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<br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br /> <br />04/83/1998 16:33 <br /> <br />818-543-4685 <br /> <br />000470 <br /> <br />COLORADO RIVER BOARD <br /> <br />PAGE 85 <br /> <br />United States Bureau ofRecJamation <br />Mr. Dale Ensminger <br />April 3,1998 <br />Page 4 <br /> <br />water. However, as the Proposed Rule is now written, it is not apparent that entities within California <br />would fiill under the definition of an "authorizIed entity" (eligible to participate in the Arizona Water <br />Bank) without specific legislation being passed within CalifOrnia. To remedy this, it is suggested that <br />the definition for "authorized entity" be separated into two definitions - one for an "authorized entity <br />in the storing state," and the second for an "authorized entity in the con.suming state." Furthermore, <br />since Nevada has' not Clq)ressed an interest in storing water in California or being a storing state, the <br />definition fur an authorized storing entity should apply to only Arizona and the Arizona Water <br />Banking Authority. If California or Nevada desire to become a storing state in the future. a <br />dctennination can be made, at that time, regarding the required rule or amendment. <br /> <br />The definition for the authorized entity in the consmning state should include: I) an entity holding <br />entitlements to Colorado River water, or 2) the Arizona Water Banking Authority. <br /> <br />Dirrrtin.. Unused ADOOrtionment <br /> <br /> <br />Section 414,3(a)(2) of the Proposed Rule permits basic apportionment from the storing slate or <br />lInllcM basic apportionment or unused SUlJIlus apportionment of the consuming slate to be stored. <br />At the March 27, 1998 public meeting. representatives of the United States indicated that it was an <br />0versigb1 that unused SUlJIlus apportionment of tbe storing state was excluded from the types of <br />water which could be stored. It was further stated that the Proposed Rule reflected a suggested <br />policy of the Secretary of the Interior to permit a state, in effect, to store water for the ultimate <br />benefit of another state even though this water could have otherwise been available for allocation to <br />the third state. 11x: use of and direction of the use of water apportioned to a state for its own direct <br />use as well as its own ultimate benefit is appropriate, but to allow a state to be able to direct the use <br />of water apportioned to it for the ultimate benefit of another state is an entirely different proposition. <br /> <br />Allowing a state to market its basic and sutplus apportionment for the ultimate benefit of another <br />state or an entity resjding in another state through interstate storage agxeements is paramount to <br />treating a state's apportionment and the water obtained through that apportionment as any other <br />commodity. Regardless of the filctthat under the Proposed Rule the consumptive use of the water <br />is being cbllrged initilllly against the storing state's apportionment, the end result is stilI the same. The <br />ultimate benefit from the stotage of water is obtained by the consuming slate whether this is the same <br />water that was stored or water that is obtained through an exchange. Ifthe purpose of the Proposed <br />Rule is to fucilitate market transactions of all. water apportioned to the states pUl'SUllllt to Articles <br />ll(B)(1-3) of the 1964 Decree in Arizona v. CalifOrnia.. the Proposed Rule must be revised to ~ <br />this purpose. <br /> <br />If the fiDal Rule WIlle promt'1g/tt"" to allow the basic and SlUplus apportiOllmf:nt of both the <br />conswning and storing states to be eligible for storage, entities in CalifOrnia could have their requests <br />fur water. lIS reasonably reqtJin,d to meet bencficiaI uses. not met in a year while water is being stored <br />in the Arizona Water Baok for Nevada fur subsequent use in a future year. Indeed, the Benefit-Cost <br />