Nov. 5, 2003

 

Mr. Will Tully
Bureau of Reclamation Eastern Colorado Area
11056 West County Road 18E
Loveland, CO 80537-9711

Mr. Chandler Peter, Project Manager
US Army Corp of Engineers
2232 Dell Range Blvd., Suite 210
Cheyenne, Wyoming 82009

Re: Financial Feasibility: Scoping questions and positions for the Windy Gap Firming project.

Dear Messers. Tully and Peter:

Funding of the projects;

In doing a preliminary review of the funding mechanisms used for the payment of debt for the Firming Project, a number of issues have come to our attention that we feel need additional review by the Scoping Committee. It is our understanding that the entire project will be paid for by a financial commitment from each of the nine participating entities. Each will pay in direct proportion to their call for water from the total available by the Firming process. In other words, Erie is requesting 6,600/a/ft. They will then be responsible for providing $20 million if it were a $300 million project. This is 6.6% of the total 100,000 ac/ft reservoir and 6.6% of the cost.
In the case of Erie, they also have a commitment to the NISP project for 12.2%. By using the same ratio calculation they would then be responsible for another $50 million or so of a $300 million project (probably a very low estimate in view of other recent projects), making their total commitment for the two projects to something between $60-$80 million.
In looking over Erie’s ‘01 audit it was noticed they are presently carrying about $20 million in debt for water projects. All of this debt is in an Enterprise Fund and probably was accumulated without a public vote. It can be assumed that they have been able to service this debt with fees collected from growth, development fees, and maybe some user fees. The question that comes to mind is; will Erie be able to take on an additional debt load of up to $80 million and then be able to service the debt? What would the rate of growth have to be to service that debt? To us it seems astounding that they would even be considering such a fiscal move and it would also seem questionable why any bonding institution, or underwriter would ever consider this. In addition, it is alarming that by running these bond issuances through enterprise funds the public will never get a chance to vote on whether the community will want to commit to that level of indebtedness, an indebtedness that will be with them for a couple of generations. What happens if the growth rate slows? (This already occurred in Berthoud and the public got stuck with a doubling of service fees!)Who will then pay the debt? Will this indebtedness occur without the public ever knowing of it? The city council will have to vote on the issues as they govern the enterprise fund, but will they represent the wishes of the public?

While Erie is the only municipality I have had time to review, it would have to be assumed that this situation may also exists in some of the other entities involved. Greeley is also into both projects at very high levels. The reason for this level of financial commitment by these small communities, a level that has not occurred historically, is due to the lack of federal and state funding. As a result of this critical situation, the local governments are being asked to pick up all of the tab on the project. What I am saying is two fold; One, it looks unlikely that the communities have the financial where-with-all to actually fund this project. Secondly, and more interestingly, if the public finds out the level of indebtedness, they will be committed to, they will be in an uproar and will deny the councils right to commit to it. In the end, it is all about financial feasibility. One thing for sure, if the public were given the opportunity to vote on this expendurature it would not pass! My guess is that some communities will force it to the surface and portions of the funds represented by that community will be cut off. Presently, I do not believe any of the affected citizens are even remotely aware of this financial situation. Interestingly, a large portion of the local citizens are opposed to our present rapid rate of development. When they find out they may have to pay to subsidize it, they will not be content citizens.

In summary, I would say that the systems being set up to fund this project are suspect because of their vulnerability to disruption. It is not as though there was a single confirmed source of funding. There are nine entities that must make a commitment and be able to service their debt. Probably, the most noticeable of concerns is the nature of the mechanism itself--the revenue bonds being held in enterprise funds. In the event citizens understand this mechanism, they will not approve it, ( much like what happened with Ref.  A) and the funding will cave in on itself. I believe it is necessary to explain and to demonstrate these funding systems to the public in general, so that they understand the debt may fall on them as water users and as tax payers.

