8 - Recommendation to City Council regarding an agreement with the Town of Nederland for use of storage space in Barker ReservoirCITY OF BOULDER
WATER RESOURCES ~DVISORY B4ARD
AGEND~ ITEM
1!'IEETING DATE: December 17, 2007
t~GENDA TITLE: Recommendation to City Cauncil regarding an agreement with
the Toi~vn of Nederlancl for use of storage space in Barker Reservoir
PRESENTERiS: Ned ~~t~illiams, Director of Public VVorks for Utilities
Carol Ellinghouse, «~ater Resources Coordinator
EYECLTTI~~ E SLTNII~~7~RY:
The t~'ater Resources Advisory Board (WRAB} is asked to approve a motion
recommending to City Council the approval of an ordinance to implement a Water
Stoi•age Agreement between the City of Boulder and the Town of Nederland regarding
the town's use of storage space in Barker Reservoir. The city purchased the Boulder
Canyon Hydroelectric Project, including Barkei• Reser~~oir, from Xcel Energy in 2001.
The city had used Bai•ker Reservoir, located just east of Nederland, for storage of the
city's municipal water supplies since the 1950s under a series of lease agreements with
Zcel. The Town of Nederland had also entered into a storage agY•eement with Xcel. The
town's agreement was not binding on the city and ~-as not transferred to the city at the
time of the Barker system sale. The town has continued to use othei-~~vise ernpty Barker
Reservoir stoi•age space on an informal basis since the city's purchase.
Nederland operates its u~ater system based on a water court decree that requires all water
consumed by the to~~n to be replaced, or augmented, at times ~-hen more senior water
rights are entitled to the water. The town owns a water ribht which is part of this
augmentation plan that originally was used for in•igation. A condition within the water
court decree approving the change in use of this irrigation ~~~ater right ri~as that ~nunicipal
diversions under the right can only be made during the iri~igation season. However,
Nederland requires augmentation of its i~~ater use yrear-round, so a pai-t of the «~ater
available to the town must be stored during the irrigation season for later use.
The proposed intergovernmental agreement between the city and the town (Attachment
A) allows Nederland to use the same amount of storage space in Barker Reservoir that
i~vas available to it under its prior agreement with Xcel, which is about 4t~ acre-feet. The
agreement does not require the City of Boulder to provide any ~~vater to the town, but only
to allow use of reservoir storage space for storage of water owned by the town. In
practice, Nederland's water will most likely use storage space in Barker Reseivoir that
AGENDA ITE11~i # PAGE 1
would otherwise be empty at that time of year. Terms in the agreement assure that
Nederland's storage use will affect Boulder's municipal water operations and ater rights
yields, minimally, if at all.
Key Issue Identification: This agreement furthers intergovernmental cooperation with
neighboring communities, increases the benefits gained from existing facilities, and does
not jeopardize the city's municipal water supply.
STAFF RECOMMENDATION:
Staff recommends approval by the WRAB of a motion to recommend to City Council
approval of an ordinance to implement an Intergovernmental Agreement between the
City of Boulder and the Town of Nederland regarding Nederland's use of approximately
40 acre-feet of storage space in Barker Reservoir.
COMMUNITY SUSTAINABILITY ASSESSMENTS AND IMPACTS:
• Economic: Nederland requires use of reservoir storage space to operate the
augmentation plan that is essential to its ability to provide municipal water
supply. It would be very costly for the town to pursue another alternative to use
of the Barker Reservoir storage space it had used for decades. The terms of the
agreement are sufficiently strict that it should result in no additional cost to the
city or its water customers. The city gains a right of first refusal for purchase of
Nederland's Farmers Ditch share should the town ever choose to sell.
• Enviromnental: Nederland's continued use of storage space in Barker Reservoir
will negate the potential need for Nederland to construct reservoir storage space
on its own and prevent the associated environmental impacts.
• Social: This intergovernmental agreement will further a good relationship with the
Town of Nederland by restoring formal use of storage space previously available
to the town prior to the purchase of the Barker system by the City of Boulder from
Xcel Energy in 2001.
OTHER IMPACTS:
• Fiscal: No additional city expenditures are required.
• Staff time: City staff already tracks Nederland's water use under its augmentation
plan, so no additional staff time would be required.
