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. .,- 001108 irrigation component of the project. The amendments also reduced the water allocations to various project beneficiaries and created "resource funds" for the Southern utes and Ute Mountain Utes. Conclusion In summary, all of the conditions of the Settlement have been satisfied, except for the construction of the Animas-La Plata Project, and the Agreement remains in full effect. Therefore, completion of the Animas-La Plata Project is of the upmost importance to Colorado if it is to avoid litigation with the Ute Tribes over their reserved water rights claims on the Animas and La Plata Rivers. After the extraordinary efforts by all the parties involved in these settlement discussions since 1972, the only responsible action is to complete implementation of the Settlement Agreement by constructing the Animas-La Plata Project. The Indian Self-Determination and Education Assistance Act (ISDEAA) P.L. 93-638 The ISDEAA is designed to provide meaningful involvement by Tribes in the administration, planning and conduct of Indian programs. The Act requires the Federal Government to contract with Indian Tribes for programs, functions, services and activities that are designed to benefit Indians. The design and construction of ALP has been made subject to the ISDEAA through the Colorado Ute Indian Water Rights Settlement Act of 1988 and we are fully in support of that settlement provision. With respect to the ISDEAA or the 638 process, the State of Colorado has no experience other than through the Animas-La Plata Project. We understand that a Tribe under ISDEAA is entitled to negotiate reasonable costs for performing the contract, the costs for preparing the proposal, reasonable general administration costs, a reasonable profit, and auditing expenses. The negotiating process provides the tribes access to project cost estimates, in this case those of the U.S. Bureau of Reclamation, in advance of the negotiations. This process clearly will not normally result in a project cost as low as what would likely occur through a competitive bid process. Furthermore, it certainly appears difficult to identify what the increased cost of working through ISDEAA is. Based on information from Reclamation for the Stage 1 work on the Ridges Basin Inlet Conduit and Ridges Basin Dam Outlet Works Excavation both of which are now complete the final contract values have exceeded the original contract values. Some of this is may actually be a savings do to the inclusion of work that was scheduled for a future phase, but breaking that out requires day-by-day monitoring of the project. Our main concern is that the ISDEAA or 638 costs, which are non- reimburseable by law, be carefully monitored and not passed on to those that have or potentially could have repayment contracts. Given the cost increases to the Animas-La Plata Project, we desire assurances that the ISDEA or 638 costs do not make the cost of project unaffordable to the end users.