To: Honorable Mayor and Members of Town Council
Through: David L. Corliss, Town Manager
From: Mark Marlowe, P.E., Director of Castle Rock Water
Lauren Moore, Water Resources Manager
Zuzana Howard, Water Resources Program Analyst
Title
Resolution Approving the 2026 Spot Water Lease Agreement Between the Town of Castle Rock and Highlands Ranch Water [Chatfield Reservoir, Douglas County]
Body
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Executive Summary
Castle Rock Water is seeking Town Council approval of a resolution (Attachment A) for a spot water lease agreement (Exhibit 1) with Highlands Ranch Water (HRW). HRW wishes to lease some of the Town’s surplus water stored in Chatfield Reservoir to increase their storage supplies within Chatfield and have additional water. While the Town currently owns 848 acre-feet (AF) of storage in Chatfield, the Colorado Water Conservation Board (CWCB) allows for rental of the remaining permitted amount, for a total of 2,000 AF of storage. The Town currently has upwards of 1,600 AF of water stored in the reservoir with additional reusable supplies coming in each day.
If Council approves this lease, up to 1,000 AF of water may be released from the Town’s Chatfield Reservoir storage account as a book-over into HRW’s Chatfield Reservoir storage account during 2026. This release may occur between May 6, 2026 and December 31, 2026. The Town will assess a $420 per AF price for the water with a minimum lease of 200 AF. The 2026 lease rate was increased by the Consumer Price Index (CPI) based on 2.1% annual increase from $411 per AF in 2025. Initial payment of $84,000 for the minimum 200 AF lease will be required within 30 days from approval of this lease, with the remaining quantity to be paid upon subsequent releases. The potential revenue for this lease is up to $420,000. The agreement will terminate at the end of 2026.
Staff Recommendation
Staff recommends approval of the resolution as presented.
Proposed Motion
“I move to approve the Resolution as introduced by title.”
Alternative Motions
“I move to approve the Resolution as introduced by title, with the following conditions: (list conditions).
“I move to continue this item to the Town Council meeting on _____ date to allow additional time to (list information needed).”
Attachments
Staff Report
Attachment A: Resolution
Exhibit 1: Spot Water Lease Agreement