ANALYSIS:
Nederland owns various water rights which are part of an augmentation plan that was
approved by the water court in 1980. Operation of Nederland's municipal water system
is dependent on this augmentation plan. The court decree states that water from a 5/8
share of the Farmers Ditch Company may be stored in Barker Reservoir up to an annual
maximum amount of 39.6 acre-feet. This water can only be diverted during the irrigation
season because it was derived from a water right originally decreed for agricultural use.
In order to make replacement water available to Boulder Creek under its augmentation
plan, Nederland requires reservoir storage space. At the time of the court decree,
AGENDA ITEM # PAGE 2
Nederland had an agreement with the Public Service Company of Colorado (now Xcel
Energy) to use storage space in Barker Reservoir. The city purchased Barker Reservoir
from Xcel in 2441, but Nederland's agreement with Xcel for use of Barker storage space
was not transferred to the city. Anew agreement between the city and the town is
required in order for Nederland to continue to have its water stored and released from
Barker Reservoir by the city.
Within the proposed agreement, the city allows Nederland to store, on an annual basis, up
to 39.6 acre feet of water in Barker Reservoir and to release the water during those times
when Nederland is making out-of-priority diversions under its augmentation plan.
Nederland's use of the city's reservoir storage is further limited because water that the
town may store can only be derived from the 5/8 share of Farmers Ditch Company that is
included in Nederland's augmentation plan. Water stored by Nederland in prior years
can be carried over into succeeding years, but at no time can the total amount of water
stored by Nederland in Barker Reservoir exceed 39.6 acre feet. The Water Storage
Agreement will terminate in 2426.
The city retains flexibility for operation of its municipal water system because it has full
rights to substitute and exchange for Nederland's stored water and the city may satisfy
the water delivery obligations of the agreement with any water available to the city. The
point of delivery of the stored water is solely at the discretion of the city so long as it
satisfies the requirements of the Division Engineer and Nederland's water decree. The
city has the right to make its own exchanges of water under city-owned water rights for
purposes of management of its water system before making water releases for Nederland.
Under Nederland's court decree, the town projected the amount ofwater that the town's
service area would consume through at least the year 2010. The decree requires
Nederland in 2410, or sooner, to return to water court for a review of its augmentation
plan. If any modifications are made to the decree that result in a need for additional water
to be stored for augmentation purposes, a new agreement a-~ith the city will lie required
for any additional storage.
Nederland agrees that it shall continue to own a minimum of 5/8 of a share of Farmers
Ditch Company. If Nederland sells all or part of the Farmers water, thereby decreasing
the amount of direct flow water available to Nederland, then the agreement may be
terminated by the city if it chooses. Within the agreement, Nederland grants the city a
right of first refusal of any Farmers water that it chooses to sell or lease during the term
of the agreement
City staff recommends approval of the Water Storage Agreement. City staff will present
the proposed agreement between the city and the town, along with WRAB's
recommendation, to the City Council for evaluation.
ATTACHMENTS:
Attachment A: Water Storage Agreement (City of Boulder/Town of Nederland)
AGENDA ITEM # PAGE 3
Attachment A
WATER STORAGE AGREEMENT
(City of Boulder/Town of Nederland)
This t~'ater Storage Agreement ("Agreement") made this day of , 200$, is by and
between the City of Boulder, a Colorado Municipal Corporation {the "City") and the Town of Nederland, a
Colorado Municipal Corporation ("Nederland").
RECITALS
A. The City owns the Barker Meadow Reservoir (the "Reservoir"), located in the N'/z, Section
18, Township 1 South, Range 72 West, 6t1i P.M., and the S '/z NE '/4 and the N'/z N'/z SE'/4, Section 13,
Township 1 South, Range 73 West, 6~` P.M., all in Boulder Bounty, Colorado; and
B. Nederland owns various water rights which are part of a Plan for Augmentation adjudicated in
Case No. W-$485-77 ("Plan for Augmentation"). As part of said Plan for Augmentation, Nederland agreed
to make available to the State Engineer's Office Division Engineer for Water Division No. 1(the "Division
Engineer") that amount of water which is expected to equal the consumptive use associated with the
projected needs of its service area through at least the year 2010. The decree in Case No. W8485-77 (the
"Decree") provides that water attributable to a 518 share of the Farmers Ditch Company ("Farmers")may
be stored in Barker Reservoir (the "Storable Water"). Annual diversions of the Storable Water are limited
to a maximum amount of 39.6 acre-feet.
