Code of Colorado Regulations
400 - Department of Natural Resources
402 - Division of Water Resources
2 CCR 402-12 - RULES GOVERNING THE ARKANSAS RIVER WATER BANK PILOT PROGRAM
2 CCR 402-12.8 - Transactional Procedures

A. After the water bank operator negotiates a lease or option agreement between the seller and buyer of the deposited water, the water bank operator will provide the State and Division Engineer with a signed agreement describing the transaction, including but not limited to the amount of water, the place of use, and the proposed time of use. (If needed, the bank will provide a standard agreement form). If the proposed lease/option shall require delivery of water into a different distribution system, the seller or buyer shall provide written consent of the owner or operator of the receiving facility or system, including any terms or conditions related to the use of such facility or system. The lease or option agreement also shall include a provision addressing procedures to be followed upon a breach of the agreement by either party.

B. Within two (2) business days of sending the lease or option agreement to the State and Division Engineers, the water bank operator shall provide written notice of the proposed transaction by first class mail or electronic mail to all persons who have subscribed to the Water Bank Notification List, and shall provide proof of such notice to the State and Division Engineers. The notice shall include the names and addresses of the parties to the transaction, a description of the water right involved, and a description of the proposed transaction, including but not limited to the amount of water, the historic place of use, the proposed new place of use, the proposed time of use, and the proposed type of use. The water bank also shall post the notice on its website.

C. The State and Division Engineers shall allow persons or entities thirty (30) days after the date of mailing of the notice in Rule 12.8.B to file written comments on the transaction. Such comments shall include any claim of injury or any terms and conditions that should be imposed upon the transaction to prevent injury to a party's water rights, and any other information the person or entity wishes the State and Division Engineers to consider in reviewing the proposed transaction.

D. Within five (5) business days after the close of the comment period described in Rule 12.8.C, the State and Division Engineers, after consideration of the comments received on the transaction, will provide the seller and buyer, and any person or entity who has submitted written comments, with terms and conditions necessary for implementing the agreement. The terms and conditions shall include any necessary and/or desirable limitations upon the time, place or type of use of the water made available through the water bank, or other terms and conditions as deemed necessary to prevent injury to vested water rights, including dry-up provisions where applicable. In making the determinations necessary to developing such terms and conditions, the State and Division Engineers shall not be required to hold or conduct any formal hearings or proceedings, but may hold or conduct a hearing or formal proceeding if the State and Division Engineers find it necessary to address the issues. Any such hearing shall be held pursuant to the Division of Water Resources Procedural Regulations, 2 CCR-402-5.

E. Upon acceptance by the buyer and seller of the State and Division Engineers' terms and conditions, the water bank operator may finalize the agreement between the seller and buyer. Once the agreement is finalized and all parties, including the water bank, have been properly compensated, the water bank will notify the Division Engineer of the completion of the transaction.

F. A seller of deposited water shall comply with all state and local laws and regulations regarding land use and vegetation (i.e. weed control).