11

• Board Meeting Date: 9/18/2007
• Description: WSP Section - Navajo-Gallup Water Supply Project Support
• Board Meetings - Doc Type: Memo

Agenda Item 11
September 18-19. 2007 Board Meeting
Page 3 of 4

regard. In fact, it is in Colorado's interests long-term to see this Settlement
completed. Assuming the "Depletion Guarantee" remains part of the BO, we ask the
USF&WS to consider language that acknowledges that unused depletions identified
in Table 4 as occurring in Colorado are for Colorado water users, not New Mexico
water users. This trigger mechanism and accounting procedure cannot injure
Colorado water users should the situation between the Navajo's and USF&WS
change without re-consultation and notice to all affected paliies.
d. The BO is based upon reducing other Navajo depletions if the "Presently Unused"
portion of the depletions in Table 4 becomes fully utilized. Again, this is clearly
contrary to the purposes of the SJRIP and the "Principles for Conducting Endangered
Species Act Section 7 Consultations on Water Development and Water Management
Activities Affecting Endangered Fish Species in the San Juan River Basin" developed
by the SJRIP Coordination Committee and endorsed by the USF&WS. The
Principles provide a process for the USF&WS to follow during the conduct of Section
7 consultations. The BO should be modified to reflect this process.

Resolution should consider the following:
. The Navajo's should have gotten a Section 7 Consultation based on the progress
of the SJRIP as described in the Principles for Consultation.
. If the depletion guarantee remains, it should be limited strictly to NIIP depletions.
Since our discussion in May the USF&WS is considering whether or not the BO should be
reopened to address this matter.

Lower Basin Actions

The Lower Division States have filed objections to the Hydrologic Determination, which
objections have been considered by Reclamation. However, over the objections of the Lower
Basin, Reclamation has formally signed off on the Hydrologic Determination. By signing off on
the Hydrologic Determination Reclamation will not withdraw support for any legislation
implementing the NGWSP at least on this basis. Reclamation does continue to express concerns
with the overall project costs associated with the Settlement.

Arizona's Position and Colorado's Concerns

Arizona' position is that any depletion of water from the San Juan River in New Mexico
that results from the diversion of water by the NGWSP for uses within Arizona, upon completion
of a settlement agreement between the Navajo's and Arizona (approximately 6,400 AF), should
be accounted for as part of the 2.8 MAF of Colorado River water apportioned to Arizona in
Article II(B)( 1) of the Supreme Court Decree in Arizona v California.

Colorado has identified several concerns with Arizona's position:
1. Any use ofNGWSP water in Arizona could and should be satisfied from Arizona's
50,000 AF apportionment of Upper Basin water.
2. Arizona's position raises a number of questions and concerns relative to the use of
tributary Colorado River water pursuant to provisions in the Colorado River Compact and
is at the very least inconsistent with the Colorado River Compact.
3. Arizona's position is contrary to provisions in previous laws that Arizona has agreed to
even though those provisions were not ultimately invoked.