C. In order to make replacement water available to the stream system pursuant to its Plan for
Augmentation, Nederland requires water storage. At the time of the adjudication of its Plan for
Augmentation, Nederland had an agreement with the Public Service Company of Colorado to use storage
space in Barker Reservoir for that purpose.
D. The City has purchased Barker Reservoir from the Public Service Company of Colorado and
this Agreement is required in order for Nederland to continue to have its Storable Water stored and released
from Barker Reservoir by the City.
AGREEMENT
NOW THEREFORE, inconsideration of the premises and of the mutual promises and covenants of the
parties hereto, it is agreed as follows:
1. Use of Reservoir Storage Space.
a. The City agrees to allow Nederland to store, on an annual basis, up to 39.6 acre feet of the Storable
tk'ater in the Reservoir and to release the Storable Water only during those times when Nederland is
making out of priority diversions of the other rights which are subject to the terms of the Plan of
Augmentation. The Storable Water shall be derived only from the 5/8 share of Farmers available to
Nederland under its Plan for Augmentation. Water stored by Nederland in prior years shall be allowed to
be carried over into succeeding years, but at no time shall the total amount of water stored by Nederland in
the Reservoir exceed 39.6 acre feet. Nederland shall comply with all terms and conditions of the Decree in
Case No. W8485-77.
b. The Decree requires Nederland u12010, or sooner, to submit a petition for review of the Plan for
Augmentation. Based on that petition, if any modifications are made to the Decree that result in a need for
additional sources of water to be stored for augmentation purposes, that additional storage water shall
require a new agreement with the City and the City makes no representations concerning the availability of
such additional storage at this time. Should any modifications of the Decree result in a requirement that
AGENDA ITEM # PAGE 4
Nederland shall store amounts less than the 39.6 acre-feet, then this agreement shall be modified to reflect
said decrease.
2. Releases.
a. As consideration for the right to annually store up to 39.6 acre feet of the Storable Water,
Nederland agrees that releases from the Reservoir of its augmentation water shall be made according to the
normal operational procedures of the City's water system in a manner which does not interfere with those
operations. The City will use its best efforts to satisfy this Agreement and Nederland's requirements under
the terms of its Plan for Augmentation, given the operational difficulties associated with the location and
diversity of the City's water system.
b. The City acknowledges the importance of the storage and release of water from Barker
Reservoir to Nederland's ability to provide water to its residents, and the City shall release water when
requested by Nederland, but only when it does not interfere with the City's operation of its water system
and when the administration of Nederland's Plan for Augmentation by the Division Engineer requires said
release. Any exchanges of water that the City engages in for the management of its water system shall be
satisfied prior to satisfying any request for water releases by Nederland.
c. The City shall have full rights to substitute and exchange for the Storable Water and the City
may satisfy the water delivery obligations of this Agreement with any water that is available to the City
subject only to the terms and conditions of Boulder's exchange right decreed in Case No. W-7$52-74. The
point of delivery of the Storable ?dater shall be at the sole discretion of the City so long as it satisfies the
requirements of the Division Engineer and Nederland's Plan for Augmentation.
d. Nederland acknowledges that there may be times when it is not operationally feasible to release
the Storable Water from the Reservoir or elsewhere within the City's water system. However, whenever
possible and to the extent that the efficient operation of its facilities would not be adversely affected, the
City agrees to coordinate any releases of the Storable Water with requests by Nederland or the Division
Engineer.
e. In the event that Nederland is required to make delivery of any portion of the Storable Water at
a location other than at a point of delivery available to the City, the City shall not be obligated to deliver the
Storable Water requested.
f. Any exchanges of water under City-owned water rights that the City engages in for the
management of its water system, shall be satisfied prior to satisfying any request for water releases by
Nederland.
