    [House Hearing, 107 Congress]
    [From the U.S. Government Publishing Office]

      H.R. 3881, TO AUTHORIZE THE SECRETARY OF THE INTERIOR TO ENGAGE IN
    STUDIES RELATING TO ENLARGING PUEBLO DAM AND RESERVOIR AND SUGAR LOAF
         DAM AND TURQUOISE LAKE, FRYINGPAN-ARKANSAS PROJECT, COLORADO
    =======================================================================

                              LEGISLATIVE HEARING

                                   before the

                        SUBCOMMITTEE ON WATER AND POWER

                                     of the

                             COMMITTEE ON RESOURCES
                         U.S. HOUSE OF REPRESENTATIVES

                          ONE HUNDRED SEVENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                 March 19, 2002

                                   __________

                               Serial No. 107-97

                                   __________

               Printed for the use of the Committee on Resources

     Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                     house
                                       or
             Committee address: http://resourcescommittee.house.gov

                               U.S. GOVERNMENT PRINTING OFFICE
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    ____________________________________________________________________________
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                             COMMITTEE ON RESOURCES

                        JAMES V. HANSEN, Utah, Chairman
           NICK J. RAHALL II, West Virginia, Ranking Democrat Member

    Don Young, Alaska,                   George Miller, California
      Vice Chairman                       Edward J. Markey, Massachusetts
    W.J. ``Billy'' Tauzin, Louisiana     Dale E. Kildee, Michigan
    Jim Saxton, New Jersey               Peter A. DeFazio, Oregon
    Elton Gallegly, California           Eni F.H. Faleomavaega, American
    John J. Duncan, Jr., Tennessee           Samoa
    Joel Hefley, Colorado                Neil Abercrombie, Hawaii
    Wayne T. Gilchrest, Maryland         Solomon P. Ortiz, Texas
    Ken Calvert, California              Frank Pallone, Jr., New Jersey
    Scott McInnis, Colorado              Calvin M. Dooley, California
    Richard W. Pombo, California         Robert A. Underwood, Guam
    Barbara Cubin, Wyoming               Adam Smith, Washington
    George Radanovich, California        Donna M. Christensen, Virgin
    Walter B. Jones, Jr., North              Islands
        Carolina                         Ron Kind, Wisconsin
    Mac Thornberry, Texas                Jay Inslee, Washington
    Chris Cannon, Utah                   Grace F. Napolitano, California
    John E. Peterson, Pennsylvania       Tom Udall, New Mexico
    Bob Schaffer, Colorado               Mark Udall, Colorado
    Jim Gibbons, Nevada                  Rush D. Holt, New Jersey
    Mark E. Souder, Indiana              James P. McGovern, Massachusetts
    Greg Walden, Oregon                  Anibal Acevedo-Vila, Puerto Rico
    Michael K. Simpson, Idaho            Hilda L. Solis, California
    Thomas G. Tancredo, Colorado         Brad Carson, Oklahoma
    J.D. Hayworth, Arizona               Betty McCollum, Minnesota
    C.L. ``Butch'' Otter, Idaho
    Tom Osborne, Nebraska
    Jeff Flake, Arizona
    Dennis R. Rehberg, Montana

                          Tim Stewart, Chief of Staff
               Lisa Pittman, Chief Counsel/Deputy Chief of Staff
                    Steven T. Petersen, Deputy Chief Counsel
                        Michael S. Twinchek, Chief Clerk
                     James H. Zoia, Democrat Staff Director
                   Jeffrey P. Petrich, Democrat Chief Counsel
                                     ------

                        SUBCOMMITTEE ON WATER AND POWER

                       KEN CALVERT, California, Chairman
                ADAM SMITH, Washington, Ranking Democrat Member

     Richard W. Pombo, California        George Miller, California
    George Radanovich, California        Peter A. DeFazio, Oregon
    Greg Walden, Oregon,                 Calvin M. Dooley, California
      Vice Chairman                      Grace F. Napolitano, California
    Michael K. Simpson, Idaho            James P. McGovern, Massachusetts
    J.D. Hayworth, Arizona               Hilda L. Solis, California
    C.L. ``Butch'' Otter, Idaho          Brad Carson, Oklahoma
    Tom Osborne, Nebraska
    Jeff Flake, Arizona

                                     ------

                                C O N T E N T S

                                  ----------
                                                                       Page

    Hearing held on March 19, 2002...................................     1

    Statement of Members:
        Calvert, Hon. Ken, a Representative in Congress from the
          State of California........................................     1
            Prepared statement of....................................     2
        Hefley, Hon. Joel, a Representative in Congress from the
          State of Colorado..........................................     2
            Prepared statement of....................................    10
        Moran, Hon. Jerry, a Representative in Congress from the
          State of Kansas............................................    11
            Prepared statement of....................................    13

    Statement of Witnesses:
        Arveschoug, Steve, General Manager, Southeastern Colorado
          Water Conservancy District.................................    43
            Prepared statement of....................................    44
            Letter submitted for the record..........................    72
        Castle, Anne, Special Water Counsel, The City of Pueblo,
          Colorado...................................................    57
            Prepared statement of....................................    59
        Kassen, Melinda, Director, Colorado Water Project, Trout
          Unlimited..................................................    51
            Prepared statement of....................................    52
        Keys, John W., III, Commissioner, Bureau of Reclamation, U.S.
          Department of the Interior.................................    21
            Prepared statement of....................................    23
        Null, James, Member, Colorado Springs City Council, State of
          Colorado...................................................    30
            Prepared statement of....................................    33
        Pope, David L., Chief Engineer, Kansas Department of
          Agriculture, Division of Water Resources...................    35
            Prepared statement of....................................    36
        Stovall, Hon. Carla J., Attorney General, State of Kansas....    27
            Prepared statement of....................................    29

    Additional materials supplied:
        Adams, Hon. Jamie Clover, Kansas Secretary of Agriculture,
          Statement submitted for the record.........................    75
        Associated Ditches of Kansas, Statement submitted for the
          record.....................................................    15
        Barela, Hon. Kenneth, Mayor, City of Fountain, Colorado,
          Letter submitted for the record............................    76
        Hamel, Bob, Chairman, Arkansas River Outfitters Association,
          Letter submitted for the record............................     5
        Kuhn, R. Eric, General Manager, The Colorado River Water
          Conservation District, Letter submitted for the record.....    77
        Ortegon, Vera, President, Board of Water Works of Pueblo,
          Colorado, Letter submitted for the record..................     6
        Rall, Joseph F., Chairman, Board of Directors, Action 22,
          Inc., Letter submitted for the record......................     4
        Scar, Dick, Director, Friends of the Arkansas, Letter
          submitted for the record...................................    79
        Tauer, Paul E., Mayor, City of Aurora, Colorado, Letter
          submitted for the record...................................    80

      H.R. 3881, TO AUTHORIZE THE SECRETARY OF THE INTERIOR TO ENGAGE IN
     STUDIES RELATING TO ENLARGING PUEBLO DAM AND RESERVOIR AND SUGAR LOAF
     DAM AND TURQUOISE LAKE, FRYINGPAN-ARKANSAS PROJECT, COLORADO, AND FOR
                                 OTHER PURPOSES

                                  ----------

                            Tuesday, March 19, 2002

                         U.S. House of Representatives

                        Subcommittee on Water and Power

                             Committee on Resources

                                 Washington, DC

                                  ----------

        The Subcommittee met, pursuant to call, at 10:30 a.m., in
    room 1334, Longworth House Office Building, Hon. Ken Calvert
    [Chairman of the Subcommittee] presiding.

      STATEMENT OF THE HONORABLE KEN CALVERT, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. Calvert. The Subcommittee on Water and Power will come
    to order.
        The Committee is meeting today to hear testimony on H.R.
    3881, to authorize the Secretary of Interior to engage in
    studies relating to enlarging Pueblo Dam and Reservoir and
    Sugar Loaf Dam and Turquoise Lake, Fryingpan-Arkansas Project,
    Colorado, and for other purposes.
        Mr. Calvert. Under rule 4B of the Committee rules, any oral
    opening statements at the hearing are limited to the Chairman
    and the ranking minority member. If other members have
    statements, they can be included in the hearing record by
    unanimous consent.
        Last year, we heard testimony that analyzed the preliminary
    Census 2000 data. This data shows clearly that 11 public land
    States of the American West head the list of America's fastest-
    growing States and continue to attract people, both Americans
    looking for new opportunities and immigrants in large numbers.
    Testimony indicated that all of the top five fastest-growing
    States within the United States are in the West, including
    Colorado.
        Today, the legislation before us addresses the desire of
    local communities in Colorado to develop and manage water
    resources over the next several decades to meet this demand.
    The proposed legislation provides an opportunity to look at an
    existing Federal project, the Fryingpan-Arkansas Project, to
    see if managing the resources in a different way can provide
    the added water required to meet the demands of a growing
    population in southeastern Colorado. It is the hope of this
    Committee that the parties involved can use this opportunity to
    resolve the competing demands for limited water supply in this
    area.
        Today, we will hear from several witnesses to present the
    issues associated with this proposed legislation. We have two
    members testifying this morning that are co-sponsors of H.R.
    3881. I would like to introduce Congressman Hefley, who is the
    sponsor of the bill and a member of the Full Committee, and
    Congressman Moran at this time.
        I would like to also ask unanimous consent that Congressman
    Hefley and Congressman Moran be permitted to sit on the dais
    following their statements. Without objection, so ordered.
        Since the Minority is not present, there will be no opening
    statement but will be entered into the record at a later time.
        [The prepared statement of Mr. Calvert follows:]

    Statement of The Honorable Ken Calvert, Chairman, Subcommittee on Water
                                   and Power

        Last year we heard testimony that analyzed the preliminary Census
    2000 data. This data shows clearly that the 11 public lands states of
    the American West head the list of America's fastest-growing states and
    continue to attract people--both Americans looking for new
    opportunities and immigrants--in large numbers. Testimony indicated
    that:
        All 5 of the top 5 fastest growing states are in the West:
    including Colorado.
        Today, the legislation before us addresses the desire of local
    communities in Colorado, to develop and manage water resources over the
    next several decades, to meet this demand. The proposed legislation
    provides an opportunity to look at an existing Federal Project (the
    Fryingpan-Arkansas Project) to see if managing the resources in a
    different way can provide the added water required to meet the needs of
    the growing population in southeastern Colorado. It is the hope of this
    committee that the parties involved can use this opportunity to resolve
    the competing demands for the limited water supply in this area. Today,
    we will hear from several witnesses to present the issues associated
    with this proposed legislation.
        I look forward to hearing from the witnesses.
                                     ______

        With that, I would recognize Mr. Hefley for his testimony.

    STATEMENT OF THE HON. JOEL HEFLEY, A REPRESENTATIVE IN CONGRESS
                       FROM THE STATE OF COLORADO

        Mr. Hefley. Mr. Chairman, thank you very much and thank you
    for having a hearing on H.R. 3881, which would authorize
    studies relating to enlarging Pueblo Dam and Reservoir and
    Sugar Loaf Dam and Turquoise Lake and the Fryingpan-Arkansas
    Project in Colorado.
        The short title, however, of this bill is a little bit of a
    misnomer. Although the second part of the bill does authorize
    the study of enlarging two of these three reservoirs, the most
    important impact of the bill comes in the first part, the
    reoperations to allow the storage of 48,000 acre feet of
    water--an additional 48,000 acre feet of water in two existing
    reservoirs. Since most of you on this Committee are Westerners,
    you can imagine what an addition of 48,000 acre feet means in a
    dry environment.
        This bill is particularly needed in Colorado at this time.
    Over the past decade, Colorado has seen unprecedented growth.
    It grew enough over the last decade that we picked up an
    additional congressional seat in the redistricting that just
    occurred. My own district, the Fifth District of Columbia, had
    to lose 200,000 people in the redistricting because we have
    grown so fast.
        But growth brings with it infrastructure demands; and, of
    course, in the West the most important of those infrastructure
    demands is water. The bill before you is the result of
    discussions between members of the Southeast Colorado Water
    Conservation District aimed at providing for the State's water
    needs for the next 50 years. The storage study committee
    estimated Colorado needs an additional 175,000 acre feet of
    water storage to meet those needs.
        The committee also adopted a preferred storage operation
    plan to address those needs. This bill will put the first part
    of that plan in motion.
        Over the past 20 years we have seen a change in the way we
    manage water in the West. The old way of building new dams and
    reservoirs has become so difficult politically as to be almost
    impossible. Thirteen years ago the Environmental Protection
    Agency killed the Two Forks Dam and Reservoir Project which
    would have supplied the Denver area with water even though it
    would have been privately funded and built largely on private
    land, and every year we face a struggle on Animas LaPlata
    Project in the Four Corners. As a result, we have been forced
    to look for new ways to meet our water needs. This bill and the
    plan it embodies reflect these new methods.
        When we were debating Two Forks 13 years ago, one of its
    opponents said we didn't need Two Forks, that we could meet our
    water needs if we only used the capacity of our existing
    reservoirs better. Well, that is what this bill would allow. We
    need the water in Colorado, and this plan will allow us to do
    it in an intelligent and an environmentally sensitive way.
        I urge the support of H.R. 3881 and look forward to today's
    testimony and to working with you on passing this legislation.
        Mr. Chairman, if I might, I would like to submit for the
    record letters from Action 22, which is a southern Colorado
    Arkansas River action group which focuses on these kinds of
    subjects in Colorado, a letter in support of this bill, the
    Arkansas River Outfitters Association in support of this bill,
    and the Board of Water Works of Pueblo, Colorado, which is also
    in support of this bill. If we could put those in the record, I
    would appreciate it.
        Mr. Calvert. Without objection, so ordered.
        [The information referred to follows:]
        [GRAPHIC] [TIFF OMITTED] 78262.017

        [GRAPHIC] [TIFF OMITTED] 78262.005

        [GRAPHIC] [TIFF OMITTED] 78262.006

        [GRAPHIC] [TIFF OMITTED] 78262.007

        [GRAPHIC] [TIFF OMITTED] 78262.008

        [GRAPHIC] [TIFF OMITTED] 78262.009

        Mr. Hefley. With that, Mr. Chairman, I will end my
    testimony and respond to any questions you might have.
        Mr. Calvert. I thank the Gentleman.
        [The prepared statement of Mr. Hefley follows:]

     Statement of The Honorable Joel Hefley, a Representative in Congress
                           from the State of Colorado

        Mr. Chairman, and members of the subcommittee, I appreciate the
    subcommittee's scheduling this hearing on my bill, H.R. 3881, which
    would authorize the Secretary of Interior to engage in studies relating
    to the enlarging Pueblo Dam and Reservoir, and Sugar Loaf Dam and
    Turquoise Lake of the Fryingpan-Arkansas Project in Colorado.
        Over the past 10 years, Colorado and particularly the Front Range
    of Colorado have seen unprecedented growth. Where once a motorist
    traveling down I-25 between Denver and Colorado Springs had his drive
    broken only by the town of Castle Rock, today the northern half of that
    drive is an almost unbroken stretch of development. The well-known
    landmarks of a decade ago are now lost behind new construction. Indeed,
    the growth has been such that Colorado will gain a congressional seat
    in the next election. My own district, the Fifth, had to lose almost
    400,000 constituents in the recent reapportionment.
        This growth has resulted in obvious demands on the area's
    infrastructure, the most important of which is water. Over the years,
    the state's water needs have been met by the tireless efforts of
    legislators, water engineers and attorneys who first pushed for the
    great water projects which supply the state, then developed the legal
    framework in which that water could be used.
        But over the past 10 years, or perhaps longer, attitudes toward
    water storage projects have changed. About 13 years ago, the
    Environmental Protection Agency effectively killed the Two Forks Dam
    project, which would have been a privately financed reservoir to serve
    the needs of the Denver area. And, for even longer, we have debated
    construction of the Animas-La Plata project in southwest Colorado. And
    still the population grew, as did the need.
        Recognizing this need, in 1998, members of the Southeastern
    Colorado Water Conservancy District, the operator of the Fryingpan-
    Arkansas project, formed a Storage Study Committee to begin discussions
    on how to meet it. An initial study, conducted in late 1998, determined
    a need for an additional 173,100 acre-feet of storage over the next 40
    years. Follow-on studies by the Bureau of Reclamation and the Study
    Committee examined over 30 options to meet the projected demand,
    including expansion of the Pueblo Reservoir. These studies determined
    that the best option was utilize the existing reservoirs.
        By September 2000, the Storage Study Committee's findings congealed
    into a Preferred Storage Options Plan, or PSOP. This plan calls for re-
    operations storage, or the use of excess capacity in existing
    reservoirs to store non-project water under long-term contracts with
    the Bureau of Reclamation. It also called for enlargement of the Pueblo
    and Turquoise reservoirs by 75,000 and 19,000 acre-feet respectively;
    for a variety of water quality monitoring and water banking programs;
    and preservation of a portion of the municipal outlet works capacity at
    Pueblo Dam for future domestic needs in the lower Arkansas River
    valley.
        The Water Conservancy District first approached me regarding this
    legislation in March 2000. At the beginning of this Congress, they
    asked me to be its sponsor and I was happy to do so. H.R. 3881 begins
    the implementation process for the Preferred Storage Option Plan.
        The first part of the bill--the re-operations segment--authorizes
    the Secretary of the Interior to enter into contracts with cities and
    towns comprising the Southeast Colorado Water Conservation District
    that need to store non-Project water to meet their current and future
    domestic needs.
        Second, the bill authorizes the Secretary to study the proposed
    enlargement of the Pueblo and Turquoise Reservoir. These studies would
    be funded by the District and by the communities that participate in
    the PSOP.
        Third, the bill authorizes the Secretary to enter temporary
    contracts to facilitate a water bank program in the basin. Such a pilot
    water bank program has already been approved by the Colorado State
    Legislature.
        The legislation also authorizes the Bureau of Reclamation to
    contract for the use of excess storage capacity by the city of Aurora
    and Pueblo West. And finally, the bill assures that the use of excess
    capacity in the existing storage facilities of the Fry-Ark project
    under the new Reclamation contracts will not be used to increase
    diversions out of the Colorado or Arkansas river basins without
    agreements or protections.
        H.R. 3881 is not the solution to Colorado's water problem but it is
    an important first step toward finding the 173,000 acre-feet the state
    will need in the next 40 years. Through intelligent use of existing
    resources, the process outlined in H.R. 3881 will provide for the
    storage of 48,000 acre-feet of non-Project water. That is water
    available under existing water rights held by cities and towns within
    the District's nine-country service area. Further, it will do this
    while continuing to honor the District's existing obligations under the
    1962 authorizing legislation and interstate compacts.
        As with any western water issue, this is something of a work in
    progress. Its present form came about, not only from the PSOP process,
    by as the result of lengthy negotiations this year between the District
    and the City of Aurora and the City of Pueblo. The debate continues.
    Today, we will hear other comments and concerns voiced by Pueblo, the
    Colorado River District, the state of Kansas and even the Bureau. Where
    water is scarce, everyone has an opinion on how it should be used.
        Thirteen years ago, when the great western water debate was over
    Two Forks, a member of one environmental group claimed the state could
    meet its needs through better utilization of existing smaller
    reservoirs. Thirteen years later, that is basically what H.R. 3881 will
    do. I look forward to working with the various affected groups to
    address their concerns and to working with this subcommittee on passing
    this bill.
        Thank you.
                                     ______

        Mr. Calvert. Mr. Moran, you may begin your testimony.

    STATEMENT OF THE HON. JERRY MORAN, A REPRESENTATIVE IN CONGRESS
                        FROM THE STATE OF KANSAS

        Mr. Moran. Mr. Chairman, I appreciate the opportunity to be
    here today and to testify on H.R. 3881; and I appreciate the
    opportunity to sit here at this table with the distinguished
    Gentleman from Colorado.
        Communities, the environment, agricultural and other
    economic interests all utilize this limited resource, water;
    and I want to discuss today a particular body of water, the
    Arkansas River and how it highlights the value of this
    important resource.
        The Arkansas River enters Kansas in the western border of
    Colorado near the small town of Coolidge, population 88. The
    river works its way eastward across the State to Arkansas City,
    where it continues into Oklahoma. Along that route, it passes
    through the towns of Garden City, Dodge City, Larned, Great
    Bend, Hutchinson and many others. It provides the only source
    of surface water for most southwestern Kansas communities.
        Parts of the Arkansas are a dry riverbed now for as many as
    8 months out of the year. However, if you look at our State
    map, it is easy to see if that this river has been the
    lifeblood of many communities that grew up out of the otherwise
    dry prairie.
        Even today, the Arkansas River is celebrated in our State.
    The Wichita River Festival is an annual event organized in
    Wichita for the sole purpose of drawing Kansans together to
    recreate in and around this vital resource. In Kansas, the
    Arkansas River is more than an important source of water for
    municipalities. It is an important emotional and cultural asset
    for people who otherwise would not experience the joy of water.
        Because of its significance to economic development, water
    use along the Arkansas basin has long been controversial. The
    waters of the Arkansas River are the only renewable source of
    water, and scarce water flows provide water for development of
    our municipalities, both large and small. The river provides
    recreation opportunities and opportunities for tourism.
    Business and manufacturing depend upon the Arkansas River for
    the existence of commerce on the High Plains, and agriculture
    relies on this water to irrigate one of the highest-volume
    farming regions in the country. Rights to use the water from
    the Arkansas River are vested and are some of the oldest rights
    in our State.
        The first compact regulating the Arkansas River was
    negotiated between Colorado and Kansas; and, since 1950, we
    have had an agreement about who can use water and how much. The
    current compact has been interpreted by the courts with a
    series of lawsuits.
        Kansas sued Colorado in 1901, 1928, and 1985 over the use
    of the river's water. The latest subject of this dispute was
    the issue concerning the Colorado wells and the resulting low
    flow of water across the State line into our State. The last
    court case stemmed from Colorado pumping activity. Dated back
    to 1968, this case was ultimately decided by the United States
    Supreme Court.
        In a ruling last June, the Supreme Court declared that
    Colorado had overused its water under the compact and owed
    Kansas damages for loss of its water. A special master was
    appointed in 2001 to work with both States to find and avoid
    future disputes over the amount of water crossing the State
    lines. The dollar amount for the settlement has yet to be
    determined; and, in addition to the costs of damages, suits
    have created an enormous burden in litigation fees for each of
    our States to bear. Kansas alone has spent $17 million
    litigating with Colorado, and Colorado has paid an estimated
    $11 million in legal expenses.
        The legislation before the Committee today has significant
    concerns for Kansas as the primary downstream State user of
    Arkansas River water. This legislation has potential to damage
    areas of Kansas that depend solely on that river.
        If Colorado is allowed to increase their storage vessels by
    122,000 acre feet, it certainly means less water for Kansans.
    Water quality is another concern. EPA requires TMDLs to be set
    for the waters in this river. Water quality is worse in low
    flow conditions of the river, and the stream flow reductions to
    Kansas could cause tremendous difficulties in our State for
    meeting the TMDL requirements.
        The Arkansas River Compact Administration was formed back
    in 1949 to deal with issues between our States, and we should
    not bypass that compact administration when dealing with
    expansion of water storage that would normally flow downstream
    and eventually into our State.
        This legislation is particularly troubling coming on the
    heels of the latest court decision. After a decision last year,
    representatives of both States indicated they hoped to stay out
    of the courts in the future. At a time when we should be
    considering advanced measures of conserving water and
    maximizing its use for many interests as possible, we will be
    heading back to the courts. People in both Kansas and Colorado
    value water and recognize the limitations of a scarce commodity
    and believe that it is not in the best course of action for the
    citizens of either State to pursue this legislation.
        I would like to thank the Chairman and other members of the
    Committee for allowing me to testify. I live in a city that is
    struggling with access to water. We have low flow toilets and
    reduced flow shower heads and outside watering restrictions, so
    I know in my own community the difficulty that access to water
    presents. When members of the Colorado delegation meet with
    their community leaders, I understand the difficult situation
    that they are facing. I am willing to look for ways to work
    with Mr. Hefley and other members of the Colorado delegation,
    and I thank you again.
        This issue is of such importance, Mr. Chairman, that we
    have today testifying before your Committee Attorney General
    Carla Stovall and David Pope, our Chief Engineer of the State
    of Kansas, Division of Water Resources, representing the
    State's Governor.
        Again, I thank you for your time and will stand for any
    questions.
        Mr. Calvert. I thank the Gentleman.
        [The prepared statement of Mr. Moran follows:]

     Statement of The Honorable Jerry Moran, a Representative in Congress
                            from the State of Kansas

        Mr. Chairman, Ranking Member Smith, and other members of the
    subcommittee, thank you for allowing me the opportunity today to
    testify on H.R. 3881. As members of the Water and Power subcommittee,
    you have to deal with one of the most difficult resource issues facing
    the Western United States: water.
        Water disputes have long divided regions, communities, states, and
    even countries. As members of this subcommittee you are faced with a
    constant barrage of requests from water users. Communities, the
    environment, agricultural, and other economic interests all utilize
    this limited resource. I want to discuss with you today how a
    particular body of water, the Arkansas River, characterizes the value
    of this important resource.
    The Arkansas River in Kansas
        The Arkansas River enters Kansas at the western border with
    Colorado, near the small town of Coolidge, population 88. The River
    works its way eastward across the state to Arkansas City, where it
    continues into Oklahoma. Along the route, the Arkansas passes through
    the towns of Garden City, Dodge City, Larned, Great Bend, and
    Hutchinson, and provides the only source of periodic surface water for
    most southwestern Kansas communities.
        Parts of the Arkansas are a dry riverbed now for as many as eight
    months out of the year. However, looking at our state map, it is easy
    to see that in earlier times the River was the lifeblood for
    communities that grew out of the otherwise dry prairie. The towns and
    roads of southwest Kansas follow the path carved by the Arkansas.
        Even today, the Arkansas River is celebrated in our state. The
    Wichita River Festival is an annual event each May, organized solely
    for the purpose of drawing Kansans together to recreate on and around
    the only river in the area. In Kansas, the Arkansas River is more than
    an important source of water for municipalities; it's an important
    emotional benefit for people who otherwise would not see water except
    that coming from wells, pumped from the High Plains Aquifer deep
    underground.
    History of Arkansas River Water Use
        Because of its significance to economic development, water use in
    the Arkansas basin has long been controversial. The waters of the
    Arkansas River are the only renewable source of waters and have
    tremendous significance to Southwest Kansas. The scarce river flows
    provide water for the development of municipalities, large and small.
    The river provides recreation opportunities for tourism. Business and
    manufacturing depend on Arkansas water for the existence of commerce on
    the High Plains. Agriculture relies on the water to irrigate one of the
    highest-volume farming regions of the country. Rights to use the water
    from the Arkansas River are vested and some of the oldest in the state
    of Kansas.
        The first compact regulating Arkansas River water was negotiated
    over 50 years ago. Since 1950, Kansas and Colorado have had agreements
    about who can use how much water. The current compact was reached after
    interpretation from the courts through a series of lawsuits. After
    spending more than a century fighting over these waters, Kansas and
    Colorado finally seem to have reached a court-imposed compromise.
    State Disputes Involve Legal Action and Lead to Lengthy Court Debates
        Kansas sued Colorado in 1901, 1928, and 1985 over the use of the
    river's water. The latest subject of dispute regarding this river was
    the issue of Colorado wells and the resulting flow at the Kansas state
    line. The last court case stemmed from Colorado pumping activity dating
    back to 1968. This case was litigated for nearly ten years and
    ultimately was heard by the Supreme Court.
        In a ruling last June, the Supreme Court declared that Colorado
    owed Kansas millions of dollars for loss of water. Over 15 years after
    the case was initiated, the dispute finally entered into the remedy
    phase. A special master was appointed in September, 2001, to work with
    both states to find a way to avoid future disputes over the amount of
    water crossing the state line.
        A dollar amount for the settlement has yet to be determined, but
    the most conservative estimates indicate that Colorado will pay Kansas
    about $22 million for money the state and our farmers lost over the
    thirty-year period. In addition to these costs and the strain on human
    resources, suits create an enormous burden of litigation fees for
    states to bear. In the last court case alone, Kansas spent over $17
    million. Colorado paid an estimated $11 million in legal expenses.
    Potential Consequences of Legislation Affecting the Water Compact
        The legislation before the committee today has caused great concern
    for Kansas as the primary downstream state. This legislation has the
    potential to damage Kansas areas that depend on Arkansas River water.
        Certainly if Colorado is allowed to increase their storage vessels
    by 122,000 acre feet, that would mean less water for Kansas. Water
    quality is another very big concern. EPA required Total Maxium Daily
    Loads (TMDL) be set for the waters of the Arkansas. Some TMDLs have
    been established and some are still to be set. Water quality is worse
    in ``low flow'' conditions of the river, and the reduction of
    streamflow to Kansas could cause tremendous difficulty in meeting new
    water quality regulations.
        There is no doubt that this legislation would cause damage to
    Kansas and to its citizens who depend on this water. In 1949 the
    Arkansas River Compact Administration was formed to deal with these
    types of technical issues. The Compact Administration should not be
    bypassed when considering expansion and storage of water that would
    normally flow down stream and eventually into Kansas.
        This legislation affecting compact violations is particularly
    troubling coming on the heels of the latest court decisions. After the
    latest decision last year, representatives of both states commented
    that they hoped to stay out of court in the future. I fear that the
    proposed legislation before the committee today would set us down the
    path of more litigation and unnecessary costs for both the state of
    Kansas and the state of Colorado. At a time when we should be
    considering advanced measures of conserving water and maximizing its
    use for as many interests as possible, we will be heading back to the
    courts. People in both states uniquely value water and recognize the
    limitations of such a scarce commodity, and is not the best course of
    action for the citizens of either states.
        I would again like to thank the chairman and other members of the
    committee for allowing me to testify, especially to those members of
    the Colorado delegation. I live in a city struggling to access enough
    water. When members of the Colorado delegation meet with their
    community leaders from Aurora, Pueblo or others, I do understand the
    difficulty of the situation.
        I look forward to working with members of the committee on this
    legislation. Thank you again.
                                     ______

