CARLSON, HMOND 8c PADDOOK, L.L.G. ATTORNEYS AT LAW 1900 GRANT STREET, sum?z 1200 JOHN UNDEM CARLSON MARY MEAD HAMMOND DENVER, COLORADO 80203 (19404992) WILLIAM A. PADDOCK 2 14435 PM kiit?o TELEPHONE (303) sen?9000 DATE FILED septem com TELECOPIER (303) ass?9025 FILING ID: 2358134 '55 MASON H. BROWN CASE NUMBER: 3091 335$v3vi?63? 'chp'laW-Com mhammond @chp-lawcom September 12, 2014 Via ICCES and US. Mail ChristOpher L. Thorne, Esq. Holland Hart, LLP 555 17th Street, Suite 3200 Denver, CO 80202 Mark E. Hamilton, Esq. Holland Hart, LLP 600 East Main Street, Suite 104 Aspen, CO 81611 Re: Case No. 13CW3109: City of Glenwood Springs RICD Dear Chris and Mark: This letter provides the initial comments of the Homestake Steering Committee, and Colorado Springs Utilities regarding Case No. 13CW3109, and the proposed decree and engineering materials dated May 30, 2014, that you have submitted for this case. In addition, we have had an opportunity to review Aurora?s comments, and endorse them as well. 1. The various documents submitted indicated that the basis of the claimed RICD is use of 50% of the total average historical volume of water in the Colorado River at Glenwood Springs over the period April 1St through September 30m. It appears that the courses, claimed amounts, and time frames, have been designed to control the desired volume of water. We believe that this is an approach that may have resulted in a wasteful and speculative claim in contravention of Colorado law applicable to RICDs. A. As you know, Colorado law precludes wasteful uses and apprOpriations of water. We believe this fundamental tenet of water law is effectuated both directly and also through a variety of more indirect means, such as the ?First Step? doctrine; the ?Can and Will? doctrine; and the Antinpeculation Doctrine, especially as it is applied to municipal. appropriators such as Glenwood Springs. As you know, the First Step Doctrine requires that an appropriation be for a beneficial use, which means use of the amount of water needed under reasonably efficient practices to accomplish the proposed use. Here, the proposed use or end of the appropriation is to allow a reasonable recreation experience. The Can and Will doctrine then requires that an appropriator demonstrate that the beneficial use, that is, the intended reasonable recreation experience, can and will be achieved. And the Anti-Speculation Doctrine requires a municipal CARLSON, HAMMOND 8c PADDOCK, L.L.G. Mark E. Hamilton, Esq. Christopher L. Thorne, Esq. September 12, 2014 Page 2 appropriath to establish and demonstrate non~speculative intent to appropriate a specific volume, tied to the amount actually required, after taking account of appropriate conservation measures, to meet the demonstrated need of the municipality. We believe that Glenwood Springs is required to demonstrate compliance with all these doctrines and ?tests? of Colorado law. B. Further, we believe that these fundamental provisions of Colorado water law are specifically incorporated into the RICD statutes which must, in any event, be interpreted and applied in the light of these principles. Thus, C.R.S. defines an RICD to be the minimum. amount of stream flow for a reasonable recreation experience in and on the water from April until Labor Day unless the applicant can demonstrate that there will be demand for the reasonable recreation experience on additional days. And C.R.S. directs the water court to determine whether the intended recreation experience is reasonable, and the claimed amount of flow is appropriate. In making such determinations the court is to consider all factors that bear on the reasonableness of the claim, including the ?ow needed to accomplish the claimed recreational use, benefits to the community, the intent of the appropriator, stream size and characteristics, and total stream flow available at the control structures during the period or any subperiods for which the application is made. We think these statutory provisions refer to and incorporate the doctrines described above: references in to minimum stream flows, and demonstrating a demand for recreation outside the April through August season in an RICD and in ?37?92~ 105(13)(b) to the flow needed for recreation incorporate the Anti-Waste, First Step, and AntinSpeculation doctrines; likewise, references to community benefits, and the intent of the appropriator, invoke the municipal Anti-Speculation doctrine, and consideration of total stream flow available gives a nod to both the Can and Will and Anti- Speculation doctrines. 2. In light of the above, we believe that to establish its RICD appropriation Glenwood Springs must (1) establish that the recreation experience intended is reasonable; and (2) that the amounts claimed are ?appropriate.? With regard to the recreational experience, we have not seen evidence to substantiate that there is a demand for the range of water-based recreational experiences for which the RICD ?courses? have purportedly been designed. Specifically, we see nothing substantiating that there is any demand for water based recreational experiences beyond those that are already available in view of the current stream regimen, including the Shoshone and Cameo calls. Similarly, we have seen nothing to substantiate that there is a specific demand for the type of recreation experience claimed; and we have seen nothing to substantiate that there is a demand for a recreational