Every Montezuma Valley Irrigation Company shareholder should consider the economic benefits of the proposal to lease water to the Colorado water Conservation Board. We have an opportunity to use someone elses money to begin infrastructure improvements that will more than pay for themselves in a few years.
MVIs chief responsibility is to distribute its water through its canals and pipes to its roughly 1,400 shareholders. Doing so requires MVI to continually maintain and improve its distribution system of ditches and pipes. Unfortunately, much of the MVI system is in disrepair, needs to be made more efficient and lacks the means to accurately measure the amount of water going through it. MVI management estimates that up to 25 percent of its water is currently lost before reaching its end users.
To maintain its water distribution system, MVI needs to invest millions of dollars. Outside funds, such as government grants, for needed capital improvements currently are very limited. In lieu of such outside monies, MVIs shareholders are the primary source of needed funds.
Currently, MVI has held several meetings with shareholders regarding the boards proposal to lease several thousand acre feet of water in three of the next five years to the Colorado Water Conservation Board (CWCB) for $1.5 million. Evidently, MVI shareholders must approve the lease. The Water Conservation Board would use the additional water to aid in the study of fish populations in the Dolores River. CWCBs interest is based on its belief that providing state solutions to issues of possible concern to the federal government may forestall federal involvement.
MVI would use the monies it receives from the CWCB to fund needed improvements to MVIs water distribution system, and might be able to use those funds as monies toward possible matching grants for further capital improvements. The state would consider the water MVI would lease a beneficial use of that water, thereby reducing the risk of the state finding that MVI has not beneficially used some of its water. While some MVI shareholders fear that MVI may permanently lose that amount of water without future compensation, representatives of MVI and other entities have stated that this is extremely unlikely.
MVI should seriously consider any means of securing outside revenue to fund capital improvement projects. The improvements MVI could make to its system using the $1.5 million in lease monies would, in and of themselves, save about half of the water proposed to be leased! The water MVI would be leasing is known as transbasin water, so MVI can retain the water these improvements would fund to sell or lease that water in the future. Thats a 50 percent return on the $1.5 million over five years, and 100 percent use of saved water thereafter!
Since the proposed lease seems to be a good opportunity that MVI should not pass up, MVI should poll its shareholders on the question before MVIs upcoming January annual meeting. Shareholders should vote their approval of the lease.
Larry Hartzke is an MVI shareholder and a resident of rural Cortez.
Editors note: The Montezuma Valley Irrigation board has decided not to push the lease option.