The aforementioned concerns reflect potential opportunities for the District to

Staff Report & Agenda Item Details

5. The aforementioned concerns reflect potential opportunities for the District to face expensive and unnecessary litigation that is both an unwanted distraction, as well as a drain on district resources. FSH requested that the proposed “Transfer of Ownership” wording be simplified. He also requested that the Board allow the General Manager and the District's consultants to work with Stakeholders to refine the proposed rulemaking package and bring it back to the Board with a consensus recommendation. lit Middle Pecos GCD Minutes for June 19, 2018 Page 3 Public Comment: Mark Harral made three comments. 1) A high producing well that did not receive a production permit for what the well could produce could potentially sue MPGCD based upon the investment-backed expectations. 2) This could potentially hurt small business owners and cause them to be unable to get financing from a bank if they do not have a corresponding production permit. 3) MPGCD could issue a drilling and production permit, and once the well was drilled and the pump test completed — the District could reduce the permit based on the results of the pump test. General Manager Ty Edwards: SUMMARY OF PROPOSED RULES CHANGES (Rules 9.2, 11.1, 11.9) (1) New requirement: limited (8-12 hour) “specific-capacity” pump tests and reports for new or amended production permit applications e All nonexempt wells that are not subject to hydrogeological report (and more extensive pump test**) are subject to this limited pump test ** No change to the more extensive pump test for hydrogeological reports already in the rules. e Pump test parameters have not changed (from April Board workshop discussion and Allan Standen’s recommendation). e New permitting timeline: Drilling permitting >Then pump test and report > Then production permitting. No consolidated permit apps. e Purpose: Better scientific info for decisions on production permit apps. (2) Information required for Drilling Permit vs. Production Permit vs. Permit Amendment Applications e Rule 11.9.1 reorganized to reflect separate application requirements. e Permit/registration transfers made easier. Adjourn hearing and consider and/or act on proposed rules. President McGuairt adjourned the hearing at 10:19 a.m. Janet Groth made a motion to approve rule change 9.2.7 first paragraph as written. Motion seconded by Vanessa Cardwell. Motion Carried Unanimously. 10 For. -0- Oppose. 1 Absent. Mike Gershon pointed out that there are additional edits to the rules in 11.1 that implements what was just passed. He proposed that another motion be offered to make the other edits consistent with the motion that was just passed. Janet Groth made a motion to approve all edits that will make the rule consistent throughout the changes. Motion seconded by Vanessa Cardwell. Motion Carried Unanimously. 10 For. -0- Oppose. 1 Absent. Middle Pecos GCD Minutes for June 19, 2018 Page 4 Ronnie Cooper made a motion to approve 11.9.1 and 11.9.2 as proposed in the tule changes. Motion seconded by Janet Groth. Ronnie Cooper amended the motion: approve 11.9.1 and 11.9.2 as proposed in the rule changes — having a threshold of 20 acre feet minimum, and under a 1,000 acre feet with a specific capacity pump test report, and striking the language that drops the 250 acre feet threshold. (This leaves the 250 acre feet threshold in the rules/See Attachment A, page 18, Rule 14.4.2). Amended motion seconded by Janet Groth. Motion Carried. Vote: 9 For. 1 Oppose. 1 Absent.

This motion is scored as RESTRAINS_GOVERNMENT (Impact Weight: 4.2/10). Under the Bastiat Liberty Watchdog Index, voting YES on measures that cap or reduce ad valorem tax burdens, expand taxpayer exemptions, retire debt early, enforce competitive bidding caps, or remove regulatory/zoning barriers to private property rights earns a positive Pro-Liberty score.