Inclusion of Larimer Open Space Project with the Chimney Hollow Site:

Citizen Planners would like bring to attention of the scoping committee the importance of including a comprehensive multi-use recreational site surrounding the proposed Chimney Hollow reservoir. At present Larimer County has developed a large, well-thought out open space area in the immediate vicinity of Chimney Hollow. We feel that it is fitting to expand this effort. From out point of view this inclusion is imperative to meeting the recreational needs of the future and providing a substantial open space site.

Thank you very much for your help and considerations.

David Wright

13850 Swanson Ranch Rd.

Loveland Co. 80538

 

The follow is the scoping presentation of Trout Unlimitd. This document is endorsed by Citizen Planners located in Fort Collins, Colorado.

Re: Scoping comments on Windy Gap Firming Project EIS

Dear Messers. Tully and Peter:

On behalf of Colorado Trout Unlimited, a non-profit organization with over 8300 members in the State of Colorado, we are pleased to submit these comments regarding the appropriate scope of National Environmental Policy Act (NEPA) compliance for the proposed Windy Gap Firming Project (WGFP).

Using the Windy Gap Firming Project Study (WGFPS, February 2003) as a starting point, there are several issues that will require more attention in the Environmental Impact Statement (EIS) than they received in this report. We list them here and then discuss them in more detail below:

· · The purpose and need for the project must be clearly identified and described;
· The role of conservation in delaying (and reducing) the “need” for the WGFP must be analyzed;
· The environmental impacts identified and described must cover both the Colorado and South Platte basins, not merely the on-site effects of dam alternatives;
· The relationship between the operation of the existing Windy Gap project and the Colorado-Big Thompson (C-BT) project must be described in detail;
· Non-structural options must be described more fully and their apparently poor performance explained more completely;
· The concept of prepositioning must be explained fully and its impacts, particularly on Colorado River flows, explained in detail; and
· An alternative consisting of small capacity elements, non-structural options, conservation, and project phasing to meet a revised purpose and need statement that tracks demand based on economic projections, not land use plans, should be investigated;
· The relationship between WGFP and the requirements of Senate Document 80 and the Blue River Decrees must be fully explored.

To the extent that these elements are interrelated, we will identify the links below.

Purpose and Need

The WGFPS purpose and need is described as firming Windy Gap water to meet a portion of the demand forecast from the Northern Colorado Water Conservancy District’s land used based demand study (NCWCD, February 2000). This land use study is not, in any sense, demand forecasting, but rather the aggregation of local planners’ wishful thinking. It cannot be used as the foundation for real demand forecasts or as justification for this or any other water supply project. A more reasonable method of forecasting would look at regional economic activity and the growth it is likely to generate. Also, it’s very likely that the future demand for the various project participants in not of the same urgency, that is assuming there is any urgency at all.

Furthermore, by its own admission, the Bureau has simply used the applicant’s assertion regarding the project’s purpose and need. From a legal standpoint, this is inappropriate. While a federal agency may give deference to a private party applicant’s stated purpose and needs, the agency is also required to look more broadly to ensure that it will consider reasonable alternatives. Citizens Committee to Save our Canyons v. United States Forest Service, 297 F.3d 1012, 1030-31 (10th Cir. 2002). Courts repeatedly find a nexus between agencies’ need to develop the project’s purpose and need independently, on the one hand, and the agency’s duty to identify reasonable alternatives, on the other. Thus, courts will not allow an agency to define objectives so narrowly as to preclude a reasonable consideration of alternatives. Davis v. Mineta, 302 F.3d 1104 (10th Cir. 2002), citing, Colo. Environmental Coalition v. Dombeck, 185 F.3d 1162, 1174-75 (1999). To be consistent with this legal requirement, the Bureau must conduct its own analysis of the objectives of applicant’s proposed project.

