I_WRRC_2018A 08/23/2018 02:15:33 PM Committee Summary

Chris Treese, Colorado River Water Conservation District, introduced himself to the committee.  He discussed land and water transfers in the state and the impact of large investor groups purchasing land and the associated water rights.  Mr. Treese stated that although these companies advertise an interest in maintaining the original use of the land they seek to purchase, there is a worry among the community that the purchase of these lands could cause a dry out of agricultural lands.  Mr. Treese responded to questions from the committee regarding the impacts on the agricultural community caused by land transfer.  He also discussed the bylaws of water users associations.

David Robbins, Hill and Robbins, P.C., introduced himself to the committee and provided a general statewide background on the transfer of land that has other natural resources tied to it.  Mr. Robbins responded to questions from the committee, and discussion ensued.

Mr. Treese responded to committee comments and questions.  He discussed the ability of agricultural users to put land and the associated resources into land trusts.  Mr. Robbins also responded to questions.

Rebecca Mitchell, Executive Director, Colorado Water Conservation Board (CWCB), introduced herself to the committee and provided an overview of the presentation regarding the Colorado River and compliance with interstate compacts.

Brent Newman, Federal Interstate Section Chief, CWCB, introduced himself to the committee and discussed interstate compact compliance.

Ms. Mitchell discussed compact administration in two scenarios. In a reactive situation, there would be imposed involutary curtailment and increased risk of federalization of water management in the Upper Basin. In a proactive situation, there would be voluntary actions in place to conserve water.  Ms. Mitchell and Mr. Newman responded to questions from the committee regarding the Colorado River Compact.

Ms. Mitchell further discussed administration of the Colorado River, specifically with an emphasis on drought continency planning and responses. She described the groups and stakeholders involved in managing the river, which include the Governor's Office, CWCB, and the Colorado River Compact Commission, among others.

Ms. Mitchell stated that drought contingency planning (DCP) is an ongoing coordinated effort of the seven basin states.  Mr. Newman discussed DCP from states in the Lower Basin, which include implementing voluntary reductions in water use beyond those required.  He stated that some states have also engaged in sustainability planning, recognizing the need for longer term mechanisms for addressing structural deficits in the lower basin.  Mr. Newman responded to questions from the committee regarding possible curtailment in the Lower Basin and how the compact can be administered while still complying with the Doctrine of Prior Appropriation. 

Mr. Newman discussed the DCP from the states in the Upper Basin.  The main goals of the Upper Basin states are to reduce or eliminate probability of Lake Powell reaching minimum power pool elevation and to ensure the continued operation of Lake Mead.

Ms. Mitchell discussed efforts within Colorado to maintain compact compliance, such as the compact compliance study, Water Bank Work Group, system conservation projects, risk studies, and measures outlined in the Colorado Water Plan. She also discussed CWCB demand management outreach, wherein the CWCB identified and evaluated possible options for avoiding involuntary compact curtailment consistent with direction from the Colorado Water Plan. Ms. Mitchell stated that CWCB will not take a position regarding whether and how to develop a demand management program, rather CWCB's goal is to stay informed and assess concerns and preserve potential options and opportunities.

Mr. Newman and Ms. Mitchell responded to questions from the committee.

Chris Treese, Colorado River Conservancy District and Colorado Water Congress, and Dianna Orf, Colorado Water Congress, provided a brief background on funding for water projects. There are two major sources for water programs and projects:  severance tax revenue and Federal Mineral Lease revenue (FML).  Severance tax funds are distributed to the Department of Natural Resources (DNR) and the Department of Local Affairs.  DNR uses the money to fund the perpetual base fund and the operational fund, which funds Tier I and Tier II programs. Tier I programs are mainly regulatory and statutory programs with guaranteed funding.  Tier II programs do not have a guaranteed source of funding.  Ms. Orf discussed the volatility of severance tax and FML funds.

Mr. Treese discussed the history of severance tax funding and the reserve accounts associated with severance tax funding.

Mr. Treese discussed possible solutions to program funding challenges.   These suggestions include moving non-DNR based programs off of severance tax entirely;  creating statutory or constitutional protections for severance tax funds to protect projects they currently fund; removing severance tax from TABOR restrictions and calculations; and backfilling severance tax funding with General Fund moneys.

Mr. Treese and Ms. Orf responded to questions from the committee regarding possible new funding sources, and removing TABOR restrictions and calculations from severance tax funds.  Mr. Treese distributed a copy of the panel's testimony and their presentation [Attachments A and B].

Mike Lester, Colorado State Forester, spoke to the committee about severance tax funding.

Senator Crowder discussed the funding for the Arkansas Valley Conduit.  He distributed a letter of support to the committee [Attachment C].  He requested that the committee review the letter and formally send the letter to encourage the funding of the project.