M&I Only 

R. O. CVP-Wide Draft 04/19-2004 

City of Shasta Lake Draft 3/01-2004 

City of Shasta Lake Draft 7/22-2003 

City of Shasta Lake Draft 6/16-2003 

Shasta/Trinity Division Draft 6/16-2003 

CVP-Wide Draft 5/23-2003 

Contract No. 

4-07-20-W1134-LTR1 

UNITED STATES 

DEPARTMENT OF THE INTERIOR 

BUREAU OF RECLAMATION 

Central Valley Project, California 

LONG-TERM RENEWAL CONTRACT BETWEEN THE UNITED STATES 

AND

CITY OF SHASTA LAKE

PROVIDING FOR PROJECT WATER SERVICE

FROM SHASTA DIVISION

Table of Contents

Article No. Title Page No.

 Preamble ................................................................................................................. 1 

 Explanatory Recitals ............................................................................................ 1-4 

 1 Definitions............................................................................................................ 4-7 

 2 Term of Contract..................................................................................................7-9 

 3 Water to be Made Available and Delivered to the Contractor...........................9-12 

 4 Time for Delivery of Water .............................................................................12-13 

 5 Point of Diversion and Responsibility for Distribution of Water.................... 13-15 

 6 Measurement of Water Within the Contractor’s Service Area........................ 15-16 

 7 Rates and Method of Payment for Water.........................................................16-22 

 8 Non-Interest Bearing Operation and Maintenance Deficits.................................. 22 

 9 Sales, Transfers, or Exchanges of Water .........................................................22-23 

 10 Application of Payments and Adjustments......................................................23-24 

 11 Temporary Reductions--Return Flows ............................................................ 24-25 

 12 Constraints on the Availability of Water ......................................................... 25-26 

 13 Unavoidable Groundwater Percolation................................................................. 26 

 14 Rules and Regulations........................................................................................... 26 

 15 Water and Air Pollution Control........................................................................... 26 

 16 Quality of Water .............................................................................................. 26-27 

 17 Water Acquired by the Contractor Other Than From the United States..........27-28 

 18 Opinions and Determinations ..........................................................................28-29 

 19 Coordination and Cooperation......................................................................... 29-31
Contract No. 4-07-20-W1134-LTR1 

Table of Contents - continued

Article No. Title Page No.

 20 Charges for Delinquent Payments ........................................................................ 31

 21 Equal Opportunity............................................................................................31-32 

 22 General Obligation--Benefits Conditioned Upon Payment .............................32-33 

 23 Compliance With Civil Rights Laws and Regulations ......................................... 33 

 24 Privacy Act Compliance ..................................................................................33-34 

 25 Contractor to Pay Certain Miscellaneous Costs.................................................... 34 

 26 Water Conservation .........................................................................................34-36 

 27 Existing or Acquired Water or Water Rights........................................................ 36 

 28 Operation and Maintenance by Operating Non-Federal Entity ............................ 36 

 29 Contingent on Appropriation or Allotment of Funds ........................................... 36 

 30 Books, Records, and Reports........................................................................... 36-37 

 31 Assignment Limited--Successors and Assigns Obligated .................................... 37 

 32 Severability ......................................................................................................37-38 

 33 Resolution of Disputes.......................................................................................... 38 

 34 Officials Not to Benefit......................................................................................... 38 

 35 Changes in Contractor’s Service Area............................................................. 38-39 

 36 Federal Laws......................................................................................................... 39 

 37 Notices .................................................................................................................. 39

 38 Confirmation of Contract...................................................................................... 39 

 Signature Page .......................................................................................................40 

 Exhibit A – Map of Contractor’s Service Area 

 Exhibit B – Rates and Charges 
M&I Only 

R. O. CVP-Wide Draft 04/19-2004 

City of Shasta Lake Draft 3/01-2004 

City of Shasta Lake Draft 7/22-2003 

City of Shasta Lake Draft 6/16-2003 

Shasta/Trinity Division Draft 6/16-2003 

CVP-Wide Draft 5/23-2003 

Contract No. 

4-07-20-W1134-LTR1 

1 UNITED STATES 

2 DEPARTMENT OF THE INTERIOR 

3 BUREAU OF RECLAMATION 

4 Central Valley Project, California 

5 LONG-TERM RENEWAL CONTRACT BETWEEN THE UNITED STATES 

6 AND

7 CITY OF SHASTA LAKE

8 PROVIDING FOR PROJECT WATER SERVICE

9 FROM SHASTA DIVISION

10 THIS CONTRACT, made this _____ day of ____________________, 20___, in 

11 pursuance generally of the Act of June 17, 1902 (32 Stat. 388), and acts amendatory or 

12 supplementary thereto, including, but not limited to, the Acts of August 26, 1937 (50 Stat. 844), 

13 as amended and supplemented, August 4, 1939 (53 Stat. 1187), as amended and supplemented, 

14 July 2, 1956 (70 Stat. 483), June 21, 1963 (77 Stat. 68), October 12, 1982 (96 Stat. 1263), 

15 October 27, 1986 (100 Stat. 3050), as amended, and Title XXXIV of the Act of October 30, 1992 

16 (106 Stat. 4706), all collectively hereinafter referred to as Federal Reclamation law, between 