g. Nederland shall request water releases by giving notice to both of the following at least 24
hours prior to the desired time of delivery:
Craig Skeie, Water Resources Facilities Manager
35465 Highway 72
Nederland, CO 80466
303-258-3446
skeiec aa'~,bouldercolorado.gov
Tim Creek, Water Source Manager
156 Shady Hollow
Nederland, CO 80466
303-258-3259
creek] @bouldercolorado.gov
AGENDA ITEM # PAGE 5
3. Augmentation. Nederland shall first satisfy its augmentation obligations pursuant to the Plan of
Augmentation with the water sources available to Nederland under Paragraph 7 of the Decree and with any
portion of the Storable t~~ater that is available on a direct flow basis at the time that the augmentation
obligation is to be satisfied. Nederland may then request release of the Storable Water in the Reservoir.
Nederland agrees that it shall continue to own a minimum of 5/8 of a share of Farmers water. Should
Nederland decrease its ownership of Fanners water below the level of 5,'8 of a share, thereby decreasing the
amount of Farmers direct flow water available to Nederland, then this agreement may be unilaterally
terminated by the City.
4. Right of First Refusal. Nederland grants to the City a right of first refusal of any Farmers water that it
chooses to sell, lease, or otherwise alienate during the term of this Agreement
5. Previous Agreements. The parties agree that City assumes no obligations pursuant to the Water
Storage Agreement dated 7uly 9, 1979 between Public Service Company of Colorado and Nederland.
6. Termination. This Water Storage Agreement shall terminate on April 1, 2026.
7. Binding Effect. This Agreement shall inure to the benefit of, and be binding upon, the Parties, and their
respective legal representatives, successors, and assigns.
8. Assignment. This Agreement or a signed written agreement of the Parties or their successors in title
shall not be assigned by either Party without the prior approval in writing of both Parties. Any assignees or
successors to the rights set forth in this Agreement shall be liable and bound under all of the provisions of
this instrument to the same extent as the Parties.
9. Entire Agreement. This Agreement represents the complete agreement of the Parties and no oral
modification shall be recognized. Any amendments, additions or any other notices shall be in writing by
the Parties and sent to the following addresses or at such other addresses as may be specified in writing by
the party to whom notice is to be given:
City of Boulder, Public Works/CTtilities
Water Resources Coordinator, Carol Ellinghouse
Box 791, Boulder, Colorado 80306
City of Boulder, Office of the City Attorney
City Attorney
Box 791, Boulder, Colorado 80306
Town of Nederland
Town Administrator
P.O. Box 396
Nederland, CO 80466
Vranesh and Raisch, LLP
Attn: Paul J. Zilis, Esq.
P.O. Box 871
Boulder, CO 80306
11. Remedies. This Agreement may be enforced by specific performance, including mandatory injunctive
relief and damages, together with reasonable attorney's fees to the prevailing party, except that any action
which requires the expenditure of funds shall be subject to city council appropriation of both Nederland and
the City.
AGENDA ITEM # PAGE 6
CITY OF BOULDER, COLORADO
By:
Frank W. Bruno, City Manager
1777 Broadway
Boulder, CO 80302
Telephone (303) 441-3090
Fax (303)441-4478
Attest:
City Clerk on behalf of the
Director of Finance and Record
Approved as to form:
Jerry P. Gordon
Acting City Attorney
TOWN OF NEDERLAND
By:
Mayor
ATTEST:
Town Clerk
STATE OF COLORADO )
ss.
County of Boulder )
Subscribed under oath before me on this day of , 2007, by
as Mayor, and , as Town Clerk of the Town of
Nederland
My commission expires:
AGENDA ITEM # PAGE 7
I~
WATER STORAGE AGREEMENT
(City of Boulder/Town of Nederland)
This Water Storage Agreement ("Agreement") made this day of ,
2007 is by and between the City of Boulder, a Colorado Municipal Corporation (the
"City") and the Town of Nederland, a Colorado Municipal Corporation ("Nederland").
RECITALS
A. The City owns the Barker Meadow Reservoir (the "Reservoir"), located in the
N %2, Section 18, Township 1 South, Range 72 West, 6th P.M., and the S '/z NE 1/4 and the .
