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TC Council Packet 02-11-2014 TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, FEBRUARY 11, 2014 RETREAT BEGINS AT 12:00 PM – AVON REGIONAL TRANSPORTATION FACILITY AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM REGULAR MEETING BEGINS AT 5:15 PM AVON TOWN HALL, ONE LAKE STREET Avon Meeting Agenda 02-11-2014 Page 1 PRESIDING OFFICIALS MAYOR RICH CARROLL MAYOR PRO TEM TODD GOULDING COUNCILORS DAVE DANTAS, CHRIS EVANS, JENNIE FANCHER, ALBERT “BUZ” REYNOLDS, JR., JAKE WOLF TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: VIRGINIA EGGER TOWN CLERK: PATTY MCKENNY ALL REGULAR MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS. GENERAL COMMENTS ARE WELCOME DURING PUBLIC COMMENT, AND COMMENTS ARE ALSO WELCOME ON ANY AGENDA TOPIC. PLEASE VIEW AVON’S WEBSITE, HTTP://WWW.AVON.ORG, FOR MEETING AGENDAS AND MATERIALS. AGENDAS ARE POSTED AT AVON TOWN HALL, AVON RECREATION CENTER, AND AVON LIBRARY. THE AVON TOWN COUNCIL MEETS THE 2ND AND 4THTUESDAYS OF EACH MONTH. ______________________________________________________________________________________________________________ AVON COUNCIL RETREAT BEGINS AT 12:00 PM AVON LIQUOR LICENSING AUTHORITY MEETING BEGINS AT 5:00 PM (SEE SEPARATE AGENDA PAGE 3) AVON REGULAR MEETING BEGINS AT 5:15 PM (SEE SEPARATE AGENDA PAGE 2) RETREAT MEETING AGENDA 1. CALL TO ORDER & ROLL CALL 2. APPROVAL OF AGENDA 3. TOPICS 3.1. Communication Protocols – Council to Council; Email & Texts; Council to Staff; Staff to Council, Council Updates 3.2. Review of the 2013-2014 Strategic Plan and Prioritized Work Plan for 2014 3.3. Discussion of Performance Review Processes and Criteria for Council Appointed Officials, including the Town Manager, Town Attorney, Town Prosecutor and Municipal Judge 3.4. Budget: Discussion of Preparation of a Two-Year Operational Budget for Fiscal Years 2015 & 2016 (if time allows) 3.5. Discussion of Written Minutes – Can these be Action Minutes (if time allows) 4. ADJOURN AT 4:00 PM TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, FEBRUARY 11, 2014 RETREAT BEGINS AT 12:00 PM – AVON REGIONAL TRANSPORTATION FACILITY AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM REGULAR MEETING BEGINS AT 5:15 PM AVON TOWN HALL, ONE LAKE STREET Avon Meeting Agenda 02-11-2014 Page 2 REGULAR MEETING AGENDA 1. CALL TO ORDER & ROLL CALL 2. APPROVAL OF AGENDA 3. PUBLIC COMMENT 4. WORK SESSION 4.1. Review Eagle River Water & Sanitation District’s Wastewater Master Plan (Diane Johnson, Communications & Public Affairs Manager, & Siri Roman, Wastewater Manager, ERWSD) 4.2. Direction regarding Town Sponsored Events and Gifts from Event Producers (Assistant Town Manager Patty McKenny) 5. PUBLIC COMMENT 6. ACTION ITEMS 6.1. Review of and Direction for Proposed Special Events with Producer Highline for Summer 2014 – Phase 3 Research (Jeff Brausch, CEO Highline) (Special Events Supervisor Danita Dempsey) 6.2. Final Action on Second Reading of Ordinance 14-01, Series of 2014, An Ordinance Amending Section 7.24.040, Table of Allowed Uses and Table 7.24-1, Allowed Uses, Avon Development Code to List Medical and Dental Offices and Clinics as a Special Review Use in the Public Facilities Zone District (Planning Manager Matt Pielsticker) 6.3.Action on Retainer Agreement with Butler Snow for Legal Services (Town Attorney Eric Heil) 6.4. First Reading of Ordinance No. 14-03, Series of 2014, Ordinance Amending Chapters 1.08 and 1.09 of the Avon Municipal Code to Increase Penalties (Town Attorney Eric Heil) 6.5. Minutes from January 28, 2014 Meeting (Town Clerk Patty McKenny) 7. COMMITTEE MEETING UPDATES: COUNCILORS AND MAYOR 7.1. Branding Sessions (Councilors Jake Wolf & Mayor Pro Tem Todd Goulding) 7.2. Colorado Creative District Roundtable (Councilor Jake Wolf) 7.3. Public Access TV, Channel 5 Board Meeting Update (Councilor Jake Wolf) 7.4. EGE Air Alliance (Mayor Rich Carroll) 7.5. ECO (Councilor Buz Reynolds) 8. COUNCIL COMMENTS TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, FEBRUARY 11, 2014 RETREAT BEGINS AT 12:00 PM – AVON REGIONAL TRANSPORTATION FACILITY AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM REGULAR MEETING BEGINS AT 5:15 PM AVON TOWN HALL, ONE LAKE STREET Avon Meeting Agenda 02-11-2014 Page 3 9. MAYOR REPORT AND FUTURE AGENDA ITEMS 10. WRITTEN REPORTS 10.1. Conditional Water Rights – Tracking System (Town Attorney Eric Heil) 10.2. Review Town of Avon Water Rights in Relationship to a Call under the State Water Compact (Town Attorney Eric Heil) 11. ADJOURNMENT FUTURE AGENDA ITEMS: February 25: Site Visit & Resolution 14-02 Minervini Minor PUD, Nottingham Park Stage Location and Funding, Highline Report Phase 2, Introduction of Director of Economic Initiatives, Vail Leadership Institute, Village at Avon Update TOWN OF AVON, COLORADO TOWN OF AVON MEETINGS FOR TUESDAY, FEBRUARY 11, 2014 AVON LIQUOR AUTHORITY MEETING BEGINS AT 5:00 PM AVON TOWN HALL, ONE LAKE STREET Avon Meeting Agenda 02-11-2014 Page 4 PRESIDING OFFICIALS CHAIRMAN RICH CARROLL VICE CHAIRMAN TODD GOULDING BOARD MEMBERS DAVE DANTAS, CHRIS EVANS, JENNIE FANCHER ALBERT “BUZ” REYNOLDS, JR., JAKE WOLF TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: VIRGINIA EGGER TOWN CLERK: PATTY MCKENNY ALL LIQUOR BOARD MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS COMMENTS FROM THE PUBLIC ARE WELCOME DURING PUBLIC HEARINGS PLEASE VIEW AVON’S WEBSITE, HTTP://WWW.AVON.ORG, FOR MEETING AGENDAS AND MEETING MATERIALS AGENDAS ARE POSTED AT AVON TOWN HALL AND RECREATION CENTER, AND AVON LIBRARY 1. CALL TO ORDER AND ROLL CALL 2. APPROVAL OF AGENDA 3. REPORT OF CHANGES: CHANGE IN MANAGER FOR SHERATON MOUNTAIN VISTA 4. RENEWAL OF LIQUOR LICENSES 4.1. Applicant Name: SVO Colorado Management Inc. d/b/a Sheraton Mountain Vista Location: 160 Beaver Creek West Type: Hotel and Restaurant Liquor License Manager: David Weiss 4.2. Applicant Name: Fiesta Jalisco Numbero Tres, LLC d/b/a Fiesta Jalisco Location: 240 Chapel Place B-12 Type: Hotel and Restaurant Liquor License Manager: Ricardo Aragon 5. OTHER BUSINESS 5.1. Report on State Liquor Serving Procedures, Timing and Role with the Town of Avon (Chief Bob Ticer) 6. MINUTES FROM JANUARY 28, 2014 7. ADJOURNMENT TOWN COUNCIL REPORT To: Honorable Mayor Rich Carroll and Avon Town Council From: Virginia Egger, Town Manager Date: February 5, 2014 Agenda Topic: Retreat Materials Please find materials for Retreat discussions on Communication Protocols, the Strategic Plan Review and Meeting Minutes in the packet. No materials have been prepared for other Retreat topics. Heil Law & Planning, LLC Office: 303.975.6120 2696 South Colorado Blvd., Suite 550 Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com HEIL LAW TO: Honorable Mayor Carroll and Town Council Members FROM: Eric J. Heil, Town Attorney RE: RETREAT: Communication Protocols DATE: February 6, 2014 Summary: This memorandum provides a legal perspective on communication protocols as well as background on past practices and expectations. There are several categories of communications which are addressed separately. Council to Council: Council members may communicate one to one with each other concerning Town business outside of public meetings. The Colorado Open Meetings Act states that three or more Council members constitute a public meeting and requires notice of that meeting in advance of such communication. Electronic communications constitute a “meeting” for the purposes of the Colorado Open Meetings Act. For this reason, Council has been advised not to engage in a dialogue concerning Town business by e-mail. Also, the Colorado Open Meetings Act prohibits public bodies from formulating a decision outside of a public meeting and violations of this rule can result in voiding of the action taken by Council. The receipt of comments by all of Council directly from the public is acceptable as is the circulation of a question by an individual Council member to all of Council concerning official Town business (however, see Council with Manager communication below). Council members should remember that any e-mail (or tweet, facebook posting, or any other communication via any electronic form or social media) concerning Town business is a potential public record under the Colorado Open Records Act. Council with Manager: Council members may communicate with the Town Manager outside of public Council meetings and such communication is an essential to the efficient function of the Town government. Only one or two Council members may communicate with the Town Manager at one time outside of a properly noticed public meeting in order to comply with the Colorado Open Meetings Act. The active involvement of Council members in many committees and topic areas necessitates regular communication with the Town Manager outside of public meetings. It has been the practice that questions of a general nature by a Council member to all of Council should be directed through the Town Manager. There are four reasons for this protocol: first, so that the Town Manager is aware of the question; second, so that the Town Manager can respond to the question or direct the question to the proper person who can answer the question; third, to insure that all Council members are receiving the same information; and fourth, to minimize the potential for a Council dialogue via e-mail to begin in order to avoid any violation of the Colorado Open Meetings Act. Council with Staff: Direct communications between Council and Town Staff are principally governed first and foremost by the Avon Home Rule Charter, which states as follows “Section 8.5 Relationship of Council to Administrative Service. M EMORANDUM & PLANNING, LLC Avon Town Council Communication Protocols February 6, 2014 Page 2 of 2 Neither the Council, its members, the Mayor, nor any council committee shall dictate the appointment of any person to office by the Town Manager except as otherwise provided in this Charter or in any way interfere with the Town Manager or other Town officer exercising judgment in the appointment or employment of officers and employees in the administrative service. Except for the purpose of inquiry, the Council, its members, the Mayor and any Council committee shall deal with the administrative service solely through the Town Manager and neither the Council, its members, the Mayor, nor any Council committee thereof shall give orders to any of the subordinates of the Town Manager.” As a Council-Manager form of government, the Council has broad discretion to manage and direct the Town Manager, but the Town Manager has authority to manage and direct Town Staff. It is permissible for Council members to ask questions or request information directly from Town Staff persons. The practice and understanding has been that Town Staff shall respond to such requests provided the requests are not burdensome or disruptive to workflow or work deadlines. It has also been the protocol that Town Staff will notify the Town Manager of inquiries by Council members so that the Town Manager has general awareness of questions, issues and activities of Town Staff. Council members do have the same rights as the general public to ask questions, request information and provide comments directly to Town Staff (e.g. reporting that a stop sign has been knocked over). The Town Charter expressly prohibits individual Council members or Council as a body from giving direct orders to Town Staff. Council with Attorney: The Town Attorney represents the Town as a municipal corporation by and through the Council as a governing body. Direct communication between individual Council members and the Town Attorney most often involves (1) pending Town business which is reflected in the Town’s strategic plan and which involves Council members assigned to the appropriate committee or topic and (2) inquiries and disclosures concerning conflicts of interest. Questions of a general nature are generally directed to the Town Manager so that the response can be provided to all of Council and the Town Manager. Thank you, Eric TOWN COUNCIL REPORT To: Honorable Mayor Rich Carroll and Avon Town Council From: Virginia Egger, Town Manager Date: February 4, 2014 Agenda Topic: Prioritized Work Plan Upon adoption of the Strategic Plan and annual budget, staff prepares detailed work plans to accomplish the work programmed in these documents as well as prioritized internal organizational improvement efforts. The Strategic Plan is attached as adopted by Council on September 24, 2013. The attached Plan includes annotated comments for the work plan items in regards to current status of the work. For the ease of Retreat discussion, the summary below captures the Strategic Plan Work Plan in a bulleted list. The list also includes major organizational improvements. I look forward to Tuesday’s review. CAPITAL PROJECTS – Implemented by July 1st - Avon Road paving and striping, including share arrows - Town Core - Bicycle street markings and signage - Saddleridge Trail - Waterslide Replacement - Rec Center Showers Upgrade CAPITAL PROJECTS – Implemented by Nov. 1st - Avon Road – Final design, budget update - Pedestrian Mall – Final design update, budget update - Post Boulevard – entry flags, signage, new landscape treatments, lighting - Nottingham Park Stage - Eagle River Trail & Bridge - Park Restrooms – design and bid docs ready - Park Playground – design and bid docs ready WILDLAND FIRE PROTECTION PROGRAM – In-Process TOWN OF AVON PROPERTIES – Complete by August 1st - Town Hall – refurbish, replace - Recreation Center – Community Meetings and Ballot Question ECONOMIC DEVELOPMENT - Creative Arts District (March 3 application) - Branding Completion – April 22nd - Special Events – Development & Added Value - 2015 World Alpine Championships - Community Survey – July - Amendment 64 Staff Report – May 1st - Avon Business Outreach - Cultural, Arts Commission VILLAGE AT AVON - Post Boulevard Improvements (see above) - Document organization & tickler file WATER AUTHORITY ISSUES - #1 Unallocated Water Determination - On-going: Mountain Star COMPREHENSIVE PLAN UPDATE – commence after Community Survey results are compiled COMCAST FRANCHISE RENEWAL – July 1st REGIONAL PARTNERSHIPS - Transit Consolidation - Develop ECO Service Request for April 23rd ECO Retreat - Eagle County Commissioners Joint Meeting – Review of revenue and service levels - Mayor/Managers: EV River Trail, EGE Funding, Transit Improvements - Trails Plan – VVMBA – Grants – West & East Avon Preserve LASERFICHE – 30,000 folder review/sort/destroy/retain - Document retention system - Public portal on website - April 30th completion goal ENERGY EFFICIENCY SAVINGS – ENERGY AUDIT/LOW HANGING FRUIT/MONITORING SOFTWARE IMPLEMENTATION & TRAINING - MuniRevs/Tourism Tracker - PowerPlan Budget Software SELECTION OF TIMEKEEPING VENDOR SELECTION OF TICKLER SYSTEM FOR DOCUMENT DATES - Village at Avon - Conditional Water Rights - Town Agreements/Contracts RESEARCH AND DEVELOPMENT OF PUBLIC COMMUNICATION PLAN, including use of social media, print and website PURCHASING POLICY UPDATE WELLNESS PROGRAM – Initiate in February SUPERVISORY AND TOWN-WIDE TRAINING PURCHASE AND IMPLEMENTATION OF EMAIL ARCHIVER (budget amendment) 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 1 2013-14 STRATEGIC PLAN 2014 WORK PLAN Adopted by the Avon Town Council Resolution 13-27, Series of 2013 September 24, 2013 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 2 Overview The Town of Avon, surrounded by natural beauty, is today a strong community that will build on its strengths to become a nationally and internationally recognized year-round mountain resort community. Committed to providing a high level of municipal services for our citizens and visitors, and the stewardship of our natural resources, Avon will expand its cultural, recreational and educational offerings in partnership with our broader community and regional public and private sector agencies, thereby ensuring sustained economic vitality and a vibrant community experience. Recent resort-oriented accommodations projects in Avon are of a higher standard than the Town attracted at its founding and in its early years. It is this superior level of quality development that Avon believes will be its comparative advantage in the future, and, therefore, will work to attract and promote these types of developments by ensuring Town plans and incentives are constructed in a manner which provides the development community clear and timely information; and by steadfastly maintaining a professional and solution-oriented municipal business. The Town will continue to value and support our full-time and part-time resident population by providing an exceptional level of municipal services and by working to retain existing businesses as the Town seeks to expand its retail and commercial base, while fostering our sense of community through both our spirit and the built environment. The importance of vibrancy and activity within the Town will be supported by attracting an array of new and diverse cultural and recreational events to Avon which are in concert with the values of our community and serve to nurture a cohesive sense of place and public. It is the Town of Avon’s elected officials and staff commitment to fiduciary responsibility, effectiveness and efficiency in providing government services and a practiced belief in open and transparent governance that will lead the successful implementation of this vision for the growth and development of Avon. 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 3 Strategic Plan Fiscal Years 2013 - 2014 Tier 1 Priority: Fiscal Year 2013-2014 1) Develop Business-like Practices and Culture of Town Hall – Ensure that Town government is operated as a “competitive” business and in a manner which is client-focused and solution-oriented, meeting the highest standards of fiduciary responsibility, implementing best practices, and using Town resources effectively and efficiently in every department. Tier 2 Priorities: Fiscal Year 2013-2014 2) Economic Development – Ensure that the Town of Avon is prepared for new development and re- development. Evaluate Urban Renewal Authority expansion and other incentives to promote quality development of a high standard; update the Avon Comprehensive Plan as needed and work closely with the Planning and Zoning Commission to understand respective roles so that developers have a good sense of what can and what cannot be negotiated. 3) Village at Avon Partnership – Meet with representatives of the Village at Avon and the Traer Creek Metropolitan District to develop understandings and trust necessary for the future development of the Village. This outreach and communication is the responsibility of all elected and appointed officials and the employees of the Town of Avon. Tier 2 Priorities: Fiscal Years 2013-2014 4) Special Events – Identify near term opportunities for special events and develop a longer term special events strategy. In March, hold a work session to establish the duties and membership of a Cultural Arts and Special Events Commission to lead this effort for the Town. Be spontaneous, when appropriate. 5) 2015 World Alpine Championships – Planning for all three phases of this internationally renowned event must be initiated: 1) Pre-event promotion and marketing; 2) Stellar events and promotion of Avon as a place to return to need to be produced during the event; and 3) Post-event requires a follow-up promotional plan to encourage and/or book guest return visits. Tier 3 Priorities: Fiscal Years 2013- 2014 6) Water Issues – Identify water issues and develop a timetable and approach for resolution over the next year or two; manage what can be done against higher priorities. 7) Transit Consolidation – Avon should be a leader in working to provide a consolidated transit operation in the valley. With negotiations for 3rd parties in the new I-70 RTF needed, service availability in Fleet, plus planning for the 2015 World Cup, begin to build on these opportunities for a longer term cooperative partnership. 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 4 2014 Work Plan Develop Business-like Practices and Culture of Town Hall Tier 1 Priority: Fiscal Years 2013 & 2014 Leader: Mayor Rich Carroll Staff: Town Manager Virginia Egger Ensure that Town government is managed and operated as a “competitive” business and in a manner which is client-focused and solution-oriented, meeting the highest standards of fiduciary responsibility, implementing best practices, and using Town resources effectively and efficiently in every department. 1st Quarter January – March 2014 1.1 Completed. Revise performance evaluations to reflect cultural goals and attributes of high performing employees. 1.2 In-Process. Implement 2014 budgeted IT improvements; including MuniRev and electronic employee payroll system to improve efficiencies 1.3 Completed. Finalize work plans for all departments for seasonal and 2014 budget operations 1.4 February 11th. Hold a Council Retreat to review leadership, collaboration and communication 1.5 Completed. Review and provide amendments to the Municipal Code in regards to residency and for Council qualifications such as marital status 1.6 In-Process with ERFPD. Prioritize a Wildridge seasonal wild land fire program, including summer “hot shot” staffing, land use regulations for new development to protect homes from wild land fire and community outreach for current home to amend residential landscaping. 1.7 March - April. Draft and finalize internal Town Hall and external community performance surveys to measure Town services and community desires (include questions in regards to Comprehensive Plan update 1.8 In June, distribute internal and external community surveys 2nd Quarter April – June 2014 2.1 Continual Process. Continue to review all Town departments to assess the necessity of tasks and functions, effectiveness and efficiency in meeting department responsibilities, staffing levels, and future needs; evaluate effectiveness of organizational changes implemented in 2013 2.2 August. Develop the 2014-15 Strategic Plan, and two year budget to implement the Plan 2.3 Each Quarter. Schedule no less than four (4) staff training sessions on “competitive” business practices and fiduciary responsibility 2.4 By early June, collect and analyze internal and external community surveys 3rd Quarter – July – September 2014 3.1 September 9th. Hold a Council Retreat to review survey results, Council leadership, collaboration and communication; update Strategic Plan 3.2 To be scheduled. Mid-year 2014 budget review and amendment, if needed 4th Quarter October – December 2014 4.1 Review and update Strategic Plan 4.2 Budget preparation, hearings and adoption 4.3 Prepare 2015 Work Plans 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 5 2014 Work Plan Economic Development Tier 2 Priority: Fiscal Year 2013 & 2014 Leaders: Economic Development Subcommittee Councilors Todd Goulding and Chris Evans Staff: Town Manager Virginia Egger, Community Development and Finance Department Staff Ensure that the Town of Avon is prepared for new development and re-development. Evaluate the retail sale of marijuana and make a final determination on whether sales should be allowed. Evaluate URA expansion and other incentives to promote quality development of a high standard; update the Comprehensive Plan as needed and work closely with the Planning and Zoning Commission to understand respective roles so that developers have a good sense of public benefit expectations, incentives and minimum development requirements for critical project elements, such as parking. 1st Quarter January – March 2014 1.1 Start date February 12. Director of Economic Initiative joins Town staff. 1.2 TBD. Current “economic development advisory group”. Establish a Town of Avon Economic Development Council for the purposes of supporting existing businesses in Avon and attracting new businesses and to support business vitality; develop an action plan. 1.3 To be scheduled. Outreach to all Avon businesses to thank each for their commitment to Avon and to ask for their ideas on business support by the Town 1.4 Initiated, on-going. Through the year, update website data base and revenue software/spreadsheet system to assist with statistical analysis of key metrics identification in collaboration with Avon businesses and regional economic development committees; understand the demographic characteristics of visitors to the region. 1.5 May 1st Staff Report. Determine whether the Town of Avon should approve the retail sale of marijuana: 1.5.1 Collect information from the scientific community on the health benefits and risks of marijuana consumption. 1.5.2 Identify possible appropriate locations for retail stores and zoning regulations 1.5.3 Analyze the financial tax estimates from retail sales 1.5.4 Define an education program for youth and adults in regards to legalized marijuana sales 1.6 To be scheduled. Review and update the Town’s Private-Public Partnership Policy and investment Policy, as needed. 1.7 Branding platform, logo & tagline to be completed by mid- April. Then on-going: Implement the Town “brand”. 1.8 Core: Bicycle Sign-age and Pavement markings to be implemented by July 1st. With Beaver Creek and other stakeholders, finalize a town-wide Parking and Transportation Plan, including bicycle, pedestrianization, vehicle and alternate transit modes. The Plan should be developed in concert with the Planning and Zoning Commission (PZC) and reviewed by the public prior to Council’s adoption action. This Plan may extend into the 2nd Quarter 1.9 Hoffmann Master Plan expected this month. Review East Avon Town Center Plan with PZC and owner of properties in the Plan to identify pro/con of the plan and to establish the priorities of both developer and Town in East Avon redevelopment. Begin Plan amendment, if needed. 1.10 Delayed until Planner 2 is hired. Develop the scope, public process, schedule for commencement and completion of the Comprehensive Plan Update. including development of questions for the Community Survey, (June/August 2014) 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 6 Economic Development - continued Tier 2 Priority: Fiscal Year 2013 & 2014 1.11 Move to 2nd Quarter. Process Annexation and Zoning applications, including surveying and public notification requirements, for the 85.99 acre “Village Parcel” deeded to Town trough the Eagle Valley Land Exchange of 2013. 1.12 Initiated. Expect model agreement by March 1st. Public process, work sessions to final action planned by July 1st. Negotiate and finalize multi-year Comcast Franchise Agreement 1.13 March. Review with the Planning and Zoning Commission the Development Standards for building colors as stated in the Avon Municipal Code, Section 7.28.090(c), Generally Applicable Design Standards, specifically related to Building Materials and Colors (v) and the standard set at a sixty or less Light Reflective Value” “LRV”. 2nd Quarter April – June 2014 2.1 TBD. Compile “Avon Business Summary Report”, which provides information about the characteristics of Avon’s various business sectors, including inventory of retail and commercial spaces occupancy and vacancy data, and leasing rates, to use as basis for partnering with the business community in attracting and expanding business in Avon. 2.2 TBD. Create marketing package for new business development. 2.3 Being led by Vail Valley Partnership – on-going support and programming, if approved. Research and evaluate opportunities and structure for creating an Avon Creative Arts District. 2.4 No plan to pursue at this time. If requested by the Town Council, evaluate expansion of URA into other qualified areas of Avon; if URA expansion is desirable, solicit RFQ and identify budgetary needs 2.5 TBD. Identify with the Planning and Zoning Commission 2014 Code amendments, including “clean-up” of definitions, charts, etc. identified through use of the Code over the past year and sections which should be updated, and sections which should be updated, such as the sign code. Evaluate whether Wildridge should be “zoned” rather than continuing to have a PUD Zone for the development. 3rd Quarter & 4th Quarter – July – December 2014 3.1 TBD. Comprehensive Plan Update; East Avon Plan Update – continuing public meetings and recommended changes. 3.2 TBD. Complete Code Clean-up 3.3 TBD. Evaluate opportunity for a “sister city/ international city” partnership 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 7 2014 Work Plan Village at Avon Partnership Tier 2 Priority - 2014 Leaders: Traer Creek Liaison Appointees Dave Dantas and Jennie Fancher Staff: Town Manager Virginia Egger, Public Works, Parks, Community Development and Engineering Staff Meet with representatives of the Village at Avon and the Traer Creek Metropolitan District to develop understandings and the trust necessary for the future development of the Village. This outreach and communication is the responsibility of all elected and appointed officials and the employees of the Town of Avon.  February Meeting Planned. Throughout the year, Liaison Appointees and Town Manager will meet with Traer Creek principals to discuss current issues and opportunities.  In-Process. Town staff will finalize in the 1st Quarter the collection, consolidation and organization of all Village at Avon documents, agreements and assignments within Town Hall. This project is considered 90% complete.  The Community Development Department will be the primary contact and responsible party for understanding and managing the Village at Avon settlement agreements, including “user” summaries of all definite dates and responsibilities of the Town of Avon.  Implement the determined actions by the Avon Town Council in the 4th Quarter of 2013. 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 8 2014 Work Plan Special Events Tier 2 Priority – Fiscal Years 2013-2014 Leaders: Councilors Jake Wolf and Buz Reynolds Staff: Town Manager Virginia Egger and Parks and Recreation Staff Identify near term opportunities for special events and develop a longer term special events strategy. In March, hold a work session to establish the duties and membership of a Cultural Arts and Special Events Commission to lead this effort for the Town. Be spontaneous, when appropriate. Beaver Creek Resort, with its recreational and cultural activities, is an important economic driver of the Avon economy, offering a vast array of amenities which add to the richness of the day-to-day life of Avon residents, the community and tourists. Avon will work closely to further build the relationship with Beaver Creek Resort Company and Vail Resorts that supports business brands, the tourist economy and community offerings, including but not limited meeting the transportation, security and amenity needs of a mature resort and community. 1st Quarter January – March 2014 1.1 2nd – 3rd Quarter. Establish a Cultural, Arts and Special Events Commission to promote and assist with the production of recreational, cultural, educational and social events; refine and develop a Special Events Strategic Plan with the participation of the business community 1.2 In-Process. Support the WinterWonderGrass Festival under the terms of the approved agreement; analyze ROI & ROO (return on objectives) within 60 days of the event 1.3 In-Process. Finalize design and construction bid documents for the Pedestrian Mall improvements 2nd Quarter April – June 2014 2.1 On-going. Implement actions for Summer 2014 Special Events 2.2 Will do. For all events; analyze ROI/ROO within 60 days of the event 2.3 In process. Commence construction of Pedestrian Mall; expected completion date is November, 2014 3rd Quarter – July – September 2014 3.1 Implement actions for Fall 2014 new Special Events, analyze ROI within 60 days of the event 3.2 Solicit funding requests for 2015 Special Events: Cultural, Arts and Special Events Commission will recommend funding levels to Town Council 4th Quarter October – December 2014 4.1 Implement actions for Winter 2015 Special Events, analyze ROI/ROO within 60 days of the event 4.2 Budget for 2015 Special Events 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 9 2014 Work Plan 2015 World Alpine Championships – February 3 – 15, 2015 Tier 2 Priority: Fiscal Years 2014-2014 Leader: Mayor Rich Carroll and Mayor Pro Tem Staff: Town Manager Virginia Egger, Transportation, Police and Parks and Recreation Staff Planning for all three phases of this internationally renowned event must be initiated: 1) Pre-event promotion and marketing; 2) Production of stellar events and promotion of Avon as a place to return to need to be produced during the event; and 3) Post-event requires a follow-up promotional plan to encourage and/or book guest return visits. 1st Quarter January – March 2014 - In-Process. 1.1 Identify Town staff participation to date and current participation activities 1.2 Advance Après Avon program with Vail Valley Foundation Ceil Folz 1.3 Commence design and bids for 2015 capital projects: Avon Road paving and divider improvements; Rec Center improvements and monument sign 1.4 Meet with representatives of Avon lodging community to discuss opportunities for 2015 1.5 Finalize comprehensive action plan for special events, marketing, logistics, security, sponsorship, partnerships 2nd Quarter & 3rd Quarter – April – September 2014 2.1 Commence implementation; including final funding and logistics 2.2 Evaluate value of promotional video and social media in marketing Avon 4th Quarter October – December 2014 4.1 Continue implementation of plan 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 10 2014 Work Plan Water Issues Tier 3 Priority: Fiscal Years 2014-2014 Leaders: Mayor Rich Carroll and Councilor Todd Goulding Staff: Town Manager Virginia Egger, Engineering Staff and Special Water Counsel Identify and water issues and develop a timetable and approach for resolution over the next two years; manage what can be done against higher priorities. 1st Quarter January – March 2014 In-Process 1.1 Review and update the Upper Eagle River Water Authority and Town of Avon 2013 Work Program. Seek to resolve all issues by November 1, 2014. 1.2 Organize water and wastewater documents and files at Town Hall; institutionalize knowledge. This project is 95% complete. 1.3 Continue with the Water Authority, Avon representatives and Mountain Star residents to reach resolution of the Mountain Star water tank, fire flow, irrigation and system delivery issues. 1.4 Schedule with Council and Water Authority representatives a program to develop and adopt solutions for needed amendments to the Master Water Agreement; plan to adopt changes no later than November 2014. These changes include the use of unallocated water held by the Authority and water conservation planning. With the Water Authority, develop an understanding of how water rights and water use are accounted for and develop a process for future transactions. 1.5 Resolve Avon Drinking Water Facility fenced area for ownership and/or lease to the Water Authority. Evaluate and remediate liability concerns, if any, for Avon Drinking Water Facility fenced area with the Water Authority. Deadline for resolution: September, 2014. 2nd Quarter April – June 2014 In-Process 2.1 Executive Committee Status Granted (Justin Hildreth) Participate as a member of the Urban Run-off Group and request that Avon is granted an Executive Committee appointment. Participate with the Group to understand activities and possible 2014 funding request for a Gore Creek Water Quality Improvement Plan. 3rd Quarter – July – September 2014 3.1 Draft and execute an agreement with the ERWSD for long term cost sharing and O&M responsibilities of the Heat Recovery System. 3.2 Review the basis for the Avon’s water fees, which are assessed in addition to those tap fees and operational fees assessed by the Water Authority. 4th Quarter October – December 2014 4.1 Schedule 1) ERWSD presentation of its 20-year wastewater infrastructure master plan, including possible rate increase needs and Town’s 1041 requirements; and 2) Water Authority and ERWSD presentation on Eagle Mine’s metal loading issues on the Eagle River. 2013-2014 STRATEGIC PLAN & 2014 WORK PLAN September 24, 2014 Pa g e 11 2014 Work Plan Transit Consolidation Tier 3 Priority – Fiscal Years 2014-2014 Leaders: Councilors Buz Reynolds and Jake Wolf Staff: Town Manager Virginia Egger, Public Works Director and Transit Division Staff Avon should be a leader in working to provide a consolidated transit operation in the valley. With negotiations for 3rd parties in the new I-70 RTF needed, service availability in Fleet, plus planning for the 2015 World Cup, begin to build on these opportunities for a longer term cooperative partnership. 