        Mr. Calvert. I certainly understand water problems, being
    from California, some of our friends from the Upper Basin
    States and other places. But rather than ask questions, I would
    ask if the two of you would like to come up to the dais, and we
    will ask for testimony, and then we will be able to ask
    questions of the panel.
        Mr. Moran. Thank you, Mr. Chairman.
        I would ask unanimous consent to place in the record
    testimony from the Associated Ditches of Kansas.
        Mr. Calvert. Without objection, so ordered.
        [The information referred to follows:]

    Statement of the Associated Ditches of Kansas with Respect to H.R. 3881

        The Associated Ditches of Kansas is a group of six non-profit ditch
    companies which hold vested rights to the use of a total of 140,000
    acre feet of the waters of the Arkansas River. Water diverted from that
    river in the exercise of those rights is used to irrigate thousands of
    acres of farm land from the Colorado-Kansas state line to Garden City,
    Kansas.
        The river flow is regulated by John Martin Reservoir, located
    upstream from the state line. It is operated by the Chief of the United
    States Corps of Engineers in accordance with the Arkansas River
    Compact, an interstate compact between the states of Kansas and
    Colorado and approved by the United States Congress which apportions
    the waters of the Arkansas River between those two states.
        The Associated Ditches have become extremely sensitized to the
    possible impacts of any development in the State of Colorado which may
    influence the amount of water available for them to divert from the
    Arkansas River. That sensitivity is the result of the protracted and
    very expensive interstate litigation between the states of Colorado and
    Kansas in the United States Supreme Court over the depletion in the
    state line flow of the river caused by the extensive well development
    in the State of Colorado. That Court has found that the unaugmented
    pumping of the Colorado wells violated the Arkansas River Compact and
    we are waiting for its determination of what kind of reimbursement of
    damages it will assess against the State of Colorado for that
    violation.
        Because of that sensitivity, we are especially concerned about the
    prospect of any new depletions in the flow of the waters of the
    Arkansas River into John Martin Reservoir, and ultimately across the
    state line. We have been told by the proponents of Colorado's storage
    project that the enlarged upstream storage capacity and the re-
    operation of the Fryingpan Arkansas project will have no impact on the
    state line flows. We heard similar assurances about the post-compact
    wells, so we are understandably skeptical about such assurances now. As
    a result, we have asked our technical advisors to analyze, as best they
    could in the short time available, all of the various impacts of the
    proposal, including environmental, as well as hydrologic.
        Those advisors have not had a chance to fully analyze the technical
    work that has been done in the Colorado studies to promote a storage
    project. What they have been able to do, tells them that the hydrologic
    work stopped short of looking for answers to the critical questions
    that trouble us about the proposal. For example, state line impacts
    have not been specifically addressed, and water quality and
    environmental impacts caused by increased upstream water use have not
    been considered. Their concerns are discussed in the attached Technical
    Appendix.
        It was clear to them that those studies, performed to support the
    Preferred Storage Option Plan, were designed to optimize the upstream
    storage capacity for the purpose of maximizing yields from the waters
    of the Arkansas River, not to find out whether the operation of that
    optimized storage capacity and the population growth it supports would
    have an impact on the amount and quality of the waters of the Arkansas
    River available for storage in John Martin Reservoir that would be
    usable by the Associated Ditches.
        It is inconceivable to us that the addition of 122,000 acre feet of
    new storage capacity upstream from Pueblo can be justified merely to
    reregulate transmountain return flows alone. Indeed, the project's
    proponents readily admit that this large storage capacity will also be
    used to store peak flows of the waters of the Arkansas River which
    would, in the absence of such capacity, flow downstream for storage in
    John Martin Reservoir and be available for use by the Associated
    Ditches.
        This Subcommittee on Water and Power should be equally concerned
    about such impacts; it should require that the project not diminish the
    quantity nor impair the quality of water delivered at the Colorado-
    Kansas state line. If H.R. 3881 studies find a detrimental impact, the
    project must be reformulated to avoid such a result. If such a
    reformulation cannot protect state line flows, the project should not
    go forward. It would be totally inappropriate for the Congress to
    authorize project modifications that would result in another violation
    by the State of Colorado of the Arkansas River Compact.
        Clearly, we are not anxious to endure another long drawn out and
    expensive course of litigation in the United States Supreme Court over
    this issue. Yet, until we have seen credible proof that the adverse
    impacts we fear will not occur, we can see no real difference between
    the State of Colorado violating the compact through unaugmented well
    pumping and violating it by skimming the peak flows of the river with
    upstream storage so as to prevent their being available for storage in
    John Martin Reservoir.

    [GRAPHIC] [TIFF OMITTED] 78262.010

                               TECHNICAL APPENDIX
     ATTACHMENT TO THE STATEMENT OF THE ASSOCIATED DITCHES OF KANSAS WITH
                              RESPECT TO H.R. 3881
        This attachment includes additional material in support of the
    statement of the Associated Ditches of Kansas regarding H.R. 3881. It
    is intended to offer a more detailed basis for the position that an
    inadequate technical analysis has been performed by proponents of the
    proposal to enlarge Pueblo Dam and Reservoir and Sugar Loaf Dam and
    Turquoise Lake, Fryingpan-Arkansas Project, Colorado. The authors of
    the Colorado reports state that their conclusions are in many cases
    based on old data (e.g., use of aerial photographs from the 1970s to
    assess wetland impacts) and should be considered essentially
    qualitative. They note that the purpose of their analysis was to aid in
    the selection of alternative scenarios and that approval of the project
    must be based on more thorough studies. The Associated Ditches of
    Kansas (hereafter referred to as ``Kansas) requests that all further
    studies that might be authorized by passage of H.R. 3881 include a
    careful consideration of the issues and concerns expressed in our
    statement and in this technical appendix.
    BASIS OF REVIEW
        The questions and concerns listed below are based upon our
    preliminary review of the following documents:
         LPreferred Storage Options Plan. Prepared by GEI
    Consultants, Inc, September 21, 2001.
         LFinal PSOP Implementation Committee Report: Addendum to
    Preferred Storage Options Plan Report, April 19, 2001
         LPreferred Storage Options Plan Proposed Federal
    Legislation. Prepared by Southeastern Colorado Water Conservancy
    District, September 2001.
         LHydrologic analysis: Technical and Environmental Analysis
    of Storage Alternatives. Prepared by Montgomery Watson, March 2000.
         LWater Quality Issues: Technical and Environmental
    Analysis of Storage Alternatives. Prepared by Montgomery Watson, June
    2000.
         LEnvironmental Issues: Technical and Environmental
    Analysis of Storage Alternatives. Prepared by ERO Resources
    Corporation, March 2000.
    QUESTIONS AND CONCERNS ASSOCIATED WITH THE PROPOSED WATER STORAGE
            ENLARGEMENT PROJECTS AND THE TECHNICAL ANALYSES OF THEIR
            HYDROLOGICAL, ENVIRONMENTAL AND WATER QUALITY IMPACTS
        1. The lack of attention devoted to potential adverse water
    quantity/quality impacts to Kansas in the documents listed above is
    surprising. Kansas was hard-pressed to find any specific evaluation of
    state line impacts. In sections where these documents address key
    project considerations, constraints, and potential fatal flaws, there
    are no concerns expressed regarding potential adverse impacts to
    Kansas. Such an omission raises questions of technical credibility for
    it is difficult to envision how the creation of over 122,000 acre-feet
    (AF) of additional storage in Colorado would not impact state line
    interests. This additional storage amounts to 75 percent of the
    historic average annual flow of the Arkansas River at the Colorado/
    Kansas border, as shown in Figure 1. It is unacceptable to disregard
    this important point and, further, to neglect the accompanying
    fundamental shifts in the day-to-day operations of the Fryingpan-
    Arkansas system.
        2. In the few places where there is any reference to state line
    impacts, the documents state that such impacts will not be significant
    or adverse. Kansas does not believe that the data presented supports
    this conclusion. It defies logic that the proposals would not adversely
    impact state line flows. If Colorado were not intending to store water
    which would otherwise have come into Kansas, why did the Southeast
    Colorado Water Conservancy District file new water rights applications
    in 2000 to capture high flows in the new reservoir storage space?
        3. The documents that we reviewed do not clearly answer this key
    question:
            What additional water will be stored that is not currently
            being stored, and where does it originate?
        The availability for storage of an additional 122,000 AF indicates
    by simple water ``mass balance'' principles that the water has been
    diverted from other destinations.
        4. We hope that the Subcommittee members recognize how much
    sophisticated computer modeling underlies the proposals for system re-
    operation and additional storage. These sophisticated models rely on
    numerous assumptions that must be based on reliable data. As Kansas
    stakeholders know from the most recent round of litigation before the
    United States Supreme Court concerning the Arkansas River Compact,
    modeling assumptions are not always consistent with reality and can
    lead to incorrect conclusions. The Associated Ditches are particularly
    interested in having engineering and economic consultants review the
    relevant models, beginning with the models that Colorado interests are
    using to generate water demands, water conservation and water reuse
    activities as of 2040. A similar review of the water rights models
    developed by GEI and Montgomery Watson/Black & Veatch using the
    Colorado State University (CSU) model, MODSIM is appropriate. Kansas'
    experience indicates that small changes in modeling assumptions often
    produce opposing outcomes. Until interested parties in Kansas have had
    the opportunity to thoroughly review the relevant models, they should
    be considered interim and subject to change.
        5. Kansas would like to learn more about the water conservation and
    water reuse proposals that are envisioned by the project proponents.
    Kansas' interest centers on the fact that effective water conservation
    and reuse reduces the need for additional storage. Furthermore, since a
    large portion of the additional storage is expected to be used to
    satisfy population growth demands, one can infer that the flows
    reaching the state line will include a significant volume of municipal
    return flow which has inherently inferior water quality.
        6. Colorado's assurances that Kansas will not be negatively
    impacted by the proposed re-operation/additional storage are not
    adequately supported. Colorado is suggesting that on an average annual
    basis, there will be little change in stream flow at the state line.
    Kansas is not comfortable with this finding. Even if it were true,
    Kansas interests could still be negatively impacted because they are
    affected by flows, not only on an average annual basis, but also on a
    much smaller ``time step'' basis. Obviously, the Associated Ditches are
    concerned with river flows during irrigation months, particularly
    during dry periods. Kansas is also keenly interested in the distinction
    between dry year and average year flows.
        There are additional examples of the importance of the timed
    distribution of water flows. Water quality regulation in the Arkansas
    River in Kansas is based on extremely low flow conditions. Various
    total maximum daily loads (TMDLs) have been and are being applied to
    the Arkansas River in Kansas, and all of these are flow dependent. Our
    state has recently established a long-term management plan for the
    Ogallala Aquifer, which includes the objective of using ``excess flow''
    in the Arkansas River to recharge the Ogallala Aquifer. Unfortunately,
    the documents listed above are not sufficiently detailed to predict how
    the high flow regime will be affected at the state line and whether
    Kansas can utilize flows in times of historic surplus for aquifer
    recharge.
        7. In addition to the requirement for more specific and detailed
    information regarding flow regime changes, better information is needed
    regarding anticipated water quality changes. At the present time, water
    users in Kansas are the recipients of extremely poor water quality from
    Colorado. In fact, the Colorado Water Quality Control Division (CWQCD)
    has acknowledged that the Arkansas River at the state line is one of
    the most saline rivers in the United States. Many aspects of the
    proposed re-operation/additional storage program have the potential to
    impair water quality further. A number of quality impacts are addressed
    in the technical reports, such as increased evaporation from the
    enlarged storage facilities, which will increase constituent
    concentrations. However, most non-hydrological impacts have been
    ignored. For example, there will be substantially more municipal and
    industrial effluent in the river, a topic that was not addressed by the
    documents reviewed. Representatives of the Kansas Department of Health
    and Environment (KDHE) and the CWQCD have been exploring potential ways
    for the states to work collaboratively and cooperatively on water
    quality issues for almost two years. These representatives should be
    interviewed by proponents of HR-3881 to explore the compatibility
    between system re-operation/increased storage and enhanced water
    quality at the state line.
        8. Spring snowmelt ``flushing'' flows into Kansas are important for
    many reasons. Aquifer recharge, mentioned above, is one such reason.
    Another reason is that one of the five major objectives of the Upper
    Arkansas Sub-basin Management Plan, developed over the past four years
    by the Kansas Department of Water Resources (DWR) and water users in
    the Upper Arkansas Sub-basin, is to restore historic river channel
    characteristics (in other words, to transform the river geomorphology
    into a more natural condition). This work is being done in cooperation
    with the U.S. Army Corps of Engineers (USACE). In the absence of
    periodic flushing flows, the ability to accomplish this will be
    impaired. As another example, extensive modeling work by the Kansas
    Geological Survey has demonstrated that decreased flows in the Upper
    Arkansas River have enhanced migration of saline river flows into the
    Ogallala Aquifer, thereby increasing aquifer salinity concentrations
    over a large area along the Arkansas River corridor. There is concern
    that this phenomenon will be aggravated by the proposed system re-
    operation/additional storage.
        9. Although many regulatory and permitting issues related to
    compliance with the National Environmental Policy Act (NEPA),
    recreation classifications, wildlife habitat, threatened and endangered
    species, Section 404 permits, etc. have been addressed in the technical
    reports, the analyses admittedly are frequently based on old data and
    may no longer be relevant. These reports note that their analyses are
    intended to help rank alternative scenarios and that approval of the
    project must be based on more thorough environmental studies and
    appropriate impact statements.
        10. Members of the Associated Ditches are struck by the potential
    for inconsistent federal action in Kansas, in association with HR-3881.
    For example, the United States Environmental Protection Agency (USEPA)
    is requiring Kansas (under a consent decree) to prepare TMDL's for
    every major watershed in Kansas within eight years, including the Upper
    Arkansas River. At the same time, under HR-3881, the Federal Government
    could be advocating a project, which might seriously impact the ability
    of Kansas Water Users to comply with the Upper Arkansas TMDL.
    Similarly, the USACE and USEPA are concerned about potential adverse
    impacts to jurisdictional wetlands, waters of the US, and riparian
    corridors in association with water delivery/storage systems, and this
    could be at odds with the proposed storage plan. In conclusion, Kansas
    requests that United States Congress be highly cognizant of the
    potential for federal agencies (and federal programs) to be at cross-
    purposes via H.R. 3881.
                                     ______

        Statement of the Associated Ditches of Kansas, Harold D. Knoll,
                                   President

        The validity of the major questions we raised in the March 19, 2002
    testimony with respect to H.R. 3881 was confirmed by our engineering
    consultant's further review of Environmental Issues (ERO Resources
    Corporation, March 2000) and Water Quality Issues (Montgomery Watson,
    June 2000) reports. These reports were prepared during the development
    of the Preferred Storage Options Plan (PSOP) by the Southeastern
    Colorado Water Conservancy District (SECWCD) and Colorado Springs
    Utilities (CSU). Water quality and environmental impacts on water users
    in Kansas which would likely result from the proposed projects were not
    addressed quantitatively or to Kansas' satisfaction in those initial
    studies.
        Such a result was inevitable, given the failure of those
    investigations to adopt a watershed or integrated approach. Our review
    of those studies supports our earlier statements that increases in
    water storage in Colorado will have detrimental effects on water users
    in Kansas. The methods and limited scope of those studies precluded any
    consideration of those detrimental impacts to Kansas. The authors state
    that the purpose of the environmental and water quality analyses was
    only to assist in ranking proposed storage alternatives. Such an
    objective inherently omits consideration of downstream (specifically
    state-line) impacts, and avoids asking the question:
        How does water chemistry change at the Colorado-Kansas border?
        Review of data sources and methods used in the reports demonstrate
    the inadequacy of the studies in addressing this important question.
    Data Sources
        Many site specific environmental impacts were apparently discussed
    in meetings and/or other personal communication with representatives
    from the U.S. Forest Service (USFS), U.S. Fish and Wildlife (FWS),
    Environmental Protection Agency (EPA), Bureau of Reclamation
    (Reclamation), Bureau of Land Management (BLM), Colorado Division of
    Wildlife (CDOW), Colorado State Parks, and the U.S. Army Corps of
    Engineers (Corps). While these agencies are certainly appropriate
    sources of information, the type of data described suggests only
    qualitative and cursory analysis.
        Examination of the potential for site specific wetland impacts was
    based primarily on 1970's National Wetlands Inventory (NWI) aerial
    photography. Delineations were not field-verified for current
    conditions. Again, no attempt was made to study possible wetland
    impacts in Kansas.
        Often qualitative assessments were used to make quantitative
    judgments. For example, increased toxicity in the Upper Arkansas River
    Basin is possible according to the analysis, but then the authors
    state, ``Additional study would be required to determine whether the
    potential change in toxicity due to increased West Slope imports is
    significant'' (Water Quality Issues, p.9-22). The omission of this
    potential effect in the list of ``fatal flaws'' is significant.
    Lack of Watershed Approach
        Only site specific impacts from the proposed action(s)which might
    be required to satisfy storage demands were examined. That approach
    considered only questions such as: What happens to the Turquoise
    Reservoir if it is enlarged? The lack of a watershed approach prevents
    assessment of impacts at downstream locations, therefore the approach
    incorrectly characterized the full scope of effects. Specific
    objections to the study's conclusions arising from the lack of an
    integrated watershed approach to assess impacts include:
        1. The Water Quality Issues report specifically states that
    increased inflows to the Turquoise and Twin Lakes Reservoirs ``would
    aggravate existing channel erosion problems'' (p. 9-13). But the
    increase in sediment loads combined with predicted decreased retention
    time in these reservoirs has a significant potential for impacting
    downstream water quality, yet that issue was not considered.
    Furthermore, transport of pollutants commonly associated with sediment
    loads, such as some heavy metals and nutrients, was not a factor in the
    analysis.
        2. In the reports, impacts to water quality that would be a direct
    result of project operation were never combined with the impacts of
    water quality changes that may occur as a result of increased water
    use. It is critically necessary to address all impacts related to the
    increased water use demand made possible by the various storage
    alternatives in order to identify potential ``fatal flaws'' in the
    different scenarios. For example, the Water Quality Issues document
    admits that ``Increased base flows in Fountain Creek would contribute
    additional sediment load to the lower Arkansas River'' (p.9-22). The
    increased flows (attributed to increased municipal return flows with
    inherently degraded water quality) were not considered as impacts
    resulting from operation of the various storage alternatives, and hence
    are not included as decision variables in the different scenarios. But
    the full potential impact of the storage plan must consider the
    cumulative sediment loads from changes in the Twin Lakes and Turquoise
    Reservoirs operations together with the loads from Fountain Creek to
    appropriately assess downstream impacts.
        3. The interaction of possible changes with current conditions was
    not considered. For example, the report states that changes to water
    depth and water quality are not anticipated in association with the
    enlargement of the Pueblo Reservoir. The report then states that the
    combination of increased residence time (which may result from
    enlargement) and the expected future increases in nutrient loading
    (regardless of enlargement) may degrade water quality (p.9-8--9-11).
    The report should not thus blithely dismiss the impact of enhancement
    of nutrient loading caused by increased residence time simply because
    the project is not the sole source of water quality degradation.
        4. The simple mass-balance model used to simulate salinity, which
    is based solely on concentrations in West Slope diversion water and
    municipal return flows, together with the effects of lake evaporation,
    is inadequate. Failure to include salinity associated with anticipated
    urban landscaping return flows and future wastewater return flows in
    the Pueblo region cannot help but underestimate the magnitude of actual
    future effects, and hence the impact to Kansas. Furthermore,
    simulations of salinity in the Lower Arkansas River indicated little
    change in average annual concentrations; however changes in average
    monthly levels may be significant, namely a 10-15% increase in the
    spring months. Increased salinity of the river flow directly impacts
    the ability of the Associated Ditches to provide suitable water for
    crop irrigation.
        5. The Water Quality Issues report acknowledges potential future
    problems associated with changes in the flow regime for Colorado as the
    US Environmental Protection Agency and the Colorado Department of
    Public Health and Environment begin to implement TMDLs, but does not
    consider changes in flow regime to be important to the TMDLs already
    being developed and/or implemented in Kansas. But those analyses must
    recognize the requirement for TMDL development within Colorado, and its
    regulatory impacts on the proposed projects' operation. Responsible
    planning and management mandate that new water projects be in
    compliance with all regulatory requirements.
        6. Impacts to riparian habitat or wetlands along the Arkansas
    River, Williams Creek, Fountain Creek or other effected streams were
    not considered.
        7. Nonpoint source loads from agricultural runoff, such as
    nutrients and bacteria were not considered.
        8. The authors clearly state that environmental modeling was not
    used for any part of the assessment. Such an admission acknowledges the
    shallowness of the study.
        9. Construction-related impacts were not considered. While such
    impacts can be mitigated to a certain extent, practical experience
    proves that these loads can still be significant. They should be
    addressed.
        The methods used to rank storage alternatives failed to address
    water quality and environmental issues to Kansas's satisfaction. Use of
    outdated and qualitative data, and lack of a watershed approach do not
    validate conclusions presented in these studies. The cursory fashion in
    which the PSOP was formulated with regard to consideration of
    downstream impacts is wholly inadequate to support Congressional
    authorization of, and the expenditure of federal money for further
    study of the proposed options.
        Even without such further study, and based on review of the
    Environmental Issues and Water Quality Issues reports, it is clear that
    increasing storage in the Arkansas River Basin within Colorado would be
    detrimental to agricultural and municipal water users in Kansas. The
    reports acknowledge increased loadings without expressing concern for
    downstream impacts. Kansas already receives water of poor quality from
    Colorado, and the proposed changes in the water regime will further
    limit the beneficial uses of the Arkansas River in Kansas.
                                     ______

        Mr. Calvert. The first witness is John W. Keys, III,
    Commissioner of the Bureau of Reclamation, United States
    Department of Interior.
        John, why don't you take a seat there. You are recognized
    for what time you may consume.

