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001429 administering interstate agreements to allow off stream storage and contractual distribution of Colorado River water, and thereby encourage voluntary interstate water transactions among the Lower Division States. Such voluntary water transactions, including interstate contractual distribution of Colorado River water consistent with the BCP A and the requirements of the Supreme Court of the United States in its Decree entered March 9, 1964 (3376 U.S. 340) (Decree) in Arizona v. California, et al., can help to satisfy regional water demands. The proposed rule does not deal with intrastate storage and distribution of water. The proposed rule will foster prudent water management in the Lower Division States by allowing authorized entities of Consuming States, pursuant to an interstate agreement, to store Colorado River water offstream, to receive storaf!e credits for the stored water. and to recover this water for future use. The off stream storage will be accomplished through an authorized entity of the Storing State. The water to be stored will be basic aDDortionment from the Storinf! Slate. or unused basic apportionment or unused surplus apportionment of the Consuming State. The proposed rule is based on the understanding that this type of offstream storage is a beneficial consumptive use of Colorado River water. The rule is permissive in nature and is intended to encourage and facilitate these voluntary water transactions. The proposed rule is designed to improve the Secretary's ability to fulfill his responsibilities to manage the Lower Basin of the Colorado River on a more efficient basis. This proposed rule is expected to be a first step toward improving the efficiency associated with management of the Colorado River in the Lower Basin. While taking action in the form of this proposed rule to assist the States of the Lower Division of the Colorado River to meet their water needs, the Department also acknowledges its responsibilities to the Indian Tribes in the Lower Division. The Department is interested in finding ways that the Tribes may more fully benefit from the water rights they hold in the Lower Basin, and in protecting the availability of water supplies to which these rights attach. The focus in the proposed rule is on the use of State-authorized entities, including water banks, as a vehicle for authorizing interstate storaQe and redemotion of storalle credits associated with Colorado River water. The Department believes that the interstate water storage and deliveries permitted by these rules can be implemented without compromising its responsibilities toward, and in fact may lead to benefits to, the Indian Tribes. The Department's proposed reliance on State-authorized entities is predicated, in part, on its expectation that these entities will be operated in a fashion that provides an opportunity for Indian Tribes to participate in storage and similar activities. In this regard the Department notes that the State of Arizona is examining "mechanisms that will enable Indian communities that hold entitlements to Colorado River water to participate in water banking with the Arizona Water Banking Authority." Arizona Laws 1996, ch. 308, Sec. 27. The Department encourages Arizona and the other Lower Division States to implement programs within the existing Law of the River that will allow the Tribes to more fully benefit from their water rights. In addition, the Department will be mindful of the need to protect local tribal water resources when fulfilling its role as set forth in these interstate water banking rules. Tribes as well as other water rights holders may, for example, have concerns regarding the potential impacts of future groundwater withdrawals from a water bank on their water rights. The Department wants to work with Lower Division States and authorized entities banking 15