1st Quarter January – March 2014 In-Process 1.1 Continue to advocate for an AGS station in Avon 1.2 Throughout the year, fully participate in regional transportation and parking forums and in CDOT I-70 corridor planning 2nd Quarter April – June 2014 In-Process 2.1 Market to other potential clients for bus/vehicle storage and Fleet Services 2.2 Evaluate transit services for FY 2015 and opportunities for regional efficiencies 2.3 As appropriate, participate in Regional Collaboration efforts on transit 3rd Quarter – July – September 2014 3.1 Finalize I-70 RTF lease agreements for 100% year-round occupancy 3.2 Assess demographic characteristics of bus riders and how best to disseminate information about transit service and about the Town 3.3 Develop consolidation plan as deemed feasible with ECO 4th Quarter October – December 2014 TBD FINAL - Memo Minutes Page 1 TOWN COUNCIL REPORT To: Mayor and Town Council From: Patty McKenny, Assistant Town Manager/Town Clerk Date: February 5, 2014 Agenda Topic: Retreat Topic: Request for “Action Minutes” Format as Official Recording of Meeting Town staff requests Council direction on the “format & content” of its official minutes for both Council and PZC meetings. The discussion is raised because technology for retaining meeting discussions and actions has changed. In order to meet both legal requirements and the records management needs of the Town, the following information is provided: Currently the Town’s meeting minutes have included necessary items per State Statutes, such as date, meeting time, location, type of meeting, regular or special, names of governing body members and municipal officials in attendance. The format and content of Council meeting minutes have typically reflected the following: 1) Name of Agenda Item, 2) Summary of Agenda Item, 3) Discussion Highlights, 4) Public Hearing Input, and 5) Motion/Action. The Planning and Zoning Commission minutes follow suit with this format but also generally include more detailed information about the Commission and applicant’s deliberations. Please note audio recordings are also made for the meetings. The retention of the Council’s and Commission’s approved meeting minutes is required to be kept as permanent record. The retention of the audio recordings requires six (6) months after approval of the written minutes per the Colorado Municipal Records Retention Schedule. The Town of Avon has been retaining the audio recordings for council audio for about one year and PZC audio as far back as 2008. However, staff will begin to follow the retention of the audio guidelines as stated above. Depending on the length of the Town Council meeting, I spend an average of 3 to 4 hours per meeting in the preparation of the minutes. Planning Manager Matt Pielsticker estimates staff time of approximately 4 to 5 hours per meeting is spent in preparing minutes. My research shows there are no hard and fast rules for drafting minutes other than what is required by Statute listed above as well as the requirement the Clerk shall make a “true and accurate record of all proceedings”. CML offers suggestions regarding the recording of minutes as summarized below (reference: Colorado Municipal Clerks Reference Guide, 2012 Revision): • Use standard phrases where possible • Develop series of standard paragraphs leaving blanks for variable factors that makes entries uniform and reduces time spent composing them • Not required to record every remark made at meeting; do not make the minutes a verbatim transcript • Debates, arguments, and discussion among the governing body members and other may be omitted; minutes are primarily a record of the governing body’s actions rather than its deliberations. FINAL - Memo Minutes Page 2 Response to a survey sent to the CML Municipal Clerk list indicates that minutes are predominately written as either “summary or action minutes” or no indication that detailed deliberations are included. Avon Municipal Code references “who” shall take minutes are found in the Charter as well as Chapter 7 which addresses PZC: 1. Charter Section 8.6 states the Town Clerk “shall keep a journal of Council proceedings and records in full all ordinances, motions and resolutions”. 2. Charter Section 5.5 (a) “Organization & Rules of Council” states that minutes are required to be kept in the English language by the Clerk and shall be signed by the Presiding Officer and Clerk of the meeting at which the minutes are approved. 3. Chapter 7, Development Code, Section 7.12.040 (k), identifies that a “recording secretary who shall act in the capacity of secretary for the PZC”; this role has been responsible for recording minutes of their meetings. Staff Recommendation: Staff recommends adopting the Action Minute format that includes only the name of agenda item, the motion/action on that item and any other action, motion or direction by Council or the Commission but does not include a description of deliberations or public comments. Memorandum To: Honorable Mayor Rich Carroll and Avon Town Council From: Siri Roman, Wastewater Manager Diane Johnson, Communications and Public Affairs Manager Date: February 11, 2014 Re: Eagle River Water & Sanitation District Wastewater Master Plan Update Summary: Siri Roman will review the ERWSD Wastewater Master Plan Update and will discuss current operations, new wastewater effluent regulations enacted by the Colorado Water Quality Control Division (WQCD) and the implications of the regulations – including benefits to stream health and financial impacts. ERWSD is informing the town of Avon about the projects and cost associated with the 15-year wastewater master plan as it dovetails with local long range planning efforts and affects our mutual constituents. No action is requested from the Council. Background: Eagle River Water and Sanitation District treats wastewater from East Vail to Cordillera, including Minturn, at three treatment facilities. The facilities are located in Vail, Avon, and west Edwards and are regulated by effluent discharge permits provided by the Colorado WQCD. In 2012, the WQCD adopted more stringent nutrient regulations (Regulation 85 and Regulation 31) that will impact the operations of the facilities. The new regulations will require that the plants discharge less phosphorus and nitrogen (nutrients) to Gore Creek and the Eagle River. The WQCD will be working with ERWSD on a compliance schedule to meet the new regulations. However, it is possible that all three plants could have to comply with the new regulations as early as 2020, which would require significant capital improvements at each facility by that date. In 2012, the District completed an update to its existing Wastewater Master Plan in order to determine a preferred capital improvement plan and schedule that would meet the new regulations and future growth through 2025. Eight alternatives were evaluated on cost, water rights issues, land availability, staffing, maintenance, sustainability, permitting, layout, scheduling, and other criteria. The preferred alternative addresses necessary increased capacity at the facilities to meet future growth, upgrades the facilities to meet anticipatory regulatory limits, and consolidates the treatment of solids at the Edwards facility. Full implementation of the wastewater master plan is projected to cost $95 million through 2030. Given the significant capital improvements required, ERWSD secured funds to implement Phase 1 of the capital plan. The District issued $28 million in revenue bonds in Dec. 2012 which will affect monthly service rates beginning in 2015. The monthly debt service rate associated with the 2012 bonds will be about $6 per single family equivalent (a generic residential unit, up to 3,000 square feet). The next phase of the plan will cost approximately $23 million and will be funded either through rates or property tax, which would become effective in 2017 – when an existing District property tax will sunset. With the release of fewer nutrients to Gore Creek and the Eagle River, the new regulations and associated capital improvements will benefit the biological health of the streams. Downstream drinking water facilities will also benefit due to improved source water. ERWSD is completing the design of Phase 1 of the Capital Improvement Plan; the solids handling improvement project at the Edwards Treatment Facility. The permitting process with the Colorado Department of Public Health and Environment (CDPHE) is underway, and approvals are being sought concurrently with the Eagle County 1041 process. Construction is slated to begin in this summer. TOWN COUNCIL REPORT To: Mayor and Town Council From: Patty McKenny, Assistant Town Manager/Town Clerk Date: February 5, 2014 Agenda Topic: Discussion Regarding Town Sponsored Events and Gifts from Producers A discussion topic is scheduled for Tuesday’s meeting about gifts received from event producers associated with Town sponsored events. The approaching WinterWonderGrass Music Festival (WWG) has prompted this issue for review. As part of the WWG Festival Agreement, the event producer is required to provide each Avon Town Council member one weekend festival pass. Town Manager Virginia Egger has included this provision so Council members can observe the production of the festival as a new event occurring in Nottingham Park. The value of the ticket is in excess of $5o; however, the Town Council received significant public input both for and against past large events held in Nottingham Park, so there is clearly a benefit to Council member’s first hand knowledge of this event. The producer of WWG has offered to give an additional weekend festival pass to each Council member for a guest (a value of $129.00). As noted in the January Disclosure Report, there have been two (2) tickets provided to Council members to the Beaver Creek Rodeo and Birds of Prey VIP tent access, so there have been instances where two tickets/passes have been provided so as to include a guest. One distinction to note is that some of the events are free to the public and others require a purchase of the tickets. This may appear to the public to be over reaching in terms of providing more than one ticket to a Council member. This topic will likely involve numerous points about public perception and again is included on the agenda so as to determine how to move forward with accepting “gifts” prior to accepting multiple tickets with the upcoming event – both from events which the Town has provided funding and do not charge for admission and those events which charge for admission. Based upon your direction, if gifts exceeding $50.00 are approved, the Town Clerk will then timely file the appropriate disclosure report on behalf of the Town Council in order to remain compliant with the Town’s Municipal Code, Section 2.30.170, Code of Ethics. TOWN COUNCIL REPORT To: Honorable Mayor and Town Council From: Danita Dempsey, Special Event Supervisor Virginia Egger, Town Manager Date: February 6, 2014 Re: Proposed Event Concept Development – Highline, Vail Office BACKGROUND The Town Council at its meeting of November 26, 2013, reviewed and approved a Statement of Work with Highline Entertainment for Phase II Event Concept Development for three events. Based upon this development work, the Statement of Work provided time for Town Council to review the information and decide whether to move none, one or more of the events forward for Phase III Final Event Planning. The three events are: • Rocky Mountain Ride (Motorcycle Rally) • Flavors of Colorado (Food/Craft Beer/Music) • Celebration of World Music (World Music & Culture Festival) Phase II funding provided Highline the resources to fully develop each of the selected events, including: • Identification of event components, including but not limited to music/talent/genre recommendation, weekend event activities, partner/sponsor expos, charity tie-in, etc. • Event Schedules with daily run of show programming • Partnership opportunities and potential sponsor identification • Attendee pricing structure: ticketed vs. non-ticketed events and activities • Ballpark budget cost estimates Total cost for Phase II was $5,400. PHASE II FINDINGS: HIGHLINE – EVENT OVERVIEW & SPONSORSHIP OPPORTUNITIES REPORTS Attached are the Event Overview and Sponsorship Opportunities reports from the Phase II work which detail each event by concept, program and cost. Highline has provided the following recommendations to Town Council based upon their event development work. - Please note that the Estimated Shortfall does not yet include any offsets the Town of Avon may be able to assist with by providing infrastructure or in-kind services. - The Estimated Shortfall also will be reduced by the estimated increases in accommodation and sales taxes from the attendee activity generated within and outside of the festival venue. Rocky Mountain Ride - Due to timing constraints may be difficult to secure the proper financial partners this late in the planning process and it will be a challenge to properly pre-promote regionally and nationally to ensure we attract a large enough group to make it successful in 2014. Our recommendation is that the event continues to move forward in planning but be produced in May of 2015. Flavors of Colorado - is an event we (Highline) have adequate planning time to secure partners and pre- promote to make year #1 successful. In addition, Highline has a solid background in producing similar  Page 2 culinary-type events, helping with planning, partners, promoting and producing. Our recommendation is that we continue to move forward in 2014 and produce this event this year. • Estimated Expense: $255,400 • Estimated Revenues: $124,500 • Estimated Shortfall: $130,900 • Estimated Attendance: 3,000 World Music & Culture Fest - is an event where we (Highline) have adequate planning time to secure partners and pre-promote the event to make year #1 successful. The challenge for this event will be ensuring we secure a diverse line-up of talent and vendors. Our recommendation is that we can continue to move forward in 2014 and produce this event this year. • Estimated Expense: $261,900 • Estimated Revenues: $127,000 • Estimated Shortfall: $134,900 • Estimated Attendance: 2,000 STAFF REVIEW & RECOMMENDATION • Staff concurs that inadequate time is available to properly market and develop the Motorcycle Rally this spring and the event should be considered for a launch in 2015. • Flavors of Colorado and the World Music Fest should continue to Phase III Final Event Plan development. The cost for this continuing work is $4,000 and includes: Final budgeting, Pre-Production Timing/Scheduling; Event Schedule Completion; and, Marketing Plan. • Included in this packet’s last attachment is the Highline Entertainment Memo. On Page 2 is a series of measurements for how investment in any one of the events can be evaluated as a Year 1 success. As part of the Phase III work, these elements will be used to measure ROI and return on objectives to assist in Council’s review of whether an event should be invested in. • The Town’s budget has set a reserve of $225,000 for new Special Event support. Special events are integral and a key component in a resort community economy. A mix and variety brings interest, culture, liveliness and a sense of community to residents. Special events are many times are the basis for visitor visits. Funding special events the Town believes will grow into signature events are of special interest – with Salute to the USA being an example of an event being synonymous with Avon. In our view, there is adequate reason to move forward with Phase III for Flavors of Colorado and World Music & Culture Fest as both events are interesting and of the nature that fit with the 2014 Strategic Plan and Special Events Work Plan. Jeff Brausch, Founder/CEO, will make a presentation at Council’s meeting and answer any questions. ATTACHMENTS 1. Event Overview for Rocky Mountain Ride, Flavors of Colorado and World Music & Culture Fest 2. Event Estimated Revenue/Expense/Attendance for each event concept 3. Highline Entertainment Memo: Highline Phase II Follow-Up EVENT OVERVIEW & SPONSOR OPPORTUNITIES Confidential and Proprietary Rocky Mountain Ride OVERVIEW When: May 23rd – May 26th, 2014. Where: Avon, CO   2 For many, spring can’t come soon enough. Motorcycle riders count the days until they can dust off their riding gear, shine their bike and get out on the open road and what a better place to do so than high in the Rockies. The Colorado Rockies are home to some of the most scenic rides in the U.S. according to top industry reports. Take world-class scenic byways, add world- class lodging, dining, shopping and activities…and 300 days of sunshine….you have the perfect mix for a great weekend ride! This Memorial Day Weekend, the Town of Avon welcomes riders from all over as they head to the high-country roads and mountain passes of Colorado. Avon will serve as their hub for the long holiday weekend of exploring while reconnecting with old friends and meeting new friends who share the same passion as well. Pouring Rights On-site Branding Sponsor Village Digital & Social Media Marketing & PR VIP Hospitality Title & Naming Rights Custom Event Components 3 PARTNER INTEGRATION OPPORTUNITIES Data Capture and Surveys Sampling / Sales AN EVENT FOR A CAUSE 4 • To raise awareness and enlist the public's aid for the needs of injured service members. • To help injured service members aid and assist each other. • To provide unique, direct programs and services to meet the needs of injured service members. A percentage of the event proceeds will be donated to the Wounded Warrior Project. The WWP is a veterans service organization that offers a variety of programs, service and events for wounded veterans. Their mission is to "honor and empower Wounded Warriors” of the United States Armed Forces, as well as provide services and programs for the family members. Rocky Mountain Ride Classic provides potential sponsors a unique opportunity to connect and engage with an active, affluent audience in the heart of the Rockies, in the Town of Avon. There are many ways that sponsors can be involved, whether it’s as simple as product displays, on-site sales, product sampling, sponsoring an event component, or working with event producer (Highline) to create a custom activation that best suites their goals, this event delivers a captive audience in a very special environment. SPONSOR POTENTIAL 5 Sample of Top Sponsor Categories • Beverage - Beer - Wine - Spirits - Non-carbonated - Carbonated - Energy • Motorcycle manufacturer / dealer • Insurance • Magazine / Media Sample of Potential Sponsor Components • Guided Rides • Scavenger Hunt • Poker Run • Panel Discussion Series • Bike Games • Stunt Bikes • Music stage • Casino Night • Biker Dinners • Memorial Day Pancake Breakfast 6 REGISTRATION PRICING / F&B PRICING / ADDITIONAL ACTIVITIES PRICING   Registration Fees: Includes event t-shirt, entry to group rides, Friday & Saturday night meals and nightly parties • Early Registration (by April 30, 2014) = $50 • Pre-Registration (May 1st – May 22nd, 2014) = $65 • On-Site Registration = $75 • Full Throttle Party w/out Event Registration = $10 / per evening Contests are additional costs w/portion of proceeds to Wounded Warriors Project: • Slow Ride, Burnout. Loud Pipes and Bike Show Contest = $5 / each contest Daytime Food Pricing: • One token = $1 • Small plate = 2 tokens • Large plate = 4 tokens Day & Evening Beverages: • One token = $1 • Non-alcoholic beverage = 3 tokens • Beer Alcoholic beverage = 5 tokens • Liquor beverage = 7 tokens Friday, May 23rd 5:00pm – 10:00pm: Registration / Info Desk Open 6:00pm – 7:45pm: Kick Start Dinner 7:45pm – 8:00pm: Official Welcoming Announcements 8:00pm – 10:00pm: Kick Start Party (Live Music & Dancing) Saturday, May 24th 8:00am – 10:00pm Registration / Info Desk Open 9:00am – 2:00pm: Guided Group Rides 9:00am – 2:00pm: Colorado High Country Scavenger Hunt 9:00am – 5:30pm: Sponsor Village / Marketplace Open 11:00pm – 3:00pm: Stunt Bike Demos (11:00am / 1:00pm / 2:30pm) 12:00pm – 5:30pm: Live Music 12:00pm – 1:00pm: Learning Curve Panel Discussion: Shop Talk 1:00pm – 5:00pm: Burnout Pit open 2:30pm – 5:30pm: Bike Show Contest 3:00pm – 4:00pm: Learning Curve Panel Discussion: Rider Safety 5:30pm – 7:30pm: Full Throttle BBQ 7:30pm – 8:00pm: Raffles & Awards 8:00pm – 10:00pm: Full Throttle Party (Live Music & Dancing) *Schedule is subject to change SCHEDULE OF EVENTS* 7 Sunday, May 25th 8:00am – 10:00pm: Registration / Info Desk Open 9:00am – 2:00pm: Guided Group Rides 9:00am – 2:00pm: Poker Run 9:00am – 5:00pm: Sponsor Village / Marketplace Open 11:00am – 3:00pm: Stunt Bike Demos (11:00am / 1:00pm / 2:30pm) 12:00pm – 5:00pm: Live Music 12:00pm – 1:00pm: Learning Curve Panel Discussion: Restoring Vintage 1:00pm – 5:00pm: Burnout Pit open 2:30pm – 3:30pm: Learning Curve Panel Discussion: Buying & Selling 101 3:30pm – 4:30pm: Slow Ride Competition 4:30pm – 5:00pm: Loud Pipes Competition 5:00pm – 7:30pm: Dinner at riders leisure (dinner costs not included in event entry fee) 7:30pm – 8:00pm: Raffle & Awards 8:00pm – 10:00pm: Full Throttle Party (Live Music & Dancing) Monday, May 26th 8:00am – 10:00pm: Memorial Day Pancake Breakfast 10:00am – 10:30am: Closing Ceremony & Salute to our Armed Forces 10:30am: Depart 12:00pm: Venue closed SCHEDULE OF EVENTS* *Schedule is subject to change 8 The Riders Village will serve as the hub of all events and activities for the weekend. Located in Nottingham Park, the venue will consist of both open and covered areas. The dinners and evening parties will be hosted under a large lighted tent while a majority of all other activities will take place around the park including the sponsor / vendor village and activities. EVENT COMPONENTS 9 Sponsor Village / Vendor Marketplace will be an area where attendees can engage with event sponsors, learn about the sponsors new products, try the product through sampling or demo, sign-up for great offers from partners, enter for giveaways, get free swag and more. In addition to the sponsors expos, attendees can browse the goods being sold in the marketplace – everything from custom riding gloves to GPS systems – the marketplace will have something for everyone. EVENT COMPONENTS 10 Sound Stage will be alive all weekend long – both during the day and evening with live music from local / regional talent. Bands will keep the tempo upbeat during the day and turn it up during the evening at the Full Throttle Parties after dinner. Make room for dancing because there will be plenty of that! Whether country, classic rock, or a mix, there will be something for everyone to enjoy. Learning Curve Panel Series will be offered throughout the weekend covering a variety of topics including rider safety, shop talk, ins and outs of buying and selling, and tips on restoring vintage bikes. These panel discussions are free to all event attendees and will be led by a moderator with Q&A session at the end of each. EVENT COMPONENTS 11 Kick Start & Full Throttle Parties will provide attendees with a place to kick back and enjoy some live music, cold beer, dancing and good friends, old and new. Each evening the rally will gather back together to celebrate another great day on the open roads. Live music on the stage, large dance floor in front, bars around the sides and plenty of fun in between. Evening Dinners Friday and Saturday night will be served under the main tent in the Riders Village. These two evenings of all-you-can eat are included in the riders entry fee (does not include beverage). Dinner will range from a big, all you can eat pasta dinner to kick off the rally to a BBQ showdown from some of the local BBQ kings. One thing is for sure, attendees will not go hungry. EVENT COMPONENTS 12 Guided Group Rides will be available both Saturday and Sunday with three routes, one for each level of rider. These rides are a great way to meet new friends, ride with old ones and take in the beautiful scenes of the Colorado Rockies. Rides will average about 80 – 140 miles per route. Memorial Day Pancake Breakfast will be the final event of the weekend and a way to honor our veterans and active military on this Memorial Day. A small donation to WWP will get attendees all-you-can-eat pancakes so they are set for their journey back home. Poker Run through the mountains of Colorado will be a great way to add excitement to a day while also raising money for a great cause, WWP. Participants will visit five checkpoints, drawing a playing card at each one. All participants must be back at 3PM with their cards in hand to qualify. The one who has the best poker hand at the end of the run, wins great prizes from sponsors. EVENT COMPONENTS 13 Colorado High Country Scavenger Hunt takes riders through the Vail Valley and up over mountain passes where they will need to collect stamps at various locations – maybe a coffee shop, maybe a gas station, it maybe at an overlook on top of the pass. The riders must turn in their completed stamped passport no later than 4:00pm to be eligible for the great raffle prizes that evening. This event will have a minimal additional fee that will go to the charity for the weekend. EVENT COMPONENTS 14 Stunt Bike Demos will be a jaw-dropping experience. Attendees will watch as some of the best motorcycle riders handle their bikes with ease as the do amazing tricks in front of the on looking crowds. Action packed excitement will continue for 30 minutes and the team will perform two times on Saturday and Sunday. Free of charge to attendees. Bike Skills & Bike Show will not only allow bikers to have fun competing against each others for great prizes but will also help raise funds for WWP. Whether it is Burnout contest, Slow Bike Riding contest, Loudest Pipes Contest or Best Bike In Show each will provide and afternoon of fun and entertainment for all and keep the energy high. EVENT COMPONENTS 15 Colorado Lifestyle Activities offers those attendees a slice of Colorado if they want to enjoy something off their bike. Whether it’s a day of rafting, a mountain hike, horseback riding, lunch on top of the mountain, mountain biking, local outfitters will be on-hand booking trips for the groups so everyone is offered a chance to explore all that Aon and the Colorado Rockies have to offer. Memorial Day Remembrance Wall & Video in honor of our soldiers, both past and active, over this Memorial Day weekend, there will be two activations in which participants can share their story, honor someone, or just say thank you. The first of the two activations will be a video booth where individuals can step inside and make a quick video remembering their fallen brothers and sisters or simply thanking our armed forces. After two days of recording, a short video will be edited and played Monday morning. If individuals would rather not be recorded and share their thoughts with a pen, a large wall will be on-site all weekend where they can pick up a pen and express their thanks or remembrance. -CONFIDENTIAL- Prepared by H I G H L I N E 2014 ROCKIES MOUNTAIN RIDE Estimated Attendance: 675 (500 bikes / 675 people) ESTIMATEDREVENUES:AMOUNTS NOTES Sponsorships 50,000$                                               Entry Fees 44,875                                                  Registration fees and contest entry fees F&B Sales (less sales tax 4.0%)31,000                                                  Gross beverage sales Friday night, Saturday, Sunday and Monday am F&B sales Merchandise Sales 5,000                                                      10% of vendor sales (F&B and merchandise) TOTAL REVENUES 130,875$                                         EXPENSES: Event Operations/Security/Police/Ambi 20,000$                                               Entertainment/Bands/Production 50,000                                                   Event Producers (EP/AP)20,000                                                   Event Payroll Expenses 20,000                                                   Event Promotions 5,000                                                       Event Advertising/Marketing 10,000                                                   Event Merchandise/Sponsor Gifting 5,000                                                       Event Supplies 15,000                                                   F&B Expenses 20,000                                                   Charitable Donation (Bev Sales)5,000                                                       Equipment Rental 25,000                                                   Event Photography 1,000                                                       Portable Toilets/Trash/Recycling 8,000                                                       Prize Money/Appearance Fees -­‐                                                                         Public Relations 2,000                                                       Venue Rental/Site Fees Wardrobe/Uniforms 1,000                                                       Event Insurance 5,000                                                       Equipment Repairs 500                                                               Bank/Credit Card Charges -­‐                                                                         Vehicle Expenses 5,000                                                       Pre-press/Design 2,500                                                       Licenses and Permits 1,500                                                       Printing and Reproduction 5,000                                                       Office/Computer Supplies 200                                                               Postage/Shipping 200                                                               Event/Sales Travel 1,500                                                       Meals/Entertainment 1,500                                                       Event Lodging 3,000                                                       Contract Labor 3,000                                                       Sponsor Implementation/Fulfillment 7,500                                                       Project Agency Fee 40,000                                                   TOTAL EXPENSES 283,400$ ESTIMATED SHORTFALL (152,525)$ 7-Feb-14 PLEASE NOTE THAT THESE ARE BEST ESTIMATES AT THIS POINT EVENT OVERVIEW & SPONSOR OPPORTUNITIES Confidential and Proprietary FLAVORS OF COLORADO OVERVIEW Whether it’s the creative flavors of a sophisticated entrée, the variety of flavors of musical sounds, the creativity of an artist’s interpretations or the artfully crafted flavors of small-batch brewing, people are seeking out these flavors more and more and Colorado is home to many of these creative flavors. In a time when “Colorado Proud” is at its peak, Flavors of Colorado, allows everyone from attendees to sponsors, to capitalize on the amazing artists we call local – whether they are culinary chefs, farmers, musicians, craft beer brewers, craft sprit distillers, local musicians and physical artists - this event is designed to celebrate each of them, their crafts and those who enjoy them in an engaging and exciting way. Be part of the celebration of all the great creative flavors Colorado has to offer, all in one place, at one time, in the heart of Colorado – Avon, CO. When: August 15th – 17th, 2014. Where: Avon, CO   2 Pouring Rights On-site Branding Sponsor Village Digital & Social Media Marketing & PR VIP Hospitality Title & Naming Rights Custom Event Components 3 PARTNER INTEGRATION OPPORTUNITIES Flavors of Colorado provides potential sponsors a unique opportunities to connect and engage with an active, affluent audience in the heart of the Rockies, in the Town of Avon. There are many ways that sponsors can get involved, whether it’s as simple as product sampling / trial, sponsoring an event component, or working with event producer (Highline) to create their own custom activation that best suites their goals, this event delivers a captive audience in a very special environment. SPONSOR POTENTIAL 4 Sample of Top Sponsor Categories • Beverage - Beer - Wine - Spirits - Non-carbonated • Auto • Media • Financial • Cooking ingredients • Kitchen products Sample of Potential Sponsor Components • Farm to Chef’s Table Dinner • Panel Discussion Series • Cooking Demo Series • Kid’s Corner • Tasting venue • Taste, Toasts & Sounds evening event • Acoustic Music Stage Friday, August 15th 6:00pm – 7:00pm: Farm to Chef’s Table Welcome Cocktail Party 7:00pm – 10:00pm: Farm to Chef’s Table Dinner Saturday, August 16thth 10:30am – 5:00pm: Flavors of Colorado venue open to public 10:30am – 5:00pm: Kid’s Corner open to kids 12 and under 10:30am – 4:30pm: Visual arts area open (vendors, displays, live creation) 11:00am – 4:00pm: Food & Beverage Tastings 11:00am – 12:00pm: The Farmer & The Chef Panel 12:00pm – 4:00pm: Live acoustic music sessions from various Colorado musicians 1:00pm – 2:00pm: Culinary Demo Series #1 2:00pm – 3:00pm: The Artists of Crafts Panel 3:00pm – 4:00pm: Culinary Demo Demo Series #2 6:00pm – 10:00pm: Tastes, Toasts & Sounds evening 10:00pm: Venue closes for evening *Schedule is subject to change SCHEDULE OF EVENTS* 5 Sunday, August 17thth 10:30am – 4:00pm: Flavors of Colorado venue open to public 10:30am – 4:00pm: Kid’s Corner open to kids 12 and under 10:30am – 3:30pm: Visual arts area open (vendors, displays, live creation) 11:00am – 3:00pm: Food & Beverage Tastings 11:00am – 12:00pm: The Backyard Farmer Panel 12:00pm – 3:00pm: Live acoustic music sessions from various Colorado musicians 1:00pm – 2:00pm: Culinary Demo Series #3 2:00pm – 3:00pm: Save the Arts Panel 4:00pm: Venue closes SCHEDULE OF EVENTS* *Schedule is subject to change 6 Farm To Chef’s Table will celebrate everything Colorado culinary. This charitable event will serve as the official kick-off of the weekend, taking place Friday evening, featuring Colorado’s finest culinary artists. Four Chef’s Tables will each seat twenty-five generous guests. Each table will enjoy the finest culinary that Colorado has to offer. Each of the four tables will feature a Colorado chef, craft brew master, craft distiller, a sommelier and a local farmer who will all co-host the dinner, preparing farm-to-table courses, paired with selected Colorado craft beer, craft spirit and wine. Each chef will select a charity in which they wish the proceeds to be donated. EVENT COMPONENTS 7 Food & Beverage Tasting will be a split open-air / tented venue in the center of Nottingham Park where Colorado chefs / restaurants, wineries, craft brewers and craft distillers will sample their finest creations. Attendees will swap out tokens in exchange for a bite or sip of the different Colorado flavors. The venue will be set-up in a way that will allow for an open flow of people while providing an intimate setting to engage with these artists of their craft. EVENT COMPONENTS 8 Tastes, Toasts & Sounds is a ticketed Saturday evening event that invites attendees to join in the celebration of flavor. Kicking off with a cocktail party with fine light samplings of food and crafted beers and spirits and leading into an evening of a plated dinner and music under the tent. Attendees can purchase tickets for an all-inclusive evening or they have the option of a concert ticket fee and cash bar. The Art Gallery is where Colorado’s finest artists can create, showcase and/or sell their art creations. Whether their art is a painting, a sketch, a sculpture, or even a piece that they are physically creating live at that moment, the Art Gallery is the perfect place, in the perfect setting, to engage and educate attendees and interact with other Colorado artists. EVENT COMPONENTS 9 Center Stage will play host to multiple local Colorado musical artists. This stage will be home for these musicians to create and share their musical art. A handful of artists, all with various sounds, will take the stage during both Saturday and Sunday, providing the sounds for each day. Kid’s Corner: Chef & Farmer is an area for kids 12 and under to come onto the “farm” and into the “kitchen” where they can touch, feel, smell, taste and even craft