Subcommittee members determined that people are getting more comfortable 

 with the concept of leasing, but some concern still existed. The Subcommittee 

 suggested it was better to be cautious, than to risk a bill not passing resulting 

 in the program sunsetting. It decided to propose the cap on the number of 

 streams be doubled from 20 to 40, to ensure the niunber of streams that could 

 be leased from did not inhibit the department in acquiring leases during the 

 renewed study period. It also decided that, for leases associated with water 

 conservation projects, the DFWP should have the authority to negotiate lease 

 terms coinciding with the projected financial life of the project, not to exceed 

 30 years. This would allow DFWP to ensure its lease matched the life of the 

 public investment in water conservation structures (often very expensive), 

 further encourage the Commission to approve such investments, and thereby 

 make such assistance more widely available to potentially willing lessors of 

 the water that would be salvaged. A Council member asked DNRC and 

 DFWP staff to determine whether salvage water created via DFWP-assisted 

 conservation projects could only be leased via the DFWP leasing program 

 (not through the private-party or Clark Fork leasing programs). 



Discuss Report/ 

 Proposals with EQC 



September 10, 1998 

 (Kieiena) 



The Subcommittee reviewed its conclusions and recommendations with the 

 EQC at the September 10th Council meeting in Helena. Subcommittee 

 members discussed their rationale for making recommendations that varied 

 from those of the departments, noting it was primarily caution that motivated 

 the difference (they didn't want to risk losing the program, if the introduced 

 proposal was too controversial). They also recommended a three-week public 

 review period for the working draft of this docmnent; Council members 

 conciured, and agreed they would also provide their comments during that 

 period. The Council asked DFWP staff their opinion on the proposals; they 

 expressed satisfaction with the proposals, and thanked the Subcommittee and 

 Council for their efforts. 



Three-Weeic Public 

 Review Period 



September/October 

 1998 



The Subcommittee conducted a three-week public review period on the water 

 leasing report and its other working draft reports between September 17 and 

 October 8, 1998. Several commentors responded that they had no comment on 

 the leasing report. One commentor focussed solely on the leasing topic, 

 however, and strongly urged the Subcommittee to adopt the DFWP's 

 recommendations in full. The commentor provided a variety of examples and 

 rationale to support his suggestion. The DFWP provided a comment letter 

 thanking the Subcommittee for its support, expressing satisfaction with the 

 result of the Subcommittee's deliberations, and encouraging an overall 

 legislative strategy that might begin with a proposal to make the program 

 permanent, but backing off to a 10-year extension if permanency appeared to 

 be too controversial. The department also suggested the Subcommittee again 

 consider eliminating the DNRC review process, noting the Commission 

 process was public, and made the DNRC process duplicative. DNRC and 

 DFWP staff also provided a memo concluding that Montana statutes limit 

 salvage water leasing to leasing under the DFWP leasing program. 



EQC/DFWP 1998 Water Leasing Report 



m 