17 THE UNITED STATES OF AMERICA, hereinafter referred to as the United States, and CITY 

18 OF SHASTA LAKE, hereinafter referred to as the Contractor, an incorporated City of the State 

19 of California, duly organized, existing, and acting pursuant to the laws thereof; 

20 WITNESSETH, That: 

21 EXPLANATORY RECITALS

 [1st 22 ] WHEREAS, the United States has constructed and is operating the Central Valley 

23 Project (Project), California, for diversion, storage, carriage, distribution and beneficial use, for 

24 flood control, irrigation, municipal, domestic, industrial, fish and wildlife mitigation, protection
Contract No. 4-07-20-W1134-LTR1 

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25 and restoration, generation and distribution of electric energy, salinity control, navigation and 

26 other beneficial uses, of waters of the Sacramento River, the American River, the Trinity River, 

27 and the San Joaquin River and their tributaries; and 

 [2nd 28 ] WHEREAS, the United States constructed the Shasta Dam pumping facilities and 

29 the Toyon Pipeline, hereinafter collectively referred to as the Shasta Division facilities, which 

30 will be used in part for the furnishing of water to the Contractor pursuant to the terms of this 

31 Contract; and 

 [3rd 32 ] WHEREAS, the rights to Project Water were acquired by the United States 

33 pursuant to California law for operation of the Project; and 

 [4th 34 ] WHEREAS, the Contractor is the successor in interest by assignment of long term 

35 water service contracts designated Contract No. I1r-1515, originally entered with the United 

36 States on August 12, 1948, by the Shasta Dam Public Utility District, and amendatory Contract 

37 No. I1r-1523, entered with the United States on December 5, 1975, by the Summit City Public 

38 Utility District, which contracts were together subsumed in a single temporary contract that was 

39 renewed successively as Contract Nos. 8-07-20-W0715, 0-07-20-W0885, 2-07-20-W1024, and 

40 No. 4-07-20-W1134, that established terms for the delivery to the Contractor of Project Water 

41 from the Shasta Division facilities from August 22, 1988, through February 28, 1994; and 

 [5th 42 ] WHEREAS, the Contractor and the United States have pursuant to subsection 

43 3404(c)(1) of the Central Valley Project Improvement Act (CVPIA), subsequently entered into 

44 interim renewal contract(s) identified as Contract No(s). 4-07-20-W1134, 4-07-20-W1134-IR2, 

45 4-07-20-W1134-IR3, 4-07-20-W1134-IR4, 4-07-20-W1134-IR5, 4-07-20-W1134-IR6, 4-07-20-

46 W1134-IR7, 4-07-20-W1134-IR8, 4-07-20-W1134-IR9, and 4-07-20-W1134-IR10, the current 

47 of which is hereinafter referred to as the Existing Contract, which provided for the continued 

48 water service to the Contractor from March 1, 2004, through February, 28, 2006; and 

 [6th 49 ] WHEREAS, Section 3404(c) of the CVPIA provides for long-term renewal of the 

50 Existing Contract following completion of appropriate environmental documentation, including a 
Contract No. 4-07-20-W1134-LTR1 

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51 programmatic environmental impact statement (PEIS) pursuant to the National Environmental 

52 Policy Act (NEPA), analyzing the direct and indirect impacts and benefits of implementing the 

53 CVPIA and the potential renewal of all existing contracts for Project Water; and 

 [7th 54 ] WHEREAS, the United States has completed the PEIS and all other appropriate 

55 environmental review necessary to provide for long-term renewal of the Existing Contract; and 

 [8th 56 ] WHEREAS, the Contractor has requested the long-term renewal of the Existing 

57 Contract, pursuant to the terms of the Existing Contract, Federal Reclamation law, and the laws 

58 of the State of California, for water service from the Project; and 

 [9th 59 ] WHEREAS, the United States has determined that the Contractor has fulfilled all 

60 of its obligations under the Existing Contract; and 

 [10th 61 ] WHEREAS, the Contractor has demonstrated to the satisfaction of the 

62 Contracting Officer that the Contractor has utilized the Project Water supplies available to it for 

63 reasonable and beneficial use and, based upon a needs analysis cooperatively prepared by the 

64 Contracting Officer and the Contractor, has demonstrated projected future demand for water use 

65 that exceeds the Contract Total to be made available to it pursuant to this Contract; and 

 [11th 66 ] WHEREAS, water obtained from the Project has been relied upon by urban and 

67 agricultural areas within California for more than 50 years, and is considered by the Contractor 

68 as an essential portion of its water supply; and 

 [12th 69 ] WHEREAS, the economies of regions within the Project, including the 

70 Contractor’s, depend upon the continued availability of water, including water service from the 

71 Project; and 

72 [12.1] WHEREAS, Contractor has made and will continue to make substantial capital 

73 investments in diversion and treatment facilities, and requires a consistent, predictable quality of 

74 raw water in order to meet Safe Drinking Water Act requirements for its municipal customers, 

75 and to provide a consistent and predictable quality of water for its industrial customers; and 
Contract No. 4-07-20-W1134-LTR1 