their own flavors. Kids will Activities range from meeting and learning about select farm animals, farming equipment, plant and grow their own fruits and vegetables, healthy snacks, kid-friendly meals and more. EVENT COMPONENTS 10 Kid’s Corner: Sights & Sounds is an area where kids 12 and under are encouraged to showcase or discover their artistic talents. If they find interest in music, kids are encouraged to pick- up one of the many instruments and learn the basics from a local musicians. If their desire is to create visual art, whether through paints, clay or crayons, kids are encouraged to explore with the various artistic tool on-hand – they can just express what they want or ask questions and learn from an on-site local artist. Panel Discussion: The Farmer & The Chef will feature local chefs and farmers addressing today’s hottest culinary topics including the growth of organic, farm to table practices, the process from seed to table, challenges each face, growth of organics in local markets and larger grocers and much more. The discussion will be followed by a Q&A session. EVENT COMPONENTS 11 Panel Discussion: Backyard Farmer will feature local farmers who will educate attendees on backyard farming practices – gardening at altitude, vegetables, fruit and flowers. These experts will provide the information needed for attendees to take home and start implementing. From tips and tricks to topics regarding proper planting, care, space limitations, key ingredients of healthy plants, the different seasons and more, attendees will be overwhelmed with knowledge. The discussion will be followed by a Q&A session. Panel Discussion: The Artists of Crafts features Colorado’s own craft beer brewers and spirit distillers. These experts will discuss topics like the popularity and growth in each of their fields, the art of their craft, how they started in the field, trends, future outlook, challenges they face and more. The discussion will be followed by a Q&A session. EVENT COMPONENTS 12 Panel Discussion: Save The Arts will feature talented local musicians and artists who will address the challenges of keeping art alive through our youth. Each of the panelists will speak about their discovery of their art and the importance it has played for them in life. The panelists will address the challenges of keeping the arts alive for our youth – whether lack of funding for school programs or outside of school distractions, the arts are running into challenges that if left alone may defeat the craft. The discussion will be followed by a Q&A session. Cooking Demo Series will take place throughout the weekend – two on Saturday and one on Sunday. There will be a cooking demo session for each of the three daily meals; breakfast, lunch and dinner. Each demo will be hosted by a professional chef and will look to actively engage the audience, answering questions, including them in the demo and more. EVENT COMPONENTS 13 Sponsor Expos / Displays will be positioned around the venue so attendees can browse at relevant product and services that sponsors which to showcase. Sponsors are encouraged to use their expo space to engage with attendees by product sampling, product education, data gathering and more. -CONFIDENTIAL- Prepared by H I G H L I N E 2014 FLAVORS OF COLORADO Estimated Attendance: 3,000 ESTIMATEDREVENUES:AMOUNTS NOTES Sponsorships 50,000$                                               F&B Sales (less sales tax 4.0%)72,500                                                  Includes Sat & Sun tasting, Friday Chefs Table & Saturday evening event Vendor Sales 2,000                                                      10% of vendor sales TOTAL REVENUES 124,500$                                         EXPENSES: Event Operations/Security/Police/Ambi 20,000$                                               Entertainment/Bands/Production 40,000                                                   Event Producers (EP/AP)20,000                                                   Event Payroll Expenses 15,000                                                   Event Promotions 5,000                                                       Event Advertising/Marketing 10,000                                                   Event Merchandise/Sponsor Gifting 5,000                                                       Event Supplies 15,000                                                   F&B Expenses 15,000                                                   Charitable Donation (Bev Sales)2,500                                                       Equipment Rental 20,000                                                   Event Photography 1,000                                                       Portable Toilets/Trash/Recycling 7,500                                                       Prize Money/Appearance Fees -­‐                                                                         Public Relations 2,000                                                       Venue Rental/Site Fees Wardrobe/Uniforms 1,000                                                       Event Insurance 5,000                                                       Equipment Repairs 500                                                               Bank/Credit Card Charges -­‐                                                                         Vehicle Expenses 5,000                                                       Pre-press/Design 2,500                                                       Licenses and Permits 1,500                                                       Printing and Reproduction 5,000                                                       Office/Computer Supplies 200                                                               Postage/Shipping 200                                                               Event/Sales Travel 1,500                                                       Meals/Entertainment 1,500                                                       Event Lodging 3,000                                                       Contract Labor 3,000                                                       Sponsor Implementation/Fulfillment 7,500                                                       Project Agency Fee 40,000                                                   TOTAL EXPENSES 255,400$ ESTIMATED SHORTFALL (130,900)$ PLEASE NOTE THAT THESE ARE BEST ESTIMATES AT THIS POINT 6-Feb-14 EVENT OVERVIEW & SPONSOR OPPORTUNITIES Confidential and Proprietary WORLD MUSIC & CULTURE FEST World Music, Food, Arts & Crafts Festival OVERVIEW When: September 12th – 13th, 2014. Where: Avon, CO   2 Music has the indescribable capability to transcend cultural, social, and language boundaries. The World Music & Culture Fest is a unique celebration of harmony in diversity bringing together people from all backgrounds to take in the unique sights, tastes, and sounds all in one place! The two-day event situated around Nottingham Lake, will offer engaged attendees a cultural journey around the world, inviting attendees to experience different cultures through musical performances, dance, cuisine, arts and workshops. World Music & Culture Fest is the perfect opportunity to enjoy global music, cuisine and art while gaining a deeper understanding of the people and culture in which it originates. Pouring Rights On-site Branding Sponsor Village Digital & Social Media Marketing & PR VIP Hospitality Title & Naming Rights Custom Event Components 3 PARTNER INTEGRATION OPPORTUNITIES World Music & Culture Fest provides potential sponsors a unique opportunity to connect and engage with an active, affluent audience in the heart of the Rockies, in the Town of Avon. There are many ways that sponsors can be involved, whether it is as simple as product sampling / trial, sponsoring an event component, or working with event producer (Highline) to create their own custom activation that best suites their goals, this event delivers a captive audience in a inviting environment. SPONSOR POTENTIAL 4 Sample of Top Sponsor Categories • Beverage - Beer - Spirits - Non-carbonated - Carbonated • Electronics • Music instruments • Media • Packaged Goods • Airlines • Hotel Sample of Potential Sponsor Components • Daytime main stage • Saturday evening concert • Kid’s Global Corner • Global Kitchen • Dragon Boat Races • Global Village • Yoga & Tai Chi Sessions Saturday, September 12th 11:00am - 10:00pm: Venue open to public 11:00am – 11:30am: Yoga session 11:30am – 12:00pm: Tai Chi session 11:00am – 5:00pm: Kid’s World Culture Corner open to kids 12 and under 11:00am – 5:00pm: Global Village open 11:00am – 5:00pm: Global Kitchen open 11:30am – 4:00pm: World Music & Dance on Main Stage 1:00pm – 3:00pm: Dragon Boat Qualifying Round 6:30pm – 10:00pm: Headliner act with opening band 10:00pm: Venue closes for evening Sunday, September 13th 11:00am - 4:00pm: Venue opens to public 11:00am – 11:30am: Tai Chi session 11:30am – 12:00pm: Yoga session 11:00am – 3:30pm: Kid’s World Culture Corner open to kids 12 and under 11:00am – 3:30pm: Global Village open 11:00am – 3:30pm: Global Kitchen open 11:30am – 3:00pm: World Music & Dance on Main Stage 1:30pm – 3:00pm: Dragon Boat Championship 4:00pm: Venue closes for evening *Schedule is subject to change SCHEDULE OF EVENTS* 5 Event Ticket Options: • One Day Event Ticket = $15 (Kids $5) • Two Day Event Ticket = $25 (Kids $8) • Saturday Evening Concert Ticket = $20 Global Kitchen Pricing: • One token = $1 • Small plate = 2 tokens • Large plate = 4 tokens • Non-alcoholic beverage = 3 tokens • Beer beverage = 5 tokens • Alcoholic beverage = 7 tokens Dragon Boat Racing: • Team of 22 (20 paddlers, 1 drummer, 1 steer person) = $250 TICKET PRICING / FOOD AND BEVERAGE PRICING / DRAGON BOAT PRICING 6 Global Stage of Music & Dance will anchor the venue and be the focal point for both Saturday and Sunday’s event. The stage will play host to the variety of musicians and dancers / performers from around the world. This stage will have continuous entertainment throughout the event, keeping all attendees engaged and amazed. In addition to the daily entertainment, this stage will also be host to a concert on Saturday evening. EVENT COMPONENTS 7 Global Kitchen will feature a variety of different culinary delights. Chefs / vendors from all different cultures will set-up their kitchen and create traditional favorites and invite attendees to taste a bit of culture. This area will be open throughout both days for attendees to feast on all different bites. Global Village will host event partners / vendors and will serve as the center of global arts and crafts. Attendees are encouraged to explore the Global Village and discover the different arts and crafts each culture has to offer. Attendees can engage with the cultural representative / vendor and learn more about their specific culture / craft / art. Attendees can even purchase and take home a piece of art on display. The Global Village provides an opportunity for attendees to fully immerse themselves into various cultures in an inviting way. EVENT COMPONENTS 8 Kid’s World Cultural Corner will welcome children 12 and younger and will serve as both an educational journey but also a entertaining experience. Children will have the opportunity to learn more about various cultures through storytellers, they will be able to create with their hands unique arts and craft projects, they will be able to learn to sing songs from different cultures, and so much more. Healthy Cultural Stimulation will be offered to event attendees who wish to learn a new practice or refine what they currently practice. Two sessions will be offered for event attendees to experience; yoga, and Tai Chi. Trained instructors will be on-hand to walk you through a session. Each of the sessions will be geared towards all levels. These sessions will take place in the quiet mountain settings of Avon, along the lake. EVENT COMPONENTS 9 Dragon Boat Racing has been called the ‘ultimate team sport’ and is the fastest-growing water sport in the world, becoming a global phenomenon. It is visually spectacular and fun for both participants and spectators. Teams will take to Nottingham Lake with their custom Dragon Boat to see who has the strength & teamwork to come across as champion in their class. -CONFIDENTIAL- Prepared by H I G H L I N E 2014 WORLD MUSIC FEST Estimated Attendance: 2,000 ESTIMATEDREVENUES:AMOUNTS NOTES Sponsorships 50,000$                                               Entry Fees 45,000                                                  Includes single day, multi-day, concert ticket only, and Dragon Boat entries F&B Sales (less sales tax 4.0%)30,000                                                  Gross Sales for Sat & Sun beverage sales Merchandise Sales 2,000                                                      10% of vendor sales (F&B and merchandise) TOTAL REVENUES 127,000$                                         EXPENSES: Event Operations/Security/Police/Ambi 20,000$                                               Entertainment/Bands/Production 40,000                                                   Event Producers (EP/AP)20,000                                                   Event Payroll Expenses 15,000                                                   Event Promotions 5,000                                                       Event Advertising/Marketing 10,000                                                   Event Merchandise/Sponsor Gifting 5,000                                                       Event Supplies 15,000                                                   F&B Expenses 20,000                                                   Charitable Donation (Bev Sales)5,000                                                       Equipment Rental 20,000                                                   Event Photography 1,000                                                       Portable Toilets/Trash/Recycling 6,500                                                       Prize Money/Appearance Fees -­‐                                                                         Public Relations 2,000                                                       Venue Rental/Site Fees Wardrobe/Uniforms 1,000                                                       Event Insurance 5,000                                                       Equipment Repairs 500                                                               Bank/Credit Card Charges -­‐                                                                         Vehicle Expenses 5,000                                                       Pre-press/Design 2,500                                                       Licenses and Permits 1,500                                                       Printing and Reproduction 5,000                                                       Office/Computer Supplies 200                                                               Postage/Shipping 200                                                               Event/Sales Travel 1,500                                                       Meals/Entertainment 1,500                                                       Event Lodging 3,000                                                       Contract Labor 3,000                                                       Sponsor Implementation/Fulfillment 7,500                                                       Project Agency Fee 40,000                                                   TOTAL EXPENSES 261,900$ ESTIMATED SHORTFALL (134,900)$ PLEASE NOTE THAT THESE ARE BEST ESTIMATES AT THIS POINT 6-Feb-14 HIGHLINE | WWW.GOHIGHLINE.COM VAIL OFFICE | 12 VAIL RD | VAIL | CO | 81657 | 970.476.6797 DENVER OFFICE | 3900 SOUTH HILLCREST DRIVE | DENVER | CO | 80237 | 303.548.2695 Date: February 6, 2014 To: Virginia Egger, Danita Dempsey, John Curutchet From: Chris Dolan CC: Jeff Brausch, James Deighan Subject: 2014 Town of Avon Special Events: Highline Phase II Follow-Up Virginia, Danita and John: Thank you again for your time on Monday to review the Phase II of the proposed 2014 Town of Avon Summer Special Events. I appreciate your feedback and I wanted to take this time to follow-up on specific questions / requests outlined by Virginia coming out of our meeting. Please see the below and let me know of any additional questions you may have or if you wish to discuss prior to council meeting. 1. Highline’s recommendation for year #1 – what do feel is most feasible in 2014 • While we would like to produce all three events in 2014 and are confident that we can, we want to make certain that we are producing events that have the proper time to succeed; financially, attendance, and positive experience. o Rocky Mountain Ride due to timing constraints may be difficult to secure the proper financial partners this late in the planning process and we will be challenged to properly pre-promote regionally and nationally to ensure we attract a large enough group to make it successful in 2014. § Our recommendation is that the event continues to move forward in planning but be produced in May of 2015. o Flavors of Colorado is an event we have adequate planning time to secure partners and pre-promote to make year #1 successful. In addition, Highline has a solid background in producing similar culinary-type events, helping with both planning, partners, promoting and producing. § Our recommendation is that we continue to move forward in 2014 and produce this event this year. o World Music & Culture Fest is an event where we have adequate planning time to secure partners and pre-promote the event to make year #1 successful. The challenge for this event will be ensuring we secure a diverse line-up of talent and vendors. § Our recommendation is that we can continue to move forward in 2014 and produce this event this year. HIGHLINE | WWW.GOHIGHLINE.COM VAIL OFFICE | 12 VAIL RD | VAIL | CO | 81657 | 970.476.6797 DENVER OFFICE | 3900 SOUTH HILLCREST DRIVE | DENVER | CO | 80237 | 303.548.2695 2. What does “Year #1” success look like? • Typically measurement is driven by the client and what they are seeking to gain from the investment – what is the programs measurable objectives? • Looking back at the original assignment and objectives, our measurement of success includes both qualitative and quantitative: o Incremental out-of-town visitors (daily / overnight) o Incremental increase in hotel nights o Incremental increase in sales tax o Positive feedback from Town of Avon retailers o Alignment and building awareness of Town of Avon’s new brand o Increased PR / Talk Value (print, radio, digital, social, WOM) o Attendee survey § Positive perception of Avon § Will they come back again for the event next year § Would they recommend Avon to others § Etc. 3. Program Estimates (Projected Revenue / Projected Shortfall / Clarifications) • These estimates do not include any offsets that Town of Avon may be able to assist with by providing infrastructure, security, etc. • All program estimates are billed to actuals and all line items are straight pass through costs with no mark-up • We have updated each program estimate with the projected revenue / projected shortfall to the best of our abilities at this point • We have provided an estimated number of attendees for Year #1 of each event to the best of our abilities, however note that year #1 attendance estimates are very challenging since it is the events inaugural year • Specific budget question follow-ups: o How do we estimate for items like portable toilets / trash / recycle? These were all the same cost across each of the three programs even though the program and attendance may vary slightly? § Initial estimate based on size of venue and needs for that size venue o Difference between payroll expense vs. contract labor expense? § Payroll expense accounts for Highline general employees while contract labor accounts for hired labor outside of Highline we contract to assist with production. This is broken out into two line items for accounting clarification and should be viewed as one cost for labor / staff to execute the event. HIGHLINE | WWW.GOHIGHLINE.COM VAIL OFFICE | 12 VAIL RD | VAIL | CO | 81657 | 970.476.6797 DENVER OFFICE | 3900 SOUTH HILLCREST DRIVE | DENVER | CO | 80237 | 303.548.2695 4. Phase III Timing • With approval of concept(s) from council, it has been estimated that Phase III will take approx. four weeks to finalize and will include: o Marketing plan o Detailed timeline o Tightened budget o Event name o Event logo & overall look / tone / feel (incremental cost) Ordinance 14‐01 – Medical/Dental Offices in the PF Zone District Page | 1             TOWN COUNCIL REPORT  To:   Mayor and Town Council  From:   Matt Pielsticker, AICP, Planning Manager  Date:   February 5, 2014  Agenda Topic:  PUBLIC HEARING on Ordinance 14‐01, Approving Amendments to Table 7.24‐1, Allowed  Uses, Avon Municipal Code, to list Medical Clinics and Offices as a Special Review Use   Introduction  This report summarizes an application (Attachment A) to amend the Avon Municipal Code (“AMC”)  for the purpose of listing “medical and dental clinics and offices” as a Special Review Use (“SRU”) in  the Public Facilities (“PF”) zone district.  All code text amendments require a public hearing with the  Planning and Zoning Commission (“PZC”), and subsequent hearings with the Town Council.  The  Council approved the First Reading of Ordinance 14‐01 (Attachment B) at the January 14, 2014 meeting,  and the Public Hearing was continued from the January 28, 2014 meeting due to the lack of quorum.    Process  §7.16.040(a), Code Text Amendment Review Procedures.  The processing of all code text amendments  follow the procedures set forth in §7.16.020, General Procedures and Requirements.  The PZC reviewed  the application at their December 17, 2013 meeting.  After conducting a public hearing, PZC approved  Resolution 13‐07 (Attachment C), recommending approval of the amendment.  The Council may  approve amendments by Ordinance after considering public input in another Public Hearing.    Summary  The Applicant, Jill Kovacevich of Doctors Plus, Inc., submitted this application to open the opportunity  to apply and expand the scope of a currently operating School Based Health Center (“SBHC”) in the  Avon Elementary School.   Since March 2013, Doctors Plus has been operating a SBHC center in the  Avon Elementary School.  The clinic can be best characterized as a comprehensive  “school health”  program, and targets students who may be in need of a higher level of care due to their health issues  that often serve as barriers to education.  Since the use is currently limited to students in the school it  was determined to be a “school centered” use and accessory to the primary use on the property.      When Staff met with the Applicant last year to discuss the use and the site, it was agreed that if the  program were to expand to serve not only students but also their adult family members, relatives, or  the general public for that matter, the zoning would need to be re‐evaluated and amended.      The PF zone district permits Medical Center/Hospitals as a use‐by‐right, but does not allow Urgent Care  facilities or Medical and dental clinics and offices (see Table 7.24‐1, AMC on following page).  The  Application would add an “S” to the yellow highlighted area, thereby allowing the ability to apply for a  SRU permit for a Medical or Dental clinic in the PF zone district:     Ordinance 14‐01 – Medical/Dental Offices in the PF Zone District Page | 2       Planning Analysis  While it is known that the processing of this Application will likely result in a subsequent SRU  application for the expansion at the Avon Elementary School, this code text amendment would apply  to all PF zoned properties.  As such, consideration should be given to this potential use in all areas of  the PF district.   For reference, below is an excerpt from the Town of Avon Zoning Map which indicates  all PF zoned properties in PINK:        According to the Avon Municipal Code, the PF zone district is “intended to provide sites for public uses  such as community centers, police and fire stations and governmental facilities.”  Table 7.24‐1, Allowed  Uses, AMC, lists all permitted and special review uses for each zone district in Town.  The following lists  summarize all of the permitted and SRU listed uses for the PF zone district:    Permitted Uses in PF District:  Art galleries, Museums, Community Centers, Library, Government  services, office and facilities, Post Office Branches, College or Universities, Schools K‐12 (public and  private), Vocational technical and trade schools, Bus Terminals, Rail Terminals, Commercial parking  facilities (surface and structure), Medical Center/Hospital, Drop‐off Recycling Facilities.    Ordinance 14‐01 – Medical/Dental Offices in the PF Zone District Page | 3   SRUs in PF District:  Preschools, In‐Home Childcare, Small Wind Energy systems, Wireless  Communication Towers and Antenna, Mining.     In the Avon Comprehensive Plan, the majority of the areas zoned PF are located within District 5:  Nottingham Park District, and District 26: Swift Gulch District.  The Nottingham Park District speaks  heavily to the area’s prominence as the cultural, civic, and recreational hub of the Town.  The Swift  Gulch District is recognized as a highly visible area where special attention should be given to help  blend buildings and facilities into the surrounding environment.    School Based Health Centers clearly provide a valuable benefit to students.  By expanding  opportunities for primary care to the general public, the compatibility and external impacts of the use  would need to be reviewed carefully.  In this instance things such as access to the office would need to  be controlled, parking, and signage come to mind.  However, those details would all be wrapped into a  SRU permit application.      By keeping the SRU process in tact to review the compatibility of a Medical Clinic in the PF zone  district, Staff is comfortable recommending approval.  If the Council approves this code text  amendment, it should be noted that this code change in no way prejudges any future applications to  expand the SBHC in Avon Elementary.  The use would need to be evaluated in detail by PZC based on  the SRU criteria separately and this would not be a guaranteed approval in the future; it would only  afford the opportunity to apply for expansion.         Review Criteria  §7.16.040(c), Code Text Amendment Review Criteria.  Council shall use the following review criteria as  the basis for recommendations on applications to amend the text of the Avon Municipal Code:  (1) The text amendment promotes the health, safety, and general welfare of the Avon  Community;  (2) The text amendment promotes or implements the goals and policies of the Avon  Comprehensive Plan;  (3) The text amendment promotes or implements the purposes stated in the Development  Code; or  (4) The text amendment is necessary or desirable to respond to changed conditions, new  planning concepts, or other social or economic conditions.      Response:  The Application is thorough and certainly makes a clear case for the necessity to offer  expanded health care options to “respond to changed conditions and other social conditions”  (§7.16.040(c)4), AMC.  PZC found that the proposed code amendment promotes the health, safety,  and general welfare of the community by promoting opportunities for healthcare integration into  existing facilities.        Staff Recommendation   Staff is recommending conducting a public hearing, and approval of Ordinance 14‐01 (Attachment B)  on 2nd Reading.    Attachments  A: Application Materials  B: Ordinance 14‐01   C: PZC Resolution 13‐07  1 DOCTORS PLUS, INC PO Box 2819 Avon, CO 81620 970-949-5434 970-949-0376 FAX November 26, 2013 Town of Avon Community Development Department PO Box 975 Avon, CO 81620 Attn: Jared Barnes and Matt Pielsticker RE: Eagle County Schools – School Based Health Center (ECS-SBHC) Doctors Plus Kids Care Clinic at Avon Elementary Dear Jared, Enclosed please find our Application for Code Text Amendment (CTA) from Doctors Plus, Inc (DOC+) for the purpose of amending the current Town of Avon Development Code to allow for location of a “medical and dental clinics and offices” in a Public Facility zone district, subject to Special Review Use. Specifically, Doctors Plus seeks to expand the Eagle County Schools – School Based Health Center (ECS SBHC) at Avon Elementary from a school centered service for students only to a “medical/dental clinics and offices” serving all children, adults and families of the Avon and ECS communities. This expanded use, however, is not currently permitted within a Public Facility zone district under Table 7.24-1 of the Town of Avon Development Code. Documents Enclosed: 1) Land Development Application- Applicant Doctors Plus; 2) Authorized Representative Form- Designating Doctors Plus; 3) Disclosure of Property Ownership from Eagle County School District (ECSD); 4) Agreement to Pay- from Doctors Plus as responsible for payment; 5) Certificate of Occupancy, Building Permit and Floor Plan for existing Doctors Plus clinic at Avon Elementary School serving only Eagle County Schools (ECS) students ages 3-18. Code Text Amendment (CTA) Narrative 1. Applicant: Doctors Plus, Inc. Jill E. Kovacevich, Executive Director, PO Box 2819, Avon, CO 81620, 970-343-0881, mtndoc@vail.net 2. Project Description: The intent of this proposal is to amend the Town of Avon Development Code to allow the location of “medical and dental clinics and offices” within a Public Facility zone district subject to Special Review Use. Attachment A 2 Potentially allowing this CTA, would permit medical providers (Doctors Plus and ECS SBHC) the opportunity to apply for Special Review Use to allow health care service provision in a Public Facility (Avon Elementary). As an allowed “medical and dental clinics and offices” use located in a Public Facility zone district, the Doctors Plus Kids Care Clinic (ECS SBHC) could then expand its current permitted use from a “school centered service for ECS students only” to a “general public use” allowing service utilization by the general public including non ECS students, children, adults and families of the Avon and ECS communities. 3. Present Zoning: The ECS SBHC operated as the Doctors Plus Kids Care Clinic is currently located in Avon Elementary as a permitted “school centered service” use in an Educational Facility within a Public Facility zone district. 4. Background and History: Doctors Plus together with the Eagle County School District operate a School Based Health Center (ECS SBHC) at Avon Elementary providing primary comprehensive health care including physical, oral and behavioral-mental health services to ECS students. SBHCs in Colorado are funded primarily by government and foundation health care grants from funders including The Colorado Health Foundation, Caring for Colorado Foundation, Colorado Rural Health Center and most recently the Colorado Department of Public Health and Environment. Additional, funding for the ECS SBHC is provided by in-kind contribution from the Eagle County School District (ECSD) and medical sponsor, Doctors Plus, from patient fees as earned income and individual donors. In December 2012, ECS SBHC was awarded state funding and became a Colorado Department of Health and Environment (CDPHE) SBHC with additional funding and quality improvement support beginning January 2013 through 2016. The ECS SBHC serves a significant community need in providing access to affordable healthcare to keep children healthy and in school. In addition, there is significant need to serve the families of ECS students including their siblings and children as well as provide an affordable care choice to the employees of ECS and our community patient population. In 2009 and 2010 planning surveys showed over 2300 children in the eastern Eagle County Schools needing increased access to affordable primary care including physical, oral and behavioral health care. Facility patient and location expansion are planned for 2014 to expand services to western ECS schools and include children ages 0-3, non ECS students ages 3-18, adults, family, community members and ECSD employees. Attachment A 3 Colorado has 54 school based health centers located throughout the State of Colorado in both urban and rural communities. These SBHCs are co-located in public schools and most are not regulated by local zoning authorities. Many deliver comprehensive health care to the general public. In February 2013, prior to opening its doors, the ECS SBHC and Town of Avon Development Department determined the ECS SBHC at Avon Elementary would provide “school centered services to ECS students only” as a permitted use within a Public Facility. Further, that ECS SBHC would address potential zoning issues in the future, if it wanted to expand services to the general public. Expanded services to non ECS students is essential to support student families, ECSD employees and provide an additional affordable health care choice in our community. The lack of affordable access to care in Eagle County is directly related to 1) the shortage of healthcare providers delivering affordable care and 2) the lack of cost-effective delivery facilities committed to providing quality affordable care to all patients. Eagle County studies show a need for an increase in affordable primary care providers by more than 8 (FTE) to deliver affordable care and meet the needs of the medically underserved. In addition, the underserved patient population in Eagle County is expected to rise by over 3,000 patients under the Affordable Care Act. Further, even as the Affordable Care Act through Colorado’s Health Exchange offers “affordable insurance”, Eagle County residents will pay 15% higher premiums than elsewhere and many will have deductibles in excess of $3500.00 and will remain “underinsured”. Recently, Eagle Care, the indigent care clinic operated by Vail Valley Medical Center was granted funding and certification as a Federally Qualified Health Center (FQHC) under Mountain Family to open in Edwards early 2014. The FQHC patient base however, is limited to 80% indigent patients at 150% FPL (federal poverty level) or lower. There remains a considerable patient population above 150% FPL without access to primary care they can afford. Families who live in Eagle County face considerable challenges accessing affordable health care. In 2008 Eagle County data demonstrated that residents do not have adequate access to health or preventive services. This “picture of healthcare” in Eagle County has not changed. Economic downturns since 2007 have shrunk the construction industry leaving many households with only one income. Despite the reduction in construction industry incomes, during this same period, the self sufficiency level (amount of income needed for minimal needs) in Eagle County has risen to $62,297.00 annual income or 3.5 times the federal poverty level (FPL). Doctors Plus seeks to expand the ECS-SBHC at Avon Elementary from a school centered service for students only to a “medical and dental clinics and offices” serving all children, adults and families of the Avon and ECS community. ECS SBHC requests the Town of Avon approval for this service expansion as a two part process: 1) to request a Code Text Amendment allowing the location of “medical or dental clinics or offices” within a Public Facility Attachment A 4 zone district subject to Special Review Use and 2) obtain Special Review Use to allow the “medical and dental clinics and offices” of ECS SBHC as a special use in Avon Elementary with service provision for the general public. 