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<br />Secretarial level and thus eliminating any opportunity for lID to administratively submit <br />evidence and appeal Interior's decision. <br /> <br />H. lID's lawsuit against Interior - On January 10th liD filed an action in the US District <br />Court in San Diego against Interior and some of its officials. The suit set forth a number <br />of counts, or allegations of wrong-doing on the part of the government, covering matters <br />such as: 1) Interior did not have the authority to cut-back lID's water use for the 2003 <br />water year; 2) Interior did not follow the regulations in Part 417, and the Part 417 <br />regulations may not be valid regulations (lack of underlying authority); 3) Interior's <br />actions constitute a taking of lID's property rights; 4) Interior's actions constitute a <br />breach of liD's water delivery contract with the Secretary; and 5) Interior failed to <br />comply with applicable environmental laws in taking action to cut-back lID's water <br />supply. <br /> <br />On January 2ih lID filed a Motion for a Preliminary Injunction, seeking to have the court <br />enjoin Interior's actions and reinstate lID's water supply during the period of time until <br />the lawsuit can be resolved. The injunction motion has been set for hearing on March <br />18th. Even if the injunction is not granted, the court could still rule in lID's favor after <br />considering all of the evidence and the applicable law and rendering a final decision <br />sometime later this year. The injunction motion is intended to obtain interim relief, prior <br />to a final decision on the merits by the court, so that lID's farmers would be able to use <br />all ofthe water legitimately ordered for 2003. lID's injunction motion and corresponding <br />documentation attempts to explain to the court that a cut-back of the magnitude imposed <br />by Interior will bring irreparable harm to farmers in the Imperial Valley. <br /> <br />MWD and CoachelIa moved to intervene in the litigation. On February 21 st the court <br />granted the motions to intervene, so that now MWD and Coachella will be parties to the <br />suit on the side of the federal government. <br /> <br />I. Federal regulations at 43 CFR Part 417 - The regulations contained in 43 CFR Part 417 <br />are part of the few regulations in the federal law relating to the functions of the Bureau of <br />Reclamation. Adopted in the 1970's, the Part 417 regulations set forth a process of <br />consultation between BOR and lower basin water users in regard to water conservation <br />opportunities, and further provide that the regulations allow BOR to make "annual <br />determinations of each Contractor's estimated water requirements for the ensuing <br />calendar year........" The regulations are allegedly based on authorities provided to <br />BOR in the Supreme Court's Arizona v. California decision and decrees, and in the <br />Boulder Canyon Project Act of 1928 (43 USC 617 et. Seq.). liD's lawsuit against Interior <br />challenges the validity of the Part 417 regulations, asserting that nothing in the Supreme <br />Court's decrees or the Boulder Canyon Project Act provide specific authorization for <br />such action by BOR, and certainly do not authorize BOR to function as the "policeman" <br />for the lower basin. <br /> <br />The Part 417 regulations set forth a prQcess whereby the water user is to be given notice <br />ofBOR's determination of water availability for the ensuing year. That determination is <br />to be based on factors outlined in the Bureau's decision, including factual matters such as <br /> <br />6 <br />