4

 [13th 76 ] WHEREAS, the Secretary intends through coordination, cooperation, and 

77 partnerships to pursue measures to improve water supply, water quality, and reliability of the 

78 Project for all Project purposes; and 

79 [13.1] WHEREAS, the Contractor is located in the region of the Redding Groundwater 

80 Basin, and it is the desire of both the United States and the Contractor to facilitate the 

81 cooperative efforts of local water service agencies to develop the Redding Groundwater Basin 

82 for conjunctive management and use with Project Water supplies, to maximize the reasonable 

83 beneficial use of water for the water service agencies and their customers in the region; and 

 [14th 84 ] WHEREAS, the mutual goals of the United States and the Contractor include: to 

85 provide for reliable Project Water supplies; to control costs of those supplies; to achieve 

86 repayment of the Project as required by law; to guard reasonably against Project Water 

87 shortages; to achieve a reasonable balance among competing demands for use of Project Water; 

88 and to comply with all applicable environmental statutes, all consistent with the legal obligations 

89 of the United States relative to the Project; and 

 [15th 90 ] WHEREAS, the parties intend by this Contract to develop a more cooperative 

91 relationship in order to achieve their mutual goals; and 

 [16th 92 ] WHEREAS, the United States and the Contractor are willing to enter into this 

93 Contract pursuant to Federal Reclamation law on the terms and conditions set forth below; 

94 NOW, THEREFORE, in consideration of the mutual and dependent covenants herein 

95 contained, it is hereby mutually agreed by the parties hereto as follows: 

96 DEFINITIONS

97 1. When used herein unless otherwise distinctly expressed, or manifestly 

98 incompatible with the intent of the parties as expressed in this Contract, the term: 

99 (a) “Calendar Year” shall mean the period January 1 through December 31, 

100 both dates inclusive; 
Contract No. 4-07-20-W1134-LTR1 

5

101 (b) “Charges” shall mean the payments required by Federal Reclamation law 

102 in addition to the Rates and Tiered Pricing Component specified in this Contract as determined 

103 annually by the Contracting Officer pursuant to this Contract; 

104 (c) “Condition of Shortage” shall mean a condition respecting the Project 

105 during any Year such that the Contracting Officer is unable to deliver sufficient water to meet the 

106 Contract Total; 

107 (d) “Contracting Officer” shall mean the Secretary of the Interior’s duly 

108 authorized representative acting pursuant to this Contract or applicable Federal Reclamation law 

109 or regulation; 

110 (e) “Contract Total” shall mean the maximum amount of water to which the 

111 Contractor is entitled under subdivision (a) of Article 3 of this Contract; 

112 (f) “Contractor's Service Area” shall mean the area to which the Contractor is 

113 permitted to provide Project Water under this Contract as described in Exhibit “A” attached 

114 hereto, which may be modified from time to time in accordance with Article 35 of this Contract 

115 without amendment of this Contract; 

116 (g) “CVPIA” shall mean the Central Valley Project Improvement Act, Title 

117 XXXIV of the Act of October 30, 1992 (106 Stat. 4706); 

118 (h) Omitted; 

119 (i) Omitted; 

120 (j) “Full Cost Rate” shall mean an annual rate as determined by the 

121 Contracting Officer that shall amortize the expenditures for construction properly allocable to the 

122 Project irrigation or M&I functions, as appropriate, of facilities in service including all O&M 

123 deficits funded, less payments, over such periods as may be required under Federal Reclamation 

124 law, or applicable contract provisions. Interest will accrue on both the construction expenditures 

125 and funded O&M deficits from October 12, 1982, on costs outstanding at that date, or from the 
Contract No. 4-07-20-W1134-LTR1 

6

126 date incurred in the case of costs arising subsequent to October 12, 1982, and shall be calculated 

127 in accordance with subsections 202(3)(B) and (3)(C) of the Reclamation Reform Act of 

128 October 12, 1982 (96 Stat. 1263), as amended, hereinafter referred to as RRA. The Full Cost 

129 Rate includes actual operation, maintenance, and replacement costs consistent with Section 426.2 

130 of the Rules and Regulations for the RRA; 

131 (k) Omitted; 

132 (l) Omitted; 

133 (m) Omitted; 

134 (n) Omitted; 

135 (o) “Municipal and Industrial (M&I) Water” shall mean Project Water made 

136 available to the Contractor for purposes other than the commercial production of agricultural 

137 crops or livestock; 

138 (p) “M&I Full Cost Water Rate” shall mean the Full Cost Rate applicable to 

139 the delivery of M&I Water; 

140 (q) “Operation and Maintenance” or “O&M” shall mean normal and 

141 reasonable care, control, operation, repair, replacement (other than capital replacement), and 

142 maintenance of Project facilities; 

143 (r) Omitted; 

144 (s) “Project” shall mean the Central Valley Project owned by the United 

145 States and managed by the Department of the Interior, Bureau of Reclamation; 

146 (t) “Project Contractors” shall mean all parties who have water service 

147 contracts for Project Water from the Project with the United States pursuant to Federal 