experience (that demands more water than is already available) after Labor Day as required by the statute. With regard to the appropriateness of the amounts claimed, we believe that it is necessary to prove that the RICD claim is in fact tailored to substantiated demand for specific recreational CARLSON, HAMMOND 8c PADDOCK, L.L.G. Mark E. Hamilton, Esq. Christopher L. Thorne, Esq. September 12, 2014 Page 3 experiences that require the specific courses you have designed, over the periods when those flows are claimed. We don?t think that Glenwood Springs has substantiated who the actual users of the claimed RICD will be, when they will actually be boating and ?using? the claimed flows, what type of craft or boating experience will actually benefit the community, and based on all of that, what water is actually needed in the relevant time frames for the relevant experience and whether or not that water needs to be appropriated to make it available. In addition, to establish that the amounts claimed are apprOpriate, it is necessary to demonstrate that the RICD will in fact appropriate and use the minimum flow needed. 3. Our clients are also concerned about the implications of the RICD on Compact compliance and/or curtailment. In that regard, we believe that decretal language similar to that included in other Colorado River basin (such as that agreed to for the recent Grant County RICD, 10CW298, set forth below) should be included. The RICD Water Rights decreed herein are not intended to deprive the people of the State of Colorado of the beneficial use of those waters available pursuant to interstate compact. The County agrees that the RICD Water Rights will be administered by the State Engineer in accordance with rules duly promulgated by the State Engineer in accordance with C.R.S. 37?80?104 and 37?92?501 related to the curtailment of Colorado River basin water uses within Colorado in order to comply with the Colorado River Compact of 1922 and the Upper Colorado River Basin Compact of 1948, including any such rules intended to avoid, delay, or limit the severity of such a compact curtailment. If no such compact curtailment rules have been promulgated, the County will not place a call for the RICD Water Rights during any specific period of time identified by the Upper Colorado River Commission in a finding issued pursuant to Article of the Upper Colorado River Basin Compact of 1948 for curtailment of Colorado River basin water uses within Colorado, which the State of Colorado implements in a manner that curtails water diversions within Water Division 5, but shall otherwise be administered in accordance with this decree and Colorado law. 4. Further, our clients would also like to explore incorporating a future develOpment ?carve? out? into the decree, effectuated in a manner similar to in the Ground County and other cases. Again, I have set forth the language from the Grand County case below: In addition to the no-call provisions in paragraphs and Grand County reserves the right not to call the RICD Water Rights, within the sole discretion of Grand County, against future water rights up to the first CARLSON, HAMMOND 8c PADDOOK, LLC. Mark E. Hamilton, Esq. Christopher L. Thorne, Esq. September 12, 2014 Page 4 3,000 acre?feet of depletions per year, applied to all water users in the order of their priority. The provision in the preceding sentence shall be implemented as follows. On or before January 30Lh of each year, Grande Coutny will provide written notice to the Division Engineer stating whether it will exercise its discretion as described in the first sentence of this paragraph, and identifying the water rights that have been applied for or decreed in the previous calendar year (and cumulatively for all previous years) that qualify under this paragraph. The notice shall be substantially in the form of Exhibit to the decree and shall identify the water rights by decree number, name, administration number, appropriation date, and year of priority of (1) the most junior right against which Grand County will not place a call, and (2) all other upstream water rights junior to the RICD Water Rights but senior to the junior~most water right identified in the written notice. Upon receipt of the written notice, the Division Engineer shall administer the RICD Water Rights as junior in priority to all water rights identified in the Exhibit form for the next 12 month period. 5. Our review, including engineering review, of the case, is continuing. Our engineering review to date indicates that estimated annual volume of flow over the claimed period (1.136 MAF) overstates the average annual flow so that the total volume of water claimed likely actually exceeds 50% of the total average historical volume of water for the stream segment over the April through September period. Accordingly, we believe that the provisions of must be incorporated into the decree. These comments are, as indicated, preliminary, and we reserve the right to change, add to, or modify our comments as the case develops. In any event, we look forward to discussing Glenwood?s claims further. Yours very truly, d, mind/W Mary Mead Hammond and Michael Gustafson (for Colorado Springs Utilities) CARLSON, HAMMOND 8c PADDOOK, LLG. Mark E. Hamilton, Esq. Christopher L. Theme, Esq. September 12, 2014 Page 5 Enclosures Copy w/enc.: Homestake Steering Committee John Dingess Michael Gustafson Kevin Lusk Pat Wells Counsel of Record