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<br />18
<br />
<br />state leasing subject to a judicial determination of the tribes' right
<br />to do so given the "Law of the River"and Colorado's anti-export
<br />statute. In other words, there was to be no guarantee, either in the
<br />agreement or in the legislation, that the tribes would be able to
<br />lease out-of-state, but neither would there be a prohibition.
<br />If the right to lease out-of-state the' water provided by this settle-
<br />ment is established by the tribes judicially, we expect that at least
<br />two benefits would result:'
<br />For the tribes, water from the settlement would become a
<br />source of capital to plan and developreservation economies.
<br />For the United States, Indian water leasing would establish
<br />an improved potential for the economic use of project water
<br />and thereby enhance project repayment.
<br />The December 10, 1986, Final Settlement Agreement requires
<br />legislation to implement some of its provisions. The agreement also
<br />provides that before the settlement can become effective, the State
<br />of Colorado, the tribes and the United States must each certify that
<br />the legislation is satisfactory. In the months following approval of
<br />the settlementagreenient, we worked with the non-Federal parties
<br />to draft that implementing legislation. Concern by the non-Federal
<br />parties that the implementing legislation be introduced in time for
<br />enactment by the 100th Congress led to the introduction of H.R.
<br />2642 before we had come to full agreement on certain of its provi-
<br />sions. IIi addition to those unresolved issues, H.R. 2642 introduces
<br />some new issues which we have not haei an opportunity to discuss
<br />with the non-Federal parties, and changes some language we had
<br />previously agreed upon. We have enclosed a background memoran-
<br />dum which presents the key differences between the most recent
<br />negotiating draft and H.R. 2642.
<br />It is our belief that H.R. 2642 could be an appropriate legislative
<br />framework within which to implement the Final Settlement Agree-
<br />ment if it were conformed generally to the Federal negotiating po-
<br />sitionas discussed in the enclosure to this letter. We do believe
<br />that certain provisions of this negotiating draft (e.g., sections 4 and
<br />5) are more important; and therefore less open to subsequent nego-
<br />tiations between the parties, than others.'
<br />In summary, we are, persuaded that further meetings of the par-
<br />ties are necessary before the Committee on Interior and Insular M-
<br />fairs completes its work on H.R. 2642. We would be pleased to par-
<br />ticipate in any efforts that your Committee might undertake to fa-
<br />cilitate the resolution of these issues. We are convinced that an
<br />early agreement is possible.
<br />A similar letter has been sent to the Honorable Ben Nighthorse
<br />Campbell.
<br />The Office of Management and Budget has ad,ised that there is
<br />no objection to the presentation of this report from the standpoint
<br />of the Administration's program.
<br />Sincerely,
<br />
<br />Enclosure.
<br />
<br />WAYNE N. MARCHANT,
<br />Acting Assistant Secretary.
<br />
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<br />
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