        STATEMENT OF JOHN W. KEYS, III, COMMISSIONER, BUREAU OF
              RECLAMATION, U.S. DEPARTMENT OF THE INTERIOR

        Mr. Keys. It is a pleasure to be here today and provide
    testimony on proposed House bill 3881, which would authorize
    the Bureau of Reclamation to engage in studies to use excess
    capacity from and enlarge Pueblo Dam and Reservoir and Sugar
    Loaf Dam and Turquoise Lake of the Fryingpan-Arkansas Project
    in Colorado.
        I would ask that my full written statement be included in
    the record.
        Mr. Calvert. Without objection, so ordered.
        Mr. Keys. Mr. Chairman, Reclamation has two main objectives
    in working with the Southeastern Colorado Water Conservancy
    District. The first is to protect the facilities and authorized
    purposes of the existing Fryingpan-Arkansas Project and,
    second, to work with the district to do the proper studies of
    enlargement of Pueblo and Sugar Loaf Dams. These project
    purposes that we will protect are domestic and municipal water
    supplies, supplemental irrigation water, hydropower generation,
    flood control, recreation and conservation of fish and wildlife
    resources.
        Under the 1962 Act, the use of water and facilities of the
    project are subject to three interstate compacts: the Colorado
    Kansas Compact, the Upper Colorado River Basin Compact and the
    Colorado River Compact. House bill 3881 would authorize
    Reclamation to conduct studies for the enlargement of Pueblo
    Dam and Reservoir, Sugar Loaf Dam and Turquoise Lake. It would
    also authorize the Secretary to enter into contracts for the
    use of excess storage and conveyance capacity in each of those
    facilities in Colorado.
        Reclamation supports the concept in H.R. 3881 of using the
    excess capacity in reclamation facilities but within legal and
    policy parameters to optimize the benefits provided by the
    projects. Use of excess capacity may offer lower costs and more
    environmentally friendly solutions to water users than building
    new facilities. However, our concerns with H.R. 3881 are
    numerous.
        As stated before, the Fryingpan-Arkansas Project is a
    multi-purpose project. Any feasibility study must assess the
    overall impacts of the proposed reoperation of existing
    facilities and project purposes and impact of planned
    enlargements on those same facilities and project purposes as
    well as the new ones, and the study must assess any impact that
    the enlargements of redelegations of water and new operations
    might have on the interstate compacts.
        H.R. 3881 refers to the Preferred Storage Options Plan
    Report, PSOP, and the final PSOP Implementation Committee
    Report as describing the proposed enlargements and the use of
    excess capacities to deliver additional water supply. H.R. 3881
    limits the scope of studies it would authorize to only those
    provisions described in the PSOP reports. These reports
    represent only the district's interests and not necessarily
    those of the Federal Government.
        The scope of any feasibility study for enlarging Pueblo Dam
    and Reservoir and Sugar Loaf Dam and Turquoise Lake of the
    Project must be significantly broader than that proposed in
    H.R. 3881. It must address the other purposes and
    responsibilities of the project.
        Rather than authorize a district to fund the study, as
    proposed in proposed H.R. 3881, Reclamation recommends that any
    legislation authorize up to 50 percent of the total cost of
    feasibility studies. Such language would ensure that the
    studies would be done to Reclamation standards. The PSOP
    reports could be used to represent the district's interest, and
    interests of the public and stakeholders would be protected. We
    estimate the Federal share of the study to be about $2 million.
        Section 2 of H.R. 3881 appears to suggest that
    congressional authorization of a feasibility study might be
    sufficient to authorize construction at the dam without need
    for Congress to consider construction after the study is done.
    Although the 1939 Act is still on the books, Reclamation has
    not done business in this matter for over 30 years. We
    encourage you only to authorize an appropriate feasibility
    study at this time. Should construction be warranted and agreed
    upon, we will return to ask for specific construction authority
    after the study is done.
        The sections of H.R. 3881 that deal with contracts are very
    complicated and prescriptive and in some cases would have
    adverse impacts upon the project and other water users. We have
    begun a full legal and policy analysis of these contract
    provisions, and we will share that review with the Committee
    when it is completed.
        Finally, the application of revenues collected under the
    legislation is not consistent with current Reclamation law.
        Mr. Chairman, Reclamation commends the district for its
    efforts to address its future water needs. We believe we can
    work with them to complete a feasibility study for enlarging
    Pueblo Dam and Reservoir and Sugar Loaf Dam and Turquoise Lake
    that will help them reach their water supply goals, protect the
    original project purposes and honor all of the applicable
    compacts. We would be happy to work with the sponsor and the
    Committee to develop legislative language that will achieve the
    sponsor's goals while addressing our concerns with H.R. 3881 as
    introduced.
        That completes my statement, and I would certainly try to
    answer any questions that you have.
        Mr. Calvert. I thank the Gentleman for his testimony.
        [The prepared statement of Mr. Keys follows:]

     Statement of John W. Keys, III, Commissioner, Bureau of Reclamation,
                        U.S. Department of the Interior

        My name is John Keys, and I am Commissioner of the U.S. Bureau of
    Reclamation (Reclamation). I am pleased to provide the Administration's
    views on H.R. 3881, which would authorize the Secretary of the Interior
    to engage in studies relating to enlarging Pueblo Dam and Reservoir and
    Sugar Loaf Dam and Turquoise Lake of the Fryingpan-Arkansas Project in
    Colorado. While the Administration supports the efforts of the
    Southeastern Colorado Water Conservancy District to plan for future
    water needs, we cannot support H.R. 3881 as written.
        Congress authorized the Fryingpan Arkansas Project (Project) in
    1962 as a multi-purpose, transmountain, trans-basin water diversion and
    delivery project in Colorado. It makes possible an average annual
    diversion of 69,200 acre-feet of surplus water from the Fryingpan River
    and other Colorado River tributaries on the western slope of the Rocky
    Mountains to the Arkansas River basin on the eastern slope. Water
    diverted from the western slope, together with available water supplies
    in the Arkansas River Basin, provides an average annual water supply of
    80,400 acre-feet for both municipal/domestic use and supplemental
    irrigation in the Arkansas Valley. The Project includes a hydroelectric
    power plant with a generating capacity of 200 megawatts. Additional
    authorized Project purposes include flood control, recreation,
    conservation of scenery, natural, historic and archeologic objects on
    Project lands, and conservation and development of fish and wildlife
    resources. Further, under the 1962 Act, the use of Project water is
    subject to numerous inter-state compacts. This includes the Colorado-
    Kansas compact. The Project has been operated and maintained by
    Reclamation since its completion.
        The Southeastern Colorado Water Conservancy District (District)
    represents the irrigation and municipal and industrial water users
    served by the Project water supply. The District is responsible for
    repaying the United States for the cost of Project works associated
    with the irrigation and municipal and industrial functions of the
    Project, plus applicable interest. The District also pays a
    proportionate share of annual operation and maintenance (O&M) of the
    Project.
        H.R. 3881 authorizes the Secretary of the Interior (Secretary),
    through the Bureau of Reclamation, to conduct studies for the
    enlargement of Pueblo Dam and Reservoir, Sugar Loaf Dam and Turquoise
    Lake. The legislation also authorizes the Secretary to enter into
    contracts for the use of excess storage and conveyance capacity in east
    slope facilities of the Fryingpan-Arkansas Project, Colorado.
        Reclamation supports the concept expressed in H.R. 3881 of using
    the excess capacity in Reclamation facilities, within legal and policy
    parameters, to optimize the benefits provided by the projects. Use of
    excess capacity may offer lower costs and more environmentally friendly
    solutions to water users than building completely new facilities.
        However, our concerns with H.R. 3881 are numerous. My testimony
    today highlights a few of these concerns.
    Feasibility Studies
        The Fryingpan-Arkansas Project is a multipurpose project whose
    authorizing legislation imposes, in addition to authorized Project
    purposes, legal obligations on Reclamation including compliance with
    the interstate compact on the Arkansas River between Colorado and
    Kansas. Therefore, any feasibility study must assess the overall
    impacts of the proposed re-operation of existing facilities, on
    contracts, and the impact that the use and operation of planned
    enlargements of Project facilities might have on other users of Project
    water and on the interstate compact.
        H.R. 3881 refers to the Preferred Storage Options Plan (PSOP)
    Report of September 21, 2000, and the Final PSOP Implementation
    Committee Report of April 19, 2001, as documents describing the various
    aspects of proposed enlargements at two reservoirs and the use of
    excess capacity of existing facilities in delivering these additional
    water supplies. H.R. 3881 limits the scope of studies it would
    authorize to only the provisions described in the PSOP reports
    themselves. These reports, products of considerable effort and forward
    thinking by the District, were prepared by consultants to the
    Southeastern Colorado Water Conservancy District and Enterprise Board,
    and, as such, represent only the District's interests, and not
    necessarily those of the Federal government.
        Because Fryingpan-Arkansas is a Federal multi-purpose Project which
    Reclamation must operate in compliance with inter-state compact
    obligations, Reclamation's role is different from and broader than that
    of the District and, therefore, the scope of any feasibility studies
    relating to enlarging Pueblo Dam and Reservoir and Sugar Loaf Dam and
    Turquoise Lake of the Fryingpan-Arkansas Project must be significantly
    broader than that proposed in H.R. 3881. While the PSOP studies are
    very useful tools in presenting the District's interests, Reclamation's
    role is to analyze the impacts of the proposed action at Pueblo Dam on
    all the beneficiaries of Project water, as well as on the multiple
    Project purposes including upland recreational improvements around
    Turquoise Lake, and on the inter-state compacts. Under Congressional
    directives and long-standing Reclamation policy, a feasibility study
    performed by Reclamation must study a range of alternatives to
    determine the best approach to meeting identified needs.
        Rather than authorize a District to fund the total cost of the
    studies, either partly or wholly in the form of services, as proposed
    in H.R. 3881, the Department recommends that any legislation authorize
    up to 50% of the total cost of feasibility studies. This would ensure
    that feasibility studies appropriate for the nature and complexities of
    the Project are designed, written, and completed to Reclamation's
    standards, using the PSOP reports as a foundation expressing the
    District's interests, and with a shared ownership of the end product.
    In this manner, the Secretary, through Reclamation, can ensure that the
    interests of the public and stakeholders have been considered, to the
    extent possible, through the public process required by Reclamation
    law, while sharing the costs with the District consistent with current
    Reclamation policy. We estimate the cost of the federal share of such
    studies to be about $2 million.
    Congressional Authorization of Construction
        Section 2 of H.R. 3881 appears to suggest that congressional
    authorization of a feasibility study may be sufficient to authorize
    initiation of construction at the Dam, without the need to go back to
    Congress for additional specific construction authorization. Although
    this law (the Act of August 4, 1939) is still on the books, it
    conflicts with how Reclamation has done business for over 30 years.
    Reclamation encourages the Committee to authorize only an appropriate
    feasibility study relating to enlarging Pueblo Dam and Reservoir and
    Sugar Loaf Dam and Turquoise Lake of the Fryingpan-Arkansas Project in
    Colorado. Reclamation will request that Congress provide for
    construction authorization if results of the feasibility study justify
    that work.
    Legal Precedents
        The sections of H.R. 3881 dealing with contracts are very
    complicated and, if enacted, could set many precedents Reclamation-
    wide. The current language of H.R. 3881 is very prescriptive and could
    cause unintended and adverse precedents for Reclamation contracts with
    other entities for excess storage capacity and the delivery of non-
    project water through project facilities. Reclamation has begun a full
    legal and policy analysis of the precedent-setting actions set forth in
    H.R. 3881. When it is completed, we will send a copy to the Committee.
        Reclamation also has concerns about the implications for potential
    water delivery contractors arising from the various restrictions
    imposed by H.R. 3881 on the Secretary's contracting authority. For
    example, H.R. 3881 states that Reclamation can contract with any entity
    delivering water for municipal or other purposes, but the entity must
    first have signed an agreement with the District under certain terms
    listed in the legislation. These terms include a provision for payment
    of any surcharges set by the District. This requirement alone could
    provide significant leverage to the District to impose substantial
    surcharges as a prerequisite to an agency's entering into a contract
    with the Secretary.
        Finally, the application of revenues collected under the
    legislation, not related to the surcharges of the District, is not
    consistent with current Reclamation law.
    Conclusion
        Reclamation appreciates the District's forward thinking and
    collaborative planning efforts in developing its PSOP reports. While we
    applaud their efforts to plan for the future, we must recognize the
    many complexities of the Project. Unlike many Reclamation projects, the
    Fryingpan-Arkansas Project was developed for multiple uses from the
    beginning, so our role is different and broader than the District's.
    Reclamation is committed to build upon the good work done by the
    District. As such, the Department proposes that Congress authorize
    Reclamation to conduct a feasibility study consistent with the
    AReclamation Manual Directives and Standards for feasibility studies@,
    with a shared ownership of the end product; and to produce contracting
    authorities consistent with and complementary to Reclamation law.
        Reclamation commends the Southeastern Colorado Water Conservancy
    District and Enterprise Board for its efforts to address its future
    water needs. Reclamation would be happy to work with the sponsor and
    the Committee to develop legislative language that would achieve the
    sponsor's goals while addressing our concerns with H.R. 3881 as
    introduced. This concludes my statement and I would be pleased to
    answer any questions.
                                     ______

        Mr. Calvert. Maybe we can expand on this a little bit.
        Section 2a of the Act begins by stating, the Secretary of
    Interior is hereby authorized to engage in storage space
    studies up to and including the feasibility study pursuant to
    section 8 of the Federal Water Project Recreation Act and
    section 9a of the Act on August 4 of 1939. As may be
    appropriate relating to the enlarging of Pueblo Dam and
    Reservoir and Sugar Loaf Dam and Turquoise Lake, explain what
    the implication of these sections are.
        Mr. Keys. Well, sir, if you look at the 1939 Act, the
    language in there actually takes it all the way to
    construction; and what we are saying is we would like to do the
    feasibility study and then come back for specific authorization
    to do construction, rather than this one authorization carry it
    all the way through the process.
        Mr. Calvert. Has there been precedent for that already? I
    mean, as far as going ahead and doing the feasibility and
    moving directly to construction?
        Mr. Keys. Yes, sir. In the 1940's and 1950's, it was done
    that way on a regular basis. But, like I said, for the last 30
    years we have not done it that way. We think we need to do a
    feasibility study and come back and let the Congress know what
    the results of that feasibility study are before specific
    construction is authorized.
        Mr. Calvert. How long would that feasibility study take?
        Mr. Keys. We think we can do it in a couple of years, sir.
        Mr. Calvert. Thank you.
        Mr. Hefley.
        Mr. Hefley. Well, we certainly want to work with you on
    your concerns, and the Bureau is concerned. Where were you when
    we were trying to develop this bill? Because we thought we
    worked with everybody to work out whatever we could on this.
        Mr. Keys. Mr. Chairman, Mr. Hefley, we worked with the
    people from southeast Colorado, but we were not part of the
    decisionmaking process in doing the designs and actually doing
    the drafting of the bill.
        Mr. Hefley. Mr. Chairman, I guess that is all I have at
    this point.
        We do want to work with you and try to work it out. I am
    not sure I agree with all of your concerns, but we don't want
    this bill to be a bill which hurts anybody--the downstream
    compacts, isn't it true that the law determines how much water
    under the compacts we send downstream to Kansas?
        Mr. Keys. Mr. Chairman, Mr. Hefley, the State law
    determines that. All of our projects are built within State
    water rights. Then we operate those projects within those water
    rights, and all of our water rights are subject to the compacts
    that are negotiated between those States. So we are subject to
    those. The existing project is subject to them, and any
    resulting project should be subject to those State water rights
    and the compacts.
        Mr. Hefley. Mr. Chairman, you are aware of this better than
    anybody because you are a recipient of the Colorado River
    drainage system, but everything starts in Colorado when we talk
    about water. I think there is one little stream that comes out
    of Wyoming up on the border and into Colorado, but all the
    other rivers run out of Colorado. So the Poudre goes into
    Nebraska, and we have to deal with a compact on the Poudre. The
    Arkansas River goes into Kansas, and we deal with the compacts
    for the Arkansas River, and they are entitled to their share of
    the water. And the Rio Grande goes into New Mexico and Texas
    and Colorado, goes to California--through a number of States.
        So it is a tough situation when we start dealing with
    water; and everybody gets very, very nervous when we start
    dealing with water because you don't want your communities
    dried up. The thing that limits Colorado's future growth is
    water. That is the one thing that limits it, and the need to
    store water. We don't get much rain. We get snow in the
    wintertime, and we need to be able to store that snow in the
    wintertime for beneficial use later on in the year, whether it
    be going downstream to the compacts or be for use within the
    State of Colorado.
        The Bureau of Reclamation has worked very well with us, and
    we hope that you will work with us as we try to develop this
    bill to make it work for everybody. We have no intention of
    damaging anybody with this piece of legislation, but we do
    think that it has a two-prong importance. The first is that
    some of the municipalities can store their water in Pueblo
    Reservoir; and that is--as I indicated in my testimony, maybe
    the most important part of this whole thing is the ability to
    store their water, it is their water, to be able to store it
    there. And, second, to look at the idea of expanding these
    reservoirs for future storage.
        After Two Forks, which was approved all the way up and down
    the line until the EPA Director, who happened to be in the
    first Bush administration and didn't know Two Forks from
    anything, arbitrarily, after it passed all the permitting and
    had gone on for years, he arbitrarily canceled it, I said,
    there will never be another major water project built in the
    West after this kind of example ever again. So you have to do
    something to be able to capture and store more of this water.
        Of course, that is the business you are in, Mr. Keys; and I
    hope that you will work with us on this.
        Mr. Keys. We would pledge to work with both the sponsor and
    the Committee to work on the bill to make it acceptable and
    then to do the necessary studies so that our project
    facilities, their purposes and so forth are protected and to
    help southeast Colorado come up with what they need to do.
        Mr. Calvert. Thank you, and I would be happy to work with
    everybody to try to accommodate that.
        Mr. Moran.
        Mr. Moran. Mr. Chairman, thank you for allowing me to be in
    a Committee that is so cooperative. It is pleasing to be here
    and hear the testimony. I thank Mr. Keys for his comments.
        I would only ask that the feasibility study include the
    role compliance with the compact. Is that something that is
    considered in your feasibility study? Is it one of the three
    compacts that you described?
        Mr. Keys. Mr. Chairman, it is part and parcel of meeting
    the water rights that we would have to obtain from the State
    before we could build the project. The study would determine
    how much water is available, how we would meet the compact and
    provide the waters that folks are looking for.
        Mr. Moran. So a project that is determined feasible by the
    Bureau of Reclamation would be in compliance with the compacts?
        Mr. Keys. Mr. Chairman, that is correct. It has several
    levels of feasibility. One is economic feasibility and the
    other is whether it will work or not. And certainly State water
    rights are part of the decision of whether it will work.
        Mr. Moran. Thank you, Mr. Chairman.
        Mr. Calvert. Thank you. Any further questions for this
    witness?
        Mr. Hefley. If I might ask one more question, why would it
    take 2 years to do this feasibility study? Don't you have most
    of the data and so forth at hand?
        Mr. Keys. Mr. Chairman and Mr. Hefley, we have the data on
    what southeast Colorado wants to do, but we need to go back and
    look at the other purposes of the project to be sure that they
    are protected, to see if there are other purposes that should
    be expanded at the same time. While we are raising the dam, it
    would be a shame to raise it to a certain level and another
    half of foot might provide so many other benefits or maybe the
    last half of foot that you are looking for has done some damage
    that you can get away from. So we would take a look at all the
    other purposes of the project at the same time, using that
    information from southeast Colorado and what they need.
        Mr. Hefley. You still think it would take about 2 years?
        Mr. Keys. Yes, sir.
        Mr. Calvert. I thank the Gentleman for his testimony.
        Our second panel is the Honorable Carla Stovall, the
    Attorney General for the State of Kansas; the Honorable Jim
    Null, Councilman, City of Colorado Springs, State of Colorado;
    and David Pope, Chief Engineer, State of Kansas Department of
    Agriculture, Division of Water Resources.
        Mr. Calvert. Ms. Stovall, you may begin your testimony.

      STATEMENT OF THE HONORABLE CARLA STOVALL, ATTORNEY GENERAL,
                            STATE OF KANSAS

        Ms. Stovall. Mr. Chairman, thank you very much for the
    privilege of being here. Congressman Moran, thank you for the
    invitation to come as well.
        I do appear in opposition to this particular piece of
    legislation, and my testimony will build on what Congressman
    Moran talked about to help the Committee members understand
    what the litigious nature of these water resources are for both
    of these States. It is litigation between Kansas and Colorado,
    litigation that has spanned a century, litigation with the
    dubious distinction of being one of the foremost water cases in
    this United States. I offer the testimony to show why passage
    and implementation of this law would cause deep concerns to us
    and we believe potentially cause additional litigation.
        As Congressman Moran said, we have spent, as Kansans, $17
    million already on this litigation which has lasted 17 years.
    Anything that gets in the way of resolving this litigation we
    think would be detrimental to the interests of the citizens of
    Colorado as well as Kansas.
        While it is my intent to talk about the litigation, David
    Pope, our Chief Engineer, will be able to provide information
    to the Committee about the technical nature of the impact of
    this potential legislation.
        Throughout the last century, Kansas and our citizens have
    battled with Colorado in the courts in a continuous battle to
    obtain our equitable share of the Arkansas River. Kansas first
    sued Colorado in the U.S. Supreme Court in 1901, alleging that
    they were depleting our water. It was the first time the United
    States Supreme Court said it would authorize original
    jurisdiction between two States suing one another over
    interstate water issues. In 1907, unfortunately for Kansas, the
    United States Supreme Court found that we hadn't adequately
    proved a depletion, but nonetheless had indicated that we are
    right to have exercised our right.
        In the early part of the 20th century, the dispute waged
    on. Kansas water users actually sued the water users of
    Colorado to stop their increasing use. Colorado then sued
    Kansas in the U.S. Supreme Court in 1927 seeking an injunction
    against our water users suing their water users. We countered
    with a second request to the Supreme Court to enjoin again the
    continuing increases in water use by Colorado.
        In 1943, the United States Supreme Court made a decision
    that really encouraged, if not directed, both States to enter a
    compact so that we weren't all the time in litigation but that
    we had a compact that would govern the use of this water. This
    Congress approved that compact in 1949; and it was, of course,
    signed by the President of the United States at that time.
        But, nonetheless, in 1985 Kansas was again forced to go to
    court, again to the United States Supreme Court, because of
    violations of the compact. The case was assigned by the U.S.
    Supreme Court to a Special Master who conducted 177 days of
    trial and made a report to the United States Supreme Court. In
    a unanimous decision written by the Chief Justice, William
    Rehnquist, in 1995, the United States Supreme Court agreed with
    the Special Master and found that Colorado had indeed violated
    the compact in direct violation of the rights of Kansas.
        One of the things the Chief Justice found in that decision
    was not only do we disagree about implementation of the compact
    but we don't even agree on how to pronounce the river. It is
    the Arkansas River that we are dealing with once it comes into
    the State of Kansas.
        But after that decision in 1995 we went back to trial
    again. Two more reports by the Special Master, a second
    argument before the State--the Nation's highest court resulted
    in the decision of 2001 that Congressman Moran mentioned. There
    the Court found that we have been shorted 428,005 acre feet of
    water since 1950. That is real water to real Kansans that we
    were deprived of.
        In keeping with the precedent-setting character of the
    ongoing dispute with us in court, the latest decision, the one
    issued in June of last year, represents the largest monetary
    award one State has ever been--had handed them down against
    them over the objection of the other State. It was also the
    first interstate water compact case in which prejudgment
    interest was awarded for a compact violation. It is also the
    most definitive statement by the United States Supreme Court
    that water compact damage claims are not barred by the Eleventh
    Amendment to the Constitution.
        This litigation has been precedent setting in many, many
    respects but has taken us a long to time to get to where we
    are. Kansas has virtually won at every stage of the proceeding
    thus far. Notwithstanding those victories, we still have
    substantial issues to resolve, and that has to do with future
    compliance of the compact. How does Colorado get to Kansas the
    water that we are entitled to? That is the next phase. We
    engaged in about 4 months of negotiation this fall to try to
    resolve that ourselves without going back to the Court. We fell
    far short of being able to resolve that.
        I would submit to you members of this Committee that
    anything that interferes, that has an impact in the Arkansas
    River is going to have substantial depletions to us and put off
    farther an ultimate decision by the Supreme Court and/or any
    successful negotiations we could possibly have. David Pope, our
    Chief Engineer, will talk about the specifics of why we believe
    technically this proposed legislation causes us problems.
        But I would suggest to you anything that increases the
    amount of water capacity to be stored in Colorado necessarily
    affects us. We believe we are still 11,000 acre feet short
    every year of water under the compact that we are entitled to.
    Storing any additional water means that we are not getting the
    water that we are entitled to. So we would very strongly oppose
    even approving this as the feasibility study which the Bureau
    of Reclamation supported, and we would simply ask you not to
    let this go any farther because of the significant depletions
    and damage that would result.
        Thank you very much for the privilege of testifying before
    you.
        Mr. Calvert. Thank you. Happy to know what we do in this
    Committee for attorneys throughout the country.
        [The prepared statement of Ms. Stovall follows:]

    Statement of The Honorable Carla J. Stovall, Attorney General, State of
                                     Kansas

        Distinguished members of the Subcommittee, my name is Carla J.
    Stovall, Attorney General for the State of Kansas. I wish to thank you
    for allowing me to appear today to testify in opposition to H. R. 3881.
        This testimony will provide some background information on the
    litigation between the States of Kansas and Colorado over the waters of
    the Arkansas River; litigation spanning a century; litigation with the
    dubious distinction of being one of the foremost disputes in the
    country for generating United States Supreme Court precedent in
    interstate water law. I offer this testimony to show why passage and
    implementation of H.R. 3881 would cause deep concern to Kansas and
    potentially cause additional litigation in the event passage results in
    increased violations of the Arkansas River Compact by Colorado, a
    result all too likely in Kansas' view.
        Throughout the entire last century, Kansas and its citizens engaged
    in court battles with Colorado in a perpetual legal attempt to obtain
    Kansas' equitable share of the Arkansas River. Kansas first sued
    Colorado in the U.S. Supreme Court in 1901, alleging Colorado was
    unfairly depleting streamflows to Kansas' detriment. When the Supreme
    Court, in 1902, refused Colorado's request that the case be dismissed,
    it affirmed for the first time that it would exercise its original
    jurisdiction to determine the equitable apportionment of interstate
    waters. In 1907, however, the high court decided that Kansas had not
    proven enough depletions to warrant an injunction against Colorado to
    halt its expanding use of the Arkansas River waters.
        In the early part of the 20th Century, the contentious dispute
    raged on between Kansas and Colorado over how to share the waters of
    the Arkansas River. Kansas water users began suing Colorado water users
    to stop Colorado's increasing use. Colorado then sued Kansas in the
    U.S. Supreme Court in 1927 seeking an injunction against the Kansas
    water-user suits, and Kansas countered with a second request to the
    Court to enjoin continuing increases in use by Colorado. The Supreme
    Court's 1943 decision in that case led to, and in fact explicitly
    encouraged, the negotiation of the Arkansas River Compact (Compact), an
    agreement between Kansas and Colorado that was ratified by Congress in
    1949 after three years of negotiations between the states.
        In 1985, Kansas filed in the U.S. Supreme Court its latest suit
    against Colorado. This case was assigned to a Special Master who
    conducted 143 days of trial and then reported to the U.S. Supreme Court
    with a recommendation that it find Colorado had violated the 1949
    Compact through groundwater pumping which materially depleted usable
    flows. The Supreme Court, in a unanimous 1995 decision authored by
    Chief Justice Rehnquist, agreed with the Special Master's assessment
    and had no difficulty in concluding that Colorado had caused material
    depletions of the usable flows of the Arkansas River, in violation of
    the Compact.
        After some 63 more days of trial, two more reports by the Special
    Master to the Supreme Court, and a second argument before the Court,
    the most recent decision was issued in June 2001. The Supreme Court's
    ruling determined that Colorado violated the Arkansas River Compact by
    depriving Kansas of 428,005 acre-feet of water from 1950 through 1996
    (one acre-foot is 325,851 gallons). As a result of the Court's
    decision, Colorado will have to pay money damages to Kansas to
    compensate for the its injury.
        In keeping with the precedent-setting character of the ongoing
    dispute between Kansas and Colorado, the latest Supreme Court decision
    represents the largest monetary award ever made in an interstate water
    compact case and the first and only such award imposed over the
    objection of the defendant state. This was also the first interstate
    water compact case in which prejudgment interest was awarded for a
    compact violation. The case also represents the most definitive
    statement ever by the Court that interstate water compact damage claims
    based on losses of individual water users are not barred by the
    Eleventh Amendment to the U.S. Constitution.
        Notwithstanding Kansas' substantial victories fought and won in the
    Supreme Court, victories achieved despite bitter and aggressive
    opposition by the State of Colorado, the most important aspect of the
    case remains to be concluded. The final phase of our 17 year battle
    with Colorado is scheduled to begin in June of this year. The Special
    Master will determine perhaps the most important question in the case:
    What must Colorado do in order to come into compliance with the 1949
    Compact?
        H.R. 3881 threatens to cause new depletions of the usable flows of
    the Arkansas River in violation of the 1949 Compact. Kansas' experts
    confirm the common sense notion that capturing and using additional
    water in Colorado, or intensifying current uses, will deplete the flows
    that now support uses downstream in Kansas. The legislation would
    authorize operation of a water bank allowing storage of existing non-
    Fryingpan-Arkansas project water in the reservoir. This storage may
    result in expanded and more consumptive uses of pre-compact water
    rights, thus depleting streamflows to KS. Storage of new water in any
    enlarged reservoir space has the certain potential to intercept water
    that would otherwise flow downstream for use in Kansas.
        The Congress should not, in my view, step into the middle of the
    pending interstate litigation on the Arkansas River by enacting the
    proposed legislation. To do so would exacerbate and rekindle the
    current suit. Colorado has not sought Kansas' input, but rather has
    rebuffed Kansas' attempts to provide such input on the enlargement and
    intensified operation of Pueblo Reservoir.
        In sum, it is inconsistent with the equal footing of the States to
    consider such potentially detrimental legislation over the objections
    of the affected downstream state. I therefore recommend against passage
    of H.R. 3881.
                                     ______

        Mr. Calvert. Our next witness is the honorable Jim Null,
    Councilman, City of Colorado Springs.