148 Reclamation law; 

149 (u) “Project Water” shall mean all water that is developed, diverted, stored, or 

150 delivered by the Secretary in accordance with the statutes authorizing the Project and in 

151 accordance with the terms and conditions of water rights acquired pursuant to California law; 
Contract No. 4-07-20-W1134-LTR1 

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152 (v) “Rates” shall mean the payments determined annually by the Contracting 

153 Officer in accordance with the then-current applicable water ratesetting policies for the Project, 

154 as described in subdivision (a) of Article 7 of this Contract; 

155 (w) “Recent Historic Average” shall mean the most recent five-year average of 

156 the final forecast of Water Made Available to the Contractor pursuant to this Contract or its 

157 preceding contract(s); 

158 (x) “Secretary” shall mean the Secretary of the Interior, a duly appointed 

159 successor, or an authorized representative acting pursuant to any authority of the Secretary and 

160 through any agency of the Department of the Interior; 

161 (y) “Tiered Pricing Component” shall be the incremental amount to be paid 

162 for each acre-foot of Water Delivered as described in subdivision (j) of Article 7 of this Contract; 

163 (z) “Water Delivered” or “Delivered Water” shall mean Project Water 

164 diverted for use by the Contractor at the point(s) of delivery approved by the Contracting 

165 Officer; 

166 (aa) “Water Made Available” shall mean the estimated amount of Project 

167 Water that can be delivered to the Contractor for the upcoming Year as declared by the 

168 Contracting Officer, pursuant to subdivision (a) of Article 4 of this Contract; 

169 (bb) “Water Scheduled” shall mean Project Water made available to the 

170 Contractor for which times and quantities for delivery have been established by the Contractor 

171 and Contracting Officer, pursuant to subdivision (b) of Article 4 of this Contract; and 

172 (cc) “Year” shall mean the period from and including March 1 of each 

173 Calendar Year through the last day of February of the following Calendar Year. 

174 TERM OF CONTRACT

175 2. (a) This Contract shall be effective March 1, 20___., through February 28, 

176 20___, and supercedes the Existing Contract. In the event the Contractor wishes to renew this 
Contract No. 4-07-20-W1134-LTR1 

8

177 Contract beyond February 28, 20___, the Contractor shall submit a request for renewal in writing 

178 to the Contracting Officer no later than two years prior to the date this Contract expires. 

179 (b) Omitted. 

180 (c) This Contract shall be renewed for successive periods of up to 40 years 

181 each, which periods shall be consistent with then-existing Reclamation-wide policy, under terms 

182 and conditions mutually agreeable to the parties and consistent with Federal and State law. The 

183 Contractor shall be afforded the opportunity to comment to the Contracting Officer on the 

184 proposed adoption and application of any revised policy applicable to the delivery of M&I Water 

185 that would limit the term of any subsequent renewal contract with the Contractor for the 

186 furnishing of M&I Water to less than 40 years. 

187 (d) The Contracting Officer shall make a determination ten years after the 

188 date of execution of this Contract, and every five years thereafter during the term of this 

189 Contract, of whether a conversion to a contract under subsection (c)(1) of Section 9 of the 

190 Reclamation Project Act of 1939 can be accomplished. The Contracting Officer anticipates that 

191 during the term of this Contract, all authorized Project construction expected to occur will have 

192 occurred, and on that basis the Contracting Officer agrees upon such completion to allocate all 

193 costs that are properly assignable to the Contractor, and agrees further that, at any time after such 

194 allocation is made, and subject to satisfaction of the condition set out in this subdivision, this 

195 Contract shall, at the request of the Contractor, be converted to a contract under said subsection 

196 9(c)(1), of the Reclamation Project Act of 1939, subject to applicable Federal law and under 

197 stated terms and conditions mutually agreeable to the Contractor and the Contracting Officer. A 

198 condition for such conversion to occur shall be a determination by the Contracting Officer that, 

199 account being taken of the amount credited to return by the Contractor as provided for under 

200 Federal Reclamation law, the remaining amount of construction costs assignable for ultimate 
Contract No. 4-07-20-W1134-LTR1 

9

201 return by the Contractor can probably be repaid to the United States within the term of a contract 

202 under said subsection 9(c)(1). If the remaining amount of costs that are properly assignable to 

203 the Contractor cannot be determined during the term of this Contract, the Contracting Officer 

204 shall notify the Contractor, and provide the reason(s) why such a determination could not be 

205 made. Further, the Contracting Officer shall make such a determination as soon thereafter as 

206 possible so as to permit, upon request of the Contractor and satisfaction of the condition set out 

207 above, conversion to a contract under said subsection 9(c)(1). In the event such determination of 

208 costs has not been made at a time which allows conversion of this Contract during the term of 

209 this Contract or the Contractor has not requested conversion of this Contract within such term, 

210 the parties shall incorporate in any subsequent renewal contract as described in subdivision (b) of 

211 this Article a provision that carries forth in substantially identical terms the provisions of this 

212 subdivision. 

