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't UV92 31-55, California v. United States, No. 77-285 (Sup. Ct. October 1977 Term). ~/ In its decision reversing the Ninth Circuit; the Supreme Court recognized that its prior statements regarding ~he effect of S B of the Reclamation Act of 1902 could be read to support the United States' argument, but the Court characterized those statements as dicta -to the extent [they] impl\y] that state law does not control even where not inconsis- tent with. . . expressions of congressional intent.- 43B U.S. at 671 n.24. The Court pointed out that each of its prior decisions involved a direct conflict between state law and a specific provision of the federal reclamation laws, and therefore disavowed that dicta insofar as it -would prevent petitioners from imposing conditions on the permit granted to the united States which are not inconsistent with congressional provisions authorizing the project in question.- Id. at 674. Because the courts below had not reached the-question whether the conditions actually imposed were inconsistent with congressional directives authorizing the New Melones project, the Court remanded the case for further consideration, 22/ The Court suggested that on remand the district court would;. be free to consider arguments that the legislation authorizing the New Melones project had -by its terms signiflied] congressional intent that the Secretary condemn or be permitted to appropriate the necessary water rights for the project in question.- Id. 56/ The Unlted States also argued that the conditions imposed on the permit granted by the California Board were inconsistent with the terms upon which construction and operation of the project had been authorized. See U.S. Brief at 57-B5. Because the lower courts had born found that California could not impose any substantive conditions on the permit, this argument was not considered below. 57/ Three justices (White, Brennan and Marshall) dissented from toe majority's decision, on the ground that S 8 should be read narrowly, as it was in Ivanhoe, Fresno and Arizona, to deal only with the acquisition of water rights and to requlre only that the United States respect water rights that have been vested under state law. See 438 U.S. at 691. The dissent would have upheld the lower court decisions -that the State was without power under the reclamation laws to impose conditions on the operation of the New Melones Dam and on the distribution of project water developed by that Dam, which would be undertaken with federal funds." Id. at 693. Justice Powell, who wrote the dissent in United States v. New Mexico, joined in the majority in California. - 36 -