       STATEMENT OF THE HONORABLE JIM NULL, COUNCILMAN, CITY OF
                  COLORADO SPRINGS, STATE OF COLORADO

        Mr. Null. Good morning, Mr. Chairman and members of the
    Subcommittee. I am Jim Null, a member of the Colorado Springs
    City Council. I appreciate the opportunity to testify here
    today on H.R. 3881 sponsored by Congressmen Hefley, McInnis,
    Schaffer and Tancredo. This bill which is of great importance
    to the City of Colorado Springs--great importance, and I
    appreciate the leadership of our congressional delegation for
    introducing this legislation.
        Colorado Springs is the second largest metropolitan area in
    the State of Colorado and the home to a number of military
    installations, including the Air Force Academy, Fort Carson,
    NORAD and Peterson Air Force Base. We sit at the base of Pikes
    Peak and find ourselves in a beautiful place to work, recreate
    and raise a family. We have experienced rapid growth in the
    past 5 years, an 18 percent increase overall. In fact, the
    population has nearly tripled in the last 30 years. Our
    community continues to draw new industry and residents.
        We have a history of providing reliable, cost-effective
    utility services to our customers, including domestic,
    commercial and industrial water supplies, despite our location
    in a very arid part of the country. H.R. 3881 will allow us to
    continue to meet that responsibility in a manner which
    maximizes the efficiency of both existing infrastructure and
    existing water supplies, thereby minimizing the need for new
    storage and the acquisition of additional water rights within
    and outside the basin. With this legislation, we can avoid new
    reservoir construction and water transfers from other basins or
    from agricultural to municipal use.
        In 1990, we began a water planning process to determine our
    needs through the year 2040, based upon realistic growth
    projections. We found that though our existing water supply
    decrees may be adequate, there was a need for additional
    storage and delivery infrastructure. 1996, the city adopted a
    plan of action which identified a number of approaches for
    meeting our future water demands, including water conservation,
    existing system improvements and a new southern delivery system
    from Pueblo Reservoir.
        As part of this plan, Colorado Springs Utilities approached
    the Southeastern Colorado Water Conservancy District and
    indicated our need for additional storage. The district then
    conducted a water and storage needs assessment on behalf of all
    district members, including Colorado Springs. Colorado Springs
    Utilities fully supported this district-wide effort. That study
    confirmed the need for additional storage capacity in order to
    provide firm yield to municipal entities and analyzed a wide
    range of alternatives to meet that demand, including project
    reoperations which would allow the storage of nonproject water
    in the Fry-Ark Project space and reservoir enlargements.
        Both reoperations and enlargement of these reservoirs
    ranked very favorably in terms of cost, operational
    effectiveness and environmental/socio-economic factors. Thus,
    it was decided by the district members to proceed with these
    options. Colorado Springs has committed to pay for and receive
    approximately 50 percent of the additional storage capacity
    available through reoperations and enlargements, totaling
    58,000 acre feet of storage, a critical component in meeting
    our future water requirements.
        Colorado Springs and the Southeast District were not alone
    in undertaking these planning efforts. Over 40 entities
    participated in the storage study process, including such
    entities as the Arkansas River Outfitters Association, the
    Colorado Division of Wildlife and the Pueblo Board of Water
    Works, the body responsible for providing water service to the
    City of Pueblo, our neighbor to the immediate south.
    Reoperation implementation costs were estimated at $2.5
    million, with enlargement implementation for the first 4 years,
    that is, preconstruction, amounting to another $2 million.
    Actual enlargement costs have been estimated at $110 million.
    Substantial investments have already been made to date.
        The advocates of H.R. 3881 have also been very careful to
    consider and attempt to accommodate the needs of a variety
    interests. Of course, in our western water rights system,
    decrees issued by our water courts will contain provisions to
    assure the water rights of others are not in any way injured.
    However, we have also attempted to accommodate the concerns of
    parties who don't even hold water rights. For example, the
    project proponents have voluntarily committed to not exercise
    their lawful water exchange rights at such times as the flow in
    the Arkansas River below the Pueblo Dam is below 100 cubic feet
    per second. In order to achieve this goal, Colorado Springs and
    other supporters of this legislation have agreed to curtail
    their ability to exchange water and store it in Pueblo
    Reservoir. This commitment is a good-faith effort to reach a
    compromise which recognizes that such minimum flows will serve
    recreation, fish and environmental values.
        We have also inserted a provision in the bill designed to
    constrain additional future transbasin diversions absent
    consent from the basin of origin. The language of this action
    remains the subject of ongoing discussions, but I believe it is
    fair to say that all parties agree upon the objective of the
    legislation, that is, the efficient utilization of decrees and
    resources.
        I am also aware of some concerns expressed by the City of
    Pueblo, as compared to the Board of Water Works, but can assure
    you that the project proponents are actively engaged in talks
    with the city. This includes an exchange of written proposals
    designed to alleviate their concerns through a mutually
    beneficial approach to water management. I believe such a
    solution is certainly possible without requiring any amendments
    to H.R. 3881. We have encouraged the City of Pueblo to join the
    rest of us in supporting this legislation and to participate in
    this project so they can acquire the ability to store water and
    release it for their legitimate downstream needs.
        H.R. 3881 is project-specific legislation and hence holds
    no implications for other Bureau projects. However, it should
    not go without saying that there is ample precedent for such a
    practical and useful approach to meeting water supply demands
    in the West, including H.R. 1235 by Representative George
    Miller of California and S. 2594 by Senator Wayne Allard of
    Colorado, each of which were adopted during the 106th Congress.
        As you can see, H.R. 3881, which confirms that nonproject
    water can be stored in excess Fry-Ark Project space and
    authorizes the study which is the precursor to project
    enlargements, is a very worthwhile and necessary piece of
    legislation which will go a long way toward meeting our future
    water demands in the entire Arkansas Valley and certainly in
    our city. Further, and you probably don't hear this very often,
    it has no fiscal note for the Federal taxpayer. We are funding
    this undertaking ourselves and not requesting any Federal
    appropriation. It is a bill I hope you will look upon
    favorably.
        I thank you for this opportunity to testify and am
    available to answer any questions you might have.
        Mr. Calvert. I thank the Gentleman for his testimony.
        [The prepared statement of Mr. Null follows:]

             Statement of James Null, Colorado Springs City Council

        Good morning Mr. Chairman and Members of the Subcommittee. I am Jim
    Null, a member of the Colorado Springs City Council. I appreciate the
    opportunity to testify here today on H.R. 3881, by Congressmen Hefley,
    McInnis, Schaffer and Tancredo. This bill which is of great importance
    to the City of Colorado Springs and I appreciate the leadership of our
    Congressional delegation for introducing this legislation.
        Colorado Springs is the second largest metropolitan area in the
    state of Colorado and the home to a number of our military
    installations, including the Air Force Academy, Fort Carson, NORAD, and
    Peterson Air Force Base. It is located within the Southeastern Colorado
    Water Conservancy District and is, in fact, the largest ``customer'' of
    that District in terms of population served. We sit at the base of
    Pikes Peak and find ourselves in a beautiful place to work, recreate
    and raise a family. That is undoubtedly part of the reason why we have
    experienced rapid growth in the past five years, an 18% increase
    overall. In fact, the population has nearly tripled in the last 30
    years. Our community continues to attract new industry and residents.
        We have a history of providing reliable, cost-effective utility
    services to our customers, including domestic, commercial and
    industrial water supplies, despite our location in a very arid part of
    the country. H.R. 3881 will allow us to continue to meet that
    responsibility in a manner which maximizes the efficiency of both
    existing infrastructure and existing water supplies, thereby minimizing
    the need for new storage and the acquisition of additional water rights
    within and outside the basin. With this legislation, we can avoid new
    reservoir construction and water transfers from other basins or from
    agricultural to municipal use.
        Colorado Springs possesses a very diverse water supply and delivery
    system, with over 75% of its water coming from the Colorado River Basin
    through transbasin diversion projects. The remainder is obtained from
    the Pikes Peak watershed or from the Arkansas River itself via the
    Fountain Valley Pipeline. The latter delivers our Fryingpan-Arkansas
    Project water.
        In 1990, we began a water planning process to determine our needs
    through the year 2040 based upon realistic growth projections. We found
    that though our existing water supply decrees may be adequate, there
    was a need for additional storage and delivery infrastructure. In 1996,
    the City adopted a plan of action which identified a number of
    approaches for meeting our future water demands, including water
    conservation, existing system improvements, and a new southern delivery
    system from Pueblo Reservoir.
        As part of this action plan, Colorado Springs Utilities approached
    the Southeastern Colorado Water Conservancy District and indicated our
    need for additional storage. The Southeastern Colorado Water
    Conservancy District then conducted a water and storage needs
    assessment on behalf of all District members, including Colorado
    Springs. Colorado Springs Utilities fully supported this district-wide
    effort. That study confirmed the need for additional storage capacity
    in order to provide firm yield to municipal entities and it analyzed a
    wide range of alternatives to meet that demand, including project re-
    operations and reservoir enlargements. Project re-operations, which
    better utilizes existing storage facilities, would allow for the use of
    excess capacity in existing Fry-Ark Reservoirs. In particular, it would
    allow for the storage of ``non-project'' water in the Fryingpan-
    Arkansas project space.
        In addition to authorizing re-operations, this legislation calls
    for a study of the feasibility of enlarging Pueblo Reservoir and
    Turquoise Reservoir. These enlargement studies are a critical first
    step in future water planning and development in the Arkansas River
    Valley. Both re-operations and enlargement of these reservoirs ranked
    very favorably in terms of cost, operational effectiveness and
    environmental/socio-economic factors. Thus, it was decided by the
    District members to proceed with these options. Colorado Springs has
    committed to pay for and receive approximately 50% of the additional
    storage capacity available through re-operations and enlargements,
    totaling approximately 58,000 acre-feet of storage, a critical
    component in meeting our future water supply requirements.
        Colorado Springs and the Southeast District were not alone in
    undertaking these planning efforts. Over 40 entities participated in
    the storage study process, including the Upper Arkansas Water
    Conservancy District, the City of Canon City, Arkansas River Outfitters
    Association, Colorado Division of Wildlife, City of Florence and the
    Pueblo Board of Water Works, the body responsible for providing water
    service to the City of Pueblo, our neighbor to the immediate south. Re-
    operation implementation costs were estimated at over $2.5 million,
    with enlargement implementation for the first four years, i.e.,
    preconstruction, amounting to another $2 million. Actual enlargement
    costs have been estimated at $110 million. Substantial investments have
    already been made to date.
        The advocates of H.R. 3881 have also been very careful to consider
    and attempt to accommodate the needs of a variety of interests. Of
    course, in our western water rights system, decrees issued by our water
    courts will contain provisions to assure that water rights of others
    are not in any way injured. However, we have also attempted to
    accommodate the concerns of parties who don't even hold water rights.
    For example, the project proponents have voluntarily committed to not
    exercise their lawful water exchange rights at such times as the flow
    in the Arkansas River below the Pueblo Dam is below 100 cubic feet per
    second. In order to achieve this goal, Colorado Springs and other
    supporters of this legislation have agreed to curtail their ability to
    exchange water and store it in Pueblo Reservoir. This commitment is a
    good-faith attempt to reach a compromise, which recognizes that such
    minimum flows will serve recreation, fish and environmental values.
        We have also inserted a provision in the bill designed to constrain
    additional future transbasin diversions absent consent from the basin
    of origin. The language of this section remains the subject of ongoing
    discussions, but I believe it is fair to say that all parties agree
    upon the objective of the legislation, i.e., the efficient utilization
    of existing decrees and resources.
        I am also aware of some concerns being expressed by the City of
    Pueblo (as compared to the Board of Water Works), but can assure you
    that the project proponents are actively engaged in talks with the
    City. This includes an exchange of written proposals designed to
    alleviate their concerns through a mutually beneficial approach to
    water management. I believe that such a solution is certainly possible
    without requiring any amendments to H.R. 3881. Colorado law, as
    developed over the last century, recognizes the seniority of the
    project participant's existing decrees and pending water right
    applications which will be utilized in project operations. That same
    set of statutes also dictates that the state Water Conservation Board
    is the ``only'' entity entitled to hold ``instream flow decrees,'' with
    such decrees being found throughout the basin. Finally, state law also
    identifies, consistent with the federal Clean Water Act, a set of
    regulatory provisions which ensure that ``dilution is not the solution
    to pollution,'' and that water quality requirements, though of
    paramount importance, cannot impair the right to divert water and place
    it to beneficial use. Investments made to date by others without
    consideration of these pre-existing legal and factual premises may have
    been unwise, but they are investments which nonetheless should be
    accommodated to the extent practicable. We have encouraged the City of
    Pueblo to join the rest of us in supporting this legislation, and to
    participate in this project so as to acquire the ability to store water
    in available space and release it for their legitimate downstream
    needs.
        H.R. 3881 is project-specific legislation, and hence holds no
    implications for other Bureau projects. However, it should not go
    without saying that there is ample precedent for such a practical and
    useful approach to meeting water supply demands in the West, including
    H.R. 1235 by Representative George Miller of California and S. 2594 by
    Senator Wayne Allard of Colorado, each of which were adopted during the
    106th Congress.
        As you can see, H.R. 3881, which confirms that non-project water
    can be stored in excess Fry-Ark Project space and authorizes the study
    which is a precursor to project enlargements, is a very worthwhile and
    necessary piece of legislation which will go a long way towards meeting
    future water demands in the entire Arkansas Valley and certainly in my
    City. Further, and you probably do not hear this very often, it has no
    fiscal note for the federal taxpayer--we are funding this undertaking
    ourselves and not requesting any federal appropriation. It is a bill
    that I hope you will look upon favorably.
        I thank you for this opportunity to testify and am available to
    answer any questions.
                                     ______

        Mr. Calvert. Next, David Pope, Chief Engineer, State of
    Kansas Department of Agriculture.

       STATEMENT OF DAVID POPE, CHIEF ENGINEER, STATE OF KANSAS
         DEPARTMENT OF AGRICULTURE, DIVISION OF WATER RESOURCES

        Mr. Pope. Thank you, Mr. Chairman and distinguished Members
    of Congress. My name is David Pope, Chief Engineer of the
    Kansas Department of Agriculture's Division of Water Resources.
    I am here representing Governor Bill Graves to testify in
    opposition to H.R. 3881.
        We believe passage of H.R. 3881 would have a long-term
    detrimental effect on the interests of the State of Kansas,
    including a reduction in the quantity and quality of water on
    which it relies.
        I am a member of the Arkansas River Compact Administration.
    That compact, which was negotiated between the States and
    approved by Congress in 1949, was designed to settle disputes
    and divide and apportion the waters of the Arkansas River and
    its benefits arising from the construction of John Martin
    Reservoir and basically to maintain conditions as they were at
    the time of ratification.
        The Arkansas River is essentially the only renewable water
    supply in southwest Kansas and provides critical water supplies
    through direct diversion from the river to agriculture and
    significant recharge to area aquifers. Kansas uses 100 percent
    of the water reaching the State line almost all of the time.
    The bill places these limited supplies in jeopardy.
        As you heard, the legislation would, No. 1, authorize the
    feasibility study to enlarge Pueblo Reservoir and Turquoise
    Lake and, second, modify the current authorization by allowing
    reoperation of the Fryingpan-Arkansas Project. So this is
    simply not a bill authorizing a study. It would allow
    significant changes to occur.
        The district expects to increase storage and supplies to
    Colorado water users with no additional imports from the
    Colorado River Basin. This means native water in the Arkansas
    River Basin which currently comes to Kansas would be the only
    source. Kansas believes the goal is not feasible without
    increasing the consumptive use of water in Colorado, which then
    takes water from Kansas.
        As you heard from the Attorney General, the Supreme Court
    is currently considering remedies for Colorado's violations of
    the Arkansas River Compact, and the State of Kansas has serious
    concerns about whether the proposed changes in operations and
    additional storage can be accomplished without additional
    violations of the compact.
        I would note that, while the compact does not prevent
    future beneficial development of the river in either State, an
    important proviso is that the waters of the Arkansas River
    shall not be materially depleted in usable quantity or
    availability for use to the water users in Colorado and Kansas
    under the compact by such future developments or construction.
        The proposed legislation contains no meaningful safeguards
    to ensure compact compliance. Kansas has not been consulted in
    drafting provisions, and we have no other forum except here
    before Congress.
        Additional storage in Pueblo Reservoir will be derived
    either from native Arkansas River Basin supplies or from
    imports of the Colorado River Basin water. The legislation
    appears to address potential for expanded use of Colorado River
    Basin supplies, but no such protection again is provided for
    the Arkansas River Basin to and Kansas.
        Water quality is a very serious concern to Kansas. The
    Arkansas River is of high quality but degrades as water flows
    from the Rocky Mountains to the State line. The use and reuse
    of water in Colorado increases the concentration of natural
    constituents and degrades the quality of water. The proposed
    legislation could further degrade water quality of the river at
    the State line.
        Dr. Donald Whittemore of the Kansas Geological Survey
    recently conducted an extensive study of water quality in the
    Arkansas River Basin in southwest Kansas. His studies show the
    water quality Kansas receives from Colorado has deteriorated
    over time. The concentrations of sulfate is extremely high at
    the State line and averages about 2,000 parts per million of
    sulfate alone.
        Currently, the Arkansas River flows at the State line are
    classified as high to very high for salinity hazard to field
    crops. Any additional increase in salinity will only decrease
    the usability of water that Kansas receives. The river and
    adjacent alluvium are already too bad to use for municipal
    supply and take extraordinary treatment. The high flows that
    are occasionally available are waters that are needed to
    provide flushing flows to the river system into Kansas, and
    those are very important to us as well.
        In summary, Kansas and Colorado have been in dispute
    concerning the water supply available in the river for almost
    as long as we have been States. Colorado is the upstream State,
    which means that Kansas must be ever vigilant and ensure
    protection from any enterprise in Colorado that may affect its
    water supply. There is no additional water available for the
    proposed uses in this legislation. Its purposes cannot be
    achieved without negative effects on the quality and the
    quantity of water on which Kansas relies.
        Mr. Calvert. I thank the Gentleman.
        [The prepared statement of Mr. Pope follows:]

       Statement of David L. Pope, Chief Engineer, Kansas Department of
                    Agriculture Division of Water Resources

        Distinguished members of the Subcommittee, my name is David L.
    Pope, Chief Engineer of the Kansas Department of Agriculture's Division
    of Water Resources. I am here representing Kansas Governor Bill Graves.
    I am testifying in opposition to H. R. 3881.
        We believe passage of H.R. 3881 would have a long-term detrimental
    effect on the interests of the state of Kansas, including a reduction
    in the quantity and quality of water on which it relies.
    Arkansas River Compact
        I am a Kansas member of the Arkansas River Compact Administration
    (ARCA) of the Arkansas River Compact. Negotiated between Kansas and
    Colorado, and approved by Congress in 1949, the compact was designed to
    settle existing disputes and remove cause for future controversy, as
    well as to divide and apportion the waters of the Arkansas River and
    the benefits arising from the construction of John Martin Reservoir.
    The compact was intended to maintain conditions as they were at the
    time of ratification.
        ARCA is composed of three members each from Kansas and Colorado,
    with each state allowed one vote. Business must be conducted with
    unanimous agreement. ARCA is chaired by a federal representative
    appointed by the President. This individual is a non-voting member.
    History
        The Arkansas River flowing east out of Colorado into Kansas has
    played a crucial role in the development of the history and economy of
    the state of Kansas. Between Kansas statehood in 1861 and Colorado
    statehood in 1876, the river was largely unregulated. Sometimes flowing
    across Kansas nearly a half mile wide, it offered great opportunities
    for development.
        The first use of the Arkansas River for irrigation in Kansas was
    just downstream from the state line in 1880. Development in Colorado,
    and subsequent shortages of surface water supplies to Kansas irrigation
    ditches, has resulted in extensive litigation between the states before
    the U.S. Supreme Court.
        Our disputes are presently pending again before the Court. Colorado
    has continued to develop wells and major reservoirs in the Arkansas
    River Basin upstream of Kansas since 1950, which resulted in the filing
    of the present litigation, Kansas vs. Colorado, in 1985. In 1995, the
    U.S. Supreme Court found Colorado in violation of the compact due to
    post-compact well development.
        Although this case is in the remedy phase and remains unresolved,
    Colorado now is proposing additional development as set forth in the
    Preferred Storage Options Plan (PSOP) of the Southeastern Colorado
    Water Conservancy District. H.R. 3881 would provide protections for
    other Colorado water users and other Colorado River Basin states.
    However, it does not mention the Arkansas River Compact, the pending
    litigation, or the state of Kansas. Neither does it provide protection
    to Kansas rights under the compact.
        The area in Kansas affected by this proposed legislation is on the
    High Plains, a semi-arid area where irrigated agriculture is critical
    to the regional economy. Kansas relies on the benefits of the
    conservation storage in John Martin Reservoir, some 60 miles upstream
    of the state line in Colorado, as provided for in the compact.
        The Arkansas River is essentially the only renewable water supply
    in Southwest Kansas, providing critical water supplies through direct
    diversion from the river to agriculture. It also provides significant
    recharge to area aquifers. The aquifers supply wells that are pumped
    for irrigation, industry, municipalities and other uses. Kansas uses
    100 percent of the flow at the state line, basically all the time. The
    proposed bill places these limited water supplies in jeopardy.
    Basis of Opposition
        The proposed legislation would: (1) authorize a feasibility study
    of enlarging Pueblo Reservoir and Turquoise Lake, and, (2) modify the
    current authorization for the Fryingpan-Arkansas Project.
        Kansas opposes this legislation for a number of reasons. Passage
    has the long-term potential for adverse effects on the quantity and
    quality of the water Kansas receives across the state line. It would
    likely lead to the shifting of current uses of water from Kansas to
    Colorado. It provides the mechanisms for Kansas water supplies to be
    consumed in Colorado. As a result, new compact violations by Colorado
    can be expected to occur if the ultimate purposes of H.R. 3881 are
    achieved.
        H.R. 3881 would authorize new contracts, including temporary
    contracts for water banking, which make project storage space available
    for non-project water. These project modifications are referred to as
    ``reoperation.'' We believe the reoperation of the project will
    materially deplete the flow and degrade the quality of the water
    flowing to Kansas. Before authorizing legislation is considered,
    proponents should obtain Kansas' agreement that the proposals will not
    materially deplete the flow or degrade the quality of water at the
    state line. Kansas is the downstream state. Its water supply would be
    jeopardized by the proposed legislation.
        Proponents of H.R. 3881 want to do whatever is feasible to maintain
    or improve the use of water by agriculture within the district, at the
    same time increasing present supplies to municipal and other users.
    Although the legislation does not specify the amount of storage
    immediately available for contract, our review of the PSOP indicates an
    additional 49,500 acre feet of available storage space. The historical
    average yield to Kansas from the Arkansas River is approximately
    150,000 acre feet, although it may vary greatly. Just this portion of
    the PSOP increase for storage is equivalent to one third of Kansas'
    average water supply.
        The district expects to accomplish this with no additional imports
    from the Colorado River Basin. This means native water in the Arkansas
    River Basin which currently comes to Kansas would be the only source.
    Adopting the legislation would enable Colorado to reduce flows into
    Kansas. Kansas believes the goal is not feasible without increasing the
    consumptive use of water in Colorado, which takes water from Kansas.
    Proposed sources of storage
        The bill's effect would be to increase storage and intensify the
    use of water in the basin in Colorado to the detriment of existing
    water uses in Kansas. This would be contrary to the compact and the
    interests of Kansas generally.
        The existing project authorization allows for limited storage of
    native water during the winter and at times when John Martin Reservoir
    is spilling. In addition, imported water from the Colorado River Basin
    or ``trans-mountain'' project water is stored, and certain municipal
    trans-mountain return flows are stored by exchange. This bill would
    expand the storage in the project, resulting in:
         LStorage of Arkansas River water rights presently used for
    irrigation, facilitated by a new Colorado water banking statute and
    proposed rules. The water bank proposal has the potential for expanded
    use of pre-compact water rights by allowing increased diversion and
    reducing the return flow from these rights.
         LStorage, by exchange, of water identified as trans-
    mountain irrigation return flows into Pueblo Reservoir. These exchanges
    would facilitate the storage of Arkansas River flows that are a part of
    Kansas' current water supply.
        Both of these potential storage sources would hold water higher in
    the river system, reducing flows to the state line. The proposed
    legislation would facilitate these changes in operation immediately
    within existing storage capacity. If Pueblo Reservoir were ultimately
    enlarged, this practice would be expanded.
        Colorado has relied on the existence of trans-mountain water in the
    system to partially offset the impacts of post-compact well pumping.
    However, the quantities of trans-mountain return flows were never
    sufficient to fully offset the well effects. Compact violations have
    been continuous. These compact violations are the subject of the
    current litigation, and the U.S. Supreme Court has found that
    violations have occurred. Storage of additional water in Pueblo
    Reservoir by exchange would worsen the current situation.
        The Supreme Court currently is considering the remedies for
    Colorado's violations of the Arkansas River Compact in the reach from
    Pueblo Dam to the Kansas state line. The state of Kansas has serious
    concerns about whether the proposed changes in operations and
    additional storage can be accomplished without additional violations of
    the Arkansas River Compact. The compact says:
            ``This Compact is not intended to impede or prevent future
            beneficial development of the Arkansas River basin in Colorado
            and Kansas...which may involve construction of dams, reservoirs
            and other works for the purposes of water utilization or
            control, as well as the improved or prolonged functioning of
            existing works; Provided, That the waters of the Arkansas
            River...shall not be materially depleted in usable quantity or
            availability for use to the water users in Colorado and Kansas
            under this Compact by such future developments or
            construction.''
        The Special Master appointed by the court concluded that the
    compact apportioned the waters of the Arkansas River, as well as the
    conservation benefits associated with John Martin Reservoir: ``The
    Compact was intended to and does apply to all waters originating in the
    natural drainage basin of the Arkansas River and its tributaries
    upstream of the state line. This includes return flows from the use of
    such water, and to tributary groundwater.'' The Special Master
    concluded, ``The Compact is intended to protect such usable flows from
    material depletion caused by any increased consumptive use...''
        The proposed legislation contains no meaningful safeguards to
    ensure compact compliance. Kansas has not been consulted in drafting
    the provisions, and we have no other forum but Congress.
        Additional storage in Pueblo Reservoir will be derived either from
    the native Arkansas River Basin supplies or from imports of Colorado
    River Basin water. In either case, enlarged use and consumption of
    water will occur unless limitations are put in place to prevent
    expanded use from either source. The legislation appears to address
    potential for expanded use of Colorado River Basin supplies, but no
    such protection is provided for Kansas' Arkansas River Basin supplies.
    Water Quality
        Water quality is a serious concern to Kansas. The Arkansas River is
    of high quality near its headwaters but degrades as the water flows
    from the Rocky Mountains to the state line. The use and reuse of water
    in Colorado increases the concentration of natural constituents and
    degrades the quality of the water. Water quality from the river and
    adjacent alluvium in Kansas is so poor that municipalities along the
    river must use special treatment methods to make it fit for public
    water supply. The proposed legislation could further degrade water
    quality of the Arkansas River at the state line.
        Recent studies show the water quality Kansas receives from Colorado
    has deteriorated over time. Increases in sulfate have adverse effects
    on irrigation and other water uses. Dr. Donald Whittemore of the Kansas
    Geological Survey recently conducted an extensive study of water
    quality in the Arkansas River basin in Southwest Kansas. He found the
    concentration of sulfate in the low flow regime doubled between 1906
    and 1973. This study also looked at the concentration of sulfate data
    available for 1964 through 1970 and compared it to the 1987 through
    1999 period. Sulfate concentrations continued to increase over the
    range of flows from the earlier period to the later period. One reason
    for this is the increased water consumption in Colorado.
        The Kansas Department of Health and Environment has reviewed the
    sulfate concentrations over different flow regimes as well. Sulfate
    concentrations are higher at low river flows. Sulfate concentrations
    vary during higher river flows, but are on average less than low flow
    concentrations. Reduced flows of the Arkansas River at the state line
    would mean increased sulfate concentration in the river water.
        Currently, Arkansas River flows at the state line are classified as
    high to very high for salinity hazards to field crops. Any additional
    increases in salinity will only decrease the usability of the water
    supplies Kansas receives. Water users in Kansas routinely assess the
    quality of the water available at their headgate when deciding whether
    to divert water to the fields.
        Water quality in the Arkansas River system is invariably linked to
    the quantity of water available, and reduction in the state line flow
    may cause a further deterioration of water quality. The build-up of
    contaminants is partially flushed when flows increase, but these high-
    flushing flows are some of the very flows that are proposed to be
    stored under the PSOP. Colorado has failed to provide data or analyses
    that show the proposed changes will not materially reduce the quality
    of the water at the state line.
    Summary
        Kansas and Colorado have been in dispute concerning the water
    supply available in the Arkansas River Basin for almost as long as they
    have been states. Colorado has the benefit of being the upstream state,
    which means that Kansas must be ever vigilant and ensure protection
    from any enterprise in Colorado that may affect its water supply.
    Colorado has continued development efforts without regard to Kansas'
    expressed concerns, as evidenced by lack of reference to Kansas in this
    legislation. The proposed legislation would allow further development
    upstream of Kansas without regard for present uses in Kansas. There is
    no additional water available for the uses proposed in this
    legislation. Its purposes can not be achieved without negative effects
    on the quality and quantity of the water on which Kansas relies.
                                     ______