5. Response to Mandatory Criteria in Section 7.16.040 (c): (1) The CTA promotes the health, safety, and general welfare of the Avon Community: The proposed CTA to allow medical and dental clinics and offices in a Public Facility zone district will support co-location of health services thereby leveraging public assets for the benefit of improved community healthcare access. As our national and local healthcare and economic crisis continues to be felt in our communities, there is a growing need for affordable health care access and affordable care choices. Particularly important is affordable access to physical, oral and behavioral health for all patients, insured, uninsured and underinsured, of all income levels. Additional “medical and dental clinics and offices” located within our town and neighborhoods where needed most, meet this need especially when co-located in a facility where costs can be reduced and leveraged among collaborative partners and services provided in close proximity (walking distance) to those who need it most Further, once amended any proposed use would be subject to Special Review Use process. Thus, the ECS SBHC would then need to establish that its desired use to deliver affordable care access to Avon Elementary students, surrounding neighborhoods, our ECS community and our entire patient population in and around the Town of Avon, is in fact, in the best interests of the health, safety and welfare of the Town of Avon. (2) The CTA promotes or implements the goals and policies of the Avon Comprehensive Plan: The CTA promotes or implements the goals of the Avon Comprehensive Plan as providing for potential Neighborhood Commercial uses that support surrounding residential neighborhoods. Additionally, by making the proposed amended use subject to Special Review Use additional compliance can be required to assure fulfillment of the Town of Avon’s Goals and Policies cited as follows:  Encourage sustainable commercial development that enhances Avon’s overall economic health, contributes to the community’s image and character, and provides residents and visitors with increased choices and services;  Encourage neighborhood retail and service activities in locations that are convenient to residential neighborhoods;  Ensure cost effective provision and development of public facilities and Services;  Coordinate with quasi jurisdictional agencies regarding service expansions and other development that could affect the achievement of the district; (3) The CTA promotes or implements the goals and policies as stated in the Development Code: The intent and purpose of the Town of Avon Development Code is to promote and achieve the following (noted with Applicant’s response): Attachment A 5 (a) Divide the Town into zones etc: Not Applicable; (b) Implement the goals and policies of the Avon Comprehensive Plan: See above response to #2; (c) Comply with state and federal regulations: The proposed CTA is not detrimental, not in conflict with, nor creates an unmitigated impact to this goal or purpose;` (d) Avoid undue traffic congestion and degradation of the level of service provided by etc: The proposed CTA is not detrimental, not in conflict with, nor creates an unmitigated impact to this goal or purpose; (e) Promote adequate light, air, landscaping and open space and avoid undue concentration or sprawl of population: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose. Further, any significant adverse impacts (including but not limited to hours of operation, traffic generation, lighting, noise, odor, dust and other external impacts) anticipated to result from the CTA can be addressed in the Special Review Use process. (f) Provide a planned and orderly use of the land, protection of the environment and preservation of viability, all to conserve the value of the investments of the people of the Avon community and encourage quality of life etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose and helps support increased access to healthcare for improved health and quality of life within our community; (g) Prevent the inefficient use of land etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose and helps support use of facilities which maximizes efficiency, optimizes costs, promotes sufficient, economical and high-quality provision of all public services including medical facilities; (h) Minimize the risk of damage etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; (i) Achieve or exceed federal clean air standards: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; (j) Sustain water sources by maintaining etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; (k) Maintain the natural beauty of the Eagle River Valley etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; Attachment A 6 (l) Promote the architectural design which is compatible etc. The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; (m) Achieve innovation and advancement etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose and helps support efficient use of resources; (n) Achieve a diverse range of attainable housing etc The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; (o) Promote quality real estate investments etc: The proposed CTA is not detrimental, not in conflict with nor creates an unmitigated impact to this goal or purpose; (p) Promote the health safety and welfare of the Avon Community. The proposed CTA supports this goal or purpose and promotes/provides increased opportunities for healthcare integration into existing Public Facilities. This integration supports economic efficiencies in leveraging assets across community partners. An example is the co-location of a physical therapy provider in the Avon Recreation Center. While that use may be an “accessory” to the purpose of the recreational use and not in need of a Code Text Amendment, the co-location itself is evidence of how a health care provider or service may be compatible with a use within a Public Facility. Further, by approving the Code Text Amendment to allow “medical and dental clinics and offices” co-located in a Public Facility subject to Special Review Use, each request for co-location would be reviewed for purpose of specific determination of its benefit to the health, safety and welfare of the community. and; (4) The CTA is necessary or desirable to respond to changed conditions, new planning concepts, or other social or economic conditions: This CTA is consistent with the TOA Comprehensive Plan (TOA-CP) by providing to the community additional services that meet the needs and interests of those who live and work in Avon. Additionally, potential healthcare related service provision is expanded to serve our community. By expanding the opportunities for location of health care services in the TOA, additional strength is added to the TOA economy, diversity in populations we serve and connectedness to the cultural needs of our community. Further, this CTA fosters cooperative partnerships with organizations throughout the valley, namely potential public-private collaboration. Summary and Anticipated Future Special Review Use Approval of this CTA would allow the co-location of a “medical clinic” providing physical, oral and mental health services such as the ECS SBHC within a Public Facility like Avon Elementary School to serve the general public. We do anticipate upon Special Attachment A 7 Review Use of the facility, addressing issues of facility hours, parking and security and any other needs to mitigate impacts. Thank you for your consideration of this request. Please feel free to contact me if you need any additional information or have any questions. We look forward to working with the Town of Avon on this project. Very truly yours, Jill E. Kovacevich, JD, FAAMA (electronically signed) Executive Director Doctors Plus, Inc mtndoc@vail.net 970-343-0881 Attachment A Page 1 of 4 Ord No. 14-01 Amending Table 7.24-1, Allowed Uses, Avon Development Code TOWN OF AVON, COLORADO ORDINANCE 14-01 SERIES of 2014 AN ORDINANCE AMENDING SECTION 7.24.040, TABLE OF ALLOWED USES, AND TABLE 7.24-1, ALLOWED USES, AVON DEVELOPMENT CODE TO LIST MEDICAL AND DENTAL OFFICES AND CLINICS AS A SPECIAL REVIEW USE IN THE PUBLIC FACILITIES ZONE DISTRICT RECITALS WHEREAS, the Town of Avon (“Town”) adopted Ordinance No. 10-14 adopting the Avon Development Code (“ADC”); WHEREAS, the Town adopted the ADC and find that the text can be amended periodically to address changed conditions; WHEREAS, Jill Kovacevich, representing the Eagle County School District, owner of real property in the Town of Avon, submitted a code text amendment (“Application”) on December 3, 2013, pursuant to their powers granted by §7.16.040(a), Review Procedures, Avon Municipal Code (“AMC”); WHEREAS, The Application would amend Section 7.24.040, Table of allowed uses, and Table 7.24-1, Allowed Uses, by adding Medical and Dental Office and Clinics as eligible for Special Review Use permits in the Public Facility (PF) Zone District; WHEREAS, the Planning & Zoning Commission of the Town of Avon held a public hearing on December 17, 2013, after publishing and posting notice as required by law, considered all comments, testimony, evidence and staff reports provided by the Town staff, considered such information prior to formulating a recommendation; WHEREAS, after conducting the noticed Public Hearing, PZC made the required findings to recommend approval of the application and adopted PZC Resolution 13-07, recommending approval to the Town Council; WHEREAS, the Town Council of the Town of Avon held public hearings on January 14, 2014, January 28, 2014, and February 11, 2014 after posting notice as required by law, considered all comments, testimony, evidence and staff reports provided by the Town staff prior to taking any action on the Application; WHEREAS, pursuant to AMC §7.16.040(c), Review Criteria, the Town Council has considered the applicable review criteria for a Code Text Amendment and found the Application in compliance with the review criteria; Attachment B Page 2 of 4 Ord No. 14-01 Amending Table 7.24-1, Allowed Uses, Avon Development Code WHEREAS, approval of this Ordinance on first reading is intended only to confirm that the Town Council desires to comply with state law, the Avon home rule charter and the Avon Development Code by setting a public hearing in order to provide the public an opportunity to present testimony and evidence regarding the application and that approval of this Ordinance on first reading does not constitute a representation that the Town Council, or any member of the Town Council, supports, approves, rejects, or denies the proposed zoning or other matters in this Ordinances. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO, the following: Section 1. Recitals Incorporated. The above and foregoing recitals are incorporated herein by reference and adopted as findings and determinations of the Town Council. Section 2. Amendment to Section 7.24.040, Table of allowed uses and Table 7.24-1, Table of allowed uses. Section 7.24.040, Table of allowed uses, and Table 7.24-1, Table of allowed uses, of the ADC is amended as follows: Section 3. Correction of Errors. Town Staff is authorized to insert proper dates, references to recording information and make similar changes, and to correct any typographical, grammatical, cross-reference, or other errors which may be discovered in any documents associated with this Ordinance and documents approved by this Ordinance provided that such corrections do not change the substantive terms and provisions of such documents. Attachment B Page 3 of 4 Ord No. 14-01 Amending Table 7.24-1, Allowed Uses, Avon Development Code Section 4. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term “provision” means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term “application” means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 5. Effective Date. This Ordinance shall take effect thirty days after final adoption in accordance with Section 6.4 of the Avon Home Rule Charter. Section 6. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town of Avon, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 7. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title at the Avon Town Hall, Avon Recreation Center and Avon Public Library, which notice shall contain a statement that a copy of the ordinance in full is available for public inspection in the office of the Town Clerk during normal business hours. The Town Clerk is further ordered to publish a notice stating a vested property right has been created in accordance with Section. 7.16.140(d)(2) of the Avon Municipal Code. Section 8. Final Action. Approval and final adoption of this Ordinance on second reading constitutes the Town’s final action for the purposes of any appeal, legal challenge or referendum seeking reconsideration of the decision of the Town Council with respect to this Ordinance and matters approved hereby in accordance with Section 7.16.020(f)(5) of the Avon Municipal Code and in accordance with Chapters VI and VII of the Avon Home Rule Charter. [EXECUTION PAGE FOLLOWS] Attachment B Page 4 of 4 Ord No. 14-01 Amending Table 7.24-1, Allowed Uses, Avon Development Code INTRODUCED, APPROVED, PASSED ON FIRST READING AND ORDERED POSTED on January 14, 2014 and a public hearing on this ordinance shall be held at the regular meeting of the Town Council on February 11, 2014, at 5:30 P.M. in the Council Chambers, Avon Municipal Building, One Lake Street, Avon, Colorado. ____________________________ Rich Carroll, Mayor Published by posting in at least three public places in Town and posting at the office of the Town Clerk at least seven days prior to final action by the Town Council. ATTEST: APPROVED AS TO FORM: ____________________________ ____________________________ Patty McKenny, Town Clerk Eric Heil, Town Attorney INTRODUCED, FINALLY APPROVED, AND PASSED ON SECOND READING, AND ORDERED PUBLISHED BY POSTING on the 11th day of February, 2014. ____________________________ Rich Carroll, Mayor Published by posting by title in at least three public places in Town and posting by title at the office of the Town Clerk. ATTEST: __________________________ Patty McKenny, Town Clerk Attachment B At t a c h m e n t C Heil Law & Planning, LLC Office: 303.975.6120 2696 South Colorado Blvd., Suite 550 Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council Members FROM: Eric J. Heil, Town Attorney RE: Dee Wisor Engagement Letter DATE: February 6, 2014 Summary: Dee Wisor recently left the law firm of Sherman and Howard and joined Butler Snow. Dee has provided public finance legal services to the Town for many years. Currently, Dee is assisting with review of documents related to the Village (at Avon) settlement. Dee is very qualified and experienced and the review of documents related to the Village (at Avon) cannot be efficiently transferred to a new attorney at Sherman and Howard. Attached is an engagement letter with Dee Wisor at Butler Snow to continue Dee’s attorney-client relationship with the Town of Avon. I have reviewed the engagement letter and it is acceptable to me. The Avon Home Rule Charter requires the Town Council to approve the retention of attorneys that represent the Town. Proposed Motion: “I move to approve the engagement letter dated January 27, 2014, for Dee Wisor at Buttler Snow.” Thank you, Eric M EMORANDUM & PLANNING, LLC BUTLER S NO W Dee P. Wisor Direct Dial Number: (720) 330-2357 E-mail: dee.wisor@,butlersnow.com January 27, 2014 VIA E-MAIL Town of Avon Avon, CO 80104 Attention: Eric Heil, Town Attorney Dear Eric: This letter is to confirm our engagement as special counsel to the Town of Avon, Colorado (the "Town"), in connection with the negotiation and review of various documents in connection with the Villages at Avon real estate development in the Town (the "Development"). As part of the settlement of litigation among the 1'own, Traer Creek Metropolitan District and the Villages Metropolitan District (collectively the "Districts") and certain owners and developers of the property within the Development (collectively, the "Developer"), the Town is currently negotiating with the Districts and the Developer with respect to development and financing of issues. This letter sets forth the role we propose to serve and the responsibilities we propose to assume as special counsel to the Town in connection with this engagement. Scope of Services The scope of our services will include assisting the Town by reviewing and negotiating the certain documents relating to the development and financing of the Development, including a development agreement, agreements related to the financing of a water tank, the Districts' service plan and related documents. Our services do not include financial advice to the Town. We will not review the financial condition of the Developer or the feasibility of the Project and we will express no opinion relating thereto. Our services as special counsel to the Town are limited to those contracted for explicitly herein and the execution of this letter by the Town constitutes an acknowledgment of those limitations. Dee Wisor will be principally responsible for the work performed by Butler Snow LLP on your behalf and they will report to and take direction from you, as Town Attorney. Where appropriate, certain tasks may be performed by other attorneys or paralegals. At all times, however, Dee Wisor will coordinate, review, and approve all work completed for the Town. Personnel 4600 South Syracuse 9tb Floor Denver, CO 80237-2719 DEE P. WISOR 720.330.2357 dee.wisor@biitlersnow.com T 720.330.2300 F 720.330.2301 www. butlersnow. com BUTLER SNOW LLP Town of Avon January 27, 2014 Page 2 Attorney-Client Relationship In performing our services hereunder, the Town will be our client. We will represent the interests of the Town rather than the Town Council, the Council's individual members, or the Town's employees. We assume that other parties to the transaction will retain such counsel as they deem necessary and appropriate to represent their interests in this transaction. Conflicts of Interest Before accepting any new business, the Colorado Rules of Professional Conduct (the "Rules") require us to evaluate whether there exist any ethical constraints to representing the Town. We have completed a conflicts check within our firm and have found no current conflict between the Town and our existing clients. Financial Arrangements Butler Snow will invoice the Town each month for our work based upon the time we spend on this matter. Butler Snow's rates for the work by its attorneys and legal assistants vary based on the experience and expertise of the individuals involved. Typically, we adjust these rates at year-end to reflect changing economic conditions. If the firm increases rates during this engagement, we will provide written notice of those changes. The Rules require that the basis or rate of legal fees be communicated to the client in writing. Mr. Wisor's current billing rate is $545.00 for the attorneys who will be working with the Town. In addition, this letter authorizes us to incur expenses and make disbursements on behalf of the Town, which we will include in our monthly invoice. Disbursement expenses will include such items as travel costs, photocopying, deliveries and other out-of-pocket costs. Public Contract for Services - Compliance with § 8-17.5-101 C.R.S. In connection with our engagement with the Town, Butler Snow LLP qualifies as a "contractor" pursuant to § 8-17.5-101(2), C.R.S. and we hereby certify that, as of the date hereof: (i) we do not knowingly employ or contract with an illegal alien who will perform work pursuant to this engagement letter, and (ii) we have participated in the e-verify program or department program in order to confirm the employment eligibility of all employees who are newly hired for employment to perform work pursuant to this engagement letter. In compliance with Section § 8-17.5-102(2), C.R.S., the provisions set forth in Exhibit A to this engagement letter are incorporated herein and made a part hereof. Document Retention At or within a reasonable period after we have concluded our work, we will review our files to determine what materials should be retained as a record of our representation and those that are no longer needed. We will return any original documents obtained from you. We will retain for several years materials such as correspondence, final substantive work product, Town of Avon January 27,2014 Page 3 documents obtained from you, and documents obtained from third parties. We will not retain such materials as duplicates of the above-described material, or drafts and notes that do not appear needed any longer. Termination of Engagement Upon completion of our work relating to the financing and development of the Project, our representation of the Town and the attorney-client relationship created by this engagement letter will be concluded. We are pleased to have the Town as our client, and look forward to a mutually satisfactory and beneficial relationship. If the foregoing terms are acceptable to you, please so indicate by having the appropriate individual execute a copy of this letter for the Town and then return the executed copy to me. Thank you. BUTLER SNOW LLP Accepted and Approved: TOWN OF AVON, COLORADO By: Title: Date: DPW/jw Exhibit A A. Butler Snow LLP shall not: (I) knowingly employ or contract with an illegal alien to perform work described in this engagement letter under Scope of Services (the "Legal Services") or (II) enter into a contract with a subcontractor that fails to certify to Butler Snow LLP that the subcontractor shall not knowingly employ or contract with an illegal alien to perform the Legal Services. B. Butler Snow LLP: (I) has confirmed the employment eligibility of all employees who are newly hired for employment to perform the Legal Services through participation in either the e-verify program or the department program; (II) shall not use either the e-verify program or the department program procedures to undertake preemployment screening of job applicants while performing Legal Services; (III) shall be required (only if Butler Snow LLP obtains actual knowledge that a subcontractor performing Legal Services knowingly employs or contracts with an illegal alien): (a) to notify the subcontractor and the Town within three days that Butler Snow LLP has actual knowledge that the subcontractor is employing or contracting with an illegal alien; and (b) terminate the subcontract with the subcontractor if within three days of receiving the notice required pursuant to subparagraph (a) of this subparagraph (III) the subcontractor does not stop employing or contracting with the illegal alien; except that Butler Snow LLP shall not terminate the contract with the subcontractor if during such three days the subcontractor provides information to establish that the subcontractor has not knowingly employed or contracted with an illegal alien; and (IV) shall comply with any reasonable request by the Department of Labor and Employment made in the course of an investigation that such department is undertaking pursuant to § 8-17.5-102(5) C.R.S. ButlerSnow 19224924v1 1 OUR FIRM Founded in 1954, Butler Snow has almost 300 attorneys ranking approximately 171st in the National Law Journal’s Top 250 list. The firm has almost doubled in size in recent years and the NLJ has deemed Butler Snow as the second fastest growing firm in the United States. The majority of Butler Snow’s attorneys are based in the Southeastern United States but the firm has acquired legal expertise from across the United States and the United Kingdom. Butler Snow’s practice areas include a full range of business law and litigation services and while we are not the largest firm, we strive to have the bench strength necessary to handle practically any matter in the States or abroad. The firm currently has offices in the following locations: o Alabama: Birmingham and Montgomery o Colorado: Denver o Georgia: Atlanta o Louisiana: New Orleans and Baton Rouge o Mississippi: Greater Jackson and Gulfport o New York: New York City o Pennsylvania: Greater Philadelphia o Tennessee: Memphis and Nashville o United Kingdom: London, England Some law firms promise client service. We deliver on that promise. Surveys by respected national consultants consistently rank Butler Snow among the best nationwide in service – in anticipating needs, in a commitment to help, in providing value, in client satisfaction. Our clients’ success is our success. With that principle guiding us, Butler Snow has emerged from being primarily a regional firm to one with national scope. We have built a team of talented legal professionals who share a commitment to serve clients – from Fortune 100 companies to emerging- technology start-ups. Butler Snow has been recognized repeatedly for our teamwork and our clients’ successes, across a variety of service areas. Corporate Counsel also ranked Butler Snow as an Innovation Leader in “The BTI Brand Elite: Client Perceptions of the Best-Branded Law Firms 2013” and ALM named the firm a “Go-To Law Firm of the World’s Leading Companies 2013.” Law360 ranked the firm as “One of the Top Ten Busiest Product Liability Practices in its Law360 Litigation Almanac. Butler Snow was named in Best’s Review as one of 69 law firms “Standing the Test of Time,” the firm having been recommended for decades by the insurance companies we have represented. The National Law Journal named Butler Snow to its Midsize Hot List, making the firm one of only 20 nationwide named for demonstrating creative, innovative strategies; developing practice areas; and recruiting and retaining top legal talent. Butler Snow’s practice areas include the full range of business law and litigation services. We offer the depth to represent a broad spectrum of national and regional clients in a variety of legal areas, including:  Corporate/Business Services  Public Finance, Tax Incentives and Credit Markets 2  Financial Services  Bankruptcy and Reorganization  Government, Environmental, Utilities and Energy  Government Relations  Taxation  Product Liability  Intellectual Property  Commercial Litigation  Appellate and Written Advocacy  Pharmaceutical, Medical Device and Healthcare Industry  Investigations  General Litigation  Labor and Employment  Real Estate Our team approach allows us to utilize resources across the firm to match legal experience with client needs. As a result, clients benefit from our strategic counsel, efficient execution and innovative solutions to complex challenges. In an increasingly sophisticated business environment, clients need law firms that have the experience and depth to handle significant matters. Our attorneys offer diverse legal, business and governmental backgrounds, bringing vast experience and practical knowledge to each client they represent. Our practice areas are focused on specific legal disciplines, but we also have teams that are equipped to address the needs of particular industries, including healthcare, banking and finance, gaming, environmental, manufacturing, governmental, pharmaceutical and telecommunications. We have represented clients in all 50 states and in the District of Columbia, as well as internationally in more than 20 countries, including Australia, Canada, China, Colombia, Kuwait, Mexico, Saudi Arabia and the United Kingdom. Chambers USA - America's Leading Lawyers for Business describes Butler Snow as a “dominant force” with a team of attorneys who have achieved national prominence because of “sheer, unambiguous quality.” According to Chambers, our clients refer to the firm as “what a law firm should be” with a “number of talented lawyers.” Chambers also noted the firm’s ability to deliver to the client “the whole package – intelligence, presence and trial experience.” OUR VALUES We are driven by commitment to superior client service. Our culture is founded on teamwork, and we develop strong, meaningful partnerships with our clients and within our firm. We encourage creative and innovative thinking to achieve results. We listen to and understand our clients, and develop powerful strategies to help our clients accomplish their goals and resolve legal matters successfully. As we work to serve and champion our clients’ interests, we are led by these core values:  Clear priorities: The client is paramount and we strive to exceed expectations.  Teamwork: Teamwork differentiates our firm and culture and creates an innovative, results- oriented environment. 3  Responsive: Accessibility and communication strengthen client relationships and guide projects to successful outcomes.  Value-driven: We staff each matter with qualified teams to achieve cost effective results.  Success: Client satisfaction is the greatest measure of our success. OUR PEOPLE Butler Snow lawyers are recognized regionally and nationally for their expertise and contributions to the profession. Butler Snow’s core values are reflected by these honors and in the satisfaction of our clients. Our litigators are Fellows of the American College of Trial Lawyers and members of the American Board of Trial Advocates and College of Labor and Employment Lawyers. They have been recognized in the International Who’s Who of Business Lawyers, named in the Who’s Who Among International Product Liability Lawyers and several are members of the Product Liability Advisory Council (PLAC). The firm’s trial lawyers have directed and served on the faculty of the IADC Defense Counsel Trial Academy, the ABA’s TIPS National Trial Academy and the National Advocacy Center for the United States Department of Justice. Butler Snow attorneys also hold leadership positions in the Business Law and Litigation Sections of the American Bar Association, and almost one-half are rated AV by Martindale-Hubbell. Nearly one-half of all Butler Snow attorneys are listed in The Best Lawyers in America® 2014, including 167 listings in 48 practice areas from litigation, alternative dispute resolution, bankruptcy and real estate, to intellectual property, corporate law practices, appellate law and labor and employment. 117 Butler Snow attorneys were named to Super Lawyers® and Rising Stars® 2013. A few of the practice areas where Butler Snow was highlighted include Healthcare, Personal Injury Defense, Business Litigation, Employment and Labor, Appellate, Securities and Corporate Finance. OUR COMMITMENT TO CLIENT SERVICE Our success is measured by our clients’ satisfaction. Butler Snow ranks at the very top in client satisfaction, according to a survey by Altman Weil, an international consulting firm. We ranked in the top five percent for client satisfaction when the survey results of our representative clients were compared to results of Altman Weil surveys for other law firms throughout the country. “Butler Snow’s client satisfaction rating is one of the highest ever recorded in the Altman Weil Client Survey Database,” said Altman Weil Managing Principal Tom Clay, who administered the survey. “The level of Butler Snow’s client satisfaction was extraordinary, especially when considering the number of national, regional and local clients that participated.” More than 400 clients were surveyed on overall satisfaction, firm expertise, responsiveness to client needs and perceived value. 4 Butler Snow was ranked as one of America’s Top 100 law firms in the BTI Power Rankings: The BTI Client Relationship Scorecard for Law Firms. More than 375 key legal decision-makers at Fortune 1000 companies were interviewed to determine the level of service provided by law firms, along with client satisfaction perceptions. BTI ranked Butler Snow on the Short List of Go-To Law Firms and also rated the firm as a Hidden Gem and one of only 33 Primary Pharmaceutical Power Firms. We were recognized as one of the nation’s top law firms for client service in The Survey of Client Service Performance Law Firms: The BTI Client Service A-Team. According to interviews with nearly 300 corporate counsel, Butler Snow delivers better client service than over half of the law firms serving the world’s largest organizations. The study also recognized Butler Snow as among the best in six additional categories: Provides Value for the Dollar, Breadth of Services, Regional Reputation, Deals with Unexpected Changes, Meets Scope and Budget, and Anticipates the Client’s Needs. PUBLIC FINANCE, TAX INCENTIVES AND CREDIT MARKETS Butler Snow offers a comprehensive and diverse public finance practice ranging from all forms of state and municipal bonds and obligations to the full complement of techniques available to finance and/or refinance governmental, healthcare, industrial/economic development, public-private partnerships, exempt facilities, utilities, public and private educational institutions, housing and other developments. With over 30 attorneys practicing full-time in our Public Finance, Tax Incentives and Credit Markets Group, Butler Snow has one of the largest and most successful public finance practices in the Southeast. Our attorneys have served state and local governmental entities, financial institutions, 501(c)(3) nonprofit institutions and other public finance participants in a myriad of public financing matters. The Butler Snow team prides itself on how we couple our public finance expertise with our commitment to coordinated utilization of all resources of the Firm to best serve our clients’ needs. This synergy helps us understand clients’ needs more thoroughly, and deliver targeted legal services that more effectively support those needs. Butler Snow Public Finance, Tax Incentives and Credit Markets Group regularly serves as bond counsel and disclosure counsel to issuers of state and municipal bonds and obligations to finance and refinance government projects, including states, their political subdivisions, special districts and authorities. We also provide guidance and advice regarding continuing disclosure matters and post- issuance federal tax compliance. Butler Snow routinely serves as underwriter’s counsel to many of the largest national and regional investment banking firms involved in public finance transactions, including assisting our clients in preparing securities offering documents to be used in the offering and sale of bonds and advising them as to their responsibilities under state and federal securities laws. Our attorneys focus on all types of tax and financing incentives offered by federal, state and local governments to encourage economic development. Butler Snow regularly serves as bond counsel in connection with tax-exempt and taxable industrial development bond financing programs. For over 20 years we have represented companies locating or expanding facilities in connection with state and 5 local financing programs, tax incentives and other financing transactions. We have substantial expertise in tax credit incentive financing transactions, which fund the development of commercial projects, historic rehabilitation projects, energy projects and affordable housing in low-income areas. In addition to our traditional public finance practice, the group works closely with the firm’s banking, commercial lending, taxation, real estate, business services, energy, governmental affairs, bankruptcy, environmental and other practice groups on highly structured financial products (including derivatives and special purpose vehicles), commodity swap transactions, synthetic fixed rate financings, project financing, letters of credit transactions, state and local tax incentives and abatements and other financing and transactional related matters, including restructurings and default workouts. Within the Public Finance, Tax Incentives and Credit Markets Group, seven recognized tax law practitioners provide advice with respect to structuring bond issues to comply with federal income tax laws applicable to tax-exempt bonds, state and federal economic development incentives, and tax credit incentive financing transactions. Our tax lawyers are available to assist in every type of municipal financing transaction, and tax credit financing transaction, regardless of the nature of the financing and the geographic location. Areas of expertise within our Public Finance, Tax Incentives and Credit Markets practice include the following:  Governmental Bonds  Industrial Development Bonds  Healthcare Facilities  Economic Development Incentives  Tax Credits  Housing Financing  Public-Private Partnerships  Financing Transaction Structures  Post-Issuance Compliance and Default/Workout Practice  Securities Laws Heil Law & Planning, LLC Office: 303.975.6120 2696 South Colorado Blvd., Suite 550 Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council Members FROM: Eric J. Heil, Town Attorney RE: Ordinance No. 14-03 Amending the Avon Municipal Code Concerning Penalties and Restitution DATE: February 6, 2014 Summary: Ordinance No. 14-03 Amends the Avon Municipal Code to increase the maximum penalty provision from $1,000 per violation to $2,650 per violation and enacts language regarding municipal court authority to order restitution. The Colorado Legislature enacted HB13-1060 last year which amended the maximum penalty for violations. Ordinance No. 14-03 amends the Avon Municipal Code so that it is consistent with statutory authority for maximum penalties. Sections 1.08.010 and 1.09.030: The only change to these sections is to change the maximum fine amount from $1,000 to $2,650. Restitution: Ordinance No. 14-03 also amends the Avon Municipal Code to enact a new Section 2.08.120 to clarify and formalize the Court’s authority to order restitution. Statutory authority exists for court ordered restitution under Colorado Revised Statute 18-1.3-601 et. seq. for sentencing in criminal cases, including misdemeanors, petty offenses and traffic misdemeanor offenses. I have reviewed restitution clauses from several other municipalities and have consulted with Judge Allen regarding these Code amendments. Requested Action: Consider Ordinance No. 14-03 for first reading. Proposed Motion: “I move to approve first reading of Ordinance No. 14-03 AN ORDINANCE AMENDING CHAPTERS 1.08 AND 1.09 OF THE AVON MUNICIPAL CODE CONCERNING MUNICIPAL COURT FINES AND CHAPTER 2.08 CONCERNING COURT ORDERED RESTITUTION” Thank you, Eric Attachment A: Ordinance No. 14-03 M EMORANDUM & PLANNING, LLC Ord 14-03 Amending Chapters 1.08, 1.09 and 2.08 February 11, 2014 1ST Reading Page 1 of 4 TOWN OF AVON, COLORADO ORDINANCE NO. 14-03 SERIES OF 2014 AN ORDINANCE AMENDING CHAPTERS 1.08 AND 1.09 OF THE AVON MUNICIPAL CODE CONCERNING MUNICIPAL COURT FINES AND CHAPTER 2.08 CONCERNING COURT ORDERED RESTITUTION WHEREAS, the Colorado legislature enacted House Bill 13-1060 which amended Colorado Revised Statute Sections 13-10-113 and 31-16-101 to raise the amount of municipal court fines to $2,650.00; WHEREAS, the Avon Town Council finds that an increase of the maximum fine amount for the Avon Municipal Court will improve the deterrence of municipal violations and the discretion of the Avon Municipal Court to impose just and appropriate fines; WHEREAS, the Avon Town Council finds that the authorization of the Avon Municipal Court to impose restitution when deemed appropriate will enhance the fairness, effectiveness and efficiency of the Avon Municipal Court; WHEREAS, the Town of Avon has adopted home rule authority and the Avon Town Council finds that the imposition of restitution is a matter of local concern; WHEREAS, it is the Town Council finds that amendment to Chapters 1.08, 1.09 and 2.08 of the Avon Municipal Code will promote the health, safety and welfare of the Avon community; and, WHEREAS, approval of this Ordinance on first reading is intended only to confirm that the Town Council desires to comply with state law, the Avon Municipal Code and the Avon Home Rule Charter by setting a public hearing in order to provide the public an opportunity to present testimony and evidence regarding the application and that approval of this Ordinance on first reading does not constitute a representation that the Town Council, or any member of the Town Council, supports, approves, rejects, or denies the proposed amendment to the Avon Municipal Code. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO the following: Section 1. Recitals Incorporated. The above and foregoing recitals are incorporated herein by reference and adopted as findings and determinations of the Town Council. Section 2. Amendment to Avon Municipal Code Section 1.08.10. Section 1.08.010 Designated. of the Avon Municipal Code is repealed in its entirety and reenacted to read as follows: 1.08.010 Designated. ATTACHMENT A Ord 14-03 Amending Chapters 1.08, 1.09 and 2.08 February 11, 2014 1ST Reading Page 2 of 4 With the exception of violations of those sections of this Code designated therein as civil infractions, whenever in any section of this Code or in any section of a rule or regulation promulgated hereunder, the doing of any act is required, prohibited or declared to be unlawful, any person who shall be convicted of, or plead guilty or no contest to, a violation of such section shall be fined in the sum of not more than two thousand six hundred fifty dollars ($2,650.00) or imprisoned not to exceed one (1) year, or both such fine and imprisonment. Each day an offense continues shall constitute a separate offense. Section 3. Amendment to Avon Municipal Code Section 1.09.030(a). Section 1.09.030(a) Minimum civil penalties. of the Avon Municipal Code is repealed in its entirety and reenacted to read as follows: 1.09.030 Minimum civil penalties. (a) Any person found responsible for a violation of this Code authorized to be prosecuted as a civil infraction shall pay a civil fine of not more than two thousand six hundred fifty dollars ($2,650.00) plus costs, damages and expenses, the amount of the fine and the charging of costs, damages and expenses to be in the discretion of the Court except as follows: (1) Any person found guilty, after trial or settlement, of any provisions of this Code designated as a civil infraction, when the date of the offense is within three hundred sixty-five (365) days of the date of a prior violation of the Code, shall be fined not less than three hundred dollars ($300.00), plus any additional penalties assessed under this Chapter. (2) Any person found guilty, after trial or settlement, of any provision of this Code designated as a civil infraction for a third or subsequent time, when the date of the offense is within three hundred sixty-five (365) days of the date of the prior violation of this Code, shall be fined not less than six hundred dollars ($600.00), plus any additional penalties assessed under this Chapter. Section 4. Amendment to Avon Municipal Code Chapter 2.08. Chapter 2.08 of the Avon Municipal Code is amended by enacting a new section 2.08.120 Restitution to read as follows: 2.08.120 Restitution. The Municipal Court is granted full power and authority to order restitution in accordance with Part 6, Article 1.3, Title 18 of the Colorado Revised Statute and to order a defendant, upon conviction or pleading of no contest, including any deferred sentence or deferred prosecution, to make restitution for any damage or injury arising from any violations of the Code. Any order of restitution may be increased or decreased upon a showing of good cause. If more than one defendant owes restitution to the same victim for the same pecuniary loss, the orders for restitution shall be joint and several obligations of the defendants. Nothing in this Chapter shall be construed to limit or abrogate the rights and ATTACHMENT A Ord 14-03 Amending Chapters 1.08, 1.09 and 2.08 February 11, 2014 1ST Reading Page 3 of 4 immunities set forth in the “Colorado governmental immunity act”, article 10 of title 24, Colorado Revised Statutes. Section 5. Codification Amendments. The codifier of the Town’s Municipal Code, Colorado Code Publishing, is hereby authorized to make such numerical and formatting changes as may be necessary to incorporate the provisions of this Ordinance within the Avon Municipal Code. The Town Clerk is authorized to correct, or approve the correction by the codifier, of any typographical error in the enacted regulations, provided that such correction shall not substantively change any provision of the regulations adopted in this Ordinance. Such corrections may include spelling, reference, citation, enumeration, and grammatical errors. Section 6. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term “provision” means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term “application” means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 7. Effective Date. This Ordinance shall take effect thirty (30) days after public notice following final passage in accordance with Section 6.4 of the Avon Home Rule Charter. Section 8. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town of Avon, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 9. No Existing Violation Affected. Nothing in this Ordinance shall be construed to release, extinguish, alter, modify, or change in whole or in part any penalty, liability or right or affect any audit, suit, or proceeding pending in any court, or any rights acquired, or liability incurred, or any cause or causes of action acquired or existing which may have been incurred or obtained under any ordinance or provision hereby repealed or amended by this Ordinance. Any such ordinance or provision thereof so amended, repealed, or superseded by this Ordinance shall be treated and held as remaining in force for the purpose of sustaining any and all proper actions, suits, proceedings and prosecutions, for the enforcement of such penalty, liability, or right, and for the purpose of sustaining any judgment, decree or order which can or may be rendered, entered, or made in such actions, suits or proceedings, or prosecutions imposing, inflicting, or declaring such penalty or liability or enforcing such right, and shall be treated and held as remaining in force for the purpose of sustaining any and all proceedings, actions, hearings, and appeals pending before any court or administrative tribunal. ATTACHMENT A Ord 14-03 Amending Chapters 1.08, 1.09 and 2.08 February 11, 2014 1ST Reading Page 4 of 4 Section 10. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title in at least three public places within the Town and posting at the office of the Town Clerk, which notice shall contain a statement that a copy of the ordinance in full is available for public inspection in the office of the Town Clerk during normal business hours. INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED POSTED AND REFERRED TO PUBLIC HEARING and setting such public hearing for February 11, 2014 at the Council Chambers of the Avon Municipal Building, located at One Lake Street, Avon, Colorado, on February 25, 2014. ____________________________ Rich Carroll, Mayor Published by posting in at least three public places in Town and posting at the office of the Town Clerk at least seven days prior to final action by the Town Council. ATTEST: APPROVED AS TO FORM: ____________________________ ____________________________ Patty McKenny, Town Clerk Eric J. Heil, Town Attorney INTRODUCED, FINALLY APPROVED, AND PASSED ON SECOND READING, AND ORDERED PUBLISHED BY POSTING on February 25, 2014. ____________________________ Rich Carroll, Mayor Published by posting by title in at least three public places in Town and posting by title at the office of the Town Clerk. ATTEST: __________________________ Patty McKenny, Town Clerk ATTACHMENT A TOWN OF AVON, COLORADO AVON REGULAR MEETING MINUTES FOR TUESDAY, JANUARY 28, 2014 AVON TOWN HALL, ONE LAKE STREET Avon Council Meeting 01-28-2014 Minutes Page 1 1. CALL TO ORDER & ROLL CALL Mayor Pro Tem Goulding called the meeting to order at 5:45 PM. A roll call was taken and Council members present were Dave Dantas, Jennie Fancher, and Jake Wolf. Councilor Chris Evans, Councilor Buz Reynolds and Mayor Rich Carroll were absent. Also present were Town Manager Virginia Egger, Town Attorney Eric Heil, and Assistant Town Manager/Town Clerk Patty McKenny, Senior Planner Matt Pielsticker, as well as members from the public. 2. APPROVAL OF AGENDA There were no changes to the agenda 3. PUBLIC COMMENT  Bill Wilto, Wildridge resident, noted concerns about traffic speeds near his Rocking Horse Ridge residence complex.  Isiah McGregory, Up with People, spoke about their productions that will be taking place in February in the Vail Valley with many opportunities for locals to get involved.  Jonathan Levine, Avon resident, spoke about his past history with the town and some alleged accusations about his involvement in criminal activity. 4. STAFF PRESENTATION SERIES 4.1. Street & Path Pavement Assessment: Multi-year Maintenance, Paving and Reconstruction Planning (Town Engineer Justin Hildreth/Road & Bridge Superintendent Gary Padilla) There was a review of the following topics that makeup this program: • The yearly assessment of the pavement performance on all roads and asphalt paths in Town • Prioritization of projects for pavement preservation • The recent changes to the program including the introduction of slurry seals and why that preservation treatment was selected over other available treatments • Bicycle and pedestrian issues with surface treatments • Inclusion of the roads in the Traer Creek Metro District in 2014 5. ACTION ITEMS 5.1. Review and Action on the Location and Cost Estimate for a Stage in Nottingham Park (Town Engineer Justin Hildreth) There was a review made of the recent meeting with stakeholders regarding the construction of a stage at the park. Three park locations were evaluated: the south side, the southwest corner of the athletic field and the north side. It was noted that the south locations were more feasible and cost effective. The two locations were noted to have similar advantages with the primary difference being the southwest corner location will project slightly less sound into the adjacent residential area. It was noted that Staff recommended keeping the stage at the currently proposed location by Town Hall because the plans are nearly complete and any changes will be minimal and easily incorporated for a summer 2014 construction. The stage estimated costs were $650,000 and funding could be made available for the Community Enhancement Fund ($350,000), with the balance being appropriated from the Capital Projects Fund Reserve $300,000). Discussion included topics as follows:  moving town hall & using its location as a parking structure which would then support the stage with storage and parking TOWN OF AVON, COLORADO AVON REGULAR MEETING MINUTES FOR TUESDAY, JANUARY 28, 2014 AVON TOWN HALL, ONE LAKE STREET Avon Council Meeting 01-28-2014 Minutes Page 2  Suggested conducting some sound sampling at different locations in the park to help determine the impacts, arrange for sound testing asap  estimate back of stage costs  would southwest corner location require removing the cabin  important point is the access ease It was noted that staff would address some of the items requested above and then review the topic again as soon as the information was available. 5.2. PUBLIC HEARING on Second Reading of Ordinance 14-01, Series of 2014, An Ordinance Amending Section 7.24.040, Table of Allowed Uses and Table 7.24-1, Allowed Uses, Avon Development Code to List Medical and Dental Offices and Clinics as a Special Review Use in the Public Facilities Zone District (Planning Manager Matt Pielsticker) Mayor Pro Tem Goulding stepped down at this time due to a conflict of interest. Councilor Dantas was asked to chair the meeting at this time. Eric Heil, Town Attorney, noted that the Town Charter requires four concurring votes in order to pass an ordinance and since there were two Councilors absent and one Councilor who recused himself, the item would need to be continued to the next council meeting date. He noted that if the public hearing were opened tonight, it would not be required at the next meeting. A brief review of the application was made noting that the application includes a request to amend the Avon Municipal Code (“AMC”) for the purpose of listing “medical and dental clinics and offices” as a Special Review Use (“SRU”) in the Public Facilities (“PF”) zone district. He noted there were no changes made to the ordinance from first reading. Jill Kovacevich of Doctors Plus, Inc. was present to address their business proposal as well. Councilor Dantas opened the public hearing, no comments were made, the hearing was closed. Councilor Fancher moved to table the decision on Ordinance 14-01, Series of 2014, An Ordinance Amending Section 7.24.040, Table of Allowed Uses and Table 7.24-1, Allowed Uses, Avon Development Code to List Medical and Dental Offices and Clinics as a Special Review Use in the Public Facilities Zone District to the February 11, 2014 meeting. Councilor Wolf seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent, Mayor Pro Tem Goulding recused due to conflict). 5.3. PUBLIC HEARING on Resolution No. 14-02, Series of 2014, Resolution Approving the Minervini Minor PUD Amendment for Lots 15 & 16, Block 4, Wildridge, Town of Avon, Colorado (Planning Manager, Matt Pielsticker) Mayor Pro Tem Goulding returned to the room at this time. Councilor Dantas noted that he has a business relation with Dominic Mauriello; Town Attorney noted that his opinion was that there was not a financial conflict of interest related to this item. Mayor Pro Tem Goulding noted that Dominic also works for his client clarifying that he has not retained him in any business capacity. Councilor Fancher noted that she does have a personal relationship with the applicant and Town Attorney noted that if she thought she could not make an objective decision about the application it should be noted. Councilor Fancher noted she did not believe the relationship would interfere in her decision-making. A review was made by staff of the application. There was a review of public input made at the PZC meetings with a request that the applicants continue to work with the neighborhood. Additional public input was provided to the town council at the meeting via email. It was noted that the Minor PUD amendment process does have review criteria that has been evaluated by staff and included in the memo. TOWN OF AVON, COLORADO AVON REGULAR MEETING MINUTES FOR TUESDAY, JANUARY 28, 2014 AVON TOWN HALL, ONE LAKE STREET Avon Council Meeting 01-28-2014 Minutes Page 3 Dominic Mauriello, the Applicant, representing John Minervini and Virginia Klyce, the Owners, made a presentation and requested a Planned Unit Development (PUD) Amendment (the Application) to modify the allowed building type for two lots, Lots 15 & 16, Block 4, Wildridge Subdivision (the Property). He noted that currently, three (3) dwelling units in the form of a single-family structure and duplex structure are permitted by right. He noted that this Application requests the ability to develop the Property with three (3) single- family structures, and is being processed as a Minor PUD Amendment. Councilor Evans arrived at 7:10 pm. Mayor Pro Tem Goulding opened the public hearing, and comments were heard from neighboring property owner Jack Huhn, Lot 20 owner. He expressed opposition and concerns about the application in light of numerous reasons, i.e. was under the impression that Lot 15 had already been built, that previous owners had vacated the property, confused about transferring development rights, that the project has a negative impact on his property. He requested height restrictions be considered. The hearing was closed. After some discussions a motion was made as follows, Councilor Evans moved to continue Resolution No. 14-02, Series of 2014, Resolution Approving the Minervini Minor PUD Amendment for Lots 15 & 16, Block 4, Wildridge, Town of Avon, Colorado until February 25, 2014 in order to allow more time for applicants and neighboring residents to resolve some issues and concerns. Councilor Wolf seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent). 5.4. PUBLIC HEARING on Second Reading of Ordinance No. 14-02, Series of 2014, An Ordinance Amending Chapter 2.32 of the Avon Municipal Code Regarding Residency of Council Members (Town Attorney Eric Heil) The ordinance was presented on second reading and final action by Town Council. It was noted that there were revisions as follows: • 2.32.090 was amended to include the phrase “including but not limited to” • 2.32.090 was amended to delete (f) participation of the affected member in meetings and affairs of the Council and Town.” as a relevant evidence criteria. Mayor Pro Tem Goulding opened the public hearing, no comments were made, the hearing was closed. Councilor Fancher moved to approve Ordinance No. 14-02, Series of 2014, An Ordinance Amending Chapter 2.32 of the Avon Municipal Code Regarding Residency of Council Members; Councilor Dantas seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent). 5.5. Resolution No. 14-03, Series of 2014, Resolution Adopting Simplified Rules of Order for Avon Town Council Meetings (Town Attorney Eric Heil) The draft rules were reviewed at the last meeting, and Section 3a included some revisions about agenda planning. Councilor Evans moved to approve Resolution No. 14-03, Series of 2014, Resolution Adopting Simplified Rules of Order for Avon Town Council Meetings; Councilor Dantas seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent). 5.6. Village at Avon Update (Town Attorney Eric Heil) 5.6.1. Approval of Extension of Outside Date for the Receipt and Escrow Agreement TOWN OF AVON, COLORADO AVON REGULAR MEETING MINUTES FOR TUESDAY, JANUARY 28, 2014 AVON TOWN HALL, ONE LAKE STREET Avon Council Meeting 01-28-2014 Minutes Page 4 An update on the numerous pending matter of the settlement were reviewed, 1) Water tank agreements were executed, 2) the pledge agreement that addresses the financing of the water storage tank has not yet been completed. It was noted that the attorneys are looking to the end of March for the completion of the settlement. A review of the need to extend the settlement date was reviewed. Councilor Evans moved to approve the Extension of Outside Date to April 11, 2014; Councilor Fancher seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent). 5.7. Action on Retainer Agreement with Butler Snow for Legal Services (Town Attorney Eric Heil) the Town Attorney requested that this item be removed from consideration on the agenda since he did receive the agreement until late that day. Councilor Dantas moved to continue the Butler Snow Legal Services Agreement to the next meeting; Councilor Evans seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent). 5.8.Consideration of Appointment of Larry Brooks to Serve as Director on Buffalo Ridge Affordable Housing Corporation (Assistant Town Manager Patty McKenny) There were no Council member objections to this appointment, no further action was required. 5.9.Minutes from January 14, 2014 Meeting (Town Clerk Patty McKenny) Councilor Evans moved to approve minutes from January 14, 2014; Councilor Wolf seconded the motion and it passed unanimously by those present (Mayor Carroll and Councilor Reynolds absent). 6. WORK SESSION 6.1. Final Review of the Agenda for the Council Retreat scheduled for February 11th at the Town’s Regional Transit Facility (Mayor Pro Tem Todd Goulding) There was agreement on the proposed retreat topics. 7. COMMITTEE MEETING UPDATES: COUNCILORS AND MAYOR 7.1. UERWA Meeting Update (Mayor Pro Tem Goulding) 8. COUNCIL COMMENTS It was noted that the community branding meeting was going to be held Wednesday evening. 9. STAFF UPDATES – REPORTS ONLY 9.1. Fiscal Year 2014 Financial Report (Budget Analyst Kelly Huitt) 9.2. Letter of Concern to Congressional Leaders from Eagle County government and business leaders expressing concern about the recent removal of funding for the Payment in Lieu of Taxes (PILT) program in the recently passed Consolidated Appropriations Act, (H.R. 3547) as requested by Vail Valley Partnership (Memo only) (Patty McKenny, Assistant Town Manager) TOWN OF AVON, COLORADO AVON REGULAR MEETING MINUTES FOR TUESDAY, JANUARY 28, 2014 AVON TOWN HALL, ONE LAKE STREET Avon Council Meeting 01-28-2014 Minutes Page 5 10. EXECUTIVE SESSION (THIS MEETING IS NOT OPEN TO THE PUBLIC) Councilor Fancher moved to meet in Executive session at 8:25 pm to discuss the following items; the motion was seconded by Councilor Wolf. 10.1. Pursuant to Colorado Revised Statue 24-6-402(4)(f) for the Purpose of Discussing Personnel Matters related to the Annual Performance Review of the Town Attorney Mayor Pro Tem Goulding noted that the discussion would be confined only to the purposes of the executive session as stated and that if at any time during the executive session anyone believes that the discussion does not concern the topic and purpose of the executive session, to please raise your objection immediately. The following people were present during the executive session: Councilor Dantas, Councilor Chris Evans, Councilor Jennie Fancher, Mayor Pro Tem Todd Goulding, and Councilor Wolf as well as Town Attorney Eric Heil. Mayor Carroll & Councilor Reynolds were absent. The Executive Session adjourned and Mayor Pro Tem Goulding noted that regular meeting reconvened and asked if any Council member believed that any discussion in Executive Session was inappropriate and not related to the topic and purpose of the Executive Session to please state their objection at this time. There were no objections stated at this time. There being no further business to come before the Council, the regular meeting adjourned after the executive session adjourned. RESPECTFULLY SUBMITTED: _________________________________ Patty McKenny, Town Clerk APPROVED: Rich Carroll ________________________________ Dave Dantas ________________________________ Chris Evans ________________________________ Jennie Fancher ________________________________ Todd Goulding ________________________________ Albert “Buz” Reynolds ________________________________ Jake Wolf ________________________________ Heil Law & Planning, LLC Office: 303.975.6120 2696 South Colorado Blvd., Suite 550 Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council Members FROM: Eric J. Heil, Town Attorney RE: Conditional Water Rights DATE: February 6, 2014 Summary: A recent news article reported that a well established Colorado water law firm had failed to file a required application for a conditional water right for a front range city and that the city then lost that conditional water right and its associated priority. Virginia and I were asked to review the Town’s calendar systems to determine the best practices for preventing a filing error related to the Town’s water rights. Under Colorado’s water rights system of prior appropriation, water rights users are required to divert water and apply the diverted water to a beneficial use. Water which is diverted and fully applied to a beneficial use can be decreed as an “absolute” right by water courts. When the diversion of water is not fully utilized but there are plans to develop the water use and fully utilize the water in the future then water courts can decree a “conditional” water right. Water courts review conditional water rights every six years to determine if the water right holder is actively seeking to develop the water right. Water courts send a notice that conditional water rights will be reviewed prior to cancellation. If an application to continue the conditional water right is not filed within the required time frame, then a water court will deem the conditional right to be abandoned. A water court determination of abandonment for a failure to timely file an application is an irreversible jurisdictional matter and no remedial measure can be taken to correct a mistake after missing the deadline to file an application. The best method to prevent a failure to timely file required water court applications for conditional water rights is a system of redundancy. Law firms which specialize in water rights are familiar with the requirements for conditional water rights and maintain calendar systems to track the filing deadlines. The majority of Avon’s water rights have been deeded or leased to the Upper Eagle River Water Authority. It is the principle responsibility of the UERWA to maintain those water rights, including the timely filing of any required applications to preserve conditional water rights. Not all of Avon’s water rights have been conveyed to the UERWA, therefore there are some conditional water rights which the Town has to monitor. Virginia and I are implementing a redundant water rights tracking system which would include tracking by the Town’s water counsel, tracking by myself as a Town Attorney function, and tracking as part of the annual Water Fund budget review. We are currently working with Jay Montgomery to identify the Town of Avon’s complete portfolio of water rights, including all conditional water rights. In addition to a redundant system of tracking, a goal is to better institutionalize the Town’s water rights information so that the information is readily accessible in the event of attorney or staff turnover. Requested Action: No action by Council is requested at this time. Thank you, Eric M EMORANDUM & PLANNING, LLC Heil Law & Planning, LLC Office: 303.975.6120 2696 South Colorado Blvd., Suite 550 Fax: 720.836.3337 Denver, CO 80222 E-Mail: eric@heillaw.com e-mail: ericheillaw@yahoo.com H EIL L AW TO: Honorable Mayor Carroll and Town Council Members FROM: Eric J. Heil, Town Attorney RE: Impact of Colorado Drought DATE: February 7, 2014 Summary: Council had noted the severe drought conditions in California and asked staff to explain the potential impacts to the Town of Avon with regard to the Colorado River Compact (“Compact”). Jay Montgomery, the Town’s water counsel, reviewed Compact information in his firm as well as received information from Glenn Porzak, water counsel for the Upper Eagle River Water Authority (“Authority”). A majority of Avon’s water rights are senior to the Shoshone water right as well as senior to the Compact (268 acre feet of senior water rights are leased to the Authority). Rights which are senior to both the Shoshone water right and the Compact have a very little risk of being affected by a call on the river. As explained in Eric Kuhn’s 2012 risk analysis, the Lower Basin States cannot put a call on the Colorado River under the Compact until the 10 year average flow (delivery) is less than 7.5 million acre feet (i.e. 75 million acre feet in 10 years time). The Upper Basin States currently meet this delivery requirement based on the 10 year average, therefore, the Lower Basin States do not have a current right to put a call on the Colorado River. Drought conditions in the Upper Basin States or increased consumption by the Upper Basin States may result in a failure to meet the Upper Basin States delivery requirement, but as stated in several documents, it is difficult to predict when this may occur. In the event of a call on the Colorado River under the Compact, there is a complicated and yet untried flow of enforcement that begins with Lower Basin States putting a call on Upper Basin States, then Upper Basin States seeking enforcement by the individual states along with complex apportionment issues, then each state enforcing through the state water engineer along with complex apportionment issues amongst basins and with curtailment of trans-mountain diversions to front-range cities. Due in part to the vast number of unresolved legal complexities related to a call under the Compact there is an active effort to manage various water rights and uses in the Upper Basin States in order to meet the Upper Basin States water delivery obligation and avoid a call under the Compact. Avon is at greater practical risk from a physical water shortage from local drought conditions. A sustained local drought could result in curtailment of outdoor irrigation. Indoor municipal water use is calculated to consume only 7% of the actual water diverted, therefore, continuation of basic indoor domestic water use is very secure except in the most extreme catastrophic local drought conditions. Requested Action: Council may desire a more involved presentation on the Colorado River Compact and various regional water agreements. I understand that Eric Kuhn has a detailed presentation and that Glenn Porzak may be available for presentation. Such a presentation may be better suited for a larger community meeting. Attachment A: Risk Management Strategies for the Upper Colorado River Basin Attachment B: Memorandum from Glenn Porzak Thank you, Eric M EMORANDUM & PLANNING, LLC ATTACHMENT A 1    January 2, 2012 RISK MANAGEMENT STRATEGIES FOR THE UPPER COLORADO RIVER BASIN Eric Kuhn, General Manager Colorado River Water Conservation District I. INTRODUCTION The 1922 Colorado River Compact (1922 Compact) divided the Colorado River Basin within the United States into two hydrologic basins, an Upper Basin and a Lower Basin. The 1922 Compact defines the dividing point as Lee Ferry, one mile downstream of the confluence of the Paria River and the Colorado River. The Upper Basin is actually defined as “those parts of the states of Arizona, Colorado, New Mexico, Utah and Wyoming within and from which waters naturally drain into the Colorado River System above Lee Ferry which are now or shall hereafter be beneficially served by water diverted from the system above Lee Ferry.” Approximately 90% of the natural flow of the Colorado River originates in the Upper Basin.1 Under the 1922 Compact, the States of the Upper Division,2 which are the four states with primary Upper Basin interests, have certain obligations at Lee Ferry. Article III (d) provides that the States of the Upper Division will not cause the flow of the river at Lee Ferry to be depleted below an aggregate of 75 million acre feet (maf) for any period of ten consecutive years. Additionally, Article III(c) provides that the delivery of water to Mexico pursuant to international treaty, normally 1.5 maf/year, is first to be provided from any surplus, but if there is no surplus or it is insufficient then the Upper and Lower Basins share equally in providing the deficiency. Whenever necessary, the States of the Upper Division shall deliver their 50% share of the deficiency in addition to the water required under Article III (d).3 Thus, the obligation of                                                              1 There are few reliable estimates of the flow of the Colorado River at its mouth. In House Document 419, Eightieth  Congress, first session, Reclamation estimated that the “virgin” aka “natural” flow of the Colorado River at Lee  Ferry from 1897‐1943 was 16.27 maf per year (page 281).  The estimated flow of the Colorado River for the same  period at the international boundary is 17.72 maf per year. This analysis suggests that 91.8% of natural flow  originates above Lee Ferry. The minutes of the 11th meeting of the Colorado River Commission suggest the  compact negotiators believed that 86% of the annual flow of the Colorado River originated above Lee Ferry (page  23).   2 The compact defines the “States of the Upper Division” as Colorado, New Mexico, Utah and Wyoming.  The terms  “Upper Basin” and,” “States of the Upper Division,” are defined by the 1922 Compact. The term “Upper Basin  States,” is not defined by the 1922 Compact. All three terms are often used interchangeably.  Because of the  compact implications, I will not use the term “Upper Basin States,” instead I will use the terms “Upper Basin” and  “States of the Upper Division” or “Upper Division states” in their proper context under the compacts.   3 The actual wording of the 1922 Compact is “such waters shall be supplied first from the waters which are surplus  over and above the aggregate of the quantities specified in (a) and (b) and if such surplus shall prove insufficient  for this purpose, then the burden of such deficiency shall be equally borne by the Upper Basin and the Lower  ATTACHMENT A 2    the States of the Upper Division could be as high as 82.5 maf every 10 consecutive years. There is currently no agreed-upon procedure or accounting system in place to determine if a deficiency exists and, if one exists, how such a deficiency is quantified.4 For the illustrative purposes of this paper, the obligation of the States of the Upper Division at Lee Ferry is assumed to be 75 maf every 10 consecutive years. Article IV of the 1948 Upper Colorado River Basin Compact (1948 Compact) addresses how the Compact Commission, established by Article VIII, would determine each state’s obligation if it is ever necessary to curtail uses in the Upper Basin to meet the obligations of Article III of the 1922 Compact. The curtailment of Colorado River water uses in the States of the Upper Division would likely have a very significant and detrimental impact on the economy of the region and perhaps even threaten the health and safety of the region’s inhabitants dependent upon the river. This paper explores some of the management strategies and other options available to the States of the Upper Division to reduce the probability and impacts of a future curtailment.                                                                                                                                                                                                  Basin, and whenever necessary the States of the Upper Division shall deliver at Lee Ferry water to supply one half  of the deficiency so recognized in addition to that provided in paragraph (d).”     