213 WATER TO BE MADE AVAILABLE AND DELIVERED TO THE CONTRACTOR

214 3. (a) During each Year, consistent with all applicable State water rights, 

215 permits, and licenses, Federal law, and subject to the provisions set forth in Articles 11 and 12 of 

216 this Contract, the Contracting Officer shall make available for delivery to the Contractor 4,400 

217 acre-feet of Project Water for M&I purposes. Water Delivered to the Contractor in accordance 

218 with this subdivision shall be scheduled and paid for pursuant to the provisions of Articles 4 and 

219 7 of this Contract. 

220 (b) Because the capacity of the Project to deliver Project Water has been 

221 constrained in recent years and may be constrained in the future due to many factors including 

222 hydrologic conditions and implementation of Federal and State laws, the likelihood of the 

223 Contractor actually receiving the amount of Project Water set out in subdivision (a) of this 

224 Article in any given Year is uncertain. The Contracting Officer’s modeling referenced in the 
Contract No. 4-07-20-W1134-LTR1 

10

225 PEIS projected that the Contract Total set forth in this Contract will not be available to the 

226 Contractor in many years. During the most recent five years, the Recent Historic Average of 

227 water made available to the Contractor was 2,530 acre-feet. Nothing in subdivision (b) of this 

228 Article shall affect the rights and obligations of the parties under any provision of this Contract. 

229 (c) The Contractor shall utilize the Project Water in accordance with all 

230 applicable legal requirements. 

231 (d) The Contractor shall make reasonable and beneficial use of all water 

232 furnished pursuant to this Contract. Ground-water recharge programs (direct, indirect, or in 

233 lieu), ground-water banking programs, surface water storage programs, and other similar 

234 programs utilizing Project Water or other water furnished pursuant to this Contract conducted 

235 within the Contractor’s Service Area which are consistent with applicable State law and result in 

236 use consistent with Federal Reclamation law will be allowed; Provided, That any direct recharge 

237 program(s) is (are) described in the Contractor’s water conservation plan submitted pursuant to 

238 Article 26 of this Contract; Provided, further, That such water conservation plan demonstrates 

239 sufficient lawful uses exist in the Contractor’s Service Area so that using a long-term average, 

240 the quantity of Delivered Water is demonstrated to be reasonable for such uses and in 

241 compliance with Federal Reclamation law. Ground-water recharge programs, ground-water 

242 banking programs, surface water storage programs, and other similar programs utilizing Project 

243 Water or other water furnished pursuant to this Contract conducted outside the Contractor’s 

244 Service Area may be permitted upon written approval of the Contracting Officer, which approval 

245 will be based upon environmental documentation, Project Water rights, and Project operational 

246 concerns. The Contracting Officer will address such concerns in regulations, policies, or 

247 guidelines. 

248 (e) The Contractor shall comply with requirements applicable to the 

249 Contractor in biological opinion(s) prepared as a result of a consultation regarding the execution 

250 of this Contract undertaken pursuant to Section 7 of the Endangered Species Act of 1973 (ESA), 
Contract No. 4-07-20-W1134-LTR1 

11

251 as amended, that are within the Contractor’s legal authority to implement. The Existing 

252 Contract, which evidences in excess of 54 years of diversions for M&I purposes of the quantities 

253 of water provided in subdivision (a) of Article 3 of this Contract, will be considered in 

254 developing an appropriate baseline for biological assessment(s) prepared pursuant to the ESA, 

255 and any other needed environmental review. Nothing herein shall be construed to prevent the 

256 Contractor from challenging or seeking judicial relief in a court of competent jurisdiction with 

257 respect to any biological opinion or other environmental documentation referred to in this 

258 Article. 

259 (f) As soon as possible following each declaration of Water Made Available 

260 under Article 4 of this Contract, the Contracting Officer will make a determination whether 

261 Project Water, or other water available to the Project, can be made available to the Contractor in 

262 addition to the Contract Total under Article 3 of this Contract during the Year without adversely 

263 impacting other Project Contractors. At the request of the Contractor, the Contracting Officer 

264 will consult with the Contractor prior to making such a determination. If the Contracting Officer 

265 determines that Project Water, or other water available to the Project, can be made available to 

266 the Contractor, the Contracting Officer will announce the availability of such water and shall so 

267 notify the Contractor as soon as practical. The Contracting Officer will thereafter meet with the 

268 Contractor and other Project Contractors capable of taking such water to determine the most 

269 equitable and efficient allocation of such water. If the Contractor requests the delivery of any 

270 quantity of such water, the Contracting Officer shall make such water available to the Contractor 

271 in accordance with applicable statutes, regulations, guidelines, and policies. 

272 (g) The Contractor may request permission to reschedule for use during the 

273 subsequent Year some or all of the Water Made Available to the Contractor during the current 

274 Year, referred to as “carryover.” The Contractor may request permission to use during the 

275 current Year a quantity of Project Water which may be made available by the United States to 

276 the Contractor during the subsequent Year, referred to as “preuse.” The Contracting Officer’s 
Contract No. 4-07-20-W1134-LTR1 

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277 written approval may permit such uses in accordance with applicable statutes, regulations, 

278 guidelines, and policies. 

