Fountain council tables 50-year Venetucci water lease, asks staff to define allocation

The Fountain City Council unanimously voted Dec. 16 to table Resolution 25‑061 — a proposed 50‑year lease that would give the city additional allocation from the Venetucci farm groundwater project — and directed staff to return within 90 days with recommendations on how to allocate the new water inventory.

Taylor Murphy, water resources and engineering manager for the Utilities Department, told the council the Venetucci project currently provides Fountain about 10% of the leased water (roughly 135 acre‑feet), which is less than 5% of the city’s approximately 3,000 acre‑feet annual usage. Murphy said the proposed lease would phase in deliveries over the first four years and run from 2026 through 2076. He described the arrangement as a “take‑or‑pay” structure: Fountain would pay for its full paper allocation each year whether it uses all of the water or not.

The lease would rely on wells operated and maintained by Security Water District. Water from the wells is routed to Security’s PFAS treatment plant — constructed with Air Force involvement — and delivered into partner systems. Murphy told the council that treatment for water delivered through Security’s plant is currently reimbursed by the Air Force, so Fountain presently does not pay direct treatment costs; if that subsidy ended, treatment charges would be added to operations and maintenance costs. Staff estimated the near‑term fiscal impact as about $40,000 in the first year of the lease and a roughly $190,000 annual impact by 2030 when full deliveries are anticipated.

Council members and staff repeatedly stressed that the new inventory is finite and recommended defining an allocation policy before finalizing the lease. Scott Treanor (staff) called the additional supply “cheap inventory” that still carries value, but said the city should set allocation priorities — how much to reserve for infill, new residential connections, commercial or industrial growth, or special projects — to avoid developers immediately claiming the capacity under existing water rules.

Public speakers asked whether the lease would support growth in Fountain and whether a 50‑year term was too long. Murphy and Treanor said the lease would increase capacity modestly (staff estimated capacity for perhaps “a couple thousand” new connections in general terms) and that the lease contains terms for mutual extension and other contract provisions; they explained a longer term provides planning certainty for infrastructure and development.

Mayor Pro Tem Estes moved to table passage of Resolution 25‑061 to a date no later than 90 days from the meeting; Council member Geeke seconded. The council voted 7–0 to table the measure and requested staff return with a dedicated allocation discussion (staff indicated they plan to return in January with details and to finish the allocation discussion no later than the 90‑day window).

Votes at a glance: the consent agenda was approved earlier in the meeting (7–0), Resolution 25‑061 was tabled to a date no longer than 90 days (7–0), and the council later voted 7–0 to enter executive session to receive legal advice on settlement authority.

If the council ultimately approves the lease, staff warned, the city will assume Security’s existing obligations to pay the take‑or‑pay ground‑water fees and will also incur incremental O&M and modest capital costs to increase pumping capacity and redundancy before full deliveries begin. Murphy summarized the policy tradeoff: the Venetucci allocation is immediately available with little capital outlay, but the council must decide how to allocate that limited supply.