4This will not be an easy calculation; Article III (c) is an annual requirement, whereas Article III (d) is a ten‐year  requirement. Water users in the Lower Basin may argue that the obligation could be greater than 82.5 maf in 10  years if the States of the Upper Division have to make up for transit losses to Mexico.     ATTACHMENT A 3    ATTACHMENT A 4    II. BACKGROUND AND SETTING The Colorado River system within the United States drains about 242,000 square miles. Of that the Upper Basin drainage is approximately 110,000 square miles. The Upper Basin is a land of high deserts, canyons, plateaus and table mesas and the Rocky Mountains. Most of the river’s flow originates in the numerous high mountain watersheds located above 9,000’ in elevation. Within each of the States of the Upper Division, the Colorado River not only supplies water for municipal, industrial and irrigation uses within its natural drainage basin, its waters are also exported to the adjacent Platte, Arkansas, Rio Grande and Great Salt Lake Basins where it is an essential supply. The Lower Basin is a land of both low and high deserts, plateaus and canyons, but with only a few mountain watersheds over 9,000’. Like the Upper Basin, Lower Basin Colorado River water is exported out of the basin for use in coastal Southern California.5 At the time of the Colorado River Compact negotiations, the estimated mean natural flow of the river at the mouth was in the range of 20 to 22 maf per year and 17 to 18 maf per year at Lee Ferry. By the 1940s, the estimated mean natural flow at the mouth was 17.3 maf per year and 15.7 maf per year at Lee Ferry. Today, using tree ring-based, long-term reconstructions, the estimated long-term mean natural flow at Lee Ferry is in the range of 14.0 to 15.0 maf per year, which would equate to about 15.5 to 16.5 maf per year at the mouth. (See footnote 1.). Current System Uses Under the 1968 Colorado River Basin Project Act (1968 CRBPA), the Secretary of the Interior issues a report on consumptive uses and losses in the Colorado River system every 5 years.6 The first published report covered the period of 1971-1975. Based on the most recent information available from the Bureau of Reclamation (Reclamation) website, the following two tables summarize current consumptive uses in each basin.7                                                              5 In addition to the Metropolitan Water District’s Colorado River Aqueduct, the All American Canal delivers  Colorado River water from near Yuma to the Imperial and Coachella Valleys (Salton Sink).  Although the Salton Sink  does not currently drain to the Colorado River, many geologists consider it a part of the Colorado River Basin.  Over  the eons, the Colorado River has alternately drained either to the Gulf or into the Salton Sink.  Plate tectonics  created the rift. The Colorado River filled it with sediment, thus creating what we today call the Salton Sink.     6 82 Stat. 885 (1968). The requirement for the repot is in Section 601 (b).     7 The reports can be found at www.usbr.gov/uc. The latest final report available covers 1996‐2000. Provisional  data are available for 2001‐2007.   ATTACHMENT A 5    Upper Basin Consumptive Uses (in 1000s acre feet per year) Average 1996-2000 2001-2005 2006 2007 In-Basin Consumptive Use 2994 3030 2862 2900 Exports from the Basin 723 766 881 706 CRSPA Reservoir Evaporation 682 487 444 453 Total Uses 4399 4283 4187 4059 Lower Basin Consumptive Uses (in 1000s acre feet per year) Average 1996-2000 2001-2005 2006 2007 Mainstem Uses 7988 7713 7411 7454 Lower Basin Tributary Use 2508 2660 not available Reservoir Evaporation and 1321 1105 11008 10508 System Losses Total Uses 11,817 11,478 11,0619 11,0549 As the above two tables show, the total annual consumptive use of water in both the Upper Basin and Lower Basin was less in 2006 and 2007 than the average annual use for the previous 1996-2000 and 2001-2005 periods. In the Lower Basin during the 1996-2000 period Lake Mead was full and surplus water was available. California was using about 5.2 maf per year. However, beginning in about 2003, a basin-wide drought reduced available water supplies. California was forced to reduce its annual use of Colorado River water to its normal year apportionment of 4.4 maf. As Lake Mead levels dropped, reservoir evaporation was less. Within the Lower Basin, there is considerable controversy over the amount of tributary use. On Lower Basin tributaries some of the irrigation use attributable to Colorado River is likely groundwater.10 The total Lower Basin consumptive use of Colorado River system water, (including mainstem, tributary, and reservoir evaporation) is in the range of 10.8 to 11.3 maf per year.11                                                              8 The information is not yet available. I made these estimates based on 24‐month studies.   9 These estimates assume that Lower Basin tributary use, including storage was 2.5 maf in 2006 and 2007.   10 In each of the published Consumptive Uses and Losses reports, Reclamation has included a disclaimer that  within the Gila River Basin it is difficult to determine how much of the existing agricultural consumptive use is  attributable to groundwater vs. Colorado River water. Further, of the total groundwater use, some portion will be  tributary groundwater.   11 These numbers are consistent with the Colorado River Basin study Interim Report #1, USBR Jan 2011, see figure  C‐5. Total Lower Basin uses include approximately 27,000 acre feet per year of Lower Basin tributary use in New  Mexico and 140,000 acre feet per year of Lower Basin tributary use in Utah.  Similarly, Arizona is using about  37,000 acre feet per year within its portion of the Upper Basin.   ATTACHMENT A 6    Within the Upper Basin, the demand for Colorado River water has been relatively flat since the mid-1990s. Actual annual consumptive use varies based on local water availability, summer precipitation and water availability in adjacent river basins (which drives the demand for exports). The current total consumptive use in the Upper Basin, excluding reservoir evaporation, is in the range of 3.6 to 4.1 maf per year. Reservoir evaporation on the large system reservoirs such as Lake Powell varies with storage levels. Based on recent reservoir levels, 0.5 maf per year is a good estimate. Thus, total Upper Basin consumptive use is in the range of 4.1 to 4.6 million acre feet per year. Adding in 1.5 to 1.7 maf per year for Mexico, total Colorado River system consumptive use is currently in the range of 16.4 to 17.4 maf per year.12 Thus, the demand for water either exceeds or, at best, is about equal to the average annual supply. Deliveries at Lee Ferry The following graph shows the 10-year cumulative flow at Lee Ferry for the last 30 years (1981-2010). As the graph shows, 10-year flows have always been well in excess of the 75 maf minimum but in recent years have approached the 82.5 maf number.                                                              12 The normal year delivery obligation to Mexico is 1.5 maf per year, but with bypasses under Minute 242 and  inefficiencies in deliveries, actual deliveries range from 1.5 to 1.7 maf per year. The Drop 2 (Brock) Reservoir has  reduced, but not eliminated, over‐deliveries.     ATTACHMENT A 7    Present Perfected Rights Article VIII of the 1922 Colorado River Compact states: “Present perfected rights to the beneficial use of waters of the Colorado River System are unimpaired by this compact. Whenever storage capacity of 5,000,000 acre-feet shall have been provided on the main Colorado River within or for the benefit of the Lower Basin, then claims of such rights, if any, by appropriators or users of water in the Lower Basin against appropriators or users of water in the Upper Basin shall attach to and be satisfied from water that may be stored not in conflict with Article III. All other rights to beneficial use of waters of the Colorado River system shall be satisfied solely from the water apportioned to that Basin in which they are situate.” ATTACHMENT A 8    A common interpretation of this provision in the States of the Upper Division is that water rights that were perfected prior to approval of the compact cannot be curtailed to meet the obligations at Lee Ferry under Article III. The 1922 Compact minutes suggest that Article VIII was one of the most difficult and contentious provisions in the Compact. The minutes include numerous drafts of this article. The Commissioners and their advisors spent considerable time and energy word- smithing and discussing how it related to other provisions of the compact. The minutes suggest that there was little or no discussion or debate concerning the need to shield or insulate perfected rights from a curtailment under Article III. Rather, the focus was on how to address low flows on the Lower Colorado River below Lee Ferry and to protect upstream rights within in the entire basin against a priority claim (call) by downstream senior rights on the Lower Colorado, especially the Imperial Irrigation District (Imperial). The Commissioners considered several alternatives including a proposed provision in Article III (d) that would require an annual minimum flow of 4 maf per year at Lee Ferry in addition to the 10-year requirement of 75 maf.13 The States of the Upper Division can find comfort and support for their interpretation based on several comments included in the minutes. During the 25th meeting, R.T. McKisick, California’s legal advisor, made the following the statement: “The underlying reason for the clause as it now stands is precisely as you have stated it. Assuming that there are rights in the Lower River which must be satisfied, this Commission has no power to impair those rights.”14 The Commission fussed and bickered over the wording and intent of the phrase “present perfected rights.” Compact Chairman Herbert Hoover was concerned with “inchoate” rights and “the fact that these rights are likely to be dated as vesting at the time they are filed. We must at least make a declaration about perfected rights.”15 Commissioner Davis of New Mexico stated, “The very word that has been causing trouble is ‘rights.’ We have been having difficulty with vested rights. We thought by using the word ‘beneficial use’ we would get away from the word rights.”16                                                              13 Minutes of the 24th meeting of the Colorado River Commission, page 232. The Commission even considered and  rejected a proposal submitted by Imperial that would prohibit any upstream water rights with priorities junior to  Imperial from diverting water during the months of August, September, October and November. Under the  Imperial proposal, the monthly prohibition would have gone away with the construction of at least 5,000,000 acre  feet of upstream storage. Obviously, Imperial and its California allies were trying to use the Compact negotiations  as a means to gain political support for the construction of Boulder Canyon Dam (now named Hoover Dam).  The  concept of a 5,000,000 acre foot storage trigger survived and was included in Article VIII. The irony is that this  proposal would have exempted only one entity, the City of Denver. In 1922 Denver was not diverting any Colorado  River water but was considering its options.  Its first major Colorado River transmountain diversion, the Moffat  Tunnel Collection System, was perfected in the 1930s.   14 Minutes of the 26th meeting of the Lower Colorado River Commission, page 284.  15 Minutes of the 25th meeting of the Colorado River Commission, page 266.   16 Minutes of the 25th meeting of the Colorado River Commission, page 267.    ATTACHMENT A 9    Commissioner Delph Carpenter of Colorado suggested a broader definition for Article VIII that would include “unperfected rights,” but he did not have any support and appears to have dropped the idea.17 The disputed issues in Arizona v. California18 relating to “present perfected rights” are interesting. Section 6 of the 1928 Boulder Canyon Project Act (1928 BCPA) states “the dam and reservoir provided for by section 1 hereof shall be used: First, for river regulation, improvement of navigation, and flood control: second, for irrigation and domestic uses and satisfaction of present perfected rights in pursuance of Article VIII of  said Colorado River compact.”  (Emphasis added).   Imperial argued that its present perfected rights should be based on the decreed amount of its river diversion, but the Special Master in Arizona v. California said “No,” it is based on what has actually been diverted and used in the service area. The Special Master’s report and subsequent U.S. Supreme Court decree contain the following definitions:19 (G) “Perfected right” means a water right acquired in accordance with state law, which right has been exercised by the actual diversion of a specific quantity of water that has been applied to a defined area of land or to definite municipal or industrial works, and in addition shall include water rights created by the reservation of mainstream water for the use of federal establishments under federal law whether or not the water has been applied to beneficial use; (H) “Present perfected rights” means perfected rights, as here defined, existing as of June 25, 1929, the effective date of the Boulder Canyon Project Act;” It should be recognized that the Supreme Court decision in Arizona v. California was only interpreting the 1928 BCPA, not the 1922 Compact. For purposes of interpreting the 1922 Compact, it is possible that the parties or the Supreme Court could use the same date, June 25, 1929 or, alternately, the date the individual Commissioners signed the Compact, November 24, 1922. The date the 1922 Compact became effective under the 1928 BCPA is the date President Hoover declared the Act effective, June 25, 1929. The alternate argument is found in the Record of the Upper Colorado Basin Compact Commission which suggests that some basin officials believed the effective date under Article VIII of the 1922 Compact was                                                              17 Minutes of the 26th meeting of the Colorado River Commission, page 275.   18 364 U.S. 940, the lawsuit was initiated on August 13, 1952.   19  The Report of the Special Master is 364.U.S.940. The Decree is 376.U.S.340.  ATTACHMENT A 10    intended to be November 24, 1922. This date is incorporated into Article IV of the 1948 Compact. The following quote from Commissioner Charles Carson of Arizona is from the 7th meeting of the Upper Basin Commission in reference to a provision in Article IV of the 1948 Compact.20 “but to exclude from the calculation consumptive uses which existed prior to the 24th day of November 1922. That is the date the original compact was signed and it was thought that the then existing uses should be protected and that any curtailment would be made out of subsequent appropriations and uses.” For the States of the Upper Division, the inclusion of federal reserved rights in the definition of present perfected rights as it applies to the 1948 Compact, especially those held in trust by the United States for Indian tribes, raises a number of additional issues and challenges. How Indian reserved rights are addressed by the Upper Colorado River Compact Commission in the event of a curtailment is only one of several issues that will have to be resolved in the future. Assuming the effective date for present perfected rights under the 1922 Compact is November 24, 1922, there could be up to 2.3 maf of consumptive uses associated with present perfected rights in the States of the Upper Division. The minutes of the 6th meeting of the Colorado River Commission include a table that shows the amount of water “probably” used on acres irrigated as of 1920:21 State Acre Feet Wyoming 550,500 Colorado 1,110,000 Utah 538,500 New Mexico 68,000 Total 2,267,000 At least for Colorado, this “guess” is probably pretty good. In May 2007, then Deputy State Engineer Ken Knox estimated that the average consumptive use for the period of 1975-2002 for rights with priorities senior to November 24, 1922 was 1,027,553 acre feet per year.22                                                              20 Official Record of the Upper Colorado River Basin Commission, Volume II, 7th meeting, page 76.   21 Note (1) under the table states that “All data involve estimation in varying degree. The acre‐feet of past use are  in the nature of guess.”  There are no known estimates for domestic or industrial uses as of 1920.      22 Mr. Knox made his presentation at meeting of the four Colorado River Basin Roundtables. Copies of the  presentation are available upon request at the Colorado River Water Conservation District.   ATTACHMENT A 11    Articles III and IV of the 1948 Compact The apportionment and curtailment provisions of the 1948 Compact are found in Articles III and IV. Article III apportions the water available to the Upper Basin among the states. Arizona receives a fixed amount of 50,000 acre feet per year. The remaining water is apportioned to the four Upper Division states by percentage. Colorado receives 51.75%, Utah 23%, Wyoming 14%, and New Mexico 11.25%. The rules for implementation of curtailment are found in Article IV. “In the event curtailment of use of water by the States of the Upper Division at any time shall become necessary in order that the flow at Lee Ferry shall not be depleted below that required by Article III of the Colorado River Compact, the extent of curtailment by each State of the consumptive use of water apportioned to it by Article III of this Compact shall be in such quantities and at such times as shall be determined by the Commission upon the application of the following principles: (a) The extent and times of curtailment shall be such as to assure full compliance with Article III of the Colorado River Compact; (b) If any State or States of the Upper Division, in the ten years immediately preceding the water year in which curtailment is necessary, shall have consumptively used more water than it was or they were, as the case may be, entitled to use under the apportionment made by Article III of this Compact, such State or States shall be required to supply at Lee Ferry a quantity of water equal to its, or the aggregate of their overdraft of the proportionate part of such overdraft, as may be necessary to assure compliance with Article III of the Colorado River Compact, before demand is made on any other State of the Upper Division; (c) Except as provided is subparagraph (b) of this Article, the extent of curtailment by each State of the Upper Division of the consumptive use of water apportioned to it by Article III of this Compact shall be such as to result in the delivery at Lee Ferry of a quantity of water which bears the same relation to the total required curtailment of use by the States of the Upper Division as the consumptive use of Upper Colorado River System water which was made by each such State during the water year immediately preceding the year in which the curtailment becomes necessary bears to the total consumptive use of such water in the States of the Upper Division during the same water year; provided ATTACHMENT A 12    that in determining such relation the uses of water under rights perfected prior to November 24, 1922, shall be excluded.” Except to identify and discuss issues that are relevant to risk and risk management, a detailed analysis of Article IV is not the focus of this paper. Implementation of Article IV does not affect the probability of a future curtailment. The probability of a curtailment is based on the requirements of Article III of the 1922 Compact, the level of upstream depletions, and future hydrology. However, different interpretations of Article IV divide up the burden of curtailment among the four Upper Division states in different ways. For example, Article IV (b) is often referred to as the “10-year penalty box” provision. The policy intent of this provision is to put the first burden of a curtailment on the state or states that use beyond its/their apportionments under Article III of the 1948 Compact. The following is an example of how Article IV (c) might work. It is based on hydrology developed by the Bureau of Reclamation for the Environmental Impact Statement (EIS) for the Lower Basin shortage criteria and the coordinated operation of Lake Mead and Lake Powell. In this example the shortage at Lee Ferry is 877,119 acre feet.23 Total CU Apportionment Percentage of Amount Prior 10 Years (af) Actual Use Over/Under (af) Colorado 27,262,728 51.75% 56.32% +2,212,258 Utah 9,564,527 23% 19.76% -1,569,015 Wyoming 5,561,864 14% 11.39% -1,265,075 New Mexico 6,067,587 11.25% 12.53% + 621,833 Total 48,406,706 100% 100% 0 In this example, Colorado and New Mexico are over their apportionments while Utah and Wyoming are under their apportionments. Colorado’s overuse is 78% the total (Colorado plus New Mexico), thus Colorado would have to pay back .78 x 877,119 acre feet or 684,183 acre feet.24 New Mexico’s share of the overuse is 22% or 192,966 acre feet. Since Colorado and New Mexico’s overuse exceeded the shortage at Lee Ferry, Utah and Wyoming are not subject to any curtailment in this example. An alternate approach to Article IV (b) would be for the Commission to adopt development caps for each of the Upper Division states. Under this approach, each state would have a 10-year cap or perhaps an annual cap based on its apportionment and a reasonable assumption of future hydrology. The 10-year cap would be in acre feet of                                                              23 The data for this example are taken from an analysis of individual hydrology traces prepared for the shortage  criteria EIS, Appendix N.  These data are from a simulated period in the 1600s using the “direct paleo” option.  Because the demand data are provided by the states and Reclamation’s model does a reasonable job of simulating  river conditions, the example may be a good illustration of what might actually happen under similar hydrology.    24 If the actual shortage at Lee Ferry is 877,119 acre feet, it is likely that Colorado and New Mexico would have to  curtail more than that amount to make up for transit losses.    ATTACHMENT A 13    consumptive use, not a percentage. In the event of a curtailment, the 10-year penalty box would only be triggered if an individual state exceeded its approved 10-year or annual cap. Thus, if IV (b) is not applicable, all four states could have some curtailment obligation under Article IV (c). The advantage to this approach is that it might provide more certainty for the planning and management of projects within each state. The downside to this approach is that if a curtailment is to occur, it almost certainly will be caused by hydrology that is drier, or a different interpretation of the 1922 Compact Article III obligation than what was assumed by the Commission when it sets the 10-year or annual caps. A second concern is whether or not this approach is legal under the existing framework of the 1948 Compact. If not, would it require a formal amendment to the Compact?25 III. FUTURE RISK OF AND POTENTIAL IMPACTS FROM A CURTAILMENT Risk of a Curtailment As previously mentioned, the risk of future curtailment is a function of three variables: the actual obligations at Lee Ferry under Article III of the 1922 Compact; the level of future water use in the States of the Upper Division; and future hydrology within the Basin. Obligation at Lee Ferry under Article III Under Article III (d) of the 1922 Compact, the obligation of the States of the Upper Division is to not deplete flows at Lee Ferry below 75 maf over any consecutive 10-year period. The 75 million is not a delivery requirement because nature, and/or presumably pre-1922 Compact water rights, could deplete the flow below this amount without a violation of Article III (d). The wild card is how much, if any, is the obligation of the States of the Upper Division under Article III (c) for delivery of water to Mexico. Since the normal year U.S. delivery obligation to Mexico is 1.5 maf per year, 26 the Upper Basin’s share could be up to 50% (750,000 acre feet per year). It could be a little bit more, if the Upper Basin has to make up for transit losses.27 Thus, if the system deficiency over a 10-year period is 7.5 maf, the total obligation for the States of the Upper Division under Article III could be as high as                                                              25 The irony is that early in the negotiations for the 1948 Compact, the Upper Colorado River Basin Compact  Commission decided to apportion water by percentage as opposed to acre feet. They did so because of the  uncertainty in the available water supply. See Official Record of the Upper Colorado River Commission meeting 5,  pages 72‐85.   26 I used the term normal year, because the treaty with Mexico provides for a delivery of up to 1.7 million acre feet  per year under surplus conditions and allows the delivery of less than 1.5 million acre feet per year under  extraordinary drought and other emergency conditions.   27 Article III (c.) is confusing. Each basin shares equally in the deficiency.  This would imply that it includes Arizona’s  share of the Upper Basin, but the additional delivery obligation at Lee Ferry is limited to the States of the Upper  Division.   ATTACHMENT A 14    82.5 maf every 10 years. The obvious conclusion is the higher the obligation under Article III, the higher the probability of a future curtailment. Uncertainties with the delivery obligation to Mexico may also be a serious problem for the individual States of the Upper Division. For planning purposes, should Upper Division states plan an apportionment based on 75 maf or 82.5 maf or something in between? Should a state water project proponent be allowed to proceed with an individual project, if that project’s long term water supply is not available if the Lee Ferry obligation is 82.5 maf every 10 years, but available if the obligation is 75 maf?28 The Level of Future Development Again, the obvious answer is the higher the level of depletions by the States of the Upper Division, the higher the probability of a future curtailment. From the perspective of the Lake Powell and the Lee Ferry gage, the impact of an upstream depletion of an acre foot is identical is to a reduction in basin yield of an acre foot. The real questions are related to the level and pace of new development. Water use in the States of the Upper Division has been relatively consistent since the early 1990s.The following graph shows annual Upper Basin consumptive use from 1971-2007 less evaporation on the large federal reservoirs. The graph shows actual annual consumptive use, a 10-year moving average, and a trend line. The graph clearly shows that from the early 1970s to the early 1990s, annual consumptive use was steadily increasing. Since the early 1990s, the trend line is still increasing, but at a slower rate. The ten year moving average has essentially been flat for the last decade.                                                              28 A related question is how or could an individual project proponent finance a project with this legal uncertainty  remaining?  Would the bond market require resolution of this issue before bonds could be sold?   ATTACHMENT A 15    There are probably a variety of reasons for the flattening trend line. The last major transmountain diversions and new irrigation projects were completed in the late 1980s. Within Colorado, the Windy Gap Project was the last new transmountain diversion project. It was completed in 1985, but its use was small until 2001. The last two traditional irrigation projects, the Dallas Creek and Dolores Projects, were completed in the late 1980s and early 1990s. Within western Colorado, urbanization of the lower valleys and resort growth in the higher mountain valleys may be replacing irrigated agriculture with less consumptive uses. Additionally, a number of the major municipal providers have implemented successful conservation programs. I’m also a little suspicious that nature helped flatten the trend line. The 1990s, especially the late 90s, were relatively wet, with decent summer precipitation and relatively abundant local water supplies. This was followed by the very dry decade of 2000-2010 where consumptive uses were often limited by a lack of local water availability, thus physical water supply limited total consumptive use. There are a number of reasons to believe that this flat trend may be ending and the consumptive use of Colorado River water by the States of the Upper Division will start growing again. Within Colorado, both Denver Water and the Northern Colorado Water Conservancy District’s Municipal Subdistrict are in the final stages of completing the ATTACHMENT A 16    permitting of expansions to existing transmountain diversion projects. In southwestern Colorado, the Animas-La Plata Project was recently completed, albeit with limited present demands. Within Colorado, a statewide water planning/consensus-building process is underway.29 Studies show that Colorado may have a large future need for water to meet growth throughout the state. While Colorado is a long way away from reaching any public consensus or even identifying candidate projects, one of the primary goals of many of the process participants is to obtain public support for new transmountain diversions. The State of Utah is in the process of permitting a pipeline from Lake Powell to the St. George area. This pipeline would divert about 90,000 to 100,000 acre feet per year. From the perspective of the Lee Ferry obligation, the project would be 100% consumptive because St. George is located in the Lower Basin, not the Upper Basin. In New Mexico’s San Juan Basin, the focus is on implementation of the water settlement with the Navajo Nation. If funding is available, implementation of the settlement will increase New Mexico’s consumptive use of Colorado River water. The wild card in Colorado, Utah and possibly Wyoming is the future demand for water by the energy industry, specifically oil shale. The Upper Colorado River Basin is home to large deposits of oil shale. However, after decades of research and development, it is still unclear whether or not oil can be recovered on an economically feasible, commercial- scale basis. If such an industry is ever successfully developed, it would require significant amounts of water. The estimates vary based on the type of technology used, but most studies suggest that an industry with a production capacity of a million barrels per day could use in excess of 200,000 acre feet per year.30 A recent GAO study concluded: “Water is likely to be available for the initial development of an oil shale industry, but the size of an industry in Colorado or Utah may eventually be limited by water availability. Water limitations may arise from (an) increase in water demand from municipal and industrial users, the potential of reduced water supplies from a warming climate, fulfilling obligations under interstate water compacts, and the need to provide additional water to protect threatened and endangered fishes.” In addition to oil shale, the Upper Colorado River Basin contains numerous other potential energy sources. The potential demand for water varies from relatively small                                                              29 C.R.S. 37‐75‐101, “Colorado Water for the 21st Century Act,” AKA, “the Colorado Roundtable/IBCC process.”   30 The most recent study is by the GAO, “Energy‐Water Nexus A Better and Coordinated Understanding of Water  Resources Could Help Mitigate the Impacts of a Potential Oil Shale Development.”  GAO‐11‐35, October 2010.  The  table on page 35 suggests that a 1,000,000 barrel per day industry would use an average of 235,000 acre feet per  year.   ATTACHMENT A 17    amounts for natural gas production to over 50,000 acre feet per year for a proposed nuclear power plant near Green River, Utah.31 Impact of Climate Change on Future Depletions Even if there are no additional future projects, climate change could significantly increase the consumptive use associated with existing agriculture, residential lawns and municipal parks and open spaces. As temperatures rise, the growing season lengthens and plant evapotranspiration goes up increasing total crop water demands. The Phase I report, public draft, of the Colorado Water Conservation Board’s (CWCB) Colorado River Water Availability Study (CRWAS), included an estimate of crop irrigation requirements (CIR) under different climate models for 2040 and 2070.32 If sufficient additional water is physically available for the plants, then CIR could go up by approximately 20% by 2040. This would increase Colorado’s consumptive use from 136,000 to 506,000 acre feet per year with an average of 350,000 acre feet per year by 2040. Due to comments on the draft report, similar numbers for 2070 are under review and may be revised.33 The preliminary results show that the projected 20% increase in CIR in 2040 could go up to 31% by 2070.34 This suggests that increased demand from climate change in the Colorado River Basin within Colorado could be more than 500,000 acre feet per year. Information presented in Interim Report #1 of the Colorado River Basin Water Supply and Demand Study (Colorado River Basin Study) shows similar results and may validate the CRWAS results. Appendix C includes a table that shows a table of expected increase in CIR vs. temperature increase. For the Upper Basin a 4 degree (F) increase in the average temperature would increase CIR by about 20%.35 There are a number of possibilities that may discount or mitigate this potential increase. The projected temperature increases may be overstated.36 Even if the temperature increase does occur, the irrigation water may not be physically available. Late season irrigation water may not be available because of decreased base-flows, and reservoirs                                                              31 “Water Grab for Proposed Green River Nuclear Power Plant Raises Eyebrows” by David O. Williams, October 21,  2009.  Accessed on www.thecoloradoindpendent.com on December 10, 2010.   32 Colorado River Water Availability Study, DRAFT Phase I Report, March 22, 2010, AECOM, prepared for the  Colorado Water Conservation Board. Table 3‐4, pages 3‐13.   33 Ibid. The 2070 issue with the study center on whether or not the five individual GCM models used for the 2070  analysis skew the 2070 results toward the dry end.  See pages 2‐26 through 2‐28 of the study for more details.   34 Ibid.  Table‐C2, page 3‐17.   35 Interim Report No. 1 Colorado River Basin Water Supply and Demand Study, U.S. Department of the Interior,  Bureau of Reclamation, June 2011. Appendix C4, Climate Change Effects on Colorado River Basin Irrigation  Demands, Technical Memo 86‐68210‐2010‐3, July 2010.   36 I believe that it is probably true that we’ve oversold what climate models can tell us about future climate  conditions in the Colorado River Basin. Unfortunately, most of the uncertainty is related to future precipitation.  There is much more confidence in the model results for future temperatures.   