The Association shall allow for deposits of water rights in the bank in exchange for financial compensation. The Association shall accept for deposit only a water right, or portion of a water right, that has been determined to be a bankable water right as defined by K.S.A. 82a-764, as amended, and Article IV, Section 404 of the charter. The depositor sets the price for a deposit, and will only receive compensation for such deposit when the water is leased from the Association. The deposit will be posted on the Association’s bulletin board when all fees required with the deposit are paid in full to the Association. Annual deposits posted to the bulletin board and not contracted for lease at the end of the calendar year shall only be extended when appropriate fees are paid in full.
Rules for Depositors
The deposit shall be for a period of not more than five years. The deposit must be posted on the bulletin board on or before April 1, of the first calendar year that the deposit will be made. All deposits must be for increments of full calendar years.
The proposed deposit:
is from a certified water right or vested right
is from a hydrologic unit designated by the Association
is within the Association's boundary
A contract between the Association and the depositor shall be required that sets forth all penalty provisions for breach of any contract conditions. The deposit shall be subject to such terms and conditions as provided by rules and regulations of the chief engineer. The depositor shall complete an application for contract to deposit on a form prescribed by the Association and approved by the chief engineer.
The amount that is eligible for deposit into the Association in the Deposit program is he average water use for years 1987 through 1996. This is intended to prevent the increase in net consumptive use for the local aquifer. If the Association were to allow deposits from water rights that were not diverted historically, this could result in an increase in consumptive use from the local aquifer.
The application shall include, but not be limited to the following:
The water right file number and hydrologic unit
Calendar years that the water right will be on deposit not to exceed five years
Whether the water right is a vested right or certified right
Any CRP contracts or WRCP contracts that were in effect any part of the representative period
Any violations of the water right within the last five years
Quantity of water proposed for deposit
If partial deposit, amount remaining under bankable portion of original water right
Accurate water use, purpose of use, and acres irrigated (if for irrigation) during the last two years preceding the date the application is filed
Terms of payment
Source of supply
Amount of water right that is bankable (average water use in past representative period)
All contracts for partial deposits shall set forth conditions limiting the total quantity of water pumped remaining under the right and the amount deposited to the bankable amount.
In 2016, Association board identified a participation roadblock in the Deposit program. Up to that point, the procedure utilized a public bulletin board on the website for advertising water for sale or lease. Additionally, the procedure was set as a “first come, first served” system. Unfortunately, this creates a burden on the individual offering the water to accurately determine the price for the water and a potential bias for those individuals who keep track of the bulletin board posts.
In an attempt to alleviate the second issue of notification, the Association now utilizes a real-time notification system that can advertise directly to anyone that wishes to be a part of those lists. More information on this system can be found on the notification system.
To address the first issue, the Association established two avenues for depositing water into the Association. The first would be a private deposit that would protect deposited water from being leased to unintended recipients. The second avenue is public and utilizes the notification system to implement a bidding system.
Public vs Private Deposit
Water deposited through this avenue will be immediately posted to the Association bulletin board and notifications sent out using the Association’s notification system. All public deposits shall include within the terms of payment the “reserve price” for the water and the time frame for accepting bids (minimum seven business days).
The Association will utilize a sealed bid framework within a set time frame for completing Public Deposit transactions.
The Association shall, through the notification system, notify the appropriate subbasin group of the amount of water available for lease within the Association and state the reserve price and timeframe for accepting sealed bids. Additionally, a link to the lease application form shall be provided for convenience.
Every bid must include complete lease application(s).
At the end of the time frame for each public deposit, the Association Manager shall open all sealed bids submitted on or before the deadline.
The bids will be ranked according to the price offered on the application in order to determine the high bid in excess of the reserve price.
An Eligible lease application will
Be within the appropriate hydrologic unit for the public deposit
Have all fees paid for the Lease application per the fee schedule
Eligible lease applications will notified within three business days following the end of the bidding timeframe of their result.
In the event of equal high bids, there shall be an additional 5 business days to allow for secondary bids of equal or higher value from the eligible lease applications involved.
In the event of eligible bids below the reserve price, the individual depositing the water shall, at their discretion, consider accepting bids below the original reserve price.
Once the publicly deposited water is leased in full, the prices for those transactions will be published to the bulletin board after redacting any personally identifying information.
Water deposited through this avenue will be held privately by an individual designated by the individual depositing the water. The depositor may set a price for this water, but it will not be required. Any contract to deposit water into the Association through this method will expire at the end of the calendar year in which it is entered into if the depositor has not completed the Lease of the deposited water within the same calendar year