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January 23 -24, 2007 Board Meeting <br />Agenda Item 17 <br />Page 2 of 6 <br />June 15, 2005, the US Bureau of Reclamation published a Federal Register notice to <br />begin the NEPA process to develop the shortage criteria and coordinated operations with <br />a deadline for completion of the process by December 31, 2007. <br />On August 25, 2005 Governor's representatives for the 7 -Basin States (Scott <br />Balcomb, Rod Kuharich, for the State of Colorado and Jim Lochhead in his capacity as <br />private legal counsel for several of Colorado's major water users) wrote a letter to the <br />Secretary of Interior stating the 7- States had agreed on a 3- pronged strategy for <br />improving management and operations of the Colorado River. First, the states, working <br />with Reclamation, would develop Lower Basin shortage criteria in conjunction with new <br />coordinated operating criteria for Lakes Powell and Mead under low reservoir conditions. <br />Second, the states, working with Reclamation, would look for ways to improve system <br />efficiency and management. Finally the states would look for ways to augment the water <br />supplies of the Colorado River. <br />On February 3, 2006, the 7- States sent a letter to the Secretary containing a draft <br />of the proposed agreement. Since then, the States have further refined that agreement, <br />the latest version of which is dated December 18, 2006. The agreement is specifically <br />designed to comport with the Compacts and the "Law of the River" but seeks to find <br />flexibility within the law to further the objectives in the 3 areas identified. <br />Summary and Status of the 3- Pron2ed Approach • <br />NEPA Process <br />The US Bureau of Reclamation initiated the NEPA process for the development <br />of Lower Basin shortage criteria and the coordinated operations of Lakes Powell and <br />Mead under low reservoir conditions on June 15, 2005. To date, USBR has completed <br />the Scoping Process and identified 5 alternatives that it will be evaluate in the NEPA <br />process: 1) the Basin States Proposal; 2) a conservation before shortage proposal <br />developed by the environmental community; 3) a water supply alternative; 4) a <br />preservation of reservoir storage option; and, 5) a no action alternative that continues the <br />existing coordinated long -range operating criteria. We anticipate the release of a draft <br />EIS for review by February 28, 2007, with a final EIS in September 2007 and a Record of <br />Decision issued by December 31, 2007. A matrix providing -a brief overview of the <br />alternatives and the states proposal is attached for reference. <br />States Proposal <br />Lower Basin Shortage Guidelines: The Lower Basin proposes to take shortages <br />in incremental amounts that are tied to reservoir elevations in Powell and Mead. Those <br />increments are 400,000 AF, 500,000 AF or 600,000 AF annually, larger amounts are <br />possible but the Secretary would need to consult further with the states before making <br />larger reductions. Most of the shortage will be born by the Central Arizona Project, but <br />some portion can be charged to Mexico and Nevada. The details of the split remain to be is <br />worked out and could depend on how other portions of the agreement are implemented. <br />