ATTACHMENT A 18    designed for shorter growing seasons will have insufficient capacity for a longer season. And finally, urbanization and resort growth will continue to displace agricultural lands throughout the Upper Basin, possibly reducing consumptive use. Future Hydrology At the time the 1922 Compact was being negotiated, the negotiators had a very limited and crude understanding of the hydrology of the Colorado River. The first true gages were not installed until the 1890s. The gage at Lee Ferry was not installed until late 1921. The hydrology data as of 1922 were based on a very short period-of-record and only a few stream gages. As luck would have it, the available data covered what we now recognize as an unusually wet period. By the late 1940s, Reclamation and the USGS had installed more gages, and sufficient hydrology work had been done so that the negotiators of the 1948 Compact had a little better understanding of the river hydrology. This better understanding of the Colorado River hydrology dictated the apportionment by percentage approach in Article III. In the 1970s, through the use of tree ring-based techniques, paleo-hydrologists began expanding the record of flows back to about the 15th century.37 Since then, a number of additional tree ring-based studies and stream flow chronologies have been published. One recent study extended the Lee Ferry record back to 762 A.D.38 These paleo-reconstructions, while not perfect, have given us a much richer picture of the long-term (1,000 year+) history of the Colorado River. I believe that it is fair to conclude that based on the paleo-record, the 20th century was relatively wet. The 20-year period prior to the negotiations of the 1922 Compact was very wet. The two most significant droughts of the 20th century, 1931-1940 and 1954-1965, were relatively mild. Finally, it is too soon to make any conclusions concerning the 11-year dry period from 2000-2010. Despite 2011 being a well above-average year, the drought period that began in 2000 may not yet be over. There have been numerous studies addressing the potential impact of climate change on the Colorado River System. Most studies suggest that the Colorado River at Lee Ferry will see a reduction in future flow as the earth warms.39 The magnitude of the reduction in flow ranges from about 5% to 20% or more by 2070.40 However, there are a number of cautions. First, there are significant uncertainties in the modeling process, especially with                                                              37 The first comprehensive report was published by Charles Stocton and Gordon Jacoby, “Long Term Surface‐Water  supply and Stream Flow Trends in the Upper Colorado River Basin, Lake Powell Research Project,” Bulletin #18 in  1976.   38 Meko, D.M., C.A. Woodhouse, C.A. Baisan, T. Knight, J.J. Lukas, M.K. Hughs, and M.W. Salazar.  “Medieval  drought in the Upper Colorado River Basin.”  Geophysical Research Letters 2007 34(5). For a comprehensive list of  reconstructions, see http://treeflow.info   39 Executive Summary, Climate Change in Colorado, A Synthesis to Support Water Resources.  A report for the  Colorado Water Conservation Board, Western Water Assessment and the University of Colorado at Boulder 2008.   40 Ibid. Table 5‐1, page 37.   ATTACHMENT A 19    the impact of climate change on precipitation. Second, the resolution of most of the current global circulation models (GCMs) is no better than 100x100 kilometers, so we do not yet really understand the impact of topography on future precipitation. 41 From the perspective of the risk of a future curtailment, the conclusions are simple and straightforward. As climate change raises global and regional temperatures, the risk of future curtailment is much higher. The risk in the near future, through about year 2020 or 2025, appears to be relatively low. After 2020 to 2025, the risk increases at an increasing rate. The following graph shows the concept of the risk increasing into the future under different scenarios.42 The lower curve shows that there is an increasing risk of curtailment in the future even if future hydrology is similar to 20th century hydrology. The small increase in risk is due to additional Upper Basin depletions and the reality that the paleo-record suggests droughts                                                              41 Ibid, page 16.  42This graph is patterned after specific graphs shown in “Water Supply Risk on the Colorado River: Can  Management Mitigate?” Rajagopalan, et.al. Water Resources Research, June 2009.   ATTACHMENT A 20    are possible that are drier and longer in duration than the gage record, even in absence of climate change. The middle curve represents a future with moderate increase in temperature. The upper curve represents a future where temperature increases and stream flow decreases are at the upper end of that projected by recent studies. In summary, a high risk scenario for a future curtailment would look like the following: Obligation at Lee Ferry: 82.5 maf every 10 years. Future Level of Development: Regional population growth will require significant new out-of-basin exports. In-basin energy development also requires significant new water supplies. Climate Change: Increased temperatures reduce available stream flow AND increases the water requirements (CIR) for for existing crops, lawns and parks. Alternately, a low risk scenario would look like the following: Obligation at Lee Ferry: 75.0 maf every 10 years. Future Level of Development: The demand for future out-of basin exports is low. Oil shale is not economically viable, thus energy water uses are small. Climate Change: The next century is similar to the 20th century, no real change in regional temperatures or hydrology. Other Hydrologic Issues Two other hydrologic factors could influence the future risk of a curtailment. The first is the impact of dust on the mountain snowpack.43 The second is the widespread impact of beetle kill on Upper Colorado River watersheds. The dust on snow study suggests that the reduced system yield caused by dust is in the range of 750,000 acre feet per year. There may be opportunities to improve future Colorado River flows through dust mitigation strategies. However, I believe mitigation will be difficult to implement. The impact of beetle-devastated forests on the Colorado River system yield is not well understood and needs more study but will also be very difficult and expensive to meaningfully mitigate.                                                              43 “Response of the Colorado River runoff to dust radiative forcing in snow.” Thomas H. Painter, Jeffery S. Deems,  Jayne Belnap, Alan F. Hamlet, Christopher C. Landry and Bradley Udall, Proceedings of the National Academies of  Science, September 2010.    ATTACHMENT A 21    Impacts of a Curtailment on the States of the Upper Division It is important to understand that it would take a significant and prolonged drought period just to get to a possible curtailment. The most likely conditions that would trigger a curtailment are as follows:  In years 1 through 9, there has been a prolonged dry period in the Upper Basin. Storage at Lake Powell would be below minimum power head, thus no hydroelectric power production. The flow at the Lee Ferry gage for the nine-year period is right at, or perhaps just a little bit more than, 67.5 maf. The upstream federal and non-federal reservoirs are all seriously depleted. Major municipal water providers throughout the Basin have all been requiring strict conservation for at least the last several years.  Year 10 is another dry year with forecasted inflow at Lake Powell well below 50% of average. Based on its 24 month study, Reclamation determines the inflow to Lake Powell will be insufficient to maintain the hydraulic head behind Glen Canyon Dam at the elevation needed to release 7.5 maf at Lee Ferry during year 10.44 At this point (and assuming all of the legal issues have been settled), the Upper Colorado River Commission (UCRC) would determine the amount of upstream curtailment necessary to keep the elevation of Lake Powell at sufficient head to deliver the necessary amount through the Glen Canyon Dam.45As prescribed by paragraph IV of the 1948 Compact, the Commission would apportion the curtailment among the states. How the curtailment would actually be handled within each state would vary. My theory is that it will take a relatively large shortage amount, on the order of 250,000 to 500,000 acre feet or more, to actually force a curtailment. For smaller amounts, the most probable outcome is a negotiated agreement to put off the curtailment for a year.46 A one-year curtailment could turn into a multi-year curtailment if the hydrology stayed dry. It is even possible that the curtailment “hole” would keep getting bigger until a very wet year or number of years restored the 10 year flow. As previously stated, once the UCRC determines the amount each Upper Division state must deliver to Lee Ferry, curtailment of actual water use is the job of the different state water administrators. While each of the States of the Upper Division uses the doctrine of prior appropriation, there are technical and administrative differences among the states.                                                              44 To make 7.5 million acre feet per year requires a flow of 625,000 acre feet per month, which for a 30 day month,  is approximately 10,500 cfs.   45 This is not the only scenario. The states might insist that Reclamation alter the dam to increase its discharge  capacity (where is Dr. Ingebretson when we need him?).  46 In my view, the effort and brain damage, including dangerous litigation necessary to force and then implement a  curtailment would politically outweigh the benefit of a small scale curtailment.   ATTACHMENT A 22    From a Colorado perspective, there are a number of critical curtailment administrative issues that have not been resolved.47 One of these issues is how to address post-1922 storage that was carried over into a curtailment year. It raises the difficult junior-junior vs. senior-junior issue. For example, assume you have a 1940 direct flow right (senior-junior) and a 1970 storage right (junior-junior). Both rights are junior to the 1922 Compact and are subject to a curtailment. In the curtailment year, the 1970 storage right has 50,000 acre feet of water in it that was stored in priority in years 1 through 9. Under a curtailment in year-10, should the State of Colorado require the release of the 50,000 acre feet of junior-junior (1970) stored water before curtailing the senior-junior (1940) direct flow right? From my perspective, there is no easy answer to this question. If the state determines that the previously, lawfully stored water should not be curtailed, it could be denying the senior- junior the benefit of its priority. On the other hand, if it releases water the junior-junior right stored, it would be depleting a valuable and flexible drought resource.48 Impacts of a Curtailment to Water Use If a sufficiently large curtailment were to occur, Colorado’s use of Colorado River water would be limited to its pre-1922 Compact rights and perhaps carryover storage. Not counting its share of federal reservoir evaporation, Colorado is currently consuming about 1.9 to 2.3 maf per year, thus Colorado would have to get by with about one half of its normal Colorado River water supply. In contrast, Colorado’s consumptive uses in the two worst drought years, 1977 and 2002, were 1.6 maf and 2.1 maf, respectively.49 The task of surviving a curtailment year with only 50% of what was used in 2002 would be an extreme challenge. The impacts to individual users would vary significantly. For example, a number of West Slope towns such as Glenwood Springs and Grand Junction have significant pre-1922 Compact rights. However, most communities have a mix of pre- and post-1922 Compact rights. Within Colorado, almost all of the major transmountain diversions and most newer communities, special districts and industrial plants use post-1922 Compact water rights. For the major, municipal transmountain diverters such as Denver Water and Colorado Springs, the situation is more complicated because these cities have water portfolios with imported Colorado River supplies and in-basin (South Platte or Arkansas River) supplies, the impact of a curtailment in these cities could be mitigated if their in-basin Front Range supplies were abundant. The impact could also be aggravated because transmountain                                                              47 In early 2011, the Colorado Water Conservation Board (CWCB) and State Engineer’s Office commenced a  Colorado River Compact Compliance Study.  Because of the future potential for litigation, the state anticipates that  portions of this study will not be available for public review.    48 This is only one of a number of thorny junior‐junior vs. senior‐junior issues.  I expect that eventually either the  Colorado Legislature or the Colorado Supreme Court may have the final say (at least in Colorado).   49 The consumptive use number for 2002 is somewhat misleading, to survive 2002, reservoir storage filled with  runoff from previous years was drawn down throughout the state, meaning more water was consumed than was  physically available in 2002 absent storage.    ATTACHMENT A 23    sources are reused through exchanges and recycle plants. The safest assumption is that under climactic conditions that would trigger a Colorado River curtailment, local South Platte and Arkansas River supplies would also be severely stressed, and, thus, the impacts of a curtailment would be very serious. In the other three States of the Upper Division, the impacts of a curtailment would also be serious. There are important transmountain diversions serving Albuquerque, Santa Fe, Cheyenne and the Wasatch Front as well as a number of large in-basin power plants and other critical uses that utilize post-1922 Compact rights. Economic Impacts of a Curtailment on the States of the Upper Division There is not much research available on the economic impacts of a curtailment. The October 1995 Severe and Sustained Drought study50 included a chapter on the “Hydrologic and Economic Impacts of Drought under Alternative Policy Responses,” written by James F. Booker. Although the study covers the entire basin and did not specifically model a curtailment (it did so by assumption), the impacts are still significant. The study suggested a marginal damage of $1,200/acre foot for Colorado Front Range cities. Therefore, a loss of 450,000 acre feet would result in an economic loss of $540 million (in 1992 dollars).51 Booker also concludes that from an Upper Colorado River Basin perspective, the economic impacts from hydropower and recreation would also be very significant, exceeding $500 million per year (in 1992 dollars).52 IV. UPPER BASIN STRATEGIES TO MINIMIZE THE RISK AND IMPACTS OF A CURTAILMENT There are four basic approaches, all interwoven, that the States of the Upper Division could use to minimize the risk of a curtailment. 1. The first approach is to optimize the use of the available storage reservoirs built pursuant to federal legislation to meet the Article III obligations. This optimization almost certainly will include studying whether additional storage, either through the construction of new units, or the expansion of existing units, would be beneficial. 2. The second approach is litigation. Litigation could be used by the Lower Division states to force a curtailment or by the Upper Division states to prevent one. The most common answer given to the question “when will the States of the Upper Division face a curtailment,” is “when the Supreme Court says so.” It is not the purpose of this paper to discuss the legal issues in great detail. I will focus on the policy and management decisions related to litigation as a risk                                                              50 “Severe and Sustained Drought in the American Southwest,” Water Resources Bulletin American Water  Resources Association, October, 1995.   51 Ibid, page 897.   52 Ibid, page 898.  ATTACHMENT A 24    management tool. In theory, decisions to litigate will be made by elected officials and policy boards (the clients) with input and advice from water agency managers, engineers and legal advisors. The issue of litigation risk will be an important decision factor. 3. The third approach is for the individual States of the Upper Division to develop curtailment compliance and contingency plans. I expect that these plans would first try to avoid a curtailment, but if that was impossible, the plans would make use of each state’s pre-1922 Compact rights and any available storage. An intriguing possibility is that two or more of the Upper Division states could join forces and develop a joint curtailment contingency plan. For this to occur there would have to be a clear advantage to each of the participating states. 4. The final approach is for the seven basin states and the United States to negotiate and implement alternative institutional governance arrangements or joint projects that would expand water supplies throughout the Basin reducing the risk of a curtailment on the States of the Upper Division. In fact, the current 2007 Interim Guidelines, which expire in 2026, contemplate that negotiations to possibly extend them will commence in 2019. I expect negotiations will actually start much sooner. These alternative arrangements could either be interim in nature or permanent changes to components of the Law of the River.53 Use of Storage to Minimize Risk The development and use of water storage upstream of Lee Ferry is the primary operational tool for managing the obligations of the States of the Upper Division at Lee Ferry and thus managing risk. The negotiators of the 1922 Compact believed that storage upstream of Lee Ferry would be developed and were aware that a high dam at Glen Canyon was feasible and would be of great value in regulating the flow of the Colorado River at Lee Ferry.54 In 1956, Congress passed the Colorado River Storage Project and Participating Projects Act (1956 CRSPA).55 The 1956 CRSPA authorized the construction of four major storage reservoirs in the Upper Basin: Glen Canyon Dam and Reservoir (Lake Powell); Flaming Gorge Dam and Reservoir; Navajo Dam and Reservoir; and the three-reservoir Aspinall Unit, of which, Blue Mesa Reservoir is the primary storage reservoir. These reservoirs have a combined live storage of over 30 maf.56 One of the primary purposes of the 1956 CRSPA is “making it possible for the States of the Upper Basin (sic) to utilize, consistently with the provisions of the Colorado River                                                              53 The various compacts, international treaties, federal and state statutes and court decrees that govern Colorado  River water use are collectively referred to as the “Law of the River.”   54 Russell Martin, “A Story that Stands Like a Dam,” 1989. See Chapter Two  55 70 Stat. 105 (1956).   56 61st Annual Report of the Upper Colorado River Commission, page 30. Under Reclamation terminology, live  storage is the amount of water above the outlet tubes. Active storage is the amount of water above the minimum  power intake. Active storage is normally less than live storage.   ATTACHMENT A 25    Compact, the apportionments made to and among them in the Colorado River Compact and the Upper Colorado River Basin Compact.” Of the four storage reservoirs, Lake Powell is by far the largest and most important. As a practical matter, Lake Powell was built to meet the 1922 Compact obligations of the States of the Upper Division at Lee Ferry. Two of the three upstream reservoirs, Flaming Gorge and Blue Mesa, are primarily operated for local river regulation, endangered species recovery needs and power generation. Navajo Reservoir is used to meet downstream water needs in New Mexico and endangered species’ needs. In the face of a curtailment, the potential role of the three upstream storage reservoirs is not well understood, and there are a number of unresolved issues. In a curtailment year, carryover storage would be a very valuable resource. To the extent that upstream 1956 CRSPA storage reservoirs have state priorities, the priorities are relatively junior (1950s and 1960s). Thus, in a larger curtailment year, it is unlikely that these reservoirs would be able to store any water, but there could be some water in storage carried over from previous years. Under curtailment conditions, how would the Secretary of the Interior dispose of this water? If it is under contract, would it be delivered to contract holders or could it be withheld for delivery to Lake Powell and subsequently to Lee Ferry? Should individual water districts or states be allowed to contract for this water with the intent that if a curtailment were to occur, the water would be released for the sole benefit of the contract holder? These are questions that need to be addressed by the individual states, the UCRC and the Department of the Interior/Bureau of Reclamation. Section 602 (a) of the Colorado River Basin Act (1968 CRBA) While the passage of 1956 CRSPA resulted in the construction of the four CRSPA storage reservoirs, it provided little guidance on the specific operation of the reservoirs, specifically Lake Powell. During the period that the Bureau of Reclamation was completing construction of the Glen Canyon Dam and beginning the slow fill of Lake Powell, the seven Colorado River Basin states were negotiating with each other and Congress for passage of the Colorado River Basin Project Act (1968 CRBPA). Among other things, the 1968 CRBPA authorized the Central Arizona Project (CAP),57 a number of participating projects in the Upper Basin, and reauthorized the Dixie Project in Utah. The 1968 CRBPA also provided Congressional direction to the Secretary of the Interior on the coordinated operations of the Colorado River projects developed under all three major development acts: the 1928 BCPA; the 1956 CRSPA; and the 1968 CRBPA. The Upper Division states’ representatives were concerned that Lower Basin interests would use Article III (e) of the 1922 Compact to interfere with the storage and operation of Lake Powell. Article III (e) states:                                                              57 The 1963 Supreme Court decision in Arizona v. California confirmed there was a mainstem water supply  available for the CAP, but California recovered some of what it lost by using its political power to make the CAP  junior to California’s uses.   ATTACHMENT A 26    “(e) The States of the Upper Division shall not withhold water, and the States of the Lower Division shall not require the delivery of water, which cannot reasonably be applied to domestic and agricultural uses.” The concern was that the Lower Basin would claim that Lake Powell storage was “withholding water” that could not be used, thus they insisted on section 602 (a). It requires the Secretary of the Interior to prepare coordinated long range operating criteria, and set priorities for the release of water from Lake Powell. Those priorities as identified in the legislation are as follows: (1) releases to supply one-half the deficiency described in article III (c) of the Colorado River Compact, if any such deficiency exists and is chargeable to the States of the Upper Division, but in any event such releases, if any, shall not be required in any year that the Secretary makes the determination and issues the proclamation specified in section 202 of this Act; (2) releases to comply with article III (d) of the Colorado River Compact, less such quantities of water delivered into the Colorado River below Lee Ferry to the credit of the States of the Upper Division from other sources; and (3) storage of water not required for the releases specified in clauses (1) and (2) of this subsection to the extent that the Secretary, after consultation with the Upper Colorado River Commission and representatives of the three Lower Divisions states and taking into consideration all relevant factors (including, but not limited to, historic stream-flows, the most critical period of record, and probabilities of water supply), shall find this to be reasonably necessary to assure deliveries under clauses (1) and (2) without impairment of annual consumptive uses in the upper basin pursuant to the Colorado River Compact: Provided, that water not so required to be stored shall be released from Lake Powell: (i) to the extent it can be reasonably applied in the States of the Lower Division to the uses specified in article III (e) of the Colorado River Compact, but no such releases shall be made when the active storage in Lake Powell is less than the active storage in Lake Mead, (ii) to maintain, as nearly as practicable, active storage in Lake Mead equal to the active storage in Lake Powell, and (iii) to avoid anticipated spills from Lake Powell. ATTACHMENT A 27    With paragraph (3), the States of the Upper Division got Congress to define the rules for delivery to the Lower Basin under Article III (e). As a practical matter, 602(a) set a trigger elevation in Lake Powell. When storage in Lake Powell is below the trigger, the States of the Upper Division are at an increased risk that there is insufficient water in storage to meet future obligations under Article III (c) and III (d) of the 1922 Compact. Calculation and Impacts of 602 (a) The formula for the calculation of 602(a) levels was included in Appendix A of the “Draft EIS for Colorado River 2007 Interim Guidelines for Lower Basin Shortages and Coordinated Operations for Lake Powell and Lake Mead.” The formula is as follows: 602(a) = {(UBDepletion + UBEvap)* (1 – percentShort/100) + minObjRel- criticalPeriodInflow} * 12 + minPowerPoolStorage where: 602(a) = the 602(a) storage requirement UBDepletion = the average over the next 12 years of the Upper Basin scheduled depletions UBEvap = the average annual evaporation loss in the Upper Basin (currently set to 560kaf) percentShort = the percent shortage that will be applied to Upper Basin depletions during the critical period (currently set to zero) minObjRel = the minimum objective release to the Lower Basin (currently set to 8.23 maf) criticalPeriodInflow = average annual natural inflow into the Upper Basin during the critical period (1953-1964) (currently set to 12.18 maf) minPowerPoolStorage= the amount of minimum power pool to be preserved in Upper Basin reservoirs (currently set to 7.179 maf) This formula has been in use for several decades. However, neither the Upper Colorado River Commission nor any of the Lower Divisions states have formally agreed to its use. In 2004, the Secretary of the Interior adopted an interim 602(a) storage guideline at 14.85 maf in Lake Powell (elevation 3630’ msl) on September 30th. This guideline was only effective through 2016. As a part of the adoption of the Colorado River 2007 Interim Guidelines for Lower Basin Shortages and the Coordinated Operations for Lake Powell and Lake Mead (2007 Interim Guidelines), the seven states negotiated a table of ATTACHMENT A 28    “equalization” levels.58 The term “602(a)” was specifically avoided.59 This table supersedes the 14.85 maf figure and will be used through 2026. The states avoided the term “602(a)” because discretion and judgment (and thus disagreement) are necessary to set almost every variable in the 602(a) formula. For example, should the minimum objective release be 7.48 maf/year, 8.23 maf/year60, or something else? Should the critical period inflow be based on 1953-1964, 1988-2009, or a more severe drought period from a paleo-hydrology study? Should climate change be considered? Should the percent shortage and minimum power pool variables even be included in the formula? The following graph plots 602(a) levels against Upper Division depletions under three different critical periods.                                                              58 Secretary of the Interior, December 13, 2007, Record of Decision.  59 The coordinated operation for Lake Powell and Lake Mead put forth an interim operation of the two reservoirs  that was much more sophisticated than previous operations or the intent of section 602 (a). These interim  guideline interim criteria sunsets in 2026.   60 The releases for Glen Canyon Dam are set at 7.48 maf or 8.23 maf because the assumption is that the Paria  River, an Upper Basin tributary that flows into the Colorado River below Glen Canyon Dam, will provide 20,000  acre feet – making the total 7.50 or 8.25 maf. In reality, because of leakage around the dam, an annual release of  8.23 maf results in a flow of about 8.4 maf.   ATTACHMENT A 29    The graph clearly shows that 602(a) levels go up steeply as depletions increase. From a risk management perspective, the States of the Upper Division want the 602(a) assumptions to be as conservative as possible. Ironically, the minimum objective release variable runs counter to other interests within each basin. A minimum release of 8.23 maf /year results in a 602(a) level 9 maf higher than a release of 7.50 maf/year (based on a 12- year critical period). Yet based on their view of the Mexican Treaty obligation, the States of the Upper Division believe that 8.23 maf is not justified. For the States of the Lower Division, 8.23 maf/year is the appropriate minimum objective release, but using a 7.50 figure in the 602(a) calculation and the 1953-1964 critical period would result in a lower 602(a) level. At current depletion levels equalization would occur just about every time storage in Lake Powell was greater than Lake Mead. Future Debate over 602(a) While the 2007 Interim Guidelines are in place, the debate between the Upper Division states and Lower Division states has been temporarily postponed. However, in 2019 or so, when the states resume negotiations, or if the 2007 Interim Guidelines agreement implodes, 602(a) could resurface as a very contentious issue. ATTACHMENT A 30    In such a circumstance, the Upper Division states would negotiate to maximize the protection accorded by 602(a), and the Lower Divisions states would negotiate for maximum equalization releases. In the longer run, if depletions in the States of the Upper Division approach or exceed 5 maf per year and/or climate change or natural variability provides a longer and drier critical period, 602(a) approaches or exceeds the available 1956 CRSPA storage capacity. If this were to occur, Lake Powell would either be operated to deliver the required minimum release or (in wet years) to avoid uncontrolled spills. How Reclamation operates Lake Powell to avoid uncontrolled spills becomes a critical issue. Since flooding damaged the Glen Canyon Dam emergency spillways in 1983-1984, Reclamation has been very conservative when operating Lake Powell at elevated storage levels. Would Additional Storage in the Upper Basin Dedicated to Compact Protection Reduce Risk? The first question many water and political officials in the Upper Division states ask is “could additional storage reduce the risk of a future curtailment?” As we move forward, this question has to be studied, and policy makers throughout the basin need to understand the results. I would split this question into two components: Can existing storage projects be re- operated or modified to provide additional compact curtailment protection? And, would the construction of new storage provide additional compact curtailment protection? Can Existing Storage Projects be Re-operated or Modified to Provide Additional Protection? The first question to consider is can the upstream 1956 CRSPA storage reservoirs (Navajo, Flaming Gorge and Blue Mesa) be operated in a manner that reduces the risk of a future curtailment? Are there options for operating these projects in a coordinated manner with the operation of Lake Powell to minimize the future risk of a curtailment? To date, the operational focus on the three upstream 1956 CRSPA reservoirs has been endangered species and power generation (except Navajo) and local supply issues. To my knowledge, there has been no detailed study on how these reservoirs could be used to manage compact risk. A second major question is whether or not Glen Canyon Dam operations might be modified to increase its effective capacity. As mentioned previously, Reclamation operates Glen Canyon very conservatively to avoid uncontrolled spills. This restriction has not been an issue recently for two reasons. First, 602(a) or “equalization” levels are currently much less than the reservoir’s capacity. Secondly, actual storage in Lake Powell has not approached 20 maf for over a decade. However, in the future, if Lake Mead and Lake Powell refill, or if upstream depletions and/or critical hydrology results in a 602(a) level that exceeds 22-23 maf, then this conservative operation could limit the compact protection provided by Lake Powell. ATTACHMENT A 31    As a practical matter, this would involve studying whether or not the spillways can be modified or otherwise operated in a manner where Reclamation is more comfortable operating Lake Powell at higher storage levels. The study would also have to consider the impact of uncontrolled spills on the environmental resources downstream of Glen Canyon Dam. Would the Construction of New Storage Provide Additional Compact Protection? The question of whether or not additional storage could reduce the risk of a curtailment on the States of the Upper Division has been on the table since the mid 1960s. In 1965, Colorado engineer Royce Tipton prepared a report for the Upper Colorado River Commission where he concluded, “The addition of more reservoir capacity than will be provided by the existing and authorized units of the Upper Colorado River Storage Project would not materially increase these (meaning Upper Basin) depletions.” 61 Mr. Tipton based his conclusion on a hydrologic analysis of the extended dry period of 1930-1964. Tipton concluded that the additional incremental evaporation from the expanded storage would exceed the additional incremental yield. By today’s standards, the Tipton analysis was relatively crude. So, it may be worthwhile for Reclamation or individual states to redo its analysis. Under climate change scenarios, one of the possible futures is more winter precipitation, especially in the northern reaches of the Upper Colorado River Basin. I expect that we may experience some rare but extremely wet winters.62 It also needs to be recognized that even if the study results suggest potential benefits from additional storage, finding an acceptable dam and reservoir site that does not inundate endangered fish habitat, a major railroad or an existing community may be problematic. As a practical matter, the options may be limited to off-channel sites or the expansion of existing facilities. Litigation as a Management Tool to Reduce Risk In the western United States, interstate litigation between or among states over the enforcement or interpretation of interstate water compacts or decrees is relatively common and has been so for over a century. Indeed, two landmark Supreme Court decisions involving Colorado in the early 1900s, Colorado v. Kansas in 1907 and Wyoming v. Colorado in 1922, led Colorado’s Compact Commissioner, Delph Carpenter, to conclude that an interstate compact on the Colorado River was essential to protecting the ability of the States of the Upper Division to develop future Colorado River water.63                                                              61 “Water Supplies of the Colorado River”, Tipton and Kalmbach, Inc., July 1965, prepared for the Upper Colorado  River Commission. Mr.Tipton was a consulting engineer that worked for the CWCB.   62 Indeed, if the Murray‐Darling River system in Australia can be seen as a proxy for the Colorado River Basin under  climate change scenarios, we need to consider both the extreme drought conditions experienced beginning in the  1990s and the more recent record wet period.    63 Carpenter concluded that absent an interstate compact, the application of the prior appropriation doctrine on  the Colorado River system wide would favor the Lower Basin because it was destined to develop at a faster pace  than the Upper Basin.    