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Western States Water Council Legal Committee Sioux Falls, South Dakota May 3,2007 Oklahoma Duane Smith: The State of Oklahoma passed a moratorium on out-of-state transfers until a comprehensive study could be done on our state water plan. A couple of months ago, the Tarrant County Water Authority came to my office and filed an application to transfer 460,000 acre feet of water from southeast Oklahoma to Texas. That was at 10:00 in the morning and by 2:00 in the afternoon a lawsuit was filed in federal court to enjoin the Oklahoma Water Resources Board from enforcing that moratorium. Also, on our Red River compact, Texas is making a legal determination that they are entitled to half ofthe water in the Red River. The interesting part is that they believe they can come into Oklahoma and take their share. It's going to be interesting. Our defense, of course, is that we have a moratorium until we do our comprehensive water study. We think it's a fairly good argument. Nevada Roland Westergard: It's not litigation, but Tracy Taylor, State Engineer didn't issue a ruling on an application filed by the Southern Nevada Water Authority for 91,000 acre feet of groundwater in one ofthe eastern Nevada valleys. They have to do five years of hydrological and biological monitoring before they can complete a project and have to pump at least 35,000 acre feet of water for 10 years, not to exceed 40,000 acre feet during that 10 year period. At the end of that time, if there are no adverse impacts, Tracy can make the determination if it's acceptable to go forward and increase the pumping. If there are adverse impacts, or consequences, the pumping would have to be curtailed to address the concerns of protecting those existing interests. This is about a 56-page decision. It was issued about April 20th and there is a 30-day appeal period in the State of Nevada. There are still pending applications in other basins. Jim Davenport: One other major thing that is happening that is beneficial to Nevada, is the Seven States Agreement on the Colorado River. Last week on the 23rd, the seven states signed the agreement, which relates to the Secretary ofInterior's adoption of shortage guidelines for the Colorado River system. In particular, in this agreement there is the ability for Nevada to create some water out ofthe Colorado River water system in addition to it's 300,000 acre foot apportionment. The first piece of that is the Southern Nevada River Authority is going to be allowed to invest some money into the development of a structure, the re-regulation structure in Imperial Valley. Nevada would get some of the state water that would be created by the new re-regulation structure. That amount is up to 40,000 acre feet per year. The second area in which the State of Nevada gets some benefit from this agreement is that water which had been used in the diversion of Muddy River prior to the Congress's adoption of the Boulder Canyon Project Act for agriculture, may be permitted to be taken out of agricultural service and left in the tributaries, and flow to the extraction point at Lake Mead, and then be extracted there. The third accomplishment is the project about which Roland reported. The state engineer's conditional 40,000 acre feet will be accounted for by the Secretary ofInterior as though it had been returned to Lake Mead. It will increase the return flow that goes to the Colorado River. That will then permit the extraction of the water from the river to replace it. With respect to the lower basin states promise in this agreement, it is that they will not challenge the action of the upper basin states in the development of their Colorado River resources during the period of this agreement, which runs until 2025. Should there be any causes of action, discussions would be undertaken before taking it to court. There's a mutual promise thatthese disputes would not be ripe for 10