N % N 1/2 SE 1/4, Section 13, Township 1 South, Range 73 West, 6th P.M., all in Boulder
Bounty, Colorado; and
~ B. Nederland owns various water rights which are part of a Plan for
Augmentation adjudicated in Case No. W-8485-77 ("Plan for Augmentation"). As part
of said Plan for Augmentation, Nederland agreed to make available to the State
Engineer's Office Division Engineer for Water Division No. 1(the "Division Engineer")
that amount of water which is expected to equal the consumptive use associated with the
projected needs of its service area through at least the year 2010. The decree in Case No.
W8485-77 (the "Decree") provides that water attributable to a 5/8 share of the Farmers
Ditch Company ("Farmers") maybe stored in Barker Reservoir (the "Storable Water").
Annual diversions of the Storable Water are limited to a maximum amount of 39.6 acre-
feet.
C. In order to make replacement water available to the stream system pursuant to
its Plan for Augmentation, Nederland requires water storage. At the time of the
adjudication of its Plan for Augmentation, Nederland had an agreement with the Public
Service Company of Colorado to use storage space in Barker Reservoir for that purpose.
D. The City has purchased Barker Reservoir from the Public Service Company of
Colorado and this Agreement is required in order for Nederland to continue to have its
Storable Water stored and released from Barker Reservoir by the City.
AGREEMENT
NOW THEREFORE, in consideration of the premises and of the mutual promises and
covenants of the parties hereto, it is agreed as follows:
1. Use of Reservoir Storage Space.
a. The City agrees to allow Nederland to store, on an annual basis, up to 39.6 acre
feet of the Storable Water in the Reservoir and to release the Storable Water only during
those times when Nederland is making out of priority diversions of the other rights which
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' are subject to the terms of the Plan of Augmentation. The Storable Water shall be
derived only from the 5/8 share of Farmers available to Nederland under its Plan for
Augmentation. Water stored by Nederland in prior years shall be allowed to be carried
over into succeeding years, but at no time shall the total amount of water stored by
Nederland in the Reservoir exceed 39.6 acre feet. Nederland shall comply with all terms
and conditions of the Decree in Case No. W8485-77.
b. The Decree requires Nederland in 2010, or sooner, to submit a petition for review
of the Plan for Augmentation. Based on that petition, if any modifications are made to the
Decree that result in a need for additional sources of water to be stored for augmentation
purposes, that additional storage water shall require a new agreement with the City and
the City makes no representations concerning the availability of such additional storage at
this time. Should any modifications of the Decree result in a requirement that Nederland
shall store amounts less than the 39.6 acre-feet, then this agreement shall be modified to
~ reflect said decrease.
2. Releases.
a. As consideration for the right to annually store up to 39.6 acre feet of the
Storable Water, Nederland agrees that releases from the Reservoir of its augmentation
water shall be made according to the normal operational procedures of the City's water
system in a manner which does not interfere with those operations. The City will use its
best efforts to satisfy this Agreement and Nederland's requirements under the terms of its
~ Plan for Augmentation, given the operational difficulties associated with the location and
diversity of the City's water system.
b. The City acknowledges the importance of the storage and release of water from
Barker Reservoir to Nederland's ability to provide water to its residents, and the City
shall release water when requested by Nederland, but only when it does not interfere with
the City's operation of its water system and when the administration of Nederland's Plan
for Augmentation by the Division Engineer requires said release. Any exchanges of
water that the City engages in for the management of its water system shall be satisfied
prior to satisfying any request for water releases by Nederland.
c. The City shall have full rights to substitute and exchange for the Storable Water
and the City may satisfy the water delivery obligations of this Agreement with any water
that is available to the City subject only to the terms and conditions of Boulder's
exchange right decreed in Case No. W-7852-74. The point of delivery of the Storable
Water shall be at the sole discretion of the City so long as it satisfies the requirements of
the Division Engineer and Nederland's Plan for Augmentation.
d. Nederland acknowledges that there may be times when it is not operationally
feasible to release the Storable Water from the Reservoir or elsewhere within the City's
water system. However, whenever possible and to the extent that the efficient operation
of its facilities would not be adversely affected, the City agrees to coordinate any releases
of the Storable Water with requests by Nederland or the Division Engineer.