279 (h) The Contractor’s right pursuant to Federal Reclamation law and applicable 

280 State law to the reasonable and beneficial use of Water Delivered pursuant to this Contract 

281 during the term thereof and any subsequent renewal contracts, as described in Article 2 of this 

282 Contract, during the terms thereof shall not be disturbed so long as the Contractor shall fulfill all 

283 of its obligations under this Contract and any renewals thereof. Nothing in the preceding 

284 sentence shall affect the Contracting Officer’s ability to impose shortages under Article 11 or 

285 subdivision (b) of Article 12 of this Contract or applicable provisions of any subsequent renewal 

286 contracts. 

287 (i) Project Water furnished to the Contractor pursuant to this Contract may be 

288 delivered for other than M&I purposes upon written approval by the Contracting Officer in 

289 accordance with the terms and conditions of such approval. 

290 (j) The Contracting Officer shall make reasonable efforts to protect the water 

291 rights necessary for the Project and to provide the water available under this Contract. The 

292 Contracting Officer shall not object to participation by the Contractor, in the capacity and to the 

293 extent permitted by law, in administrative proceedings related to the Project Water rights; 

294 Provided, That the Contracting Officer retains the right to object to the substance of the 

295 Contractor’s position in such a proceeding; Provided further, That in such proceedings the 

296 Contracting Officer shall recognize the Contractor has a legal right under the terms of this 

297 Contract to use Project Water. 

298 TIME FOR DELIVERY OF WATER

299 4. (a) On or about February 20 of each Calendar Year, the Contracting Officer 

300 shall announce the Contracting Officer’s expected declaration of the Water Made Available. 

301 Such declaration will be expressed in terms of both Water Made Available and the Recent 

302 Historic Average and will be updated monthly, and more frequently if necessary, based on then-
Contract No. 4-07-20-W1134-LTR1 

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303 current operational and hydrologic conditions and a new declaration with changes, if any, to the 

304 Water Made Available will be made. The Contracting Officer shall provide forecasts of Project 

305 operations and the basis of the estimate, with relevant supporting information, upon the written 

306 request of the Contractor. Concurrently with the declaration of the Water Made Available, the 

307 Contracting Officer shall provide the Contractor with the updated Recent Historic Average. 

308 (b) On or before each March 1 and at such other times as necessary, the 

309 Contractor shall submit to the Contracting Officer a written schedule, satisfactory to the 

310 Contracting Officer, showing the monthly quantities of Project Water to be delivered by the 

311 United States to the Contractor pursuant to this Contract for the Year commencing on such 

312 March 1. The Contracting Officer shall use all reasonable means to deliver Project Water 

313 according to the approved schedule for the Year commencing on such March 1. 

314 (c) The Contractor shall not schedule Project Water in excess of the quantity 

315 of Project Water the Contractor intends to put to reasonable and beneficial use within the 

316 Contractor's Service Area or to sell, transfer, or exchange pursuant to Article 9 of this Contract 

317 during any Year. 

318 (d) Subject to the conditions set forth in subdivision (a) of Article 3 of this 

319 Contract, the United States shall deliver Project Water to the Contractor in accordance with the 

320 initial schedule submitted by the Contractor pursuant to subdivision (b) of this Article, or any 

321 written revision(s), satisfactory to the Contracting Officer, thereto submitted within a reasonable 

322 time prior to the date(s) on which the requested change(s) is/are to be implemented. 

323 POINT OF DIVERSION AND RESPONSIBILITY FOR DISTRIBUTION OF WATER

324 5. (a) Project Water scheduled pursuant to subdivision (b) of Article 4 of this 

325 Contract shall be delivered to the Contractor at the 16-inch water meter located at the 

326 interconnection of the pumping plant discharge line at the water treatment facilities which are 

327 located adjacent to the Shasta Dam visitor area, and any additional point or points of delivery 
Contract No. 4-07-20-W1134-LTR1 

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328 either on Project facilities or another location or locations mutually agreed to in writing by the 

329 Contracting Officer and the Contractor. 

330 (b) The Contracting Officer or other appropriate entity as designated by the 

331 Contracting Officer (hereinafter referred to as the “Other Appropriate Entity”) shall make all 

332 reasonable efforts to maintain sufficient flows to deliver Project Water to the Contractor at the 

333 design capacity of the pumping plant minus losses due to the Contractor’s treatment facilities and 

334 delivery pipe sizes. 

335 (c) Omitted. 

336 (d) All Water Delivered to the Contractor pursuant to this Contract shall be 

337 measured and recorded with equipment furnished, installed, operated, and maintained by the 

338 Contractor at the point or points of delivery established pursuant to subdivision (a) of this 

339 Article. Upon the request of either party to this Contract, the Contracting Officer shall 

340 investigate the accuracy of such measurements and shall take any necessary steps to adjust any 

341 errors appearing therein. For any period of time when accurate measurements have not been 

342 made, the Contracting Officer shall consult with the Contractor prior to making a final 

343 determination of the quantity delivered for that period of time. 