NEPA provisions requiring an examination of potential alternatives to a project or proposal are considered the "linchpin" of the impact statement. Monroe County Conservation Council v. Volpe, 472 F2d 693 (2nd Cir. 1972). If one accepts the premises that policy objectives of the Act (Section 101) can be achieved only through good planning and that the consideration of a wide range of alternatives is essential to "good" planning, then the analysis of alternatives in the EIS process is the most important measure of the effectiveness of NEPA. CEQ guidelines require an EIS to describe "[a]lternatives to the proposed action, including those not within the existing authority of the responsible agency [emphasis added]" (CEQ Guidelines, Section 1500.8(a)(4)). The range of alternatives must include a "no action" alternative and "non-structural" options as well as modifications of the proposed project. Based on NEPA Section 102(2)(A), the guidelines stress that "[t]he interdisciplinary approach should not be limited to the preparation of the environmental statement, but should also be used in the early planning stages [emphasis added] of the proposed action” (CEQ Guidelines, Section 1500.8(c)).

Finally, because the WGFP will require a Clean Water Act §404 permit, the Army Corps of Engineers is also part of this NEPA process. Therefore, the Corps’ Section 404(b)(1) Guidelines are relevant. These Guidelines (40 CFR Part 230.10(a)) allow “… permit issuance for only the least environmentally damaging practicable alternative.” The emphasis is on the avoidance of impacts. The Guidelines require “…that no discharge shall be permitted if there is a practicable alternative to the proposed discharge which would have less adverse impact to the aquatic ecosystem, so long as the alternative does not have other significant adverse environmental consequences.” They also make clear that “[C]ompensatory mitigation may not be used as a method to reduce environmental impacts in the evaluation of the least environmentally damaging practicable alternatives for the purposes of requirements under Section 230.10(a).”

For all of the above reasons, the purpose and need section of the EIS cannot be constructed in a way that restricts or eliminates alternatives by restricting the purpose or misstating the need. Rather, the Bureau and Corps should articulate a basin purpose of the proposal (e.g., to provide a reliable water supply for the project participants, including by use of Windy Gap water rights) to satisfy a defensible need based on recognized geographic and economic forecasts.

Conservation’s Role in Delaying the Need for Windy Gap Firming

With the exception of Broomfield and perhaps Erie, the water users participating in the WGFP are within the area identified as the “North Region” in the Metropolitan Water Supply Investigation (Colorado Water Conservation Board, January 1999). In that study the aggregate per capita future water use for the North Region was 259 gcd (gallons per capita per day). This is a very high urban water use figure for this region. Merely by reducing it to a more reasonable level like 220 gcd or 200 gcd would reduce the 2020 urban demand on a region-wide basis by 42,000 acre-feet to 66,000 acre-feet. Even though the WGFP participants account for only part of this potentially saved water, it would be signification, particularly when taking account of the fact that Boulder is part of the North Region and its water use is already below 200 gcd. Extracting its water use figures from the regional aggregate would make the gcd figure even higher, implying an even greater potential for savings. What is more, Boulder demonstrates what can be done with conservation in a similar urban environment. For these reasons, the Bureau and Corps must evaluate conservation measures as at least a component of one reasonable alternative to the WGFP as proposed.

A Full Accounting of Environmental Impacts

The WGFPS does a fair job of identifying and organizing the on-site environmental impacts of the various structural options. What it does not do and what must be part of the EIS is the identification of all environmental impacts, particularly as they relate to stream flows in both the Colorado and also east of the Continental Divide. This may be particularly important when related to the concept of prepositioning. The EIS must also identify, describe, and analyze the cumulative effects of the WGFP, related not only to the effects of the existing Windy Gap project, but also to C-BT operations, and Denver’s Moffatt Tunnel system. A few examples are offered below.

With regard to hydrology, the EIS must include in the baseline conditions a summary of all instream flow rights and by-pass flow requirements applicable to the affected streams, and must evaluate the impacts to those flows and requirements. Impacts caused by changes in the flow regime of all affected streams must be evaluated.

