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Woodmoor Water & Sanitation District

Woodmoor Water and Sanitation District No. 1 agrees to contracts for purchase of water rights and reservoir storage in El Paso County

May 12, 2011

The Woodmoor Water and Sanitation District began planning for a renewable water system many years ago.  Over the past few years the District has been executing that plan with the acquisition of rights along Monument Creek, development of Woodmoor Lake, and construction of a treatment facility to treat surface water as well as entering into multiple contracts for water rights and storage facilities on the Arkansas River.

At the Board’s May 12th , 2011 meeting, District Leaders demonstrated their commitment toward achieving the goal of acquiring dependable water sources by executing a contract to purchase a Ranch with water rights and a reservoir within El Paso County.  The Board of Directors authorized the issuance of a notification letter to our customers announcing the news and providing a general summary of the acquisition.  (Please see letter to residents).

Some of the details and highlights of the recent contract are presented below:

Location:                                     Approximately 4 miles Southeast of the City of Fountain

Water Rights:                             Between 2,500 and 3,400 acre feet annually

Reservoir & Storage rights:    Calhan reservoir is a 70 acre facility with a decreed storage right of approximately 700 acre feet

Land:                                           approximately 3,500 Acres

Purchase Price:                        approximately $25 Million Dollars to $31 Million Dollars (final price dependant upon water rights quantification in Water Court)

This acquisition marks another step forward in the district’s Renewable Water Plan and could be a significant milestone in completing the first phase of the plan – acquiring renewable water rights and storage facilities for future conveyance to District residents.

Eventually the District will replace Woodmoor’s current reliance on Denver Basin aquifers and this latest acquisition could be an instrumental asset in achieving this goal which would allow the District to meet our customer’s water demands for many years to come.

Currently the District is embarking on its due diligence investigations of the ranch property, the storage reservoir and the water rights.  The contract provides the District with a 60 day (no obligation) time period to perform our investigations and evaluate whether these ranch assets are appropriate for Woodmoor and its customers.  The contract also provides for two 60 day diligence extensions if the District needs additional time for its evaluation.  We believe that this opportunity may serve the District well but we must be certain before we commit to buy and we must evaluate this opportunity to make sure it stands up to our scrutiny.

Please remember that the District takes this charge very seriously and compares all of it’s renewable water acquisitions to four primary criteria:

•Reliability:  Our customers expect water to flow when the faucet turns on, and the district likewise must depend on the water being in place when needed.
•Independence:  WWSD must have control over how and when any water source can be used.
•Sustainability:  WWSD must be able to depend on the water flowing from year to year.
•Cost:  Acquiring and delivering the water source must be appropriate for the district’s and our customers’ budgets.
Until the District completes its due diligence investigations we are unable to report any factual information as to how this opportunity may enhance the Districts renewable water plan, and at present time, we are unable to comment with any certainty what the magnitude of this acquisition will mean for our plan.  Please continue to check our website for updated news of our investigations and our progress.