        Mr. Calvert. Ms. Stovall, I understand your concerns from
    your testimony on the proposed legislation, but also in your
    testimony you bring up that you are even opposed to a
    feasibility study. Now as I understand it from the Department
    of Reclamation and from our prior witness, that during a
    feasibility study that the State water rights certainly must be
    protected in order to move that feasibility report forward.
    Certainly operation of the project would be done by the
    Department of Reclamation.
        It has been my experience that if a project is built
    properly that it certainly can protect your water rights and,
    in fact, have potentially beneficial use for downstream users
    as well as the State of Colorado if it is done properly. Are
    you opposed to any kind of feasibility report being done, or is
    it just--.
        Ms. Stovall. It was simply based on our experts, that we
    can predict what an accurate feasibility study would result in
    and that is to say it is not feasible because there will be a
    depletion to Kansas water rights. So my suggestion, why bother
    and why take 2 years of Bureau of Reclamation time? We have, as
    well, not always agreed with everything that the Federal
    agencies have indicated is appropriate in this river basin and
    are somewhat concerned as well.
        We are 11,000 acre feet short every year. There simply is
    no way for Colorado to store additional water because there is
    no additional water. We are this much short all the time now.
    So it is best to leave this on the shelf and don't even get
    started with it because of the risk of depletions to us.
        Mr. Calvert. Are you saying that flood flow water--you use
    100 percent even during a flood flow event every single year?
        Ms. Stovall. The flood flow events are so rare they are not
    really worthy of authorizing the study. In addition, as David
    said, when on the rare occasions there is surplus water that
    comes down, it has that flushing effect that helps us with the
    quality that is so very important and now is so bad that it is
    putting the crops at risk.
        Mr. Calvert. Can't you operate a dam and have flushing
    events? We do that on the Colorado, obviously. I mean, we
    released water under the prior Secretary of Interior to have
    those so-called budding events for other purposes. I imagine
    that is for endangered species or protection of habitat areas
    or something like that.
        Ms. Stovall. David, our Chief Engineer, may be able to talk
    about the technical aspects. What my understanding is, after
    these 17 years of litigation, any flushing that happens with
    water that comes from the reservoir is water we are entitled to
    anyway, so there is no surplus there.
        Mr. Calvert. I was just curious. Was Art Littleworth, the
    water master, involved in the dispute between Kansas and
    Colorado?
        Ms. Stovall. Arthur Littleworth. He is still the Special
    Master and most eager to see this case be resolved.
        Mr. Calvert. He is a resident of my district in California.
    We are experts on water dispute in my part of the country.
        Ms. Stovall. He has done a fabulous job and--I would note,
    and he has voted for Kansas at every step of the litigation.
        Mr. Calvert. Mr. Pope, you are the engineer, so I will ask
    you for the technical questions.
        In an operation of a dam, couldn't you not protect
    beneficial use of downstream users and the rights of those who
    have water--utilization of water downstream and at the same
    time operate the dam? Theoretically, Reclamation would operate
    it properly to make sure that the type of problems that may
    come up are taken care of in the operation of the project
    itself?
        Mr. Pope. Mr. Chairman, certainly in theory.
        Mr. Calvert. We do a feasibility report. If you are an
    equal participant in that feasibility report, theoretically--
    and certainly State water rights, as the Gentleman has
    indicated, would be recognized. What would be the problem with
    moving forward with a feasibility report?
        Mr. Pope. Well, basically again, we are not convinced that
    there is excess water to work with.
        Mr. Calvert. Wouldn't it come up in a feasibility report? I
    mean, if in fact that is what a feasibility report is going to
    have to do, we are going to have to determine that you have
    water that we can use downstream and that your rights are
    protected.
        Mr. Pope. I understand. Mr. Chairman, of course, I would
    remind you, the commissioner's statement that the legislation,
    as it is drafted, is very directive to the Bureau of
    Reclamation in regard to what they can even look at in a
    feasibility study. So there are some restrictions, as I
    understand it, in this legislation.
        Mr. Calvert. Maybe we can help in that regard.
        Mr. Pope. I think that would certainly be very critical if
    it is going to move forward at all.
        Second, I think the reoperation activities that are quite
    prescriptive in the bill are another area of concern, even
    leaving aside potential enlargement of the reservoirs. So it is
    another area of concern.
        Mr. Calvert. Thank you.
        Mr. Hefley.
        Mr. Hefley. Thank you, Mr. Chairman. You have done an
    excellent job of questioning, so I don't have much left, but I
    guess I would ask Mrs. Stovall the same question. If we can't--
    if we can't meet your needs--I mean, you have gone through the
    court, and they have determined what you are entitled to, and
    if we can't meet that in the feasibility study, we can't do it.
    But you still are absolutely opposed to even a feasibility
    study because you are just assuming that that can't be done, is
    that true?
        Ms. Stovall. Seems to me that we ought to have some level--
    and clearly, it is your decision. It seems to me, to engage in
    a 2-year study, necessarily costing money, that there ought to
    be some basic threshold that Colorado could show to us
    initially to say there is probable cause or it is more likely
    than not that there is adequate water or some minimum threshold
    to suggest that it is worth engaging in a 2-year feasibility
    study.
        If we have a choice between the bill as it is and a
    feasibility study and that is all, we would want only the
    feasibility study. I am suggesting we can probably save 2 years
    of time and effort by Federal staff to even begin. There is no
    water there.
        Mr. Hefley. You would be basically opposed to any
    additional storage in Colorado on any river that flows into
    Kansas; is that correct?
        Ms. Stovall. The Arkansas River is the river that flows in.
        Mr. Hefley. There are no other streams that flow in?
        Ms. Stovall. It is the one that we have the compact with.
        Mr. Hefley. It is interesting to me that Nebraska did the
    same thing with the Two Forks Project. At that time we were
    sending five times as much water downstream as the compacts
    demanded. And although--from the court case, Kansas was not
    getting it out of the Arkansas, but some of the others were,
    and Nebraska fought the Two Forks Project as well because, of
    course, the downstream States want all of the water that they
    can possibly get.
        Jim, we appreciate you being here. Let me go back to you,
    Ms. Stovall. You would not have any objection to the first part
    of the bill, I suppose, the municipalities storing additional
    water in the existing facilities that weren't part of the
    project. But you wouldn't have any objection to that, I
    suppose.
        Ms. Stovall. I don't. But I defer to David for the
    understanding of what the technical aspects of that might be.
    He clearly has a better understanding of the technical pieces
    than I do.
        Mr. Hefley. Mr. Pope, do you have any objection to that?
        Mr. Pope. Yes, Representative Hefley. I think that there
    are concerns there. The current authorization for the Fryingpan
    Arkansas Project really allows, of course, West Slope water to
    be stored, as I understand it, and also winter water storage.
    But it is pretty restrictive beyond that. And we do have--the
    complexity of this system is such that it has been very
    difficult to track all of the exchanges and all of the other
    things that occur. And we just candidly ended up on the short
    end of the stick. So I would be very cautious before I can
    answer that question yes. It is hard for me to understand all
    of the details of that at this point.
        Mr. Hefley. Jim, again, thanks for you being here. You are
    talking--on that first part of the bill, you are talking about
    your water, aren't you? Water that belongs to the City of
    Colorado Springs?
        Mr. Null. That is correct. All decreed water rights in
    existence now, in fact, out to 2040.
        Mr. Hefley. As far as you are concerned, that has nothing
    to do with Kansas whatsoever?
        Mr. Null. That is correct. And we do have faith for the
    other part of the bill and the Bureau that their feasibility
    will show it one way or the other.
        Mr. Hefley. Thank you very much. Thank you, Mr. Chairman.
    Thank you.
        Mr. Calvert. Mr. Moran.
        Mr. Moran. Mr. Chairman, I have no questions. I thank you
    for the courtesies extended to me and the witnesses from Kansas
    today.
        Mr. Calvert. I just have one quick question. I am not
    totally familiar with the hydraulics between Colorado and
    Kansas. But I was curious from --I always think that more
    storage is better than less. That is my particular experience
    in California. But it is possible to divert water--we are in an
    agreement with Colorado in the upper and lower basin states
    right now to limit California's use to its allocated amount of
    4.4 million acrefeet a year. Obviously Colorado will pick up
    water from that. Is it possible to do--transfer water storage
    into those facilities to add additional storage of water? Just
    curious. Mr. Null, would you be aware of that?
        Mr. Null. I don't know.
        Mr. Calvert. I probably would have to ask the Gentleman
    from Reclamation. Because I was curious. I was looking at that.
    If you have additional storage, you have additional
    flexibility. But that would be something that would come up in
    a feasibility study, I would assume.
        Mr. Null. That is right. What we would use is decreed water
    rights water. Existing. We would not be looking at transferring
    any water out of any other basin that isn't already decreed and
    on line.
        Mr. Calvert. Thank the Gentleman.
        Mr. Hefley. Mr. Chairman, one other last comment to these
    wonderful witnesses from Kansas. You have an outstanding
    Congressman here sitting next to me who represents your
    interests very well. I was going to correct him on his
    pronunciation in private so that it wouldn't embarrass him, but
    it seems that the whole State has trouble reading Arkansas
    River. But we will work on that with you.
        Mr. Moran. Mr. Chairman, I would only say that perhaps we
    would not have these problems today had Kansas not voluntarily
    given up that portion of Colorado formally known as the Kansas
    Territory.
        Mr. Calvert. Well, I want to thank the witnesses for their
    testimony and answering our questions, and we will now
    introduce the next panel. Let me see if I can pronounce this
    name properly. Steve Arveschoug, General Manager, Southeastern
    Colorado Water Conservancy District; Melinda Kassen, Director
    of the Colorado Water Project, Trout Unlimited; and Anne
    Castle, the Special Counsel, the City of Pueblo for Water
    Matters, State of Colorado.
        I will be a little informal here and say Steve, you can
    start your testimony when you are ready.

     STATEMENT OF STEVE ARVESCHOUG, GENERAL MANAGER, SOUTHEASTERN
                  COLORADO WATER CONSERVANCY DISTRICT

        Mr. Arveschoug. Mr. Chairman, thank you. You did a very
    good job in pronouncing that name.
        Mr. Hefley, thank you for the opportunity, Congressman, to
    testify on your bill. Appreciate your initiative and effort in
    this. It is very important, as you know, to Southeastern
    Colorado.
        To give the Committee just a quick background, I am General
    Manager of the Southeastern Colorado Water Conservancy
    District. The District covers nine counties in Southeastern
    Colorado. We are the local sponsor for the Fryingpan Arkansas
    Project. We hold the water rights for the project, allocate
    water to cities and farms in our committees each year, and help
    meet the repayment costs for the project through a local tax.
        The Fry-Ark Project is very much and was intended to be a
    regional project covering all of Southeastern Colorado, both
    urban communities such as Colorado Springs and Pueblo, as well
    as rural communities in Southeastern Colorado.
        Mr. Chairman and members, I am here today to ask you to
    support, not withstanding previous testimony, H.R. 3881,
    because it provides very important solutions to problems in
    Southeastern Colorado. We call the elements of H.R. 3881 our
    preferred storage options plan.
        Mr. Chairman, we didn't just dream up this plan one night
    in a dark room. We have spent years working on this effort. It
    has involved literally hundreds of people and local entities
    working together collaboratively in coming up with this storage
    plan. We started this effort in 1996, developing what we call
    our storage study committee. They did a water and storage needs
    assessment report that told us that if we didn't develop
    additional storage, we would be short in meeting our water
    supply needs in the future.
        We then went on to analyze alternatives. We looked at
    everything including main stem reservoirs, new facilities, as
    we did our analysis.
        What we concluded in that years of study that we did is we
    were best served by looking at better utilizing the existing
    facilities of the Fry-Ark Project to meet our demands. Our goal
    was to help our constituents in our nine-county service area
    meet their water demands into the year 2040.
        That effort was locally funded. And we are here today
    through H.R. 3881 to continue that local funding approach to
    meeting our concerns. We have a problem, but we are willing to
    help provide the solution for that problem.
        We also spent a lot of time analyzing the surrounding
    issues. We realize that in our basin you cannot just develop
    water resources absent consideration of environmental and
    recreation issues. Mr. Chairman, the big pile I threw on the
    corner of your table here is representative of the studies that
    we have done on a local level looking at not only our needs,
    but other needs in the basin as we move forward with our
    planning process.
        So our preferred storage options plan in this legislation
    represents about a 5-year effort, because frankly we need
    additional water. As Congressman Hefley put it, we are an arid
    state. This year, as we sit here today, our snow pack is well
    below average, about 60 percent. The river is running also well
    below average. If we don't have additional storage to meet
    those types of dry cycles, we fall short, we can't meet the
    obligations we have set out for our constituents.
        And, obviously Southeastern Colorado is growing. In
    addition to being dry, we have growth. We have more people. Our
    current population in Southeast Colorado is about 680,000
    people, projected to be as much as 1.5 million people by the
    year 2040. And we need to be prepared for that type of growth.
        Cities, as well as farming communities, as well as ditch
    companies, need additional storage, Mr. Chairman, Mr. Hefley,
    to manage their existing supplies. We need additional storage
    to help with the development of a water bank concept that we
    have been working with the State legislature on. We need
    additional storage to allow our farmers to make full use of
    their winter-stored water rights. This is very much a regional
    project designed to meet regional needs, including the
    communities of Pueblo and Colorado Springs, as well as rural
    parts of our district.
        I feel a little bit outnumbered from the testimony that
    came before us and the panel that is joining me up here. But I
    can tell you I am very much not alone. I am here today
    representing 30 local, regional and State entities that support
    our initiative because we have taken a thoughtful approach to
    trying to provide a solution to our problems.
        I also represent 20 communities who have signed commitments
    with the district that they want to participate directly in the
    preferred storage options plan. These are the same communities,
    Mr. Chairman, that participated in the development of the
    Fryingpan Arkansas Project, that project designed to meet year
    2000 demands. We are trying to do the same thing our
    forefathers did in preparing for the year 2040.
        With that, Mr. Chairman, I would ask for this
    Subcommittee's support of H.R. 3881.
        [The prepared statement of Mr. Arveschoug follows:]

     Statement of Steve Arveschoug, General Manager, Southeastern Colorado
                  Water Conservancy District, Pueblo, Colorado

        Chairman Calvert, Congressman Hefley, and members of the
    Subcommittee, thank you for the opportunity to testify today in support
    of H.R. 3881. I'm Steve Arveschoug, General Manager of the Southeastern
    Colorado Water Conservancy District (the District). I've worked with
    the constituents of the District on the development of this legislation
    for nearly five years, and I'm excited and pleased that the Committee
    will now consider supporting this local initiative to prepare for the
    future water resource needs in southeastern Colorado along the Arkansas
    River.
        H.R. 3881 represents just the starting point in the implementation
    of the District's Preferred Storage Options Plan (the PSOP), a plan
    that is designed to help provide additional water storage capacity to
    serve the future domestic and irrigation water needs of the 680,000
    constituents of the District's nine-county service area, while
    protecting water quality, and assuring that recreation and fishery
    values are represented and enhanced.
        Before I discuss the Preferred Storage Options Plan further, and
    address the specifics of the legislation, allow me to offer some
    important background information.
        Background--The Southeastern Colorado Water Conservancy District is
    the local sponsor of the Fryingpan-Arkansas Project (the Fry-Ark
    Project), a multipurpose project constructed by the Bureau of
    Reclamation (Reclamation) that stores and delivers water for municipal
    and agricultural use within the nine-county service area of the
    District, Arkansas River basin, Colorado. The Fry-Ark Project was
    authorized by Congress in 1962 and provides a supplemental supply of
    water, and storage for native agricultural and municipal water
    supplies, to serve a population of 680,000 and to irrigate
    approximately 200,000 acres within the District.
        As this Committee understands too well, building consensus among
    the diverse set of interests in water resources is challenging. Many
    efforts to wisely plan for the effective use of water bog down for
    decades, just give up, or are never even started because of the
    commitment it takes to work through the issues and solve problems. I
    can tell you there have been days in this process that I would have
    found it a much easier trek to just give up. But, there is a great deal
    at stake in this effort.
        Like other regions in the western United States, southeastern
    Colorado is growing. The District's population is expected to grow to
    over 1.5 million by the year 2040. Most of that growth will occur
    within Colorado Springs and Pueblo, but several of the rural
    communities within the District will grow as well.
        In addition to the population growth pressures, the District's
    smaller communities, especially those east of Pueblo who rely on
    groundwater for their main water supply, need to develop a higher
    quality drinking water supply for their residents. Additional water
    storage will help them do that. And, additional storage will help
    communities better manage the water they have already developed. The
    state of Colorado is also developing a water-banking program for the
    Arkansas River basin. Long-term, the success of the water bank will
    depend on additional storage.
        Support for the PSOP and H.R. 3881--The District's Preferred
    Storage Options Plan was crafted to meet these diverse, regional needs.
    And, it has local, regional, and statewide support. The supporters of
    the PSOP include:
            Pueblo County
                Board of Water Works of Pueblo
                Pueblo County Board of Commissioners
                Pueblo West Metro District
                St. Charles Mesa Water District
            Arkansas Valley
                City of Lamar
                Otero County Board of Commissioners
                City of La Junta
                Crowley County Board of Commissioners
            Upper Arkansas
                Penrose Water and Sanitation District
                City of Florence
                City of Canon City
                Town of Poncha Springs
                City of Salida
                Upper Arkansas Water Conservancy District
            El Paso County
                Colorado Springs Utilities, City of Colorado Springs
                City of Fountain
                Widefield Water District
                Security Water and Sanitation District
                Fountain Valley Authority
            Regional and Statewide Entities
                Action 22 (an organization of 22 counties in southern
                Colorado)
                Colorado Counties Inc.
                Colorado Water Conservation Board
                Colorado Department of Natural Resources
                Southeastern Colorado Water Conservancy District
            Recreation and Environmental Organizations
                Arkansas River Outfitters Association
                Colorado Board of Parks and Outdoor Recreation
                Friends of the Arkansas
        The support from the local communities that represent the nine-
    county service area of the District comes as a result of a nearly five-
    year effort to study District-wide water and storage needs, assess
    storage and resource management alternatives, address water quality and
    recreation needs, and provide assurances that existing uses and
    entitlements in the Fry-Ark Project would be protected. It involved
    thousands of hours of work by the local Storage Study Committee (the
    SSC), which included municipal, agricultural, recreation,
    environmental, and state and federal resource management agencies (a
    membership list of the Storage Study Committee is attached as Exhibit
    No. One).
        This Storage Study Committee first developed a ``Water and Storage
    Needs Assessment Report'' (December 1998) to determine District-wide
    demands for water and storage to meet domestic and agricultural needs
    into the year 2040. That report indicated a need for an additional
    173,100 acre-feet of storage to provide for growth and to sustain
    agricultural water supplies. The SSC, through the District, then asked
    the Bureau of Reclamation to do an investigation of the technical
    feasibility of enlarging Pueblo Reservoir (August 1999). In addition to
    Reclamation's study of Pueblo Reservoir, the SSC working with hired and
    staff engineers, evaluated over 30 different alternatives to meet the
    projected demand. That evaluation lead to the conclusion that we were
    best served by focusing our efforts on the existing Fry-Ark Project
    reservoirs as a means to help meet future demands. The SSC then began
    to evaluate how the existing reservoirs could be better used, and that
    effort, after many hours of study and consideration, and public
    meetings, lead to the development of the Preferred Storage Options Plan
    and the PSOP Implementation Committee Report, which provides the
    operational details for the PSOP.
        Elements of the Preferred Storage Options Plan--The Southeastern
    Colorado Water Conservancy District's Preferred Storage Options Plan,
    as adopted by the District Board in September 2000, (PSOP) includes the
    following elements:
        1. Re-operations Storage--use of excess capacity in existing Fry-
    Ark Project Reservoirs to store non-Project water under long-term
    contracts with Reclamation
        2. Enlargement of Pueblo Reservoir and Turquoise Reservoir--up to
    75,000 acre-feet of conservation storage added to Pueblo Reservoir
    (needed by the year 2013), and up to 19,000 acre-feet of conservation
    storage added to Turquoise Reservoir (needed by the year 2025)
        3. Enterprise Water Management Storage'to provide storage for
    irrigation purposes and for a water bank
        4. Long-term Water Quality Monitoring Program'to establish a water-
    quality baseline so that any potential changes in water quality can be
    determined and responded to accordingly
        5. Pueblo Flow Management Program'' a 100 cfs target minimum flow
    (proposed to be a threshold to reduce or curtail PSOP participant
    operations) in support of the City of Pueblo's Legacy Project
        6. Preserve Capacity for Future Arkansas Valley Conduit--a
    commitment from all PSOP participants to continue to reserve a portion
    of the municipal outlet works capacity at Pueblo Dam for the future
    development of the Arkansas Valley Conduit to serve the domestic water
    needs of communities in the lower Arkansas River valley in Colorado.
        7. Protection of the Winter Water Storage Program'the establishment
    of a Winter Water Spill Credit Program designed to offset the impacts
    of any spill of winter-stored water in Pueblo Reservoir.
        8. Implementation Committee Report'the Storage Study Committee and
    the proposed partners in the development of the PSOP developed an
    Implementation Committee Report to address the details of how the re-
    operations storage and the enlarged storage would be operated so as to
    protect the current interests in the Fry-Ark Project
        Supporting Studies--The development of the PSOP was truly a local
    effort to plan for the future water resource needs of southeastern
    Colorado. In addition to the PSOP itself, the Storage Study Committee
    studied the many issues surrounding the development of additional water
    storage. Those studies included:
            Hydrologic Analysis Report (March 2000)
            Environmental Issues Report (March 2000)
            Water Quality Issues Report (June 2000)
            Socioeconomic Issues Report (March 2000)
            Cultural Resources Issues Report (March 2000)
            Permitting and Regulatory Issues Report (March 2000)
            Engineering and Cost Issues Report (June 2000)
        These supporting studies were not intended to be conclusive. They
    were designed to identify the many issues that would need to be
    addressed as the PSOP is implemented. And, H.R. 3881 starts the
    implementation process for the Preferred Storage Options Plan.
        The Need for Federal Legislation--First, it's important to note
    that H.R. 3881 doesn't authorize the enlargement of Pueblo Reservoir or
    Turquoise Reservoir. As I'll explain, the legislation only directs
    Reclamation do feasibility studies of the proposed enlargements. And
    H.R. 3881 does not ask for a federal appropriation. Local communities
    will fund the study effort that is being requested.
        H. R. 3881 has two main purposes.
        The first objective of H.R. 3881 is to better utilize existing
    capacity in the Fry-Ark Project reservoirs to help meet growing demand
    for storage. Section 3 of the legislation would authorize the Secretary
    of Interior to enter into contracts with cities and towns within the
    District that need to store non-Project water to supply their current
    and future domestic supply needs. This is Phase I of the District's
    PSOP referred to as re-operations storage, the goal being to make full
    use of existing capacity in the Project without interfering with the
    current entitlements to Project water and storage. These new storage
    contracts help communities meet their water needs through the year
    2013. At that point new storage capacity will need to be developed and
    that's why we're asking for the enlargement studies.
        There is a very important element to this new contract authority
    established in Section 3. Under subsection (d) of Section 3, entities
    wanting a re-operations contract from Reclamation must have first
    agreed to the protections established in the PSOP. Before a contract is
    executed the contractor must have an agreement in place with the
    District that commits them to participate in the Long-term Water
    Quality Monitoring Program, the Pueblo Flow Management Program, the
    Winter Water Spill Credit Program, and to share in the costs of
    developing the re-operations contract authority.
        I understand that Reclamation may view this approach as a
    limitation on their discretion to contract with whomever they want, but
    it's probably the most important piece of this legislation. It protects
    the other interests in the Fry-Ark Project that are not direct
    participants in the re-operations contracting. This requirement does
    not set aside Reclamation's National Environmental Policy Act (NEPA)
    review process that will be done before executing these storage
    contracts. Indeed, that process may identify other environmental or
    recreation issues that will need to be addressed before a contract is
    executed. The commitments we're asking for are not a requirement on
    Reclamation. The water users will need to make the commitment to these
    programs to help protect water quality, fish and wildlife, and
    recreation interests. To date, the District has executed a memorandum
    of agreement with eight communities seeking storage contracts from
    Reclamation totaling 38,300 acre-feet. The commitments to these
    programs are already in place.
        There is precedent in looking to the water districts involved in
    the Fry-Ark Project before contracts are executed. The Operating
    Principles of the Project require that Reclamation seek the approval of
    the Colorado River Water Conservation District before Colorado River
    water in Ruedi Reservoir (a west slope feature of the Fry-Ark Project)
    can be contracted to an entity out of the basin. That's an important
    protection for the Colorado River basin. H.R. 3881 doesn't create the
    same sort of approval process, but it would require that protections be
    in place for the Arkansas River basin, as described in the PSOP, before
    Reclamation executes a ``re-operations'' contract.
        Secondly, Section 2 of the legislation would authorize the
    Secretary of Interior to study the proposed enlargement of Pueblo
    Reservoir and Turquoise Reservoir. Both reservoirs are Fry-Ark Project
    facilities on the east slope. The studies would be done in cooperation
    with the District and would be funded by the District and the
    communities that are participants in the PSOP. It's important that
    these federal-level studies take a closer look at the many issues
    identified in the District's study process. While the outcome of these
    studies should not be predetermined, it is essential that the studies
    consider the District's Preferred Storage Options Plan and the many
    commitments to water quality, flow protection, and support of
    agricultural and municipal water supplies that are established in the
    PSOP. Without these elements--the Long-term Water Quality Monitoring
    Program, Pueblo Flow Management Program, Winter Water Spill Credit, and
    preservation of infrastructure for the Arkansas Valley Conduit--the
    development of additional storage capacity in the basin, through the
    enlargement of Fry-Ark Project facilities, will not meet the diverse
    needs of the District's constituents.
        In addition to the main goals of maximizing the use of existing
    storage capacity and planning for future enlargements, H.R. 3881 also
    provides authority to the Secretary of Interior to execute temporary
    contracts to facilitate a water bank program in the basin. The Colorado
    legislature approved the development of a pilot water bank program in
    the Arkansas basin. Section 9 of the legislation would make it clear
    that the Fry-Ark Project facilities could be used to support the
    operation of the water bank.
        The legislation also authorizes Reclamation to contract for the use
    of excess storage capacity by the City of Aurora and Pueblo West. The
    City of Aurora is not in the Project service area, so their use of the
    Project storage will at all times be subordinate to the needs of in-
    District water users. Pueblo West entered the District later than other
    communities so they are not eligible for a storage contract as
    described in Section 3, but will be given the option to execute a long-
    term If and When contract.
        Lastly, Section 12 of H.R. 3881 provides protections to the
    Colorado River basin and the Arkansas River basin. This section of the
    legislation was negotiated with the Colorado River Water Conservation
    District and parties in the Arkansas River basin for nearly a year. It
    assures that the use of excess capacity in the existing storage
    facilities of the Fry-Ark Project under the new Reclamation contracts
    will not be used to increase diversions out of the Colorado River basin
    or the Arkansas River basin without agreements and protections. It
    allows existing trans-basin diversions to continue so long as new
    infrastructure is not needed for the diversion. This section of the
    legislation continues to be discussed among the parties.
        Local Commitment to the PSOP and H.R. 3881--At the present time,
    the District has secured the participation of twenty (20) communities
    and water providers within the District, representing the 680,000
    constituents of the District, for the implementation of the PSOP. These
    entities have signed agreements with the District requesting 38,300
    acre-feet of re-operations contract storage and 69,775 acre-feet of
    enlargement storage. H.R. 3881 represents the first step in meeting
    these expectations. In order to meet their growing demands these
    communities need the ability to contract with Reclamation for the use
    of excess capacity by the year 2003. And, they need an enlargement of
    Pueblo Reservoir by the year 2013, and the enlargement of Turquoise
    Reservoir by the year 2025. This is definitely a long-range plan to
    provide for the future water needs of rural and urban communities
    within the Southeastern District.
        Building Consensus for the PSOP and Addressing the Issues--
    Throughout the development of the PSOP and this federal legislation we
    have identified issues of concern that must be addressed as the PSOP is
    implemented. Many of those issues relate to recreation at the Fry-Ark
    Project's reservoirs or on the Arkansas River above and below the
    reservoirs. Pueblo Reservoir, the Fry-Ark Project's main storage
    facility (350,000 acre-feet covering 6,000 surface acres), averages
    over one million visitors each year to the Colorado State Park
    campgrounds and boating facilities. Most years Pueblo Reservoir is the
    most- visited state park in Colorado. In addition, the Fry-Ark Project
    is used to help manage flows in the upper Arkansas River to support
    fishing and rafting opportunities in the communities of Buena Vista and
    Salida, Colorado. This flow management effort is called the Upper
    Arkansas Flow Management Program, and for over ten years it has been a
    cooperative effort of the Colorado Department of Natural Resources,
    including State Parks and the Division of Wildlife, the Bureau of
    Reclamation, the Arkansas River Outfitters Association, local
    communities in the upper Arkansas, the Southeastern District, and
    water- right owners from throughout the basin.
        Under Reclamation's leadership the Fry-Ark Project has made a
    tangible commitment to the fish and wildlife and recreation interests
    within the Arkansas River basin. And, that commitment will continue and
    be enhanced under the District's preferred Storage Options Plan.
        In working with the county commissioners in Lake County we
    identified the need to consider land-use and recreation issues
    associated with the Project's Turquoise Reservoir and Twin Lakes
    Reservoir. At the present time we are drafting an agreement and scope
    of work with Lake County to cooperatively study alternatives to enhance
    recreation opportunities in and around the Fry-Ark Project reservoirs
    that are in their county. We are also hopeful that the feasibility
    study of the enlargement of Turquoise that's being asked for in H.R.
    3881 will address the county's questions regarding the potential
    impacts to recreation at Turquoise Reservoir when the reservoir is
    enlarged (not planned for until the year 2025).
        The City of Pueblo Issue--Before the PSOP was completed in
    September of 2000, the District's Storage Study Committee and District
    staff worked with staff from the City of Pueblo's Planning Department
    in an effort to consider flow issues below Pueblo Dam through the City
    of Pueblo. While we were working on our storage plan the City was
    working on the Arkansas River Legacy Project with the assistance of the
    Corps of Engineers. We realized that our future plans for additional
    storage had to work with the City's plan to provide greater recreation
    opportunities on the river below Pueblo Dam.
        The participants in the development of the PSOP agreed to develop a
    ``Pueblo Flow Management Program'' that would target a 100 cfs minimum
    flow below Pueblo Dam and would operate similar to the successful Upper
    Arkansas Flow Management Program. The commitment to this Pueblo Flow
    Management Program is included in the District's Preferred Storage
    Options Plan Report (September 2000), the PSOP Implementation Committee
    Report (April 2001) and now in H.R. 3881.
        As currently written, H.R. 3881, Section 3 (Section 8, d) would
    require all water users contracting with Reclamation for use of excess
    capacity in the Fry-Ark Project to sign an agreement with the District
    committing to ``cooperate in a flow management program designed to
    maintain target minimum flows of 100 cfs on the Arkansas River just
    below Pueblo Dam.'' The PSOP participants have been working with
    attorneys representing the City of Pueblo over the last several months
    in an attempt to add details to the flow program and, in response to
    the City's concerns, have agreed to establish the 100 cfs target flow
    as set threshold whereby they would reduce or curtail storage
    operations at times when flows in the river below Pueblo Dam are at or
    below 100 cfs.
        The City has recently filed for a ``recreation in-channel
    diversion'' (RICD) water right for 100 cfs during the winter storage
    period (November 15 to March 14) and 500 cfs during the remainder of
    the year. That water right is for a city-planned boating course. That
    RICD water right has the potential to stop any future water development
    in the lower Arkansas, including making it nearly impossible for
    communities in the Arkansas Valley to execute future water exchanges of
    their own water rights through the planned for Arkansas Valley Conduit,
    a project that is vital to the future of towns like La Junta and Rocky
    Ford. It would also make it nearly impossible for cities like Fountain
    to exchange their water into Pueblo Reservoir, which is a must if they
    are to provide water for their constituents.
        The City's recent RICD filing certainly adds a new twist to the
    discussions on the Pueblo Flow Management Program, but the PSOP
    participants are committed to seeking a win/win resolution of this
    issue. That commitment is represented in H.R. 3881 and by our record of
    performance with the Upper Arkansas Flow Management Program.
        I would refer the Subcommittee to the written testimony of the
    Arkansas River Outfitters Association with whom we've worked very
    closely for ten years. Cooperation is the key to the success of this
    program and that same approach has great potential for the Pueblo Flow
    Management Program.
        It's important for the City of Pueblo to understand that the Fry-
    Ark Project is a regional water supply project that meets the needs of
    communities throughout the Southeastern District, including Pueblo and
    at least 20 other cities and towns, as well as farmers in the Arkansas
    Valley. Through the Board of Water Works of Pueblo the citizens of
    Pueblo benefit today from the storage and exchange of water into Pueblo
    Reservoir. The citizens of Pueblo also benefit from the recreation
    opportunities at Pueblo Reservoir. Those opportunities will be enhanced
    with the additional storage capacity.
        The Board of Water Works of Pueblo currently has a long-term
    storage contract to use excess capacity in Pueblo Reservoir to store
    non-project water for the benefits of the citizens of Pueblo. Other
    communities in the District, whose citizens also pay taxes to repay the
    Fry-Ark Project construction and O&M costs, want that same opportunity,
    and that opportunity would be granted to them through H.R. 3881.
        The PSOP was designed to be a regional project just like the
    original Fry-Ark Project. It will benefit communities District-wide,
    including Pueblo. The Board of Water Works of Pueblo has signed an
    agreement with the District securing their participation in the future
    enlargement of Pueblo Reservoir. Based upon that agreement the proposed
    enlargement would provide Pueblo an additional 5,000 acre-feet of
    storage to help meet their future demand for water. Again, other
    communities in the District are working toward the same goal of
    providing water resources to their citizens.
        All the participants in the PSOP process understand that the
    development of water resources to meet population growth and irrigation
    needs must work with environmental and recreation needs. And, that is
    the goal of the PSOP. To the extent we have not fully addressed the
    concerns of the City of Pueblo regarding recreation below Pueblo Dam or
    their compliance with their wastewater discharge permit requirements,
    we will continue to work toward a positive resolution. In fact, the
    PSOP participants met on March 13 and are prepared to offer another
    proposal to the City of Pueblo to address their concerns.
        The Arkansas River Compact--Throughout the process of developing
    the PSOP we involved local citizens and organizations through the
    Storage Study Committee decision-making process. In addition to this
    committee process, all of our Storage Study Committee meetings were
    open to the public, and we maintained a mailing list of individuals and
    entities that had an interest in the outcome of the PSOP. The state of
    Kansas was included on that mailing list. They had the opportunity to
    review and comment on our Preferred Storage Options Plan Report, both a
    draft report and final report. We have also kept the Arkansas River
    Compact Commission fully informed of our plans.
        The PSOP Report considered impacts on flows to the Kansas-Colorado
    state line as part of the analysis. A computer simulation model of the
    Fryingpan-Arkansas (Fry-Ark) Project and the proposed storage
    alternatives was developed to analyze each of the storage alternatives
    with the projected storage requests. The model includes Fry-Ark Project
    water and storage facilities, the storage enlargements being proposed,
    and the existing water rights involved in the storage proposals.
    Reservoir and streamflow impacts were investigated from the headwaters
    downstream to the Avondale gage and Lake Meredith, including Fountain
    Creek. Impacts at the Avondale gage show little variation from
    historical streamflows. The average annual streamflow is expected to
    increase zero to two percent over historical streamflows, depending
    upon the storage scenario. This small change is because streamflow at
    the Avondale gage is primarily demand driven, and demands downstream of
    the Avondale gage are not shown to change for future conditions. Based
    on the modeling results, the hydrologic analysis concluded that there
    would be no negative hydrologic impacts on state line flows.
        In addition, the state of Kansas has previously raised concerns
    regarding how the PSOP may impact on the Arkansas River Compact. Our
    understanding of the Arkansas River Compact is that it did not
    apportion the unusable flows of the Arkansas River Basin. As Article
    IV. D of the Arkansas River Compact states ``the waters of the Arkansas
    River . . . shall not be materially depleted in usable quantity or
    availability for use to the water users in Colorado and Kansas under
    this compact by such future developments or construction.'' (Emphasis
    added.) Instead of apportioning unusable flows, the Compact provided
    that it was not intended to impede or prevent future beneficial
    development of additional water that was unusable when the Compact was
    signed and, in fact, Article IV. D expressly approves such development.
    While the opportunity to develop additional, heretofore unusable waters
    of the Arkansas River above John Martin Reservoir is very limited, it
    is not impeded by the Compact. We are not aware of any provision in the
    Compact that entitles Kansas to a share of the benefits if additional
    storage in Colorado develops previously unusable flows. While
    implementation of the PSOP may allow for some development of infrequent
    storage opportunities for additional water that was unusable when the
    Compact was signed, the primary benefit of implementation of the PSOP
    will be better management of existing supplies.
        Most of the water captured by re-operations and enlarged space will
    be transmountain water and legally reusable consumptive use credits.
    With that said, it is our intent that any development of additional
    storage capacity through the PSOP is done in complete compliance with
    the Arkansas River Compact. And, throughout the federal-level studies
    requested in H.R. 3881, we expect that Reclamation will continue to
    involve the state of Kansas and the Arkansas River Compact Commission.
        Conclusion: I consider H.R. 3881 to be the most significant water
    resources legislation for Southeastern Colorado since the authorization
    of the Fryingpan-Arkansas in 1962. The Fry-Ark Project was designed and
    built to meet the year 2000 water demands in the Arkansas River basin
    in Colorado. Community leaders from throughout the basin worked
    together to create the vision for the Fry-Ark Project. Their vision has
    certainly paid off, but it wouldn't have been accomplished without a
    lot of cooperation and compromise that followed the 1962 Act of
    Congress.
        The communities in southeastern Colorado have again come together
    to plan for their future water resource needs. This time the target is
    the year 2040. Again we need the expertise and cooperation of the
    Bureau of Reclamation, and we're again asking Congress to get us
    started by passing legislation, H.R. 3881. Like before there will be a
    need for cooperation and compromise as our plans move forward. But, we
    can't continue the process without the blessing of Congress.
        Today, I'm asking that the members of the House Resources Water and
    Power Subcommittee support H.R. 3881. It will help southeastern
    Colorado continue the local initiative to prepare for our future. Thank
    you.
                                     ______

        Mr. Calvert. I thank the Gentleman for his testimony.
        Melinda Kassen, Director of the Colorado Water Project,
    Trout Unlimited. You are recognized.

    STATEMENT OF MELINDA KASSEN, DIRECTOR, COLORADO WATER PROJECT,
                            TROUT UNLIMITED

        Ms. Kassen. Thank you, Mr. Chairman. As a preliminary
    matter, I would ask that my testimony and our report which was
    submitted, Dry Legacy, be included in the record.
        Mr. Calvert. Without objection, so ordered.
        Ms. Kassen. Thank you. Trout Unlimited is--I am here today
    for Trout Unlimited because my job for Trout Unlimited is to
    try to keep water in the rivers for the fish. And while we
    certainly appreciate the efforts of Southeastern to look at a
    variety of options in terms of storage to meet municipal
    demand, our concerns with H.R. 3881 is that it doesn't go far
    enough to deal with some of the other issues in addition to
    providing storage for municipal demands. And this bill has the
    potential to create significant adverse impacts on the Arkansas
    River, particularly in a 10-mile stretch between Pueblo
    Reservoir and the City of Pueblo.
        This stretch is the subject of a 6-year Army Corps of
    Engineers project called the Arkansas River Legacy Project,
    which is a river restoration project. It is a six-and-a-half
    million dollar project, roughly, and the Corps is 4 years into
    that project.
        One of the goals of this project is to create a wild, self-
    sustaining fishery. And because of the way 3881 is currently
    drafted, it would not protect the value associated with that
    Corps project. The Arkansas River Legacy Project was not just
    funded by the Corps. The City of Pueblo has put in money. The
    State of Colorado, through Great Outdoors Colorado, has put in
    money. Trout Unlimited has raised money in addition to 400
    hours of sweat equity working on restoration. We think that it
    is critical that the value of this project not be lost, as
    Southeastern addresses the storage issues of its water users.
        H.R. 3881, by taking the PSOP and using that as the
    foundation for the feasibility study, puts a minimum hundred
    cfs flow target, a voluntary target, into a river that
    currently runs at 2,000 to 2,500 cfs in the summer. We believe
    that the bill as drafted sets a course which doesn't allow for
    the environmental reviews which will be a requirement down the
    road to really look at and develop the science of what is
    necessary to satisfy other project purposes of the Fryingpan
    Arkansas Project, particularly fish and wildlife conservation.
        We hope that this bill can be amended to ensure that the
    science developed would allow for the goal of the Corps project
    to be achieved. 3881 deals virtually exclusively with storage.
    In addition to the fish and wildlife issues, there are
    socioeconomic issues. I think Ms. Castle for the City of Pueblo
    will talk about how Pueblo feels, that it may be something of a
    loser in the construct of this bill. You heard already from
    Kansas in terms of their feelings that they are a loser under
    this bill.
        I would urge the Committee on behalf of Trout Unlimited to
    take a step back, broaden the scope, and deal with all of the
    issues that are involved here, not just storage but protection
    of the Federal investment to the Arkansas River Legacy Project,
    as well as consideration of protection for the basin of origin,
    the Colorado River, because there is also a recreational
    economy on that side of the Rocky Mountains.
        We made a number of recommendations in our testimony. I do
    believe that it is possible, given what we know about the
    project now, to work those issues out and, as Mr. Hefley said,
    to satisfy everybody. I am hopeful that we can do this. But we
    believe that it is imperative not to lose the value that the
    Corps project has contributed to this area and to protect a
    fishery that is widely used by Pueblo citizens. There are a lot
    of lower economic status citizens in the City of Pueblo who use
    this fishery. TU has contributed to it's viability. It is our
    hope that it will be protected as Southeastern grows. Thank
    you.
        [The prepared statement of Ms. Kassen follows:]

     Statement of Melinda Kassen, Director, Colorado Water Project, Trout
                                   Unlimited

        Good morning Mr. Chairman and members of the subcommittee. I am
    honored today to be here to discuss Trout Unlimited's interests in, and
    opposition to H.R. 3881, a bill to authorize the re-operation of, and a
    study to enlarge, Pueblo Reservoir and other Bureau of Reclamation
    (Bureau) Fryingpan-Arkansas Project (Fry-Ark) facilities. I am the
    director of the Colorado Water Project for Trout Unlimited; my resume
    and disclosure form are attached to this testimony.
                                  Introduction
        Trout Unlimited (TU) is a national non-profit organization with
    125,000 members nationally and over 8,200 in Colorado. TU's Southern
    Colorado Greenback chapter, based in Pueblo, CO, has approximately 230
    members. TU's mission is to conserve, protect and restore coldwater
    fisheries and their habitats. The goal of the Colorado Water Project is
    to restore and maintain stream flows for healthy coldwater fisheries
    and to increase meaningful public participation in decisions regarding
    water allocation.
        Both TU's Colorado state council and its local chapter have shown a
    longstanding and active interest in restoring the coldwater portion of
    the Arkansas River. For example, TU has been involved in projects to
    protect the Upper Arkansas River from high flows associated with
    increased transmountain diversions made possible by the Fry-Ark
    Project. TU was party to the Federal Energy Regulatory Commission's
    relicensing process for the Salida Hydro plant on the South Arkansas
    River. Another area TU chapter has worked with the Bureau of Land
    Management (BLM) and the Colorado Division of State Parks in their
    partnership for the Arkansas Headwaters Recreation Area via the
    Citizens Task Force, to bridge the gap between different groups of
    recreational users. In partnership with the BLM, TU volunteers have
    established angler access points along the river. TU has been involved
    in numerous projects to restore greenback cutthroat trout within the
    Arkansas River basin. Local TU volunteers have contributed more than
    4000 hours a year in conservation and education programs for the
    Arkansas River Basin. National TU's Colorado Water Project also
    recently released a report, Dry Legacy (copies attached and available
    at Dry Legacy or www.cotrout.org) that highlighted low flow problems on
    the South Fork Arkansas River and Fooses Creek (one of its
    tributaries), as well as recommendations for solving the problem.
        In my testimony today, I would like to make three main points:
        First, as drafted, H.R. 3881 creates a project that would have
    significant negative impacts on the City of Pueblo, the Arkansas River,
    and the Colorado River basin. Those impacts include both further
    degradation of already seriously degraded aquatic ecosystems in two
    major river basins in Colorado and a significant reduction of the
    benefits of an environmental restoration and recreation project, the
    Arkansas River Legacy Project, now underway.
        Second, because H.R. 3881 is drafted to foreordain some critical
    components of the project, the bill effectively blocks meaningful
    evaluation of the alternatives for the project in the feasibility study
    and environmental review. As an example, the bill calls for a target
    minimum flow below Pueblo dam of 100 cubic feet per second (cfs). This
    flow has already been demonstrated to be grossly inadequate for a
    healthy fishery, but because that number is in the bill, the Bureau's
    ability to determine and require an adequate flow would be highly
    circumscribed. As a result, designing the project to minimize impacts
    and crafting appropriate mitigation will not occur.
        Third, Colorado's water management system is complicated, with
    complex and difficult problems. Simple solutions, such as the storage
    capacity increase proposed in H.R. 3881, may address one interest's
    issues, but do not necessarily lead to a better situation for all
    affected interests. As this committee is wrestling with in the case of
    California's CALFED legislation, increasing storage may be part of the
    solution, but it must be integrated into a more comprehensive approach
    to solving the regional problems. H.R. 3881 does not even begin to take
    that more comprehensive approach, and therefore fails to advance an
    overall resolution.
                       The Arkansas River Legacy Project
        In many places, the Arkansas River is a highly managed system, as
    much a tangle of plumbing as a river. Little remains of its natural
    ecosystem through much of its more than 325 miles in Colorado.
    Substantial quantities of the water flowing through the basin come from
    west of the continental divide, as a result of several transmountain
    diversion projects, including the Fry-Ark that is the focus of H.R.
    3881. Pueblo Reservoir, which is part of the Fry-Ark Project, closed
    its gates in 1975. Prior to then, the reach of river from the dam site
    down to the Arkansas River's confluence with Fountain Creek was a warm
    water environment. With the reservoir in place, this reach of the river
    became a coldwater environment. However, the river was also highly
    channelized below Pueblo Reservoir, as a result of older flood control
    measures and served initially as a conduit for high volume summer flows
    destined to satisfy the water rights of Lower Arkansas River basin
    farms, and deliveries under interstate compact to the State of Kansas.
        The native coldwater fish species from the Arkansas (greenback
    cutthroat trout) was listed as an endangered species in 1973
    (downgraded to threatened in 1978). These fish are in trouble due both
    to the introduction of non-native species and to the basin's severe
    water management regime that has destroyed the natural flow patterns in
    many places. Given this listing, persons interested in healthy
    coldwater fisheries saw the tailwater reach below Pueblo Reservoir as a
    place to recover coldwater fishery habitat. However, Pueblo Reservoir
    only releases a meager 100-200 (cfs) to the stream for the five-month
    winter period, when there is little irrigation demand downstream and
    water users instead store water in the reservoir for summer use. These
    winter flows are insufficient to allow trout to survive through the
    winter and establish a breeding population. Thus, the Colorado Division
    of Wildlife has managed the reach of the Arkansas River from Pueblo
    Reservoir downstream to the City of Pueblo in the last several decades
    as a ``put-and-take'' trout fishery, stocked with catchable-size trout.
    None-the-less, the fishing in this reach of the river is a significant
    recreational amenity even now, particularly for Pueblo's large, low-
    income population.
        Recognizing the recreational and habitat potential for this reach
    of river, in 1998, the US Army Corps of Engineers began a major effort
    to restore a 9.5 mile reach of the Arkansas, from below Pueblo
    Reservoir downstream to the confluence with Fountain Creek. Teaming
    with the Colorado Division of Wildlife, the City of Pueblo, two local
    school districts, the University of Southern Colorado, and several
    local environmental and recreational groups, the Corps embarked on the
    Arkansas River Corridor Legacy Project (Legacy Project). Funds for the
    project come from the Corps, Great Outdoors Colorado (the recipient of
    Colorado lottery proceeds), the City of Pueblo and other team members.
    The Corps is expecting the total project to cost $6.6 million, with a
    35% share being paid by non-federal partners. (The Corps' share is
    capped at $5 million.) Completion is expected in 2004. There are
    several additional components of the Legacy Project in which the Corps
    is not directly involved (including enhancements of Pueblo's nature
    center--located adjacent to the river--nature trails and zoo exhibits)
    which bring total project costs to $8.75 million
        The local TU chapter is one of the partners in the Legacy Project.
    Within the past four years, the chapter secured a $2,500 grant through
    TU's Embrace-a-Stream program to buy and place boulders in the river
    several miles downstream of Pueblo Reservoir for habitat restoration
    purposes. In addition, the chapter has contributed over 400 hours of
    volunteer time planting trees and reclaiming the riparian corridor of
    this reach.
        One aspect of the Legacy Project, scheduled to enter construction
    as early as November 2002, will be to construct a winter low flow
    channel within the current river corridor. This will allow the
    concentration of wintertime low flows to maintain sufficient habitat so
    that fish could over-winter successfully. With the additional
    restoration efforts, the Legacy Project partners hope to nurture a wild
    fishery for this reach upon completion. But the Legacy Project will not
    just yield recreational amenities; it will also give the Pueblo area a
    fully functioning ecosystem, with all the positive values that entails.
        Because of the work that TU and others have put into improving the
    value of the Arkansas River resource through Pueblo, TU believes that
    it is imperative to protect flows in this reach of the river.
     Impacts of the Pueblo Reservoir Re-operation and Potential Enlargement
        Passage of H.R. 3881 would authorize an immediate re-operation of
    Pueblo Reservoir to enable storage and transport of additional water
    and would fund studies to look at enlarging Pueblo Reservoir. The
    Arkansas River is a highly over-appropriated river in a semi-arid
    region. Because Colorado adheres to the prior appropriation system of
    water allocation, the state administers water rights in the order of
    their seniority. The municipalities that support H.R. 3881, including
    the Cities of Colorado Springs and Aurora, do so because the re-
    operation and enlargement of Pueblo Reservoir will increase their
    ability to make ``exchanges'' of water upstream into Pueblo Reservoir
    that will supply their burgeoning populations' needs. (In an
    ``exchange,'' a water user diverts water from a different location that
    was originally decreed and then supplies water from a different source
    to those diverters whom the change would otherwise adversely affect.)
    The current operating regime and storage capacity of the Reservoir
    limit the quantity of water that these cities can now exchange within--
    and outside--the basin. (Aurora sits in the Platte River Basin adjacent
    to, but north of, the Arkansas River Basin; Colorado Springs straddles
    Fountain Creek, a major tributary of the Arkansas.) As a result, they
    are not able to exercise some of their decreed water rights. The re-
    operation of Pueblo Reservoir allowed by H.R. 3881 would enable
    additional exchanges to occur now; the proposed enlargement would
    further expand the beneficiaries' ability to make new exchanges.
        There are two significant practical effects that would result from
    passage of H.R. 3881, as introduced, on aquatic ecosystems. The first
    is a substantial decrease in flows in the Arkansas River below Pueblo
    Reservoir through the City of Pueblo. Historic summer flows in this
    reach of the river are typically in excess of 2000 cfs, with a minimum
    of close to 500 cfs. With the enlargement and re-operation that H.R.
    3881 would set in motion, the Southeastern Colorado Water Conservancy
    District and the entities who intend to store additional water in
    Pueblo Reservoir commit only to a voluntary ``flow management program''
    that will ``target'' a flow of 100 cfs in this reach--a few percent of
    typical summer flows and potentially an 80% decrease from the historic
    summer low flow condition, with no guarantee of even that amount.
    Despite that existing winter flows are insufficient to support a wild
    fishery now, H.R. 3881's increased storage and target minimum would
    reduce them to the low end of their range (100 cfs).
        The second major category of adverse impacts is to the Colorado
    River basin through increased transmountain diversions. The course that
    H.R. 3881 sets appears to allow for increases in transmountain
    diversions, using the existing infrastructure of the Fry-Ark project as
    well as the proposed expansion. The Fryingpan River is a lively
    tributary to the Roaring Fork River, which is itself a tributary to the
    mighty Colorado River. 69,200 acre feet of water, a large portion of
    the native flows of the Fryingpan River, cross the continental divide
    for the Fry-Ark project now, along with additional water from non-
    federal projects, such as the Homestake Project that Colorado Springs
    and Aurora jointly own and operate. When Congress authorized the
    original project, Congress provided mitigation for the loss of native
    flows on the Colorado River side of the divide by constructing Ruedi
    Reservoir, which provides 100,000 acre feet of use to west slope water
    users for a variety of purposes. The expansion and re-operation
    proposed in H.R. 3881 has the potential to increase Colorado River
    depletions beyond the quantity that could be diverted for non-project
    purposes without the infrastructure of the Fry-Ark Project and beyond
    the quantity for which Congress originally provided mitigation. The
    result is likely to be an expanded transmountain diversion, without any
    provision for additional mitigation for the basin of origin, and
    certainly no mitigation for the adverse impact to the basin of origin's
    aquatic resources.
        The complexity of accounting for water transfers within the
    Arkansas River Basin, as well as within the Fry-Ark project itself,
    makes it difficult to determine at this time what the actual effects of
    expansion and re-operation may be. Doing so should be a major focus of
    the analysis of this proposed project during its environmental review.
    However, additional transmountain diversions out of the Colorado River
    Basin, a basin that has its own interstate compact delivery
    requirements, its own phenomenal growth, its own burgeoning
    recreational economy that relies on healthy river flows, and its own
    endangered species, is an outcome that Congress should avoid.
        These two major categories of impacts--de-watering in the Legacy
    Project reach of the Arkansas River, as well as unmitigated impacts in
    the Colorado River Basin resulting from additional transmountain
    diversions--need to be thoroughly examined in the feasibility study and
    associated environmental review. However, H.R. 3881 defines the project
    and some key features, such as the target minimum flow, in a way that
    will prevent carefully designing the project, its operations, and
    environmental components to address these adverse effects and create
    the greatest benefit for all Coloradans.
                             The Bureau's Challenge
        As members of this subcommittee well know, the Intermountain West
    is one of the fastest growing regions in the county, with Colorado as
    no exception. Colorado is projected to add one million residents in the
    next generation to the four million who already call the state home. In
    a state that gets, on average, 15 inches of rain annually, this growth
    will strain the state's water resources. Colorado is typical of the
    West in that irrigated agriculture uses the vast majority of the
    state's limited water resources, exceeding 80% of all consumptive water
    use. Unlike the population, however, the water supply will remain
    essentially constant over the next generation, given the limits of
    hydrology and the delivery requirements under the Arkansas River
    compact with Kansas. In the quest to develop the water supplies
    necessary to meet the demands of growing cities, there are hard choices
    to make and balances to strike between fueling that growth and
    preserving rural communities dependent on an agricultural economy that
    is already highly subsidized. However, in this balancing act, it is
    also important not to sacrifice the aquatic environments on which much
    of the ``New West'' recreational and tourism economy depends. And, as
    Members of this Committee know well, our laws require that federal
    actions occur without endangering native species on the verge of
    extinction.
        Most western states use some form of the prior appropriation system
    to allocate water resources. Colorado employs a particularly pure form
    of this system. Thus, as the state's water courts consider requests for
    new or changed water rights, they cannot consider impacts on the
    environment in making decisions. Nor can a water court consider whether
    the exercise of a water right may adversely affect a local economy.
        In this case, the municipalities supporting the re-operation and
    enlargement already hold water rights that, if exercised all together,
    would virtually dry up the Arkansas River in the stretch between Pueblo
    Reservoir and Fountain Creek through the City of Pueblo if they had the
    additional storage that H.R. 3881 would provide. Yet, Colorado law does
    not provide any legal venue in which to consider directly the adverse
    effects on the environment or the recreational amenity that would
    result from the cities exercising their water rights. It is simply not
    illegal in Colorado to dry up streams.
        As a practical matter, this system causes many of Colorado's rivers
    and streams to run dry at some time of the year. The Colorado Division
    of Wildlife maintains a database that has identified at least 571
    rivers where low flows are a limiting factor on the health of aquatic
    communities. It was not until 1973--a century after issuance of decrees
    for the state's most senior water rights--that the state recognized the
    need to protect rivers by keeping some water in the stream. Since the
    creation of the state's instream flow protection program, a single
    state agency has been allowed to appropriate water for environmental
    protection purposes, but the state program has been limited in many
    respects. Almost all of the rights it holds are quite junior (in a
    system based on seniority) and the quantities are only for minimum
    amounts, thus limiting the habitat protection they afford. Today the
    program protects fewer than 20 percent of the coldwater streams in
    Colorado (and only a handful of others). Of the 25,000 miles of streams
    in the Arkansas River Basin (a figure that includes both perennial and
    ephemeral streams), the state's program covers just over 600 miles of
    streams (none of which are on the mainstem of the Arkansas River).
        Colorado's political leaders now recognize that this approach to
    water may have suited 19th century miners and ranchers, but is
    inappropriate for Colorado's current and future residents and economy.
    Recognizing that fish and people need water flowing in the state's
    rivers, Colorado's legislature is now considering improving the program
    for protecting flowing rivers.
        By contrast, when considering its actions, the federal government
    not only may, but also is required to, consider the needs of fish,
    wildlife, endangered species, recreation, local economies and a host of
    other interests affected by water projects. However, the tools federal
    agencies have available for protecting rivers in the West have been
    little used in areas affected by this project. First, the federal
    agencies with lands reserved from the public domain can obtain federal
    reserved rights dating to when their lands were withdrawn; however,
    there are no federal reserved rights in the Arkansas River Basin, and
    none pending that would help protect the Arkansas River between Pueblo
    Reservoir and Fountain Creek. Similarly, some federal agencies, in the
    context of exercising their administrative authorities, can impose
    bypass flow requirements, for example, through permits; however, there
    are few operating in the Arkansas River Basin.
        As part of the changes H.R. 3881 seeks, the legislation should
    ensure that the Bureau considers how best to ensure protection of the
    flow levels that will restore the Arkansas River consistent with the
    Corps' Legacy Project. TU urges an amendment to H.R. 3881 to direct the
    Bureau not to enter into contracts unless they allow release of flow
    levels to the affected reach of the Arkansas sufficient to establish
    and maintain a wild fishery.
        The Bureau's role throughout the West was initially to reclaim the
    arid lands. While early Bureau projects focused on irrigation, and to a
    lesser extent municipal use, over time the purposes of Bureau projects
    have expanded. More recent projects, including the Fry-Ark, include
    power generation, as well as recreation and fish and wildlife
    protection or enhancement. As described in the testimony from the City
    of Pueblo, the Fry-Ark project enabled better use of the fertile lands
    in the lower Arkansas River Basin, as well as provided these other
    benefits.
        The irony, of course, is that, even with the Fry-Ark project, the
    future of irrigated agriculture remains hazy. Today, the farm economy
    depends on substantial federal subsidies. In addition, Colorado has
    obligations under the Arkansas River Compact to deliver certain
    quantities of water downstream to the State of Kansas. Making those
    compact deliveries has meant some curtailment of agricultural rights on
    the Colorado side of the border. In addition, as municipal growth takes
    increasing amounts of water to sustain, agricultural water users are
    hard pressed to hang on to their valuable water rights.
        Nowhere is there a better example of this phenomenon than in Otero
    County, Colorado, located in the Lower Arkansas River Basin. There, the
    City of Aurora, one of the same municipalities that would benefit
    greatly from the re-operations and enlargement that H.R. 3881
    contemplates, bought out most of the water users along the Rocky Ford
    Ditch. Acquiring agricultural water rights is often the cheapest way
    for thirsty cities to enlarge their water supplies. The effects of this
    purchase and the transfer of the water rights out of the county and
    Arkansas River Basin on the local economy and community have been
    significant.
        One of the many conditions imposed on Aurora's transfer of these
    water rights was that the City would have to demonstrate conservation
    of water within its service area. Certainly, given the huge burden that
    a basin of origin shoulders when a remote water user diverts water out
    of the basin, this type of condition is not only reasonable but also
    imperative. Yet, H.R. 3881 is silent on the need for those who would
    benefit from the transfer of water out of the Arkansas or Colorado
    Rivers to conserve the water removed. The bill should direct those in
    the basins of use to ensure that the water transferred is conserved to
    the maximum extent possible. A particularly galling example is
    diverting water out-of-basin, drying up recreational and environmental
    treasures, for delivery to subdivisions with covenants that favor--or
    even require--blue grass lawns (that demand profligate watering).
    Precious out-of-basin water should be used most efficiently, and not
    for watering city sidewalks or landscape unsuitable for an arid
    climate.
        Finally, the Bureau must determine how to meet the fish and
    wildlife purposes of the Fry-Ark Project on both sides of the
    Continental Divide. We suggest that the Project not be used to de-water
    the Arkansas River between Pueblo Reservoir and Fountain Creek, and not
    allow any expansion or re-operation of project facilities to harm the
    Colorado River Basin tributaries that contribute their flows to the
    Arkansas and South Platte River Basins. While Section 12 of the bill
    appears to limit the additional draw on the Colorado River, it does
    allow new depletions if accompanied by compensatory storage for west
    slope water users. Given the realities of the west slope economy, and
    given the fish and wildlife purposes of the initial project, TU urges
    Congress to ensure that the Bureau not only considers compensatory
    storage, but also ensures protection of the remaining aquatic and
    recreational values of the Fryingpan River valley.
        In this complex situation, it is important for the Bureau to take
    the lead to helping the Arkansas River Basin respond to the growth
    pressures it faces. That means fine-tuning the water management that
    the Bureau's Fry-Ark Project makes possible. But, particularly given
    the Corps' and its partners' investment in the Legacy Project, it is
    important for the Bureau to act as well to protect the fish and
    wildlife benefits that are also within the purposes of the original
    Fry-Ark Project.
       Balancing Arkansas River Protection and Supplying Water for Growth
        TU is not opposed to growth; we recognize that the Rocky Mountain
    West generally, and southeastern Colorado in this instance, is going to
    grow. That said, TU believes that the only way to grow responsibly is
    to do so while protecting important environmental and recreational
    resources. In a state like Colorado, these protections are necessary to
    preserve the quality of life. This is especially the case where such
    resources have been the centerpiece of cooperative federal/state/local
    restoration efforts. In considering this bill, the subcommittee needs
    to determine how best to protect the federal investment, through the
    Corps, in the Arkansas River Legacy Project, including sustaining flows
    in the reach subject to restoration. H.R. 3881 should not start a
    process that will lead to the Bureau taking action that will undermine
    this Corps initiative, done in concert with local and state government,
    as well as local citizen groups and individuals' support.
        Therefore, we believe that Congress must direct the Bureau to
    impose reasonable requirements in the contracts and project features
    authorized by H.R. 3881 to protect both the aquatic environment within
    the Corps' Legacy Project area and that of the Colorado River Basin.
    H.R. 3881 should not function to create winners and losers. Rather, the
    bill should ensure balance in its outcome. TU believes that amendments
    to the bill can accomplish a more even-handed outcome. Such amendments
    would require:
         LRe-operation to be done in a way that protects flows in
    the Corps' Legacy project reach to accomplish that project's goals. In
    this regard, while TU supports Pueblo's proposal to limit re-operation
    and use of enlarged capacity when flows through the City of Pueblo are
    less than 500 cfs in the summer and 100 cfs in the winter, we also
    stress that the legislation direct that ultimate minimum and target
    flows be set to support a healthy wild fishery based on a thorough
    scientific evaluation done during the environmental review process;
         LRe-operation to be done both to protect the aquatic
    resources as well in the basin-of-origin tributaries out of which
    additional transmountain diversions may be made, and to provide
    appropriate mitigation for west slope water users;
         LThat the water for municipal use made available as a
    result of reservoir re-operations (or reservoir enlargement after the
    study H.R. 3881 authorizes is completed), and in particular as a result
    of increased transmountain diversions, be the subject of conservation
    requirements within the area of use;
         LIntegration of any re-operation or expansion with the
    needs of the affected local communities, including the City of Pueblo
    and the recreation and tourism based communities on the West Slope; and
         LAuthorization of funds, if necessary, to buy water rights
    to accomplish the above.
        Thank you for your attention and consideration. I would be happy to
    answer any questions.
                                     ______