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e. In the event that Nederland is required to make delivery of any portion of the
Storable Water at a location other than at a point of delivery available to the City, the
City shall not be obligated to deliver the Storable Water requested.
f. Any exchanges of water under City-owned water rights that the City engages in
for the management of its water system, shall be satisfied prior to satisfying any request
for water releases by Nederland.
g. Nederland shall request water releases by giving notice to both of the following
at least 24 hours prior to the desired time of delivery:
Craig Skeie, Water Resources Facilities Manager
35465 Highway 72
Nederland, CO 80466
303-258-3446
skeiec(u,bouldercolorado. gov
Jim Creek, Water Source Manager
156 Shady Hollow
Nederland, CO 80466
303-258-3259
creek] @bouldercolorado. gov
3. Augmentation. Nederland shall first satisfy its augmentation obligations pursuant to
the Plan of Augmentation with the water sources available to Nederland under Paragraph
7 of the Decree and with any portion of the Storable Water that is available on a direct
flow basis at the time that the augmentation obligation is to be satisfied.. Nederland may
then request release of the Storable Water in the Reservoir. Nederland agrees that it shall
continue to own a minimum of 5/8 of a share of Farmers water. Should Nederland
decrease its ownership of Farmers water below the level of 5/8 of a share, thereby
decreasing the amount of Farmers direct flow water available to Nederland, then this
agreement maybe unilaterally terminated by the City.
4. Right of First Refusal. Nederland grants to the City a right of first refusal of any
Farmers water that it chooses to sell, lease, or otherwise alienate during the term of this
Agreement
5. Previous Agreements. The parties agree that City assumes no obligations pursuant to
the Water Storage Agreement dated July 9, 1979 between Public Service Company of
Colorado and Nederland.
6. Termination. This Water Storage Agreement shall terminate on April 1, 2026 .
7. Binding Effect. This Agreement shall inure to the benefit of, and be binding upon,
the Parties, and their respective legal representatives, successors, and assigns.
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8. Assignment. This Agreement or a signed written agreement of the Parties or their
successors in title shall not be assigned by either Parry without the prior approval in
writing of both Parties. Any assignees or successors to the rights set forth in this
Agreement shall be liable and bound under all of the provisions of this instrument to the
same extent as the Parties.
9. Entire Agreement. This Agreement represents the complete agreement of the Parties
and no oral modification shall be recognized. Any amendments, additions or any other
notices shall be in writing by the Parties and sent to the following addresses or at such
other addresses as maybe specified in writing by the party to whom notice is to be given:
City of Boulder, Public Works/Utilities
Water Resources Coordinator, Carol Ellinghouse
Box 791, Boulder, Colorado 80306
City of Boulder, Office of the City Attorney
City Attorney, Ariel P. Calonne
Box 791, Boulder, Colorado 80306
Town of Nederland
Town Administrator
P.O. Box 396
Nederland, CO 80466
Vranesh and Raisch, LLP
Attn: Paul J. Zilis, Esq.
P.O. Box 871
Boulder, CO 80306
11. Remedies. This Agreement maybe enforced by specific performance, including
mandatory injunctive relief and damages, together with reasonable attorney's fees to the
prevailing party, except that any action which requires the expenditure of funds shall be
subject to city council appropriation of both Nederland and the City.
CITY OF BOULDER, COLORADO
By:
Frank W. Bruno, City Manager
1777 Broadway
Boulder, CO 80302
Telephone (303) 441-3090
Fax (303) 441-4478
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Attest:
City Clerk on behalf of the
Director of Finance and Record
Approved as to form:
i
Jerry P. Gordon
Acting City Attorney
TOWN OF NEDERLAND
B ~ ,r
~yor ~~~,~.1D, Cp~o/A
tub
z 1- \
ATTEST: ~ ~ , _ 1
t-,' /
Town k tic A. D . 1~'~~
STATE OF COLORADO )
ss.
County of Boulder )
Subscribed under oath before me on this '1~`~^day of ~~;~Jt,~,-X2007, by
_ ~-~,~;~i•~j , as Mayor, and ~ ` ~ ~ as Town
Clerk of the Town of Nederland
My commission expires: .q-
J®YCE Pt{~G!e_WESIBROOK
NOTARY'P{~BLIC~.
STATE OF.E~L_
QRLDO ~ ~ J
Notarry~Pu 1'
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