The impact on aquatic biota is another important environmental issue. The EIS should address the existing problems, such as whirling disease, in the description of baseline conditions, and describe future impacts to fishing, fisheries and aquatic habitat caused by each alternative. This should include an evaluation of the effect of increased pumping and the relationship to whirling disease in Grand Lake, Shadow Mountain and Granby Reservoir. It should also look at options like a by-pass channel (which would also have a positive effect on fish passage) for reducing the impact of whirling disease on downstream fisheries.

Turning to water quality, the EIS must consider at least the potential impacts on temperature, salinity and selenium. To accomplish this, the Bureau and Corps should determine baseline water temperatures in any stream segment affected by the WGFP and then evaluate potential impacts to baselines associated with the operation of the project. Further, the EIS should examine how the increased depletions for each alternative would affect salinity and selenium concentrations in the lower stretches of the Colorado River in the State of Colorado as well as in the Lower Basin.

To capture the cumulative impacts of each alternative accurately, the EIS must also evaluate, among other things, the changes to streams’ flow, water quality and aquatic communities caused by Denver’s expansion of its Moffatt collection system coupled with the WGFP. This can be accomplished by ensuring that the impact analysis describes all impacts based on a future scenario that includes Denver’s expansion.

Relationship between Windy Gap and C-BT

It’s clear from the WGFPS that relatively junior position of Windy Gap with respect to its water stored in Lake Granby leaves Windy Gap without firm yield in wet periods. However, what the study does not make clear is why this unusual condition, i.e., wet-year zero firm yield, does not make possible the development of more flexible cooperative Windy Gap-C-BT operating regimes that would allow the firming of some Windy Gap yield without injury to C-BT. The EIS must provide a full and complete explanation of what seems to be a puzzling point.

Description of Small Projects and Non-Structural Options

The non-structural options and small projects are not very well described (and perhaps not completely analyzed) in the WGFPS. Based upon the objective of firming as much Windy Gap yield as possible, it’s as though the study team knows where it’s heading - to the full assessment of several dams - and, as a result, it gives relatively little attention to what can be done for less and with less. For the public to fully appreciate and understand the options and alternatives in this EIS, the non-structural measures and small projects must be more fully elaborated, as one, or a part of one, of the reasonable alternatives. Since all Windy Gap and C-BT water is transbasin, this small projects/nonstructural options analysis should also include an assessment of the re-use potential of these non-native waters.

The Concept of Prepositioning

From the description given in the WGPFS, it seems as though the prepositioning of Windy Gap water in Chimney Hollow reservoir may present both institutional and environmental issues. Setting aside the institutional questions (e.g., can this paper shuffle be used in a federal transbasin water project?), there are very likely to be some environmental effects, principally to Colorado River flows below Windy Gap. These effects must be completely identified and fully analyzed in the EIS.

A Real Non-Structural, Small Project, Conservation Alternative

Given the questions raised above about purpose and need, demand forecasts, and the potential role of conservation, the EIS must present a real alternative to a major dam for meeting the WGFP component of the region’s future urban water needs. It appears that there is the basis for a non-structural/small project/conservation/reuse alternative that would go most of the way to meeting the future demand that the participating water utilities believe they have.

Compliance with Senate Document 80, the Blue River Decrees and other institutional issues

The EIS should review whether the operation of the project would violate any of the provisions of Senate Document 80 or the Blue River Decrees. The Bureau of Reclamation should analyze whether the WGFP, in particular the pre-positioning concept, requires an amendment to the Carriage Contract for Windy Gap. The EIS should describe all of the existing permits and approvals that pertain to Windy Gap and discuss whether there will be a need to modify those permits or approvals. The EIS must include in the baseline conditions a summary of all in-stream flow and by-pass flow requirements that control the affected streams, and must evaluate the impacts to those flows and requirements.

Thank you for the opportunity to comment on the scoping of the WGFP EIS.

Sincerely,



Daniel F. Luecke, PhD David Nickum, Executive Director
Consultant Colorado Trout Unlimited
3870 Norwood Court 1320 Pearl Street, Suite 320
Boulder, CO 80304 Boulder, CO 80302



 

 

 

 

Home