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<br />. <br /> <br />. <br /> <br />Related to Arizona's first concern, it should be pointed out that the California proposal <br />establishes the proposed policy based upon the purpose(s) behind the proposed mainstream water <br />uses for environmental purposes. Consequently, if the environmental restoration and maintenance <br />water use is associated with a valid entitlement holder's contract water use (e.g., for agricultural, <br />domestic, or industrial uses), the environmental water uses would require a Section 5 contract as <br />well. Ifhowever, as the proposed policy articulates, the environmental water use is associated with <br />the Secretary's operations and management of the Colorado River related to delivery of water to <br />entitlement holders in the United States or the Mexican Treaty obligation, the water uses associated <br />with habitat restoration and maintenance would be categorized as system loss. <br /> <br />With regard to Arizona's second concern, the proposed policy does not alter, in any fashion, <br />the Secretary's discretionary or non-discretionary authorities, obligations, or responsibilities. The <br />proposed policy relies on existing authorities embedded within the 1928 Boulder Canyon Project <br />Act, the Colorado River Front Work and Levee System Act and amendments, the Supreme Court <br />Decree in Arizona v. California, and the 1970 Long-Range Operating Criteria. <br /> <br />Arizona's third concern regarding quantification and Article V Decree accounting is <br />addressed through an analysis of the purpose behind the habitat restoration and maintenance projects <br />and water uses. If the water uses are the result ofthe Secretary's water management responsibilities, <br />they are not accounted for in the annual Article V Decree accounting report. If the water uses are <br />associated with a valid entitlement holders diversion, use, and return flow of mainstream water, the <br />Decree requires that the use be reported and accounted for annually in the Article V report. <br /> <br />Reclamation is still evaluating the California proposal, but stated that they did have concerns <br />related to the effect the proposed policy has on the definition of Reclamation's "discretionary <br />authority." Additionally, Reclamation staff are not yet sure what effect the proposed policy will <br />have on Article V Decree accounting requirements (i.e., diversions less returns equals consumptive <br />use). <br /> <br />Finally, Arizona has committed to provide a written description of their concerns. <br />Reclamation committed to finalizing their internal review ofthe proposal prior to the next meeting. <br />A meeting has been scheduled for February 4,2003, to be held in Las Vegas, Nevada. <br /> <br />California's Colorado River Water Use Plan <br /> <br />Quantification Settlement Agreement (QSA) and Related Documents <br /> <br />As you are aware, discussions related to execution of the QSA by midnight on December 31, <br />2002 were not successful. The parties to the QSA are still continuing the discussions in the hope that <br />final agreement can be reached at some juncture in the near future. <br /> <br />On January 6,2003, State Senators Machado and Kuehl held a press conference to announce <br />they would be introducing legislation to limit the Imperial Irrigation District's ability to receive <br />Colorado River water to 2.6 million acre-feet per year. The major components of the proposed bill <br />would include: <br /> <br />6 <br /> <br />j <br />