        Mr. Calvert. Thank the Gentlelady.
        Ms. Castle, you may begin your testimony.

     STATEMENT OF ANNE CASTLE, SPECIAL COUNSEL, THE CITY OF PUEBLO
                    WATER MATTERS, STATE OF COLORADO

        Ms. Castle. Thank you, Mr. Chairman. I am Anne Castle, and
    I am special legal counsel to the City of Pueblo for Water
    Matters. With me here is today is Mike Occhiato, the President
    of the Pueblo City Council, Lee Evett, the city manager, Dave
    Galli, the assistant city manager, and Tom Florzak, the city
    attorney. Their presence today indicates how serious a concern
    this legislation is for the City of Pueblo.
        Pueblo is a city of about a hundred thousand people located
    about a hundred miles south of Denver on the front range of the
    Rockies. It is bisected by the Arkansas River. Why is Pueblo
    concerned? Quite simply, Pueblo is concerned because this
    legislation is going to substantially decrease the flows in the
    Arkansas River in the segment that flows through the city.
        As Councilman Null said, Colorado Springs, for example,
    intends to store private water rights, water rights that belong
    to Colorado Springs, in the space that is created by the
    reoperation of the Fryingpan Arkansas facility that would be
    allowed by H.R. 3881. Those are water rights that used to be
    taken to irrigate fields downstream of the City of Pueblo.
    Instead, the reoperation of this project would allow those
    water rights to be stored upstream, and so the water wouldn't
    be flowing through the city any more. It is going to be stopped
    at Pueblo Dam, from there taken in a pipeline to Colorado
    Springs or, as this legislation allows, to Aurora, a city over
    a hundred miles away and located in an entirely different river
    basin and not even within the Southeastern District.
        So the legislation has the potential to substantially
    decrease flows in the part of the river that flows through the
    city. Why is that a problem? Three reasons. Ms. Kassen has
    talked about the Army Corps of Engineers Arkansas River
    restoration project. That is a $6-1/2 million project that the
    City of Pueblo is cost-sharing in and will pay 35 percent of
    the cost of that project. That project is based on the
    assumption that existing conditions will continue, that Pueblo
    Dam will continue to operate the same way and be the same size,
    and that the river flows that exist currently will continue.
        Well, if that is not the case, if the reoperations goes
    forward, if the reservoirs are enlarged and the flows are
    reduced, then the restoration project is jeopardized.
        Second reason. The city has added on to the Corps
    restoration project with its own Arkansas River Legacy Project,
    which is more work to revitalize the river area within Pueblo,
    to rehabilitate a nature center, expand a river trail system,
    and to construct a boating course in a small segment of the
    river right in the middle of the city to provide some
    recreation opportunities for this low income area. Pueblo has a
    population that is over 19 percent poverty level, as opposed to
    the much reduced or much lesser poverty levels in the cities
    that will benefit from this project.
        Third reason. The city's wastewater treatment plant
    discharges at a location on the downstream edge of the city
    limits. And it is--quite simply, its discharge permits are
    based on the amount of historical flow in the river at that
    point. If the flows go down, if the flows get lower, then the
    discharge permit has to change. The requirements have to be
    tightened up, and that is a very expensive proposition for the
    city.
        It has been estimated that cost of upgrade to the city's
    wastewater treatment plant that would be required is about $10
    million. So, as Mr. Hefley said, this is a project that will
    benefit municipalities and allow municipalities to store
    private water rights in what is now a Federal project. Those
    municipalities are going to get great benefits, no question
    about that.
        And the City of Pueblo doesn't oppose this legislation in
    concept. But the benefits to the municipalities have to be
    balanced by a sharing of the burden that is borne by the City
    of Pueblo in the form of reduced flows.
        This legislation is going to create significant changes in
    the river, and they are changes for the worse for Pueblo. That
    reach of the river is going to be reduced substantially. The
    lion's share of the benefits are going to cities far away. Some
    of this water is going to be removed from the Arkansas Valley
    entirely and used by the City of Aurora.
        We are not asking that the project be stopped. We are not
    suggesting that there shouldn't be any reduction in flows. What
    Pueblo is asking for is that a floor be established, a bare
    minimum level of water flow that will continue to exist after
    this project is reoperated and after those reservoirs are
    enlarged, so that the City of Pueblo will continue to have a
    live, healthy stream flowing through it, not a dry ditch, for
    the benefit of its citizens. Thank you, Mr. Chairman.
        [The prepared statement of Ms. Castle follows:]

     Statement of Anne J. Castle, Esq., Holland & Hart LLP, Special Water
              Counsel, on Behalf of the City of Pueblo, Colorado,

        H.R. 3881 would authorize the Secretary of Interior to enter into
    contracts that would effectively increase the capacity of Pueblo
    Reservoir available for the storage of non-federal water rights by a
    substantial amount, and also authorize feasibility and other studies
    relating to the proposed physical enlargement of Pueblo Dam and
    Reservoir. As discussed in more detail below, the City of Pueblo,
    Colorado opposes H.R. 3881, as currently proposed, because the
    legislation would result in substantial, additional depletion of the
    already severely impacted Arkansas River as it flows through Pueblo.
       I.TESTIMONY OF MICHAEL A. OCCHIATO, PRESIDENT, PUEBLO CITY COUNCIL
        Pueblo is a community of approximately 105,000 people located on
    the semi-arid plain in southeastern Colorado, and serves as the
    medical, financial, retail and cultural center for 350,000 people from
    the Continental Divide east to Kansas, and from the City of Fountain
    south to the New Mexico border. Located at the confluence of the
    Arkansas River and Fountain Creek (see the location map attached at Tab
    B), Pueblo has been an important trading and population center for over
    300 years. Spanish and French explorers visited in the sixteenth
    century and Zebulon Pike explored the area in 1806 when it became part
    of the United States. The present day city of Pueblo was incorporated
    in 1886 as a consolidation of three previously existing towns. From the
    1870s until after completion of the Moffat Tunnel in 1928, which
    allowed the diversion of rail traffic across the continental divide at
    a more northern location, Pueblo was a thriving industrial and railroad
    city, second in population only to Denver. The Arkansas River has
    always been an important part of the City, due both to its prominent
    role in commerce and industry and as a source of water for the
    community. The River may have divided the City geographically, but it
    has also united the people of our community both as a devastating force
    of nature such as occurred in the 1921 flood, and as the peaceful
    riparian habitat enhancing the urban core of the City adjacent to our
    City parks, river trails and nature center.
        We have very serious, continuing concerns regarding the impact that
    passage of H.R. 3881 will have upon our community. Before addressing
    the flaws in this bill, a brief history of the original Fryingpan-
    Arkansas Project, of which Pueblo Reservoir is an integral part, may be
    helpful.
        During the early 1930s, Pueblo and the Arkansas Valley experienced
    a severe drought, which created near dustbowl conditions. This
    continued for many years, preventing otherwise fertile soil from being
    productive throughout the normal growing season. In the mid-1950s,
    President Dwight D. Eisenhower visited Pueblo and the Arkansas Valley.
    He took this opportunity to experience firsthand the blighted
    conditions of the soil and the plight of the region's farming
    communities. In good, wet years, nature stored heavy-packed snow in the
    high Rocky Mountains. Farmers had water for the initial part of the
    growing season, but not all of the growing season, as run-off in the
    early part of the season prevented water from being available later in
    the year. This flow regime made it difficult for the farming community
    to harvest good crops and utilize the fertile soil to its full
    potential. After many years of local citizens selling cast iron frying
    pans to generate funds for lobbying Congress, President John F. Kennedy
    visited Pueblo and signed legislation authorizing the Bureau of
    Reclamation to begin building the Fryingpan-Arkansas Project, part of
    which is Pueblo Reservoir located less than 10 miles upstream from
    Pueblo. This project brings surplus water from the western slope of
    Colorado to southeastern Colorado for use by the people of southeastern
    Colorado. Once completed in 1975, Pueblo Reservoir provided relief to
    the farm communities downstream as a more reliable source of precious
    water for both agriculture and domestic use.
        Now, nearly thirty years later, there are those that see the
    project's usefulness not in terms of preserving the River and the life
    which it brings to southeastern Colorado, but as a vehicle to transfer
    and store additional water for use elsewhere. Both the economic
    difficulties of farming and the value of water to thirsty metropolitan
    cities--such as Aurora which lies more than 100 miles north of Pueblo--
    are exerting pressure to remold the project into a vehicle to transfer
    more water away from Pueblo and the region generally, by making
    possible additional upstream exchanges of water, that previously flowed
    through the City to downstream users. As explained below by Ms. Castle
    in her testimony, H.R. 3881 as presently drafted, will allow further
    exchanges and transfers, and conceivably could at times dry up the
    Arkansas River through Pueblo.
        As presently written, Pueblo must oppose H.R. 3881. First, we do
    this because the bill authorizes reoperation of the project and
    contemplates enlargement of water storage space in a manner that will
    benefit other entities far from the Arkansas River while burdening
    Pueblo. These burdens are the additional depletion of the Arkansas
    River as it flows through Pueblo, thereby diminishing the value of the
    River as an important and irreplaceable amenity for the City and its
    residents. Second, the project may thwart the City's efforts to restore
    the riparian habitat and enhance recreation through Pueblo under the
    Arkansas River Corridor Legacy Project (the ``Legacy Project'') being
    undertaken by the United States Army Corps of Engineers in partnership
    with Pueblo. The Legacy Project, which involves improvements to
    approximately ten miles of the River as it runs through the core of the
    City, has been long in planning, and enjoys the support and cooperation
    of numerous entities, including the Pueblo Natural Resources and
    Environmental Education Council, funding from Great Outdoors Colorado
    and the provision of lands and easements from the Pueblo Conservancy
    District. Third, the River may be depleted to such a degree that costly
    improvement to the City's wastewater treatment facilities will be
    required, even though the improvements will not result in corresponding
    environmental or health benefits. A reasonable quantity of water must
    be present in the River to allow fish and other aquatic life to thrive,
    before an advanced level of wastewater treatment becomes the limiting
    factor.
        Pueblo would be able to support this legislation if it provided
    enforceable mechanisms to protect minimum flows of 100 cubic feet per
    second (``cfs'') through Pueblo during the winter months (November 15
    through March 15), and 500 cfs in the summer release months (March 16
    through November 14). Without this protection, depletions to the River
    through the City can only increase with the reoperation and enlargement
    of Pueblo Reservoir, and the ``voluntary'' minimum flow level that is
    currently specified in the bill as a desirable ``target'' flow is
    unenforceable and insufficient.
        We acknowledge that an enlarged Pueblo Reservoir would also
    somewhat enhance the existing reservoir as a recreational amenity.
    Notwithstanding this, we believe that the harm which would come from
    the present bill far outweighs its benefits to Pueblo. We also feel it
    is important to ensure that sufficient quality water is available to
    our neighboring communities downstream.
        Pueblo remains committed to pursuing an appropriate, cooperative
    resolution of the issues that will allow for increased water storage
    opportunities in Pueblo Reservoir to improve water supply reliability,
    while protecting the interest of Pueblo and its residents in preserving
    appropriate minimum flow levels in the Arkansas River through Pueblo.
    We sincerely ask for this Subcommittee's cooperation in either amending
    the bill to resolve our concerns or to delay the measure for a
    reasonable time to allow the affected state interests to develop an
    appropriate solution.
                         II.Testimony of Anne J. Castle
        The reoperation and physical enlargement of the storage capacity in
    Pueblo Reservoir that is the subject of H.R. 3881, has been proposed
    and developed by the Southeastern Colorado Water Conservancy District
    (the ``Southeastern District''), and a group of some of its
    constituents dominated by municipal water providers, including the
    cities of Colorado Springs and Aurora (respectively located more than
    40 and 100 miles from Pueblo Reservoir and the Arkansas River). These
    entities will reap the greatest benefits of the increased water storage
    capacity, while the lion's share of the negative impacts of the project
    will be borne by Pueblo. Pueblo's concerns and fears that H.R. 3881 and
    the proposed reservoir reoperation and enlargement project will
    materially harm Arkansas River flows and Pueblo's interests are
    confirmed by the studies and reports prepared for the Southeastern
    District and referenced in the bill. See, e.g., ``Preferred Storage
    Options Plan Report,'' Sept. 21, 2000 (the ``PSOP Report''), p. 31
    (stating ``[r]e-operation storage will facilitate additional river
    exchanges that could impact stream flows below Pueblo Dam,'' and
    confirming that flows from a reoperated Pueblo Reservoir as low as 49
    cfs will occur).
        Pueblo has been engaged for many months in discussions with the
    Southeastern District and the municipal water providers supporting the
    project, in an attempt to reach a mutually acceptable resolution of
    Pueblo's concerns. Pueblo has advocated, unsuccessfully thus far, for
    the development of enforceable limitations on uses of the increased
    storage capacity in Pueblo Reservoir that could further diminish
    outflows from the Reservoir below minimum acceptable levels. It is
    unreasonable and inequitable for the entities that will be able to
    significantly increase the value and yield of their water rights
    through the proposed reoperation and enlargement, to insist that they
    be allowed to do so to the maximum extent possible, without some
    reasonable level of mitigation to the impacted Arkansas River
    environment through Pueblo.
        Pueblo has also been actively participating in the Water Court
    processes initiated by the Southeastern District, Aurora, and others
    relating to water rights issues associated with the reoperation and
    enlargement of Pueblo Reservoir. Pueblo, too, is pursuing its own claim
    for a junior water right for recreational flows in the Arkansas River.
    Colorado's Water Courts, however, do not provide a ready forum or
    adequate remedy for the injuries that will be caused by the significant
    additional depletion of flows that will occur as a direct result of
    H.R. 3881 and the proposed project.
        A. Arkansas River Flows through Pueblo Already Diminished. Since
    construction of Pueblo Reservoir, the flow regime of the Arkansas River
    as it runs into and through Pueblo has been increasingly the subject of
    management and manipulation to satisfy the needs of the agricultural
    and municipal interests that rely on water from the River. One
    significant impact is a very substantial reduction in flows in the
    River from mid-November to mid-March each year. During this period, the
    Southeastern District operates its ``winter storage program,'' and the
    outlet on Pueblo Reservoir is virtually shut down. Attached at Tab C
    are two recent photographs depicting the Arkansas River with winter
    flows (measured at approximately 70 cfs on the day of the photos)
    through downtown Pueblo. Flows in the River increase during the spring
    and summer months when releases of water called for by downstream
    irrigators are made.
        The existence of Pueblo Reservoir just upstream of the City
    diminishes flows in the Arkansas River through Pueblo by allowing for
    the upstream ``exchange'' of water into the Reservoir of water that has
    traditionally flowed through the City to satisfy downstream water
    rights. Under these exchanges, which are the subject of Water Court
    decrees, water is stored in Pueblo Reservoir, rather than being taken
    out of the River at original points of diversion downstream, thereby
    reducing the flow of the River through Pueblo. Such decreed exchanges
    are currently being operated by the Cities of Colorado Springs and
    Aurora, among others.
        B. H.R. 3881 Will Further Reduce Flows. The authorization of H.R.
    3881 for reoperation of the east slope facilities of the Fryingpan-
    Arkansas Project (Sec. 3 of the proposed bill) will take effect
    immediately to facilitate additional exchanges of downstream water
    rights to storage and conveyance facilities upstream of Pueblo. This
    reoperation is sought because the authority of the Bureau of
    Reclamation to enter into contracts for the storage of ``non-project''
    water in Fryingpan-Arkansas Project facilities has been challenged. In
    addition, the PSOP Report, specifically incorporated in the proposed
    bill, expands the definition of ``excess water storage capacity,''
    thereby effectively creating a larger federally subsidized storage
    reservoir for private use.
        As acknowledged in the PSOP Report, the proposal to expand the
    storage capacity of Pueblo Reservoir has the potential to result in
    further dewatering of the river as it flows through Pueblo, by
    providing additional storage capacity into which water can be exchanged
    upstream. The current ability of several municipalities to operate
    their decreed exchanges is limited by the availability of upstream
    storage, and an enlarged Pueblo Reservoir will allow more water to be
    exchanged. A new water supply pipeline for the delivery of additional
    water from Pueblo Reservoir north to Colorado Springs and neighboring
    communities is currently in the planning stages.
        The bottom line is that upstream exchanges of Arkansas River water
    rights that cannot be operated currently due to the limited
    availability of storage in Pueblo Reservoir, would be able to operate
    if the Pueblo Reservoir reoperation and enlargement sought in H.R. 3881
    proceeds. The result will be further reduction in Arkansas River flows
    through Pueblo, as the exchanged water is transferred out of, rather
    than flowing from Pueblo Reservoir.
        C. Negative Impacts to the Legacy Project, Including Fish,
    Wildlife, and Recreation. The Legacy Project being undertaken at an
    estimated cost of $6.6 million, as a partnership between the Corps of
    Engineers and Pueblo, is intended to rehabilitate fish and wildlife
    habitat and improve public recreational opportunities in a 10-mile
    reach of the Arkansas River, stretching from Pueblo Dam downstream
    through the City. The anticipated benefits to Pueblo and the riverine
    environment that will result from the Legacy Project, which is
    scheduled to be completed in 2004, will evaporate if Arkansas River
    flows substantially diminish below current levels. Pueblo believes that
    a wintertime flow of 100 cfs through the City is the minimum level that
    would be sufficiently protective of the improved wildlife habitat, re-
    established fish populations, and recreational aspects of the Legacy
    Project. The ``voluntary,'' ``target'' flow of 100 cfs at the outfall
    of the Dam, provided for in H.R. 3881 and supporting documents is not
    an adequate guarantee or protection of the investment in the Legacy
    Project.
        The significant negative impacts to fish and wildlife, and
    recreational opportunities on the Arkansas River through Pueblo that
    could result from H.R. 3881 would also be contrary to the original
    purposes of the Fryingpan-Arkansas Project, which include ``supplying
    water for irrigation, municipal, . . . and for other useful and
    beneficial purposes incidental thereto, including recreation and the
    conservation and development of fish and wildlife . . ..'' Pub. L. No.
    87-590, 76 Stat. 389 (1962) (emphasis added.) The interests of the
    municipal water providers that are supporting the Pueblo Reservoir
    reoperation and enlargement should not be advanced, to the exclusion
    and at the expense of the other intended purposes of the original
    project.
        D. The Proposed Project Will Diminish Water Quality. Passage of
    H.R. 3881 will exacerbate the poor water quality conditions that exist
    at certain times in the Arkansas River. The reoperation and proposed
    enlargement will not only result in decreased quantity of water through
    Pueblo, but also will allow distant municipalities to take high quality
    upstream water out of the system, and substitute treated sewage
    effluent or lower quality downstream water by exchange. The relatively
    high levels of selenium carried into the Arkansas River by Fountain
    Creek is a widely-recognized water quality issue of increasing concern
    to the regulatory community. Further flow reductions in the Arkansas
    River obviously will reduce the dilutive capacity of the River, making
    the impacts of the poor quality from Fountain Creek even more acute.
        Additionally, further flow reductions in the Arkansas River will
    pose potentially significant compliance problems for Pueblo's municipal
    wastewater treatment plant (the ``Treatment Plant''), by reducing the
    amount of dilution flow that is available to mix with treated effluent
    discharged from the plant. If this occurs, Pueblo may be required to
    implement costly additional treatment processes in order to comply with
    future discharge permitting requirements of the United States
    Environmental Protection Agency and the Colorado Department of Public
    Health and Environment. These issues are compounded by the fact that
    the discharge point for Pueblo's Treatment Plant is located immediately
    downstream from the confluence of the Arkansas River and the already
    poor quality flows from Fountain Creek.
        E. Conclusion/Proposed Solution. Pueblo is not conceptually opposed
    to reoperation or enlargement of the Fryingpan-Arkansas facilities,
    including Pueblo Reservoir. However, these changes that benefit
    entities far away from the facilities must be balanced with a
    recognition of the great potential for detrimental impact on the City
    located in the midst of those facilities. Pueblo's proposed amendments
    to H.R. 3881 would simply protect a minimum flow of water through the
    City and prevent new exchanges from drying up the River entirely. The
    minimum flows sought to be protected (100 cfs during the winter, and
    500 cfs during the remainder of the year) are less than the average
    flows that exist currently in this section of the River (see the graph
    attached at Tab D.)
        Pueblo remains hopeful that an appropriate, cooperative resolution
    of the issues can be achieved that will allow for increased water
    storage opportunities in Pueblo Reservoir to improve water supply
    reliability for the municipal water providers, while protecting the
    interests of Pueblo and its residents in preserving appropriate minimum
    flow levels in the Arkansas River through Pueblo. Again, Pueblo
    recognizes that as with all similar projects, a balancing of the
    potential water supply benefits of the proposed reoperation and
    enlargement project, against the resulting negative impacts must occur;
    however, the balance proposed by the Southeastern District and others
    as proposed in H.R. 3881 is vastly unfair to Pueblo and its residents.

