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<br />provide the loan guarantees or bond funds by the end of this session. These early termination <br />provisions were unacceptable to the Department of Interior. <br /> <br />The documents approved by lID also included joint and several liability commitments of <br />Metropolitan, Coachella and San Diego for unexpected environmental costs, shortfalls in funding <br />expected environmental costs, and post-QSA environmental legacy costs. This type of <br />commitment was not acceptable to CVWD. Division of future environmental costs among the <br />agencies is still an open issue. <br /> <br />Imperial's definition ofpost-QSA residual environmental costs that the other agencies were <br />expected to fund included coverage for activities Imperial and its farmers could exercise <br />discretion to continue. <br /> <br />lID has proposed covenants for Metropolitan, Coachella and San Diego to not support <br />fallowing after year 15 which have not been agreed to. <br /> <br />Imperial's proposed covenants regarding SB 482(Water Code Section 1013(c)) presumptions <br />exceeded the language of the statute. <br /> <br />There are other drafting issues that the attorneys need to resolve. <br /> <br />Allocation Agreement Issues <br />A condition precedent of the Quantification Settlement Agreement is the Allocation <br />Agreement among the United States, Metropolitan, Coachella and Imperial regarding disposition <br />of water made available as a result oflining the All-American and Coachella Canals. Although <br />significant progress was made on the text of the agreement, there was not agreement upon certain <br />key provisions including the effect of shortages, payment of capital costs to Metropolitan if <br />Metropolitan does not receive water after termination of the QSA, and remedies available to <br />Metropolitan against the United States. <br /> <br />MWD-CVWD issues <br />Coachella and Metropolitan have not completed negotiations regarding a 100 kaf SWP <br />Transfer and Exchange Agreement to provide supplemental water for the Upper Coachella <br />Valley and MWD requests for adjustments in the CVWD QSA water budget. <br /> <br />7 <br />