ATTACHMENT A 32    While these cases are heard in the United States Supreme Court as the court of original jurisdiction, the court normally assigns a special master. The process can take years, if not decades, and normally the cases are very expensive for the participating states. On the Colorado River system, there have been four United States Supreme Court cases, all initiated by Arizona. All four of these cases were initiated during the development phase of the Colorado River. The most recent case, decided in 1963 and decreed in 1964, was necessary for Arizona to demonstrate to Congress that a water supply was available from the mainstem of the Colorado River for the Central Arizona Project (CAP). The decision was limited to adjudication of rights on the Gila River and the interpretation of the intent of Congress under the 1928 Boulder Canyon Project Act, not the 1922 Compact.64 From a risk management perspective, the initiation of interstate litigation over the interpretation or enforcement of the 1922 Compact is a potential action, but in my view, one that is just as likely to increase risk to the initiating state and indeed the entire basin. From my perspective, litigation on the Colorado River could involve the interpretation of one or more specific provisions of the 1922 Compact or the more basic question of whether or not the compact was based on a fundamental “mutual error in fact.” The possible error in fact is the hydrology. Did the parties approve the compact based on a fundamental mistake concerning the water available in the Colorado River system? Many authors have written scholarly articles on this subject, so I will avoid it. From my perspective, challenging the compact as a whole is by far the most risky approach. If the Supreme Court were to invalidate the compact, what would it replace it with, an equitable apportionment based on the underlying priorities? Would the priorities be based on a uniform set of rules or individual state rules which vary from state to state? The result could be extreme chaos throughout the Basin; a consequence that I believe is well understood throughout the Basin. I believe that it is more likely that an individual state would initiate litigation to seek an interpretation of a specific article or provision of the Compact. For example Arizona could seek a ruling that the Colorado River system as defined by Article II does not include the Gila River. Alternatively a State of the Upper Division could seek an interpretation that the Upper Basin’s right to consume 7.5 maf/year under Article III (a) is superior to the Upper Basin’s Lee Ferry obligations under Articles III (c) and (d). Other potential provisions for dispute include the interpretation of Article III (c), the Mexican Treaty provision and Article III (e), the “withholding of water” provision. From the perspective of basin hydrology, I believe the most likely dispute will be the interpretation of Article III (c), the obligation of each basin’s water to the Mexican Treaty. Even though a state may target an individual provision, litigation over one provision would raise differences and trigger disputes over related provisions. For example, I don’t                                                              64 The decisions to limit the case to the interpretation of the 1928 BCPA was made relatively early in the process.  The Upper Division states of Colorado and Wyoming were not allowed as parties because in the court’s view they  had no interests impacted by the BCPA or Gila River adjudication. Section VIII of the Decree states that “This  decree shall not affect: (D) Any issue of interpretation of the Colorado River Compact.”   ATTACHMENT A 33    believe the Supreme Court could interpret III (c), without interpreting several other provisions as well. There are a number of different possible initiation triggers; most of them would likely involve actual basin hydrology. If the 10-year flow at Lee Ferry were to drop below 82.5 maf, it is possible that one of the States of the Lower Division could initiate litigation to force the States of the Upper Division to curtail uses or release more reservoir water to bring the flow at Lee Ferry up to 82.5 maf. The trigger could be higher than 82.5 maf if the Lower Division state wanted to address the transit loss issue. I believe it is highly unlikely that any of the Upper Division states would curtail any existing uses to bring flows at Lee Ferry up to the 82.5 maf 10-year level unless ordered to do so by the United States Supreme Court. Whether or not the Upper Division states would agree to support additional releases from Lake Powell is also problematic. It would probably depend on water supply conditions and whether or not the 2007 Interim Guidelines are still in place. To do so could undermine the value of the 2007 Interim Guidelines.65 From the perspective of the States of the Lower Division, if 10-year Lee Ferry flows drop below 82.5 maf, the 2007 Interim Guidelines are not in effect; it would present an interesting management challenge. Each state would have to carefully weigh the potential risks and rewards of litigation versus continued negotiations among the states. Litigation will almost certainly raise the issue of the Lower Basin tributaries and the limitations inherit to Articles III (a) and III (b)66 of the 1922 Compact. The issue is not if the Lower Basin tributaries have to physically contribute to the delivery of water to Mexico. As a practical matter, because of large channel losses on the Gila River between Phoenix and Yuma, only the Colorado River mainstem can efficiently deliver water to Mexico. The real question is whether or not the consumptive uses on the Lower Basin tributaries count against the apportionment limit of 8.5 maf per year. Special Master Simon Rifkind in his report on Arizona v. California put it very simply, “The Compact puts an embargo upon the acquisition of appropriative rights in excess of the limits set by Article III (a) and (b). The first call upon any remaining water goes  to supply Mexico.”67 (Emphasis added). The Lower Basin is currently consuming about 11 maf per year (see page 5). 11 maf per year is 2.5 maf more than the 8.5 maf provided for under Articles III (a) and III (b). Even                                                              65 One of the purposes of the Interim Guidelines is to put in place a more efficient operation of Lake Mead and  Lake Powell as a unit rather than as two separate reservoirs. The guidelines allow for annual releases from Lake  Powell to be as low as 7.48 maf/year. The modeling suggests that the coordinated operation is a benefit to both of  the basins, but the modeling also shows that the price of the coordinated operations is occasional  10 years flows  at Lee Ferry  less than 82.5 maf.   66 Article III (a) apportions in perpetuity, 7.5 maf per annum each to the Upper Basin and Lower Basin.  Article III (b)  allows the Lower Basin to increase its annual consumptive use by one million acre feet per annum in addition to  Article III (a).    67 36 U.S. 940, page 196.   ATTACHMENT A 34    under shortage conditions, such as a 600,000 af shortage from Lake Mead, it is still very likely that the Lower Basin would consume more than 8.5 maf/year. Nevada and Arizona should be concerned that a possible, perhaps even probable, outcome of litigation is that the Supreme Court could conclude that the first obligation of any Colorado River water beyond the 8.5 maf plus the lesser of the Upper Basin current use or 7.5 maf is for delivery to Mexico. Under current conditions, the Upper Basin is using about 4.5 maf/year (including CRSPA reservoir evaporation), so it is possible that the first obligation of any system water available over 13.0 maf/year would go to Mexico.68 This means that in most, but not all years, there would be no deficiency and thus the States of the Upper Division would have no obligation to Mexico under Article III (c). A pretty good rule of thumb for the operation of Lake Mead is that if Lake Powell releases 8.23 maf/year, Lake Mead will lose about a million acre feet of storage per year. To stabilize Lake Mead levels, deliveries to the Lower Divisions states and Mexico and system evaporation and losses would have to be reduced by that same million acre feet.69 The following line diagram is often used to demonstrate this rule of thumb.                                                              68 This is an oversimplification of the technical issues involved.  The court would have to address the issue of  whether depletions are charged at the point of diversion or at mouth.  Further, the court might have to address  where in the basin the surplus is located.  My point is to make the case that litigation could add significant risk.    69 Evaporation losses will be reduced by lowering reservoir elevations, so this is just a thumb rule approximation.    ATTACHMENT A 35    Reducing Lake Powell deliveries to 7.48 maf/year would increase the deficit at Lake Mead to about 1.75 maf/year. The actual impacts are more complicated than the rules of thumb. Reducing the minimum release from Lake Powell to 7.48 maf/year would also increase the frequency of “balancing” (a.k.a equalization) releases during wetter periods, and as previously mentioned, there could be years when the Upper Basin owes water under the Mexican Treaty. All of these factors have to be modeled to show actual impacts. A second possible litigation trigger is if the 10-year flow at Lee Ferry were to drop below 75 maf. First, it is unlikely that flows would approach the 75 maf figure without significant impacts and discourse throughout the basin. I would expect that prior to the flow approaching 75 maf; there will have been several years of Lower Basin mainstem shortages of at least 600,000 acre feet/year. In the Upper Basin, federal and non-federal storage reservoirs would be seriously depleted. Mandatory conservation measures would be common throughout the basin. Frustration levels would be high, tempers short, with attorneys manning their battle stations. ATTACHMENT A 36    I further expect the Secretary of the Interior would be using all of his/her powers and influence to bring the basin states together to manage the available water in very different ways than the status quo and to avoid litigation. If, despite the extraordinary management actions throughout the Basin, 10-year flows at Lee Ferry went below 75 maf and the Upper Basin did not begin curtailing uses, litigation would be a near certainty. I also expect that at least in one of the Upper Division states, there would be political pressure to resist curtailment and litigate. The idea that the 1922 Compact gave the Upper Basin an absolute right to consume 7.5 maf per year regardless of the 10-year flow at Lee Ferry may still be engrained in the politics of several States of the Upper Division. The issues would be similar to those mentioned under the 82.5 maf trigger, but the increased risk would be transferred to the Upper Basin. If the court were to agree that the Upper Basin owed additional water to Mexico for past years under Article III (c) in addition to the 75 maf, the result of litigation could turn a small curtailment into a larger and possibly longer multi-year curtailment. My personal view is that as the 10-year flow at Lee Ferry drops below 82.5 maf, the Upper Basin has a slight litigation advantage, but as flows approach or drop below 75 maf, that advantage shifts dramatically to the Lower Basin. The conventional wisdom is that based on the law of gravity, as opposed to the Law of the River, downstream users will be the first to initiate litigation because nature gives the upstream users first access to the water.70 A reasonable scenario is that at some flow between 75 and 82.5 maf, the Basin would reach an agreement and/or the states of the Upper Division would begin curtailing post-1922 Compact uses. In summary, interstate litigation may be a political necessity, but from a more focused risk management perspective and due to the particular facts on the Colorado River, I suggest that most parties would first make extraordinary efforts to avoid litigation. Development of Curtailment Contingency Plans The third general approach to managing risk in the Upper Basin is for the States of the Upper Division to either individually, or possibly collectively, develop curtailment contingency plans. I would suggest two basic components. The first component would be to consider approaches to first avoid a curtailment, and if that fails, the second component would be to have a contingency plan in place that allows critical uses to continue to divert during a curtailment. Since we can’t foretell the future, developing a strategy to avoid a curtailment is quite a challenge. The potential for a continually changing hydrologic baseline due to climate change also complicates any strategy to avoid a curtailment. One possible method to avoid a curtailment would be to develop and use a CRSPA reservoir storage hydrology model that looks out 10 years and then implements certain actions based on the probability that total CRSPA storage would be reduced below identified triggers. This                                                              70 An interesting question would be how many times the downstream states vs. the upstream states initiate  interstate water litigation.  In Arizona v. California the states are across the river neighbors.   ATTACHMENT A 37    approach would be similar to the 602 (a) concept but targeted to uses upstream of Lake Powell. For example, the model would start with current conditions. Then use actual or simulated hydrology to determine the minimum CRSPA storage for the next 10 years. If the model results showed that there was a risk of draining the CRSPA reservoirs and possibly result in a curtailment then states would take certain actions. Again, as an example, and just an example, if the model results showed the probability of a curtailment was greater than 20%, then some junior rights would be curtailed. If the probability was greater than 40%, perhaps the states would curtail more juniors and start banking depletions from existing uses in water bank reservoirs on a space available basis. As total CRSPA storage dropped or as 10-year flows at Lee Ferry approached 75 maf, the Upper Division states would individually or collectively become more aggressive at banking depletions, hoping to always have sufficient storage to deliver the 75 maf. There are many difficult, if not impossible, obstacles to this strategy. Reaching a consensus on the hydrologic questions and the probability levels that trigger certain actions, agreeing on what those actions would be, and whether or not such a plan would be legal under state law will be a major political challenge.71 Water banking in the Upper Basin presents technical challenges. About 90% of in-basin agriculture’s consumptive uses are from the irrigation of alfalfa and hay/pasture grasses. The common fallowing program models now successfully used in the Lower Basin will have to be modified and deficit irrigation techniques used.72 The advantage of this approach, however, is that it does something to protect important post-1922 Compact uses with relatively senior rights (senior-juniors) and may provide an opportunity to divert the water available during wet cycles. An alternative that many in Colorado would like to avoid is to only allow development up to a traditional firm yield basis. Doing so might protect the senior-juniors, but in wetter periods, a lot of water could be left undeveloped and unused. A second problem is that under some hydrologic assumptions, development in Colorado may already be beyond a true “firm” or “safe” yield level. Developing the second part of the strategy, a curtailment contingency plan, will be necessary either if an avoidance strategy is politically or legally impossible to implement or, if one is implemented, it fails to completely avoid a curtailment. The concept most commonly discussed for a contingency plan is based on developing a water bank where the consumptive use from a portion of a state’s pre-1922 Compact (prior-perfected) water rights would be available to cover critical, post-1922 Compact uses during the curtailment period.                                                              71 The legal issues are very difficult.  The basic problem is that in states like Colorado, river administration is on an  annual real time basis, but as a State of the Upper Division, its obligation at Lee Ferry is on a 10 year basis.  Imposing a 10 year compact commitment on water rights administration while preserving the doctrine of prior  appropriation will be a difficult challenge.  72 Colorado River Compact Colorado Water Bank Feasibility Study Water Supply Technical Memorandum prepared  by Natural Resources Consulting Engineers, Inc., November 28, 2011.   ATTACHMENT A 38    In 2007, the Colorado River Water Conservation District (River District) and Southwestern Water Conservation District (Southwestern) Boards held a joint meeting where they instructed their staffs to work together to develop a curtailment contingency plan. A water bank is one component of this draft plan. Since 2007, the River District and Southwestern have been joined by The Nature Conservancy, the Colorado Water Conservation Board (CWCB) and the Front Range Water Council.73 At its January 2011 meeting, the CWCB awarded an “Alternatives to Agriculture Dry Up” grant to study the concept in more detail. What we know is that Colorado has about a million acre feet per year of consumptive uses associated with pre-1922 Compact rights. We also know that most transmountain diversions and many West Slope critical uses, such as water supplies for newer cities, power plants, snowmaking and reservoirs, are post-1922. We don’t know how much of the million acre feet might be available on a willing lessor basis and what the magnitude of demand of critical uses will be. We don’t have a consensus on the definition of “critical use.” We don’t know how a bank would be managed, how it would be administered from a water rights administration standpoint, and whether it would necessarily involve storage or not.74 We don’t have a good understanding of the economic or institutional structure of a bank, and we have not addressed secondary impacts. We plan on addressing all of these issues as work on the concept progresses. There are a number of basic political and legal assumptions inherent with a bank. The first assumption is that as long as an Upper Division state meets its 1922 Compact obligations at Lee Ferry as determined by the UCRC under Article IV of the 1948 Compact, what happens within the state is a state matter. Thus, the consumptive use from pre-1922 Compact rights should be available to replace post-1922 Compact depletions. The second assumption is that owners of post-1922 Compact critical rights would be willing to participate in a bank like an insurance policy.75 Another critical assumption is that the State of Colorado would be an active enabler of such a bank. If not, the water rights administration, exchange issues and water court procedures could be so complex as to make a bank impractical. The diverse coalition pursuing the concept of the bank has its advantages and obstacles. The advantages are that it brings broad resources to the table. If we can find consensus, it                                                              73 The Front Range Water Council is an association of the major Front Range transmountain diverters including  Denver Water, Northern Colorado Water Conservancy District, the Cities of Aurora, Colorado Springs and Pueblo,  and the Southeastern Water Conservancy District.   74 The Arkansas River Basin and Gunnison River Basin Roundtables received a state grant to study how Aspinall  Unit storage might be used as a part of the bank.  The CWCB awarded a grant for this study at its March 2011  meeting.   75 By insurance model I mean that the owners of the post‐1922 Compact critical uses would contribute financially  to the operation of the bank every year, but only use the bank in rare curtailment years. One of my concerns is  that some users may only want to participate once a curtailment is certain.  Wouldn’t it be wonderful if we could  buy fire insurance after the fire?    ATTACHMENT A 39    will make it much easier for enabling legislation and ultimately governance. The obstacles include the fact that each of the entities has fundamentally different missions. An example of a fundamental difference is that the River District and Southwestern Boards see a bank as insurance for critical existing uses. Front Range water users understandably see it as a source of supply. So far the focus on a curtailment water bank has been centered in Colorado. However, I believe the other three Upper Division states are interested and are paying close attention. A multi-state bank is a potential. However, due to differences in how water is administered and the political culture within each state, I expect individual Upper Division states will first focus on state plans. What ties the four Upper Division states together are the many questions related to the operation of 1956 CRSPA reservoirs. If individual state banks are to be operated in conjunction with 1956 CRSPA storage, it will take cooperation among the states and Reclamation. I believe that the cooperation on the use of 1956 CRSPA storage for individual state banks could ultimately lead to a more integrated strategy among the Upper Division states. Alternative Institutional Arrangements or Agreements for Managing Risk The fourth approach is for the seven Colorado River Basin states and the United States Department of the Interior to negotiate alternative institutional arrangements, new agreements and/or implement new projects that would reduce the risk of a curtailment on the Upper Basin. From my perspective, this approach could involve new governance mechanisms, or it could be a continuation of the “incremental adaptation” approach that has always been an integral part of the management of the river.76 The issue of new governance mechanisms for the Colorado River has been on the table since at least the early 1980s. At the December 2010 Colorado River Water Users meeting in Las Vegas, Dr. Douglas Kenney of the University of Colorado Natural Resources Law Center presented a paper titled, “Rethinking the Future of the Colorado River.”77 In his presentation, Dr. Kenney argued that incremental reform has been reduced to a point of diminishing returns, and in fact, may be inhibiting different and better futures. I found Dr. Kenney’s presentation quite thought provoking, but I would also observe that the basin states are not quite ready to discuss new approaches for the broad issues of river governance. Therefore, I will assume that the incremental approach will continue into the foreseeable future.                                                              76 I believe the incremental adaptation approach started in the mid 1920s after the Arizona Legislature refused to  ratify the 1922 Compact. In response, the six remaining states put together a six‐state ratification strategy which  was made a part of the 1928 Boulder Canyon Project Act.   77 The report can be found at www.waterpolicy.info   ATTACHMENT A 40    Whether under old or new governance approaches, the challenges are similar. To reach a successful agreement on the Colorado River among seven states and the United States, each of the individual parties must conclude that it is better off with an agreement than without one. This is a very difficult standard. In certain situations, such as the Interim Shortage Guidelines, the United States, through the Secretary of the Interior, has sufficient power to incentivize an agreement. The 1928 BCPA and the decree in Arizona v. California give the Secretary broad powers on the Colorado River mainstem in and below Lake Mead.78 These broad powers arguably don’t extend into the Upper Basin or onto the Lower Basin tributaries. There are several potential agreements that could be used to help reduce or manage the risk of a curtailment on the Upper Division states. These range from the relatively non-controversial to the very controversial. As a general rule, the least controversial are the least effective, and unfortunately, those with the potential to be the most effective are the most controversial. At the relatively non-controversial end of the spectrum, the states could agree to continue to sponsor, finance, and support in-basin augmentation strategies, such as phreatophyte control, cloud seeding and dust abatement. Programs to promote cloud seeding and tamarisk control have been underway for a number of years, but at moderate levels. Whether or not these programs can be ramped up to actually make a difference is uncertain. There are several problems. The first is uncertain science. The second is funding. As long as the funding levels are low, there is not much concern with uncertainty on the results. However, if the states were to propose large new Congressional funding or a basin-wide surcharge on federal water deliveries, they will need better science and better consensus that programs actually augment flows. Dust control is a relatively new issue. Recently published science suggests that dust is reducing Colorado River system flows by as much as 750 kaf per year. Whether or not a basin-wide program can be put into place to reduce dust levels is uncertain, especially the funding. I can also see conflicts between dust control and land development and recreation on public lands and conflicts with grazing on public and tribal lands. The next level of controversy involves augmentation plans that would move new water from outside the basin into the basin either by exchange or physical delivery. Examples of these kinds of projects are: a large seawater desalination plant in Mexico or southern California that would provide water to cities like Mexicali, San Diego or other Southern California Metropolitan Water District customers, and a like amount of water would be exchanged back to the Colorado River system. If an Upper Division state or water provider wanted to participate financially in the project, water could be, in theory, exchanged all the way back above Lee Ferry. A second example is a pipeline from the Mississippi River to Colorado’s Front Range.79 The concept would be that the                                                              78 In recent years, the threat of unilateral action by the Secretary has been strong incentive, at least for the States  of the Lower Division, to reach an agreement among themselves.   79 At the 2009 Colorado River Water Users meeting, a representative of the Central Arizona Project made this  suggestion.   ATTACHMENT A 41    Mississippi River water would replace current Colorado River diversions, allowing the Colorado River water to be used by the financial sponsors of the pipeline. There are numerous problems with these large augmentation schemes; enormous costs, high energy use, large environmental footprints, political problems from the exporting regions, etc. The problem from an Upper Basin risk management perspective is that these projects have been primarily proposed to supplement Lower Basin supplies, not Upper Basin supplies.80 To potential Upper Basin participants, the costs of these projects will likely outweigh the costs of local alternatives. I expect that a discussion of large scale augmentation will continue to be on the table, but I personally doubt it will do much more than divert our attention from more productive discussions. The two most controversial kinds of agreements would be those that either change, or substantively reshape, the structure of the 1922 Compact and other components of the Law of the River or that attempt to open the entire Colorado River Basin to market-based mechanisms for moving water from one use to another. Basin water users have been considering these kinds of solutions for some time. At a seven states meeting in Albuquerque, New Mexico in 2005, participants from Colorado81 made an informal suggestion that the basin states might want to consider an approach where, under certain conditions, the Upper Division states would not contest the use of water in the Lower Basin beyond the 8.5 maf limits of Articles III (a) and (b), including the full use of the Lower Basin tributaries, if, in return, the Lower Basin would never require or severely limit an Upper Basin curtailment under either Article III (c) or III (d). In our discussion we acknowledged that the Upper Basin would have to limit its depletions to something less than the 7.5 maf provided in Article III (a) and most likely less than the 6.0 maf/year then thought to be a reasonable estimate of Upper Basin yield.82 If such a concept were to be reconsidered, the details and sideboards would get very complicated. To make this work, the Upper Basin would probably have to limit the non-call provision to existing uses or existing uses plus a future development allowance. This kind of arrangement would shift some of the climate change risk to the Lower Basin. It would also benefit Arizona and Nevada by providing a long term solution for the Lower Basin’s overuse and tributary use problems. As a part of any agreement the Basins would have to reach an agreement on the Mexican Treaty obligation as well. There are many potential fatal flaws to this concept. One of the most obvious is that California has no Lower Basin tributaries and thus, little to gain by this proposal.                                                              80 I believe that the development of desalination projects will continue, but on a scale of a tens of thousands of  acre feet, perhaps even several hundred thousand acre feet, but probably not sufficient to affect curtailment risk  in the Upper Basin. Additionally, moving desalinization water from below to above Lee Ferry will be a legal  challenge.      81 The participants from the State of Colorado were Scott Balcomb, Rod Kuharich and Ted Kowalski. The Colorado  Water User Coalition participants were Jim Lochhead and Eric Kuhn.   82 This number was determined by the 1988 Hydrologic Determination (HD) prepared by the Secretary of the  Interior. Technically, the HD only applies to the federal contracts in New Mexico for water from Navajo Reservoir  and has no legal meaning for Colorado, Utah and Wyoming. The HD was slightly revised in 2007.   ATTACHMENT A 42    The second very controversial institutional arrangement or reform would be to put in place programs that would move the entire Colorado River Basin toward a market-based approach, including both interstate and inter-basin consumptive use transfers. There were several proposals in the 1980s for interstate water marketing, including one by the Chevron Oil Company. One of the problems with these first generation proposals was that the proponents were trying to turn “paper” water into real water. Colorado has conditional water rights that preserve a diverter’s place in line (priority) until the diverter actually begins diverting water. None of the proposals added wet water to the system. In general, these water marketing proposals were strongly opposed by numerous parties. In the last 15 years or so, inter-basin water marketing from the Upper Basin to the Lower Basin has received little or no attention. It may re-surface as an alternative identified through the vehicle of the Colorado River Basin study. As basin supplies get tighter and tighter and shortages become more prevalent, I expect that there will be considerable pressure to expand water market access to existing high- value water providers such as MWD, Phoenix, Tucson, Las Vegas, the Colorado Front Range, the Wasatch Front and perhaps a future oil shale industry. The theme of the 2011 Colorado Water Congress winter meeting was a series of presentations by water officials from Australia. Beginning in the 1990s, Australia experienced a severe drought,83 well beyond what was or even could have been predicted. It fundamentally changed how the country and its states viewed water management. Australia’s solution to address its water problems relies on expanding its use of water markets, subject to significant environmental controls. Australia’s experience is important. Like in Australia, in the United States market-based solutions to most problems have strong political appeal. Although it would be a challenging task, I expect that the Upper Division states will continue to strongly resist efforts to open up inter-basin water marketing. The primary concern is similar to the original motivation for the 1922 Compact. The Lower Basin’s higher value agricultural economy and faster urban growth would command the river. A market-based approach would move water-based economies from rural areas to the Lower Basin and urban areas. It would severely impact Upper Basin agriculture as well as smaller and rural communities. From a risk perspective, free-market based water solutions, including interstate and inter- basin access, could reduce the risk of a curtailment on the larger municipal users that have significant financial resources but could also increase the risk and burden on entities with limited resources. The Colorado River Basin study will analyze much of what I have discussed and hopefully some new and more creative options. The “strategies and solutions” section of the final report will certainly be read with a great deal of interest.                                                              83 In 2011, the problem was severe flooding, at least in eastern Australia. At the CWC meeting, Brad Udall, Director  of the Western Water Assessment, noted that Australia’s water problems, both the highs and the lows, are  consistent with what science tells us about climate change.   ATTACHMENT A 43    I expect that the results of the basin study will suggest that there are three basic “solutions” for meeting the future water needs of the Colorado River Basin: extraordinary augmentation strategies (which I discount for previously stated reasons), extraordinary conservation (using a very broad definition of conservation) which will leave the Law of the River mostly intact, and market-based extraordinary conservation, which will fundamentally alter the law-of-the-river. Each of these different solutions will involve fundamental risk management approaches, the difference will be in which party gains or loses risk. Summary of Approaches The four basic approaches that I have listed are by no means the only risk management strategies available to the Upper Basin. I expect that new approaches and ideas will surface. I also expect that the States of the Upper Division will explore or pursue all identified approaches in parallel. We’ve reached a time where the current demands for Colorado River water exceed the available supply. This gap will continue to grow. Climate change adds uncertainty and new challenges. At the local, water provider level, conservation will be a priority, not an afterthought, but even extraordinary conservation will leave shortages. Application of the Law of the River will have consequences, some will be painful. At the same time, engrained expectations, like the idea that Colorado has a million acre feet of Colorado River water left to develop will confuse, complicate, and delay strategies to reduce risk. Thirty years from now, I expect that the Colorado River Basin will look about the same as it does today but with more people and a bit less water. Within the Lower Basin, shortages will be common. Within the Upper Basin, risk management of water supplies will be a top priority. Those entities that take this issue seriously today will be the most successful in the future. About the Author Eric Kuhn is the General Manager of the Colorado River Water Conservation District. He began working at the District in 1981and has been its general manager since 1996. The mission of the District is “to lead in the protection, conservation, use, and development of the water resources of the Colorado River basin for the welfare of the District, and to safeguard for Colorado all waters of the Colorado River to which the state is entitled.” Laurie DePaolo and David Smith provided invaluable assistance and patience for the preparation of this paper. ATTACHMENT A     Key Sources House Document 419, Eightieth Congress, First Session, “The Colorado River - A Natural Menace Becomes a National Resource” U.S. Department of the Interior, July 1947. Colorado River Compact, November 24, 1922. Upper Colorado River Basin Compact, October 11, 1948. Minutes and Record of the first 18 sessions, and sessions 19-27 of the Colorado River Commission. Official Record of the Upper Colorado River Basin Compact Commission. “Climate Change in Colorado, A Synthesis to Support Water Resources Management and Adaptation,” Colorado Water Conservation Board, 2008 The Colorado River Documents, Katherine Ott Verburg, U.S. Department of the Interior, U.S. Bureau of Reclamation, 2008. Colorado River Water Availability Study, AECOM, Phase I Report, Public Draft, March 22, 2010. Report of the Special Master in the Arizona v. California case, 364, U.S. 940, January 16, 1961. Colorado River Compact Administration, Department of Natural Resources, Division of Water Resources, June 2007 PowerPoint Presentation Prepared by Ken Knox. Interim Report No. 1 Colorado River Basin Water Supply and Demand Study, U.S. Department of the Interior, Bureau of Reclamation, June 2011. Severe and Sustained Drought in the American Southwest, Water Resources Bulletin, American Water Resources Association, October 1995. i. 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