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<br />000748 <br /> <br />responsibility of non-Federal Project participants. In addition, the Settlement Act provided for the <br />establishment of a Tribal Development Fund and other project arrangements. It also specifies <br />that the Tribes, under provisions of Federal law, can lease or temporarily dispose of water to the <br />extent permitted by State and Federal laws, interstate compacts, and international treaties. <br /> <br />Section 3(a)(3) ofS. 1771 would limit the capital payment obligations for the San Juan Water <br />Commission, Animas-La Plata Water Conservancy District and the State of Colorado for the <br />nontribal municipal and industrial water supplies attributable to the three features included in the <br />modified Proj ect to $29 million. Section 4 (b) acknowledges that the uncommitted portion of the <br />State of Colorado's cost sharing obligations provided in the Cost Sharing Agreement shall remain <br />available to assist in the funding of other facilities and features of the original Animas-La Plata <br />Project. <br /> <br />The proposed cap on the fmancial contribution of non-Indian beneficiaries is contrary to long- <br />standing Reclamation law and policy that requires non-Indian M&I water users to payor repay all <br />costs allocated to serving them. For example, the 1986 cost-sharing agreement for the original <br />Animas-LaPlata Project required the non-Indian M&I water users and beneficiaries to adhere <br />toReclama~ion law and policy and pay all of their allocated costs. By constrast, S. 1771, would <br />cap the obligations at about 10.8 percent of the estimated project costs, including funds provided <br />on their behalf by the State of Colorado. Under such an arrangement, the Federal taxpayers <br />would bear a disproportionate financial burden. <br /> <br />S. 1771 would further increase the Federal government's cost-share by not allowing adjustments <br />for ordinary construction cost increases and inflation. Specifically, the bill does not include <br />indexing language to adjust the repayment obligations from 1998 price levels plus or minus such <br />amount, if any, as may be justified by reasons of ordinary fluctuations in construction costs as <br />indicated by engineering cost indexes applicable to the types of construction involved herein. <br /> <br />Addressine Concerns of the Navaio Nation <br /> <br />The Navajo Nation's water rights in the San Juan Basin have not been quantified and the United <br />States cannot allow those rights to be compromised through a process that could have the effect <br />of distributing additional depletions from the original or a modified Animas-LaPlata Project <br />among non-Indian stakeholders at the expense of the Nation. Any legislation addressing water <br />rights in the San Juan Basin must ensure that any depletions will not compromise the Navajo <br />Nation's rights to waters of the San Juan River and its tributaries, nor its ability to secure water <br />for the Navajo Indian Irrigation Project. <br /> <br />S. 1771 raises additional concerns regarding the proposed transfer of the Department of the <br />Interior's water rights in New Mexico under New Mexico Engineer Permit No. 2883. In <br />particular, the legislation does not clearly provide that the proposed transfer shall not affect <br />application of the Endangered Species Act and other federal law requirements for the use of this <br /> <br />9 <br />