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. The Honorable Gale Norton Page 20f7 At the same time, the Basin states are also experiencing population growth. As a result, states like Arizona and Nevada, that once did not use their full Colorado River apportionments, now do. Over the last decade, the Department and the seven basin states painstakingly negotiated an historic agreement on Colorado River water use. The principal issue of the negotiations was how to achieve certainty that California would actually reduce its overuse of the Colorado River. The agreement that emerged is embodied in what is known as the AInterim Surplus Guidelines.@ This agreement is non-partisan, as demonstrated by the fact that my predecessor, former Interior Secretary Bruce Babbitt, negotiated and approved the Guidelines. After careful review when I took office, I endorsed the agreement, and decided to stay the course. That was the right decision then, it is the right decision now. My staff and I have been working for more than a year and a half to keep the process on track. This seven-state agreement gave California a choice for reducing its Colorado River overuse: California could take specific actions to reduce its Colorado River water use to 4.4 million acre-feet by the year 2015. In return, California would receive enhanced access to surplus water during a 15 year interim period. This is known as the Asoft landing@ for California. Alternatively, if California didn=t take required actions, it would immediately lose enhanced access to surplus water, beginning January 1,2003. This is known as the Ahard landing@ approach. California=s choice will be determined by whether California water entities sign the Quantification Settlement Agreement before January I st. At this time, it appears that California=s Imperial Irrigation District has decided not to execute the QSA. This QSA is extremely important to the basin states and to the Department. The QSA quantifies California agricultural water entitlements - a matter that has been unresolved since 1931. Without a clear understanding of each entities= portion of California=s agricultural entitlement, it will be very difficult to transfer water from California=s agricultural users to its urban users. These transfers may be the only solution for California to live within its 4.4 million acre-foot limit. Here=s why. California=s agricultural users have a priority right to 3.85 million acre-feet of this apportionment, and the small remainder is all that is left for Southern California cities serving more than 17 million people. If California chooses the Ahard landing@ approach, California will lose access to surplus water beginning January I, 2003. Cities in Southern California will bear the immediate shortfall, potentially losing as much as half of the Colorado River water they currently receive. Because the Metropolitan Water District in Southern California had the leadership and foresight to develop alternative water supplies, people there will continue to see water flow from their taps. But over time, the reduction in Colorado River water could have very real impacts to all water users in Southern California. As you all know, the operations of the Colorado River reservoir system are determined in each year's Colorado River Annual Operating Plan. The Annual Operating Plan is developed with input from the Basin States, Tribal representatives, environmental groups and other members ofthe public. I signed the 2003 Annual Operating Plan this morning. The Annual Operating Plan implements the Surplus Guidelines. It provides that if the California entities do not sign the QSA, surplus deliveries of water to Southern California cities will automatically be suspended in 2003. As Secretary and River Master, I must enforce the Law of the River. This means I will hold California to the http://www.doi.gov/news/nortonl.html 12/16/2003