Fountain Council approves water authority membership, withdraws from Haines Creek reservoir project

The Fountain City Council on Aug. 12 approved three related resolutions to manage regional water infrastructure: (1) a temporary construction and right-of-entry license for the Arkansas Valley Conduit pipeline across jointly owned Roy/Haines Creek property; (2) creation of a Restoration of Yield Water Authority and Fountain’s membership in it; and (3) direction to staff to remove Fountain from the Haines Creek (Roy Haynes) reservoir project and authorize sale of the city’s share.

Why it matters: Council members said joining the authority preserves Fountain’s ability to participate in future regional projects while the city exits a project staff and council described as small relative to Fountain’s needs and potentially expensive. The votes were 5–0 on each resolution.

City staff said the authority creates an administrative “umbrella” to study and manage multi‑jurisdiction water projects and allows members to opt into particular projects later. The presentation explained that Fountain currently owns a 4.76% share of a site near Boone (sometimes called Haines Creek Reservoir) that, under a 2019 preliminary design, would provide roughly 4,004 acre‑feet of storage total; Fountain’s share would be about 200 acre‑feet. The 2019 construction estimate was roughly $53 million; Fountain’s share at that time would have been about $2.5 million, and staff said current costs are likely higher.

Staff and council emphasized two points: Fountain will remain a member of the authority to keep a “seat at the table” for future projects, and the city has an off‑ramp in the authority agreement that allows members to exit specific projects and recover sunk costs. Staff recommended selling Fountain’s share of the Haines Creek property and returning the proceeds to the utility fund; in presentation staff said they expect to recover at least the city’s purchase price (roughly $135,000 plus small post‑purchase costs paid to date).

During the presentation staff described the technical context: state‑managed water “exchanges” move accounting of water upstream or downstream without physically moving it, and a 2004 intergovernmental agreement (Arkansas Flow Management Program) requires municipal users to curtail exchanges when minimum flows through Pueblo are needed for environmental and recreational purposes. The proposed authority and downstream storage options are designed to “restore yield” by providing temporary downstream storage so exchanges can resume later.

The council voted to approve the temporary construction license (to accommodate the federal Arkansas Valley Conduit construction crossing the Haines Creek property), to authorize formation of the Restoration of Yield Water Authority and Fountain’s membership, and to direct staff to remove Fountain from the Haines Creek reservoir project and to sell the city’s share. Each resolution passed 5–0.

Staff noted the easement/license for the federal conduit is time‑sensitive because the U.S. Bureau building the pipeline wants to proceed; the license is a five‑year temporary agreement to allow construction followed by permanent easement discussions.

Councilmembers and members of the public asked about governance of the authority, quorum and voting (the authority uses simple majority votes for routine matters and weighted voting for significant project decisions), who would sit on the authority board (staff representatives were described as likely), and what proceeds from a sale would be used for (staff said proceeds would go back to the water utility fund). The council’s motion included authorization for staff to execute sale negotiations.

Looking ahead: Fountain remains a member of the new authority to evaluate future projects. The city manager and utility staff will handle the sale process for the Haines Creek share and return with final sale documents if required by council policy.