1. CENTRAL KANSAS WATER BANK P O Box 7 - Stafford, Kansas, Tele:620-234-5352 email: gmd5@earthlink.net

5. 1997 Kansas Water Plan stated goal for Water Banking in Kansas Efficiently allocate water resources to achieve economic growth while protecting the public interest in such resources through encouraged conservation and management of existing water rights.

6. OBJECTIVES Add flexibility in closed areas Reduce water use in over appropriated areas Reduce impact of pumping on to streams

7. KANSAS WATER BANKING ACT Signed by the governor in May 2001 Defines a water bank as a not-for-profit corporation that (1) Leases water from water rights that has been deposited in the bank and (2) provides for safe deposit accounts.

8. CENTRAL KANSAS WATER BANK Working through GMD5 to start initial bank. Steering committee established to draft charter. Developed first draft and submitted to chief engineer in May 2002. Received first review comments from chief engineer in September 2002. Second draft submitted to chief engineer April 03. Third draft submitted August 03

9. Charter Outlines the location, boundaries, and organizational rules. Defines conservation programs, bankable water rights, hydrologic units and associated guidelines. Sets forth procedures for the deposit and leases and the safe deposit account programs.

10. PROGRAMS DEPOSITS AND LEASES

11. DEPOSITS Water right must be determined bankable. Water right must be in good standing, and be certified. Amount of a water right that is bankable will be 85% of an individuals average water use for the period 1987 through 1996.

12. Bulletin Board Postings NAMEDATEAC/FTCOST/AF Posting 11/14/0410025.00 Posting 22/18/047550.00 Posting 33/12/0415030.00 Posting 43/18/042515.00 Posting 53/20/043510.00 Posting 63/21/041550.00 Posting 73/24/0412545.00 Posting 83/25/048035.00 Posting 95/30/048515.00

13. Leases Any water leased must be used within the bank boundary and in the same hydrologic unit from which the water right authorizing diversion of the water is deposited. K.S.A. 82a-763(b)(1)

15. Conservation Component All leases will be subject to the conservation program. A minimum 10% conservation component must be achieved. Net consumptive use must not be increased.

16. Point System System developed to determine conservation elements – based upon: 1. Number of wells within two mile area 2. Water level changes since predevelopment 3. Amount of saturated thickness

18. Lease Example Water user wants to lease 150 AF After applying conservation component of 20% – he must buy 187.5

19. Water User Purchases 35 AF from Posting #5 = $ 350.00 25 AF from Posting #4 = $ 375.00 85 AF from Posting #9 = $1,275.00 42.5 AF from Posting #1 = $1,062.50 Total of 187.5 AF for $3,062.50

20. PROGRAMS DEPOSITS AND LEASES SAFE DEPOSIT ACCOUNTS

21. Carry over a certain percent of unused water from one year to the next Requires water users to monitor water use and report more accurately Promotes conservation (incentive to save water)

23. Accounting Water use tracking system of all deposits and leases will be developed to assure accountability of conservation efforts. Annual reports must be generated and submitted to the chief engineer.

24. HYDROLOGIC MONITORING A total of 367 well sites will be used to monitor water levels within the bank boundary There will be annual reviews of all climatic conditions, water use, and water levels.

25. COMPLIANCE AND ENFORCEMENT Procedures are being developed to address non-compliance with the Banking Program Contracts will be developed between the bank and water users setting forth each partys obligations

26. DIVISION OF WATER RESOURCES State Engineer retains jurisdiction of bank Bank must reimburse the state for associated costs Bank must pay costs to have the state review banking activities which includes a hydrologic and economic review.

27. 5 Year Review The bank can only be chartered for seven years. After five years of operation, the bank will be evaluated to determine if it has met the goals set out in the Banking Act and the Kansas Water Plan. The chief engineer has the authority to extend the bank another seven years or call for dissolution after the initial seven year period.