        [Attachments follow:]

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        [GRAPHIC] [TIFF OMITTED] 78262.004

        Mr. Calvert. Thank you for your testimony.
        I think I will ask a question, and all three witnesses can
    address this.
        If, in fact, a feasibility report was to move forward,
    isn't it true that not just the economic issues have to be
    addressed, not just the water rights, State water right issues
    must be addressed, but community issues must be addressed and
    environmental issues must be addressed. Isn't that correct?
        Mr. Arveschoug. Mr. Chairman, I guess I will start. I would
    answer yes to your question. The work that we have done is not
    intended to be conclusive. We look specifically at our storage
    needs. We looked at other issues as well. But we fully expect
    the Bureau of Reclamation to look at all issues, including
    recreation and environmental issues, not just the work that we
    have done, Mr. Chairman, but all issues presented.
        And, just for the record, we are not asking Congress to
    authorize the enlargements. The reference to the 1939 Act is to
    provide legal authority for the feasibility studies themselves.
    I am not an attorney, and so I can't give you the details of
    that.
        Mr. Calvert. You are the only one that isn't, I suspect.
        Mr. Arveschoug. We are not asking for you to authorize the
    enlargements. We want to be very thoughtful about this process.
    We realize it will take time. Our constituents need the
    additional storage in a reasonable amount of time. But we know
    Reclamation needs to do a thorough job in the studying the
    issues surrounding enlargement.
        Mr. Calvert. Thank you. Ms. Kassen.
        Ms. Kassen. The short answer is yes, that a feasibility
    study should address environmental impacts. Our concern with
    the way the bill is drafted is that it seems to sort of
    preordain the outcome of the feasibility study. And I would
    second what Commissioner Keys said earlier, that the bill be
    amended to allow the Bureau the flexibility to look at all of
    those issues and all of the options that they ordinarily
    consider, and not be limited in any way. And I don't believe
    that what Mr. Arveschoug said is contrary to that, at least
    right here.
        Ms. Castle. In addition to that, Mr. Chairman, I would
    point out that the feasibility study portion of the legislation
    applies only to the proposed enlargement of the reservoirs and
    not the proposed reoperations, meaning the authorization to
    enter into contracts with entities for the storage of
    nonproject water.
        Reoperations would create a 48,000 acrefoot bucket within
    this Federal project, within the existing space. That causes
    the City of Pueblo the same concerns as I just expressed. That
    is not the subject of a feasibility study.
        Mr. Calvert. Well, I think hopefully we can work out
    something that would address those issues if we move forward
    here on a feasibility study. The City of Pueblo, through your
    testimony--and I can understand you have made a significant
    investment in this water park and certainly other things that
    have been going on down that river.
        What rights to the water do you have ultimately outside of
    obviously what is going on in the community, and the water is
    passing through there? But do you actually have a water right
    to that?
        Ms. Castle001. A couple of answers to that. The water
    rights that are used within the city's municipal water system
    are operated by our Board of Water Works, which would, no
    question about it, benefit from the authorization of this
    legislation.
        However, the Board of Water Works doesn't have the
    responsibilities that the city council has to protect all of
    the interests of its citizens.
        Second, the City of Pueblo has filed just recently for a
    water right to protect its proposed boating course in the reach
    of the river through the city. But I will tell you, Mr.
    Chairman, Mr. Hefley, that this is not a water rights matter.
    Colorado water law does not deal with the protection of minimum
    flows in this type of context. That is just not what it was set
    up to do. Colorado water rights law protects water rights from
    injury and doesn't deal well with the situation that we are
    describing where we are trying to protect a minimum level of
    flow in the river that has always flowed through the city, but
    that this legislation jeopardizes.
        Mr. Calvert. Well, let me ask one final question. Because I
    am looking at a photograph that has average and maximum daily
    flow rates that was brought up in your testimony, and your
    proposal would obviously want to increase that amount of water
    even--that is above the average flow rate sometimes during the
    year; isn't that correct?
        Ms. Castlese 004. No. Let me be very clear about that, Mr.
    Chairman. We are not proposing to try to increase the amount of
    natural flow. What we are trying to do is protect what is there
    at a minimum level. So if the flow in the river, the natural
    flow that would be in the part of the river that flows through
    the city, is less than the 500 cfs protection that we are
    asking for during the irrigation season, then we are not trying
    to bump that up to 500, we are just trying to protect what is
    there.
        As you can see from that chart that was attached as Tab D
    to our written testimony, most of the time the average flows in
    the river considerably exceed the minimum levels that we are
    asking to be protected. What we are suggesting, that the flows
    just not drop below that level if they would have been above it
    naturally. If they are already naturally below it, then there
    is nothing more to do. We just don't want it to get lower than
    that.
        Mr. Calvert. Thank you. Mr. Hefley.
        Mr. Hefley. Thank you, Mr. Chairman. It is good to see
    Steve Arveschoug here today. I would like to tell you, Mr.
    Chairman, that Steve was an outstanding State representative
    for years in Colorado. But he had a campaign technique, which
    was to walk between the two major cities in his district,
    Canyon City and Pueblo, about 50 miles every campaign year, and
    I would go down and walk a portion of that with him. I am so
    glad he is in this job now and not in the State legislature, so
    I don't have to go down there and walk that distance any more.
    Steve, good to see you here.
        Mr. Arveschoug. Thank you, Mr. Hefley.
        Mr. Hefley. It is obvious that we have got competing values
    here. That is what hearings are for, to weigh those competing
    values. And I find myself frankly agreeing with all of the
    values that have been expressed here today, except for the one
    I guess where Kansas doesn't even want a feasibility studio. I
    don't agree with that. And we may have to do some discussion on
    how we accomplish the competing values.
        But, for instance, for Trout Unlimited, I was--in the
    redistricting, I have--I will now again--I did when I first
    started in Congress, and I will now again represent the upper
    reaches of the Arkansas River to the headwaters up at
    Leadville. I remember when I represented it before there was a
    big debate about the Elephant Rock Dam. And I happened to side
    with Trout Unlimited and Chaffee County against the City of
    Colorado Springs. I was on the other side because I thought
    that you were right in that. That was a value that we should
    support.
        And I think Pueblo is a wonderful community, who has done a
    wonderful job of spiffying up its image that--this river walk
    and all of that kind of thing. The representatives of Pueblo
    should be commended on what they have done in this. And I don't
    want to do anything to give you a dry ditch. I think the Legacy
    Project is an excellent project. I want that to continue.
        Two weeks ago I was down in Chaffee County and
    reintroducing myself to folks down there and came back along
    the Arkansas, which is one of the prettiest drives that you can
    have in the State of Colorado through that Arkansas River
    Canyon, and stopped repeatedly to watch fishermen fish in the
    stream there. You know, we want these values. And now how do we
    get to them? And I think the feasibility study is the way to do
    that.
        But let me ask you, Ms. Castle, the Pueblo Board of Water
    Works and the Southwest District say that the reoperation and
    the reservoir enlargement will benefit the citizens in the
    vicinity of Pueblo. Is that not correct?
        Ms. Castle. As I said, Mr. Hefley, the Board of Water Works
    will benefit from the reoperation and proposed enlargement of
    the reservoir because they have water rights to store there.
    They are like the cities of Colorado Springs and Aurora in that
    the project can benefit them, and we certainly don't deny that.
    But the Board of Water Works has a very narrow scope. It is not
    their job, as it is the Pueblo City Council's, to protect all
    of the interests of the folks in Pueblo, including the
    recreational interests and the fish and wildlife interests that
    are part of the original purposes of the Fryingpan Arkansas
    Project.
        Mr. Hefley. Well, I would assume that when they say benefit
    the citizens of Pueblo, they weren't just talking about the--
    them storing their water rights so they can have drinking
    water. I thought they probably meant some of the other values
    as well. But maybe I am wrong about that.
        Ms. Castle. Well, I think that city council has made a
    determination that the burdens of this legislation on the city
    and the folks within it and the folks in the Pueblo area that
    enjoy the benefits of the river as it flows through the City of
    Pueblo, that those outweigh the benefits to the water board.
        Mr. Hefley. OK. Steve, this bill would require entities
    receiving a contract from Reclamation using excess capacity in
    Pueblo Reservoir to participate in a flow management program to
    help maintain flows below Pueblo Dam through the City of
    Pueblo. How did this requirement come about? And do you believe
    that it address the issues raised by the City of Pueblo? I
    would assume you, too, don't want a dry ditch down there.
        Mr. Arveschoug. No, Mr. Hefley, I don't. I am a citizen of
    Pueblo, represented Pueblo in the legislature, and I don't want
    to see the Arkansas River through Pueblo dry up.
        Let me tell you why we have that requirement in the bill.
    When we were in the middle of our study on enlarging Pueblo
    Reservoir, looking at this concept of reoperations which, Mr.
    Chairman, if we have time I would like to explain that concept
    a little further because I think it would answer some of
    Kansas's questions and some of the other questions that are
    here.
        But when we were doing our study, Pueblo was also in the
    midst of their Legacy Project looking and doing a study with
    the Corps of Engineers. We knew that, obviously, and we shared
    information with city staff. They shared information with us.
        We knew that in the work that we were doing, if communities
    who needed space in Pueblo were going to operate an exchange,
    that that would have an impact on that reach of the river below
    Pueblo Dam, not a significant impact if you look at the
    modeling, but it will have an impact. That is recognized in our
    study. And that is why we say we need to develop a flow
    management program.
        Mr. Chairman, Mr. Hefley, you know this. There is precedent
    for what we were proposing. In the Upper Arkansas reach of the
    river we participate with the Bureau of Reclamation in an Upper
    Arkansas Flow Management Program. The Department of Natural
    Resources provides flow recommendations to the Bureau of
    Reclamation. Then the project is operated to enhance fishery
    and recreation in the upper reach of the river.
        Frankly, we thought that model would work pretty good for
    flows below Pueblo Dam. That is why we included it in the
    legislation as kind of a prerequisite for entities having a
    storage contract. They had to commit to participating in a flow
    management program.
        Mr. Hefley. Well, Steve, without the preferred storage
    options plan, would there be any protection under existing law
    to maintaining the flows through the City of Pueblo?
        Mr. Arveschoug. I think Anne spoke to that a little bit.
    Most of the water rights we are talking about are senior water
    rights. The exchanges on the river are senior. They are senior
    to anything the City of Pueblo is filing for now and would have
    the right, as long as the water is there, to divert that water.
    There is no legal protections for flows below the reservoir.
        We consider the preferred storage options plan as a good
    mechanism or foundation to develop the necessary flow
    protection because Colorado law does not accommodate that at
    the present time.
        Mr. Hefley. Well, you have heard the testimony from the
    State of Kansas, and they have raised, I think, important
    questions regarding compliance with the Arkansas River Compact.
    How will compact issues be dealt with as the preferred storage
    option plan moves forward?
        Mr. Arveschoug. Well, we also heard from Commissioner Keys.
    We would echo his comments that the studies on the enlargement
    will take a very close look at compact compliance. It is our
    sense and our intent that we do not want to develop water
    resources in Colorado out of compliance with the compact, so we
    would expect that the study that would be done by Reclamation
    would take a close look at those issues.
        One key point here. The feasibility study that looks at
    enlargement would also look at the district having a junior
    flood storage right at Pueblo Reservoir. That right comes into
    priority only when John Martin Reservoir is spilling, only when
    other senior water rights in the basin are met, and when flows
    at the State line are in excess of usable flows to Kansas.
        It is very much a junior water right that we would be
    storing under the enlargement. Under the reoperations concept,
    we are going to be storing existing senior water rights in
    Colorado, and return flows from trans-mountain water. We have
    requests for about 38,000 acrefeet of reoperations storage
    space to use existing capacity. That is all existing water, not
    new water. It is us better managing water rights that we
    already have and has no impact to State line flows.
        Mr. Hefley. Thank you very much, Steve. Thank all of the
    witnesses. And, Mr. Chairman, thank you so much for this
    hearing this morning. And I hope the Committee will look
    favorably on this legislation. I am happy to work with you,
    your staff, and with the others that are interested to try to
    make this bill workable for all of these values that we talked
    about. Thank you.
        Mr. Calvert. I will be happy to work with you and our
    friend from Kansas and all of the others to hopefully work out
    a solution to this problem. With that--Steve, you have--.
        Mr. Arveschoug. I am sorry. Someone handed me a card and I
    said I boo-booed here. I need to ask that the record reflect my
    testimony today. And I would submit my reports for the record
    as well.
        Mr. Calvert. Without objection. All of that will be entered
    into the record.
        Ms. Castle. May I just do the same, Mr. Chairman? May I
    submit my remarks?
        Mr. Calvert. Without objection, so ordered. We will leave
    the record open for additional questions to be submitted and
    for those answers to be delivered to the Committee.
        [The letter submitted for the record by Mr. Arveschoug
    follows:]
    [GRAPHIC] [TIFF OMITTED] 78262.014

    [GRAPHIC] [TIFF OMITTED] 78262.015

    [GRAPHIC] [TIFF OMITTED] 78262.016

        Mr.  Calvert. With that, we thank you and we are adjourned.
        [Whereupon, at 12:05 p.m., the Subcommittee was adjourned.]

        The following information was submitted for the record:
         LAdams, Hon. Jamie Clover, Kansas Secretary of
    Agriculture, Statement submitted for the record
         LBarela, Hon. Kenneth, Mayor, City of Fountain,
    Colorado, Letter submitted for the record
         LKuhn, R. Eric, General Manager, The Colorado
    River Water Conservation District, Letter submitted for the
    record
         LScar, Dick, Director, Friends of the Arkansas,
    Letter submitted for the record
         LTauer, Paul E., Mayor, City of Aurora, Colorado,
    Letter submitted for the record

        [The statement submitted for the record by Mr. Adams
    follows:]

      Statement of The Honorable Jamie Clover Adams, Kansas Secretary of
                                  Agriculture

        This written testimony is to alert the Subcommittee to potential
    endangered species implications posed by the projects outlined in H.R.
    3881. The bill raises serious concerns for the Kansas Department of
    Agriculture, and those concerns revolve around issues of flood flows in
    the Arkansas River, including their capture, and endangered fish
    species.
        As I understand H.R. 3881, the bill would authorize a feasibility
    study for enlarging the Pueblo Reservoir and Turquoise Lake to capture
    and store flood flows, or unusable water, from the Arkansas River.
    There are endangered species issues related to flow regimes and quality
    of waters in downstream segments of the Arkansas River.
        Several prairie fishes that were once widespread and abundant in
    prairie stream ecosystems downstream from the Rocky Mountains have
    declined markedly in their distribution and abundance. One such species
    is the Arkansas River Shiner. In 1998, the Arkansas River Shiner was
    federally designated by the U.S. Fish and Wildlife Service as an
    endangered species. In Kansas, portions of the Cimarron and Arkansas
    rivers were ultimately designated as critical habitat for this species.
    Specifically, the Kansas portion of the Arkansas River, which stretches
    east from Highway 27 in Hamilton County in far western Kansas to the
    Kansas-Oklahoma state line, was designated as critical habitat.
    Excluded from that designation was a 12-mile stretch of the river where
    it passes through the city of Wichita. The U.S. Fish and Wildlife
    Service has noted that Colorado actions can, if proper care is not
    taken, adversely modify critical habitat in Kansas.
        The Arkansas River Shiner is a mainstream channel fish species that
    likes a wide, sandy-bottomed environment. The shiner spawns downstream
    of sandbars during May, June and July. Spawning occurs coincident with
    peak river flows. The eggs are non-adhesive and buoyant, so they drift
    in the current and hatch after two to four days. Although minimum or
    optimal flow requirements are not known, it is clear that the species
    is strongly influenced by river flows and it appears dependent on
    periodic intensive river flows during the spring and summer.
        The shiner is native to the Arkansas River Basin and, before 1985,
    it was widespread. However, populations disappeared rapidly during the
    mid-1980s, which prompted the federal endangered species listing.
    Although all causes of the decline in shiner numbers are not known,
    extensive demands on water in the river, reservoir construction and
    alteration of flow regimes appear to be the factors having the greatest
    impact on populations of the Arkansas River Shiner and several other
    prairie fish species.
        In recent years, much of the discussion between Kansas and Colorado
    has focused on water quantity issues. However, endangered species
    issues ranging from the black-tailed prairie dog to salmon to prairie
    fish populations are receiving increasing national attention. I
    appreciate the opportunity to provide you information for your
    deliberations on H.R. 3881.
                                     ______

        [The letter submitted for the record by Mr. Barela
    follows:]
                                City of Fountain

                                 april 2, 2002

    The Honorable Ken Calvert, Chairman
    Subcommittee on Water and Power Resources
    Committee on Resources
    United States House of Representatives
    1522 Longworth HOB
    Washington, D.C. 20515

    RE: House Resolution 3881 (Pueblo Reservoir Reoperation/ Enlargement)

    Dear Chairman Calvert:

        The City of Fountain, Colorado, submits this letter in order to
    supplement the record of the hearing held before the Subcommittee on
    Water and Power Resources on March 19, 2002, on H.R. 3881, regarding
    reoperation and enlargement of Pueblo Reservoir. Fountain supports this
    legislation, which is designed to more efficiently use Colorado s
    limited water resources, in part by allowing more complete use of water
    imported to the Arkansas River basin from the Colorado River.
        Fountain is a small city located on Fountain Creek, upstream of its
    confluence with the Arkansas River, in the Arkansas River basin. During
    the last decade, Fountain experienced enormous growth which brought its
    population to 15,197 in 2000. It is one of the fastest-growing cities
    on the Colorado front range. Population projections for the year 2020
    range from 30,000 to 37,000. Accommodating this growth has been a major
    challenge to the city, whose residents are working people with low to
    moderate incomes.
        During this period of great growth, the city has had to
    significantly expand its water resources and infrastructure just to
    keep up with its ongoing needs. Fountain now obtains its water supply
    from the Fryingpan-Arkansas (Fry-Ark) project and from several wells
    located within the city. Fountain s allocation of Fry-Ark water is
    approximately 2,000 acre-feet per year, and is delivered via the
    Fountain Valley Conduit. Because the Fry-Ark water is insufficient to
    meet all of Fountain s water needs, the city supplements the Fry-Ark
    supply with water from its wells, although the wells supply water of
    inferior quality. Although the Fry-Ark water is reusable, Fountain can
    fully reuse its share only if the Pueblo Reservoir reoperation and
    enlargement projects are approved.
        The Pueblo Reservoir reoperation and enlargement projects will
    enable Fountain to obtain maximum use of all of its water supplies by
    providing a storage vessel for the city s reusable Fry-Ark return flows
    and certain other water rights. The city is not in a position to
    acquire a sufficient supply of expensive senior water rights on
    Fountain Creek and to construct storage and other water system
    infrastructure on its own. Therefore, the Pueblo Reservoir reoperation
    and enlargement projects are the city s only realistic options.
        We urge the subcommittee to support H.R. 3881, in order to allow
    the necessary resolutions and feasibility studies required to further
    evaluate the Pueblo Reservoir reoperation and enlargement projects. Our
    city s future depends upon this.

    Sincerely yours,

    Kenneth Barela,
    Mayor

    cfc/m

    cc:  LColorado Congressional delegation
        LCity Council, City of Fountain
        LSteve Arveschoug, General Manager, Southeastern Colorado Water
      Conservancy District
                                     ______

        [The following letter was submitted for the record by R.
    Eric Kuhn, General Manager, The Colorado River Water
    Conservation District:]

                 THE COLORADO RIVER WATER CONSERVATION DISTRICT

                                 march 15, 2002
    The Honorable Ken Calvert, Chairman
    Subcommittee on Water and Power
    U.S. House of Representatives
    Committee on Resources
    1522 Longworth HOB
    Washington, D.C. 20515

    RE: H.R. 3881

    Dear Chairman Calvert and Members of the Committee:

        Thank you for this opportunity to share the views and concerns of
    the Colorado River Water Conservation District (River District)
    regarding H.R. 3881. The River District is a political subdivision of
    the State of Colorado that is responsible for the conservation, use,
    and development of the water resources of the Colorado River basin to
    which the State of Colorado is entitled under the 1922 and 1948
    Colorado River compacts. The River District includes all or part of 15
    counties in west-central and northwest Colorado, comprising 28 percent
    of the state.
        Roughly 80% of Colorado s population resides east of the
    Continental Divide, while approximately 80% of the moisture in the
    state falls, principally as snow, west of the Divide. Colorado has
    developed an extensive network of surface and underground water
    conveyance structures, which divert water transmountain from Colorado s
    western slope to its population and agricultural centers on the eastern
    slope. Among the largest of these systems are U.S. Bureau of
    Reclamation projects: the Colorado-Big Thompson Project and the
    Fryingpan-Arkansas Project. The latter being the subject of H.R. 3881.
        The River District supports the general purposes of H.R. 3881,
    namely more efficient use of Colorado s limited water resources
    especially the more complete use of water imported to the Arkansas
    River basin from the Colorado River basin.
        The River District has provided input to relevant sections of H.R.
    3881, specifically Section 12, which assures mitigation for increased
    diversions of water from the headwaters of the Colorado River basin
    into the Arkansas River basin. However, we have an unresolved concern
    with the language in Section 12, Paragraph (1) regarding precisely what
    constitutes an increased diversion that would be subject to the
    mitigation requirements of this section.
        The total amount of both project and non-project water which would
    be transmountain diverted as a result of the Fryingpan-Arkansas Project
    was an issue when Congress debated and enacted the authorizing
    legislation for the Project. The following brief excerpt from a House
    Resources Committee hearing on the Fryingpan-Arkansas Project s
    authorizing legislation from 1960 highlights our concerns today:
        Chairman Aspinall. What is the total amount that will be subject to
    diversion from western Colorado to eastern Colorado if this legislation
    is approved?
        Mr. Ogilvie (U.S. Bureau of Reclamation, Assistant Regional
    Director, Denver): It will be the 40,000 presently coming from Twin
    Lakes plus an additional 15,000 for Twin Lakes plus the 69,100 through
    the Fryingpan-Arkansas tunnel. That adds up to approximately 124,000
    acre-feet.
        Chairman Aspinall. Thank you.
        It was on the assurance of such limitations that Chairman Aspinall
    and western Colorado agreed to support the authorizing legislation for
    the Fryingpan-Arkansas Project in 1960. It is similar commitments that
    we seek today. Adequate provisions for mitigation of activities
    authorized under H.R. 3881 must be included in this legislation for any
    water which is conveyed through or stored in project facilities in
    excess of that contemplated at the time of, and included under, the
    Fryingpan-Arkansas Project s authorization.
        The Bureau constructed Ruedi Reservoir as a project feature as
    mitigation for western Colorado s loss of water resulting from
    Fryingpan-Arkansas Project diversions from the Colorado River basin to
    the Arkansas River basin. However, there is no compensatory mitigation
    for additional non-project water which may be transmountain diverted as
    a result of the activities authorized under H.R. 3881. Accordingly, the
    language in Section 12 was drafted to address those additional
    diversions to ensure protection to present and future western Colorado
    water users.
        We are working with the proponents of H.R. 3881 to resolve the
    question of which existing non-federal, transmountain diversion
    projects should be grand fathered under the provisions of Section 12,
    Paragraph (1) and which projects represent increased diversions and
    therefore would be subject to the mitigation provisions of Paragraphs
    (2) through (4). However, to date, we have not reached agreement on
    mutually acceptable language to assure that the language of this
    paragraph will not be the subject of future dispute. Only with
    resolution of this final issue can the River District and western
    Colorado support passage of H.R. 3881.
        Thank you for your time and consideration of our views and concern.

    Sincerely,

    R. Eric Kuhn,
    General Manager

    cc:  LColorado Congressional delegation
         LBoard of Directors
         LSteve Arveschoug
                                     ______

        [The letter submitted for the record by Mr. Scar follows:]
        [GRAPHIC] [TIFF OMITTED] 78262.013

        [The letter submitted for the record by Mr. Tauer follows:]
        [GRAPHIC] [TIFF OMITTED] 78262.011

        [GRAPHIC] [TIFF OMITTED] 78262.012

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