Case No. 02CW038 Prehearing Statement nad Agreement June 2000

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15. The utilization of water by the water users represented by the River District or the Upper Gunnison District, or the utilization of water by the Upper Gunnison District, shall be subject to the laws of the State of Colorado relating to water use and administration and ditch and reservoir rights. The River District and the Upper Gunnison District shall be responsible for obtaining appropriate decrees as may be required in order for the Colorado State Engineer to effectively administer this Agreement in accordance with Colorado law. The United States shall cooperate with the Districts in accomplishing such adjudication. 16. Subordination of Aspinall Unit Rights pursuant to this Agreement shall be applicable only to water rights with priorities junior or equal to the Aspinall Unit Rights which are exercised for beneficial use within the Upper Gunnison River Basin, and shall not in any way be construed as affecting the relationship or relative priorities of any of those rights or other water rights within such basin. 17. This Agreement may not be assigned in whole or in part without the written consent of the United States, provided that the River District and the Upper Gunnison District may impose obligations on water users and/or the Water Court may impose decretal obligations on water users in order to facilitate compliance by the River District and Upper Gunnison District with this Agreement and any related water decrees. Obligations imposed by the Districts pursuant to this paragraph shall relate only to matters such as water measurement, accounting, and other administrative matters, and may include, without limitation, recoupment of the Districts' actual costs of administration of the Depletion Allowance. 18. This Agreement and all water diverted pursuant thereto shall be subject to and controlled by the Colorado River Compact dated November 24, 1922, and proclaimed by the President of the United States, June 25, 1929, 46 Stat. 3000; the Boulder Canyon Project Act approved December 21, 1928, 45 Stat. 1057; the Boulder Canyon Project Adjustment Act of July 19, 1940, 54 Stat. 774; the Upper Colorado River Basin Compact dated October 11, 1948 and approved April 16, 1949, 63 Stat. 31; the Mexican Water Treaty of February 3, 1944, 64 Stat. 846; the Colorado River Storage Project Act of April 11, 1956, 70 Stat. 105; and the Colorado River Basin Project Act of September 30,1968, 82 Stat. 885, as any of the above may have been amended or supplemented and to related decrees of appropriate courts. This Agreement shall not be construed to bring the owners of water rights benefitting from this Agreement under Sections 202 through 209 of the Reclamation Reform Act of 1982 (43 USC §§ 390bb through 390ii), as amended. 19. No Member of or Delegate to Congress, Resident Commissioner or official of the Districts shall benefit from this Agreement other than as a water user or landowner in the same manner as other water users or landowners. 20. Any notice, demand, or request authorized or required by this Agreement shall be deemed to have been given, on behalf of the River District or Upper Gunnison District when mailed, postage prepaid, or delivered to the Area Manager, Western Colorado Area Office, Bureau of Reclamation, 2764 Compass Drive, Grand Junction, Colorado 81506; Colorado State Engineer, 1313 7