344 (e) The Contracting Officer shall not be responsible for the control, carriage, 

345 handling, use, disposal, or distribution of Water Delivered to the Contractor pursuant to this 

346 Contract beyond the delivery points specified in subdivision (a) of this Article. The Contractor 

347 shall indemnify the United States, its officers, employees, agents, and assigns on account of 

348 damage or claim of damage of any nature whatsoever for which there is legal responsibility, 

349 including property damage, personal injury, or death arising out of or connected with the control, 

350 carriage, handling, use, disposal, or distribution of such Water Delivered beyond such delivery 

351 points, except for any damage or claim arising out of (i) acts or omissions of the Contracting 

352 Officer or any of its officers, employees, agents, or assigns with the intent of creating the 

353 situation resulting in any damage or claim, (ii) willful misconduct of the Contracting Officer or 
Contract No. 4-07-20-W1134-LTR1 

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354 any of its officers, employees, agents, or assigns, (iii) negligence of the Contracting Officer or 

355 any of its officers, employees, agents, or assigns, or (iv) damage or claims resulting from a 

356 malfunction of facilities owned and/or operated by the United States. 

357 MEASUREMENT OF WATER WITHIN THE CONTRACTOR’S SERVICE AREA

358 6. (a) The Contractor has established a measuring program satisfactory to the 

359 Contracting Officer. The Contractor shall ensure that all surface water delivered for M&I 

360 purposes is measured at each M&I service connection. The water measuring devices or water 

361 measuring methods of comparable effectiveness must be acceptable to the Contracting Officer. 

362 The Contractor shall be responsible for installing, operating, and maintaining and repairing all 

363 such measuring devices and implementing all such water measuring methods at no cost to the 

364 United States. The Contractor shall use the information obtained from such water measuring 

365 devices or water measuring methods to ensure its proper management of the water, to bill water 

366 users for water delivered by the Contractor; and, if applicable, to record water delivered for M&I 

367 purposes by customer class as defined in the Contractor’s water conservation plan provided for 

368 in Article 26 of this Contract. Nothing herein contained, however, shall preclude the Contractor 

369 from establishing and collecting any charges, assessments, or other revenues authorized by 

370 California law. The Contractor shall include a summary of all its annual surface water deliveries 

371 in the annual report described in subdivision (c) of Article 26. 

372 (b) To the extent the information has not otherwise been provided, upon 

373 execution of this Contract, the Contractor shall provide to the Contracting Officer a written 

374 report describing the measurement devices or water measuring methods being used or to be used 

375 to implement subdivision (a) of this Article and identifying the agricultural turnouts and the M&I

376 service connections or alternative measurement programs approved by the Contracting Officer, 

377 at which such measurement devices or water measuring methods are being used, and, if 

378 applicable, identifying the locations at which such devices and/or methods are not yet being used 

379 including a time schedule for implementation at such locations. The Contracting Officer shall 
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380 advise the Contractor in writing within 60 days as to the adequacy and necessary modifications, 

381 if any, of the measuring devices or water measuring methods identified in the Contractor’s report 

382 and if the Contracting Officer does not respond in such time, they shall be deemed adequate. If 

383 the Contracting Officer notifies the Contractor that the measuring devices or methods are 

384 inadequate, the parties shall within 60 days following the Contracting Officer‘s response, 

385 negotiate in good faith the earliest practicable date by which the Contractor shall modify said 

386 measuring devices and/or measuring methods as required by the Contracting Officer to ensure 

387 compliance with subdivision (a) of this Article. 

388 (c) All new surface water delivery systems installed within the Contractor's 

389 Service Area after the effective date of this Contract shall also comply with the measurement 

390 provisions described in subdivision (a) of this Article. 

391 (d) The Contractor shall inform the Contracting Officer and the State of 

392 California in writing by April 30 of each Year of the monthly volume of surface water delivered 

393 within the Contractor’s Service Area during the previous Year. 

 (e) The Contractor shall inform the Contracting Officer on or before the 10th 394 

395 calendar day of each month of the quantity of M&I Water taken during the preceding month. 

396 RATES AND METHOD OF PAYMENT FOR WATER

397 7. (a) The Contractor shall pay the United States as provided in this Article for 

398 all Delivered Water at Rates, Charges, and the Tiered Pricing Component established in 

399 accordance with (i) the Secretary’s then-existing ratesetting policy for M&I Water. Such 

400 ratesetting policy shall be amended, modified, or superceded only through a public notice and 

401 comment procedure; (ii) applicable Federal Reclamation law and associated rules and 

402 regulations, or policies; and (iii) other applicable provisions of this Contract. Payments shall be 

403 made by cash transaction, electronic funds transfer, or any other mechanism as may be agreed to 

404 in writing by the Contractor and the Contracting Officer. The Rates, Charges, and Tiered Pricing 
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405 Component applicable to the Contractor upon execution of this Contract are set forth in Exhibit 

406 “B,” as may be revised annually. 

407 (b) The Contracting Officer shall notify the Contractor of the Rates, Charges, 

408 and Tiered Pricing Component as follows: 

409 (1) Prior to July 1 of each Calendar Year, the Contracting Officer shall 

410 provide the Contractor an estimate of the Charges for Project Water that will be applied to the 

411 period October 1, of the current Calendar Year, through September 30, of the following Calendar 

412 Year, and the basis for such estimate. The Contractor shall be allowed not less than two months 

413 to review and comment on such estimates. On or before September 15 of each Calendar Year, 

414 the Contracting Officer shall notify the Contractor in writing of the Charges to be in effect during 

415 the period October 1 of the current Calendar Year, through September 30, of the following 

416 Calendar Year, and such notification shall revise Exhibit “B.” 

417 (2) Prior to October 1 of each Calendar Year, the Contracting Officer 

418 shall make available to the Contractor an estimate of the Rates and Tiered Pricing Component 

419 for Project Water for the following Year and the computations and cost allocations upon which 

420 those Rates are based. The Contractor shall be allowed not less than two months to review and 

421 comment on such computations and cost allocations. By December 31 of each Calendar Year, 

422 the Contracting Officer shall provide the Contractor with the final Rates and Tiered Pricing 

423 Component to be in effect for the upcoming Year, and such notification shall revise Exhibit “B.” 

424 (c) At the time the Contractor submits the initial schedule for the delivery of 

425 Project Water for each Year pursuant to subdivision (b) of Article 4 of this Contract, the 

426 Contractor shall make an advance payment to the United States equal to the total amount payable 

427 pursuant to the applicable Rate(s) set under subdivision (a) of this Article, for the Project Water 

428 scheduled to be delivered pursuant to this Contract during the first two calendar months of the 

429 Year. Before the end of the first month and before the end of each calendar month thereafter, the 

430 Contractor shall make an advance payment to the United States, at the Rate(s) set under 
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431 subdivision (a) of this Article, for the Water Scheduled to be delivered pursuant to this Contract 

432 during the second month immediately following. Adjustments between advance payments for 

433 Water Scheduled and payments at Rates due for Water Delivered shall be made before the end of 

434 the following month; Provided, That any revised schedule submitted by the Contractor pursuant 

435 to Article 4 of this Contract which increases the amount of Water Delivered pursuant to this 

436 Contract during any month shall be accompanied with appropriate advance payment, at the Rates 

437 then in effect, to assure that Project Water is not delivered to the Contractor in advance of such 

438 payment. In any month in which the quantity of Water Delivered to the Contractor pursuant to 

439 this Contract equals the quantity of Water Scheduled and paid for by the Contractor, no 

440 additional Project Water shall be delivered to the Contractor unless and until an advance 

441 payment at the Rates then in effect for such additional Project Water is made. Final adjustment 

442 between the advance payments for the Water Scheduled and payments for the quantities of Water 

443 Delivered during each Year pursuant to this Contract shall be made as soon as practicable, but no 

444 later than April 30th of the following Year, or 60 days after the delivery of Project Water carried 

445 over under subdivision (g) of Article 3 of this Contract if such water is not delivered by the last 

446 day of February. 

447 (d) The Contractor shall also make a payment in addition to the Rate(s) in 

448 subdivision (c) of this Article to the United States for Water Delivered, at the Charges and the 

449 appropriate Tiered Pricing Component then in effect, before the end of the month following the 

450 month of delivery; Provided, That the Contractor may be granted an exception from the Tiered 

451 Pricing Component pursuant to subdivision (j)(2) of this Article. The payments shall be 

452 consistent with the quantities of M&I Water Delivered as shown in the water delivery report for 

453 the subject month prepared by the Contracting Officer. The water delivery report shall be 

454 deemed a bill for the payment of Charges and the applicable Tiered Pricing Component for 

455 Water Delivered. Adjustment for overpayment or underpayment of Charges shall be made 

456 through the adjustment of payments due to the United States for Charges for the next month. 
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457 Any amount to be paid for past due payment of Charges and the Tiered Pricing Component shall 

458 be computed pursuant to Article 20 of this Contract. 

459 (e) The Contractor shall pay for any Water Delivered under subdivision (a), 

460 (f), or (g) of Article 3 of this Contract as determined by the Contracting Officer pursuant to 

461 applicable statutes, associated regulations, any applicable provisions of guidelines or ratesetting 

462 policies; Provided, That the Rate for Water Delivered under subdivision (f) of Article 3 of this 

463 Contract shall be no more than the otherwise applicable Rate for M&I Water under subdivision 

464 (a) of this Article. 

465 (f) Payments to be made by the Contractor to the United States under this 

466 Contract may be paid from any revenues available to the Contractor. 

467 (g) All revenues received by the United States from the Contractor relating to 

468 the delivery of Project Water or the delivery of non-Project water through Project facilities shall 

469 be allocated and applied in accordance with Federal Reclamation law and the associated rules or 

470 regulations, and the then-current Project ratesetting policy for M&I Water. 

471 (h) The Contracting Officer shall keep its accounts pertaining to the 

472 administration of the financial terms and conditions of its long-term contracts, in accordance 

473 with applicable Federal standards, so as to reflect the application of Project costs and revenues. 

474 The Contracting Officer shall, each Year upon request of the Contractor, provide to the 

475 Contractor a detailed accounting of all Project and Contractor expense allocations, the 

476 disposition of all Project and Contractor revenues, and a summary of all water delivery 

477 information. The Contracting Officer and the Contractor shall enter into good faith negotiations 

478 to resolