cont

7082 . Grant Adm-Crystal Res.

4655 -Transfer btwn fun~s A"../ 1\\"'- 6,096.71

West Divide Water Conservancy District-FoUITI1i1eCreekBills to be Paid

January 21, 2010

Num Name- -1548

void

1549

void

1550

void

1551

void

1552

void

1553

void Memo Account Amount

1554 Olszewski, Massih & Maurer, P.C.General (2009)8050 . Legal--General1,818.001554

Olszewski, Massih & Maurer, P.C.Zilm (2009)8054 . Legal Litigation216.00

1555

Grand River Consulting Corp. Acctg. & Adm.(2009)8030 . Hydrology285.00

1556

Zilm, William M. and Charlotte B.2009 af lease8090· Water Lease--Price, Ber., Zilm4,716.451556

Zilm, William M. and Charlotte B.minimum fee for 20108090· Water Lease-Price, Ber., Zilm768.64

1557

Elk Meadows Properties, LLC 2010 Minimum fee8090 . Water Lease--Price, Ber., Zilm768.64

1557Elk Meadows Properties, LLC 2009 af lease8090 . Water Lease-Price, Ber., Zilm4,716.45

1558

Price, David D. Min pymt 2010 Hughes Res.

8090· Wat••.L=o-Prire. B"'~

768.64( \

, "\'----../

,

West Divide Water Conservancy District--Silt InterconnectBills to be Paid

January 21,2010

Num Name- ----------------

143 Olszewski, Massih & Maurer. P.C.

143 Olszewski, Massih & Maurer. P.C.

Memo

Service Area (2009)

Advanced costs (2009)

7801 . Legal

7801 . Legal

Account Amount

528.00

13.50

144 Silt Water Conservancy District Proceeds from 2009 Contracts

7100. SWCDOp,,,,'ingE%

DATE:

TO:

FROM:

SUBJECT:

MEMORANDUM

January 21, 2010

West Divide Water Conservancy District

Kerry SundeenMaria Pastore

Status of Crystal River Contracts

.. -....- ..- ..

--~ --')GrandRiver~Consulting Corporation

In response to a recent request from Board Member Bob Zanella, we have reviewed the District's water

allotment contracts within the Crystal River watershed. This information is summarized below.

I. How Many Contracts Currently Exist?

The District currently has 14 contracts to supply water within the Crystal River watershed (Tables 1 and

2). Of this total, 10 contracts are associated with augmentation plans of the District, and do not currently

have a reliable supply of augmentation water. The remaining four contracts are either irrigation contracts

or contractor aug plans. The District has no obligation to provide augmentation water within the Crystal

River watershed for these four contracts. The location of the Crystal River contracts is illustrated in the

attached figure.

Total contracted amount associated with the West Divide augmentation program is 19.6 acre feet. In

total, we estimate that about 15 acre feet of augmentation water in the Crystal River drainage is requiredto provide a reliable legal supply of water for the contractees served by West Divide's augmentation

plans.

2. Proiection of Future (20 yr) Water Demands

It is difficult to project future water demands within the Crystal River drainage. Actual demands will

vary in response to many conditions; perhaps most importantly, economic conditions and Pitkin County

land use regulations. Given the Pitkin County regulations, we do not anticipate a large amount of

residential growth within the watershed.

Current augmentation demands for West Divide are about 15 acre feet, and we suspect that the demand of

the Basalt Water Conservancy District is similar. Accordingly, about 30 acre feet of augmentation

demand currently is known to exist. The existing demand is probably somewhat higher than this amount,as the two Districts would likely have more contractees if they had reliable augmentation water available.

718 Cooper Avenue Glenwood Springs, CO 81601 (970) 945-2237 Fax (970) 945-2977

West Divide Water Conservancy DistrictJanuary 21, 2010Page 2

The future demand for residential augmentation water will likely originate from the development of small

rural lots. With the development of an additional 50 residential units in the watershed, the demand foraugmentation water could double to about 60 acre feet.

The demands for irrigation water and for instream flow water are much higher. The water demand for

each of these two uses is substantially greater than 1000 acre feet per year.

3. Can Crystal River Storage be Used in Other Areas?

Yes it could be. However, this supply would provide the same function as Ruedi Reservoir water. Ruedi

water is much cheaper to acquire. The development of storage in the Crystal River watershed wouldprobably not change the amount of water that the District leases from Ruedi Reservoir.

4. What Water Rights Does the District Control in the Crystal River?

The following rights have been decreed for use by the District:

Avalanche Canal and Siphon 830 cfsPlacita Reservoir 62,009 acre feet

Osgood Reservoir 128,728 acre feet

Yank Creek Reservoir 13,695 acre feet

These rights are relatively junior and can be called out by senior irrigation rights. The West Divide rightsare senior to the State of Colorado's instream flow water rights.

KDSjkdj

Enclosures

( ( (

TABLE 1

Summary of WDWCD Contractees in the Crystal River Valley - West Divide Aug PlansContract Amt

Active

MaplD#

Contract#(AF)(V!N) LName CaseLocationComments

129920914CNS(a) 1VStratton 99CW320Crystal

141

931012K(a) 3.1VKennedv 99CW320Abv Carbondale

162

940725JJ(b) 1VDonnellv 99CW320Crystal

300

990114PS(b) 1NRussell 99CW320Crystal

302

990113BHW#A c 2YSabo 02CW281Abv Carbondale

303

990113BHW#B b 2VSterrett 02CW281Abv Carbondale

304

990113BHW#C c 2NBeuter 02CW281Abv Carbondale

317990614TR[c] 1VKelly 02CW281Abv Carbondale

595080529RS(al 3.3NRubino / Coal Creek Ranch SSP-CR

167a940919BD(a) 3.2VDorman 99CW320Crystal

167b940919BD(a) Dorman99CW320Crystal

167c940919BD(a) Dorman99CW320Crysta I

Total Contracted Amount =

19.6

TABLE 2

Summary of WDWCD Contractees in the Crystal River Valley - Contractor Aug Plans / Irrigation UseContract Amt

Active

MaplD#

Contract#(AFIIY!N) LName CaseLocationComments275

980113TC(a) 3.8YCarbondale Contractor Aug PlanAbv Carbondale

465030520PH(a I 3YHenke Contractor Aug PlanCrvstal

307a990220CRC(a) 10.62YCoryell Ranch Company, LLCContractor Aug PlanAbv CarbondaleTotal of 19 wells associated with contract amount.

307b

990220CRC(al Corvell Ranch Company, LLCContractor Aug PlanAbv CarbondaleOnly two wells are outside Area A, up Crystal River.463a

030227CMO(a) 60YOgllby Contractor Aug PlanCrysta I463b

030227CMO(a) OgilbvContractor Aug PlanCrvsta I

Total Contracted Amount =

77.42

1/21/2010

current contractees 011510