Water is wealth in Spanish Valley, and both the direction of flow and ownership of the water will determine the pattern of growth in San Juan and Grand Counties. Grand Water and Sewer Services Agency (GWSSA) does not own sufficient water to complete build out in Spanish Valley, and the transfer of a connection to San Juan County is equivalent to $20,000 to $50,000 of property value. Each lot that cannot be built on in Grand County because of insufficient water is a loss for that property owner. Every connection transferred from Grand County to San Juan County is a potential loss in tax revenues to Grand County.

The first question of concern is the quantity of available water in Spanish Valley. The water district (GWSSA) currently owns 960 acre-feet of water from their new wells. They are negotiating to buy approximately 431 acre-feet from George White Ranch and can also exchange 193 acre-feet of irrigation water for culinary water with George White for the next nineteen years. Approximately one-quarter of the 960 acre-feet has been presold to SITLA, and the remainder is being used by the current residents of Spanish Valley. The anticipated 431 acre-feet purchase from George White Ranch will furnish approximately 550 new connections and provide water to 550 one-acre lots. Once those 550 connections are provided, no other land will receive a water connection unless additional water becomes available to the district.

The questions of how much future water is available in Spanish Valley now become clouded by speculation. The State of Utah may increase or decrease the water allocation for our new wells. Ken's Lake water, during the months it is available, can be purified for drinking water at an estimated cost of $3 million or more. We can pump Colorado River water to Ken's Lake at high cost and pay for a purification system. More water may be purchased from George White Ranch.

The major question today is where the approximately 435 acre-feet of new water purchased from George While Ranch will flow and who will own the water. The new water may flow to San Juan County. The water district has voted twice to move water out of Grand County and into San Juan County. SITLA currently owns over 300 connections which were presold from the 960 acre-feet in the new well that they can move to San Juan County. Water was also made available to lots in San Juan County adjacent to the new pipeline. A developer asked last month to supply water to his project in San Juan County. The water district board advised the developer to annex his project into the water district and they would be able to supply his land with water. Each connection moved to San Juan County is one less connection available in Grand County.

The owners of the George White Ranch water will be the Conservancy District (Ken's Lake users). The Grand Water and Sewer Service Agency (GWSSA) for Spanish Valley is made up of board members from the Conservancy District, who represent Ken's Lake users, and board members from the Improvement District, who represent the culinary water users. Some board members on each board have family and personal ownership of extensive land in San Juan County. Those board members in the district who use Ken's Lake water will prosper when irrigation rates are kept low. The board members who own property in San Juan County and their families will prosper if Spanish Valley water flows across the county line. The culinary water users and landowners in Spanish Valley will pay for the water sent to San Juan County and will also lose value from their own property if there is not sufficient water for development.

The Conservancy District (Ken's Lake users) will have control over $1.1 million in fees paid by the culinary water users. The Conservancy District has historically used their ownership of culinary water to subsidize their irrigation operations and to keep their irrigation rates low. Prior to the formation of Grand Water and Special Sewer Agency (GWSSA), the Conservancy District exchanged Ken's Lake water with George White for culinary water. The 625 acre-feet of Ken's Lake water had a value of $22 per acre-foot, and the Conservation District sold George White culinary water to the culinary users at $80 per acre foot. The extra $36,000 dollars were used to store the culinary water and pay Ken's Lake operating expenses. The Conservation District no longer charges extra for George White water to pay their operation expenses, as Grand Water and Sewer Service Agency (GWSSSA) currently commingles the Ken's Lake bills with the culinary water bills and pays all expenses with $1.1M from the culinary water fees and $108,000 from irrigation fees.

I believe little can be done to change the flow of water away from Grand County or the ownership of our water under the current membership of the district water board. This December up to eight board positions in the Water District are coming up for renewal by the Grand County Council. The citizens of Spanish Valley need to become involved in the water district meetings prior to December and need to apply for the positions opening on the board. The Conservancy Board members can live anywhere in Grand County. You do not have to live in the water district's boundary to become active in protecting the land values in Spanish Valley.

GLOSSARY

Grand Water and Sewer Services Agency (GWSSA): Responsible for administration of the Conservancy District and Improvement District.

Conservancy District: Responsible for Ken's Lake irrigation water and represents 125 Ken's Lake users. Collects fees of $108,000 per year and owns all culinary water.

Improvement District: Responsible for supplying culinary water and sewer to Grand County in Spanish Valley. Receives $1.1M in fees from culinary users.

CULINARY WATER SOURCES AND AVAILABILITY

1. 960 acre-feet allocated by the State of Utah to the new wells, currently all reserved or in use. One-quarter of this water has been presold to SITLA, and three-quarters is being used by current connections.

2. 431 acre-feet to be purchased from George White Ranch. This water may be made available for approximately 550 new connections.

3. 193 acre-feet of culinary water in an exchange with George White Ranch for irrigation water. This would be available for the next nineteen years.