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<br />Allen Matkins Leek Gamble & Mallory LLP <br />attorneys at law <br /> <br />Interested Persons <br />May 23,2003 <br />Page 2 <br /> <br />1998 IID/SDCW A Conserved Water Transfer Agreement, including the Fourth Amendment <br />thereto <br /> <br />The essence of lID's obligation is summarized in Article 2: "The IID may undertake and <br />agrees to contract with Landowners to undertake Water Conservation effortsin order to reduce <br />the diversions (less retumflows) of Colorado River water by the IID. The IID agrees to transfer <br />the Conserved Water to the Authority." Section 3.1 specifies the "quantity of Conserved Water <br />transferred in Agreement Year 1 through 19" and thereafter (at Fourth Amendment). Section 6.5 <br />identifies how this is accomplished. "The IID effects a transfer of Conserved Water under this <br />Agreement by reducing its annual diversion (less retumflows)from the Colorado River at <br />Imperial Dam by an amount equal to the Conserved Water to be transferred." Verification is <br />identified in Section 8. 1 (d)(i)(E) and (F), requiring lID's diversions at Imperial Dam (less return <br />flows) be reduced by the quantity of transferred Conserved Water and by measuring such <br />reductions against a 3.1 mafy cap. Section 14.2 imposes the obligation on the lID to contract <br />with the landowners and to enforce the contracts: "The IID solely shall contract with <br />Contracting Landowners and shall be solely responsible for enforcing the terms of such <br />contracts. The IID shall bear the sole responsibility and consequences of a breach by any <br />Contracting Landowner." Article 16 governs enforcement of these contractual obligations by <br />SDCW A, including specific performance (Section 16.1). <br /> <br />March 2003 IID/CVWD Acquisition Agreement and March 2003 IIDIMWD Acquisition <br />Agreement <br /> <br />These Agreements obligate IID to implement transfers and reductions in lID diversions in <br />the same manner as the lID/SDCW A Transfer Agreement. Specific'delivery schedules for <br />conserved water transfers are identified (lID/CVWD Acquisition Agreement Sections 3.1 and <br />3.2 and Exhibit A; 1ID1MWD Acquisition Agreement Exhibit E.) Reductions in lID <br />consumpti ve use in the amount of conserved water transferred is required. (lID/CVWD <br />Acquisition Agreement Section 7.2; IIDIMWD Acquisition Agreement Section 9.1.) The risk of <br />nonperformance by contracting landowners is exclusively on the IID. (IID/CVWD Acquisition <br />Agreement Section 14.2). Remedies for lID breach include specific performance (lID/CVWD <br />Acquisition Agreement Section 16.1; lIDlMWD Acquisition Agreement Section 18.1). <br /> <br />Secretarial Iml'lementation Agreement <br /> <br />The SIA is an agreement among IID, SDCW A, MWD, CVWD and the Secretary. <br />Section 2(a) establishes the contractual obligation of the Secretary to deliver Colorado River <br />water as set forth in the SIA. Section 3 establishes the IID contractual Priority 3a cap and the <br />Secretary's contractual commitment: "The Secretary shall deliver Colorado River water to IID <br />in an amount up to but not more than IID's QSA Priority 3a consumptive use quantification cap <br /> <br />579332.01lSD <br />I4161-OO2I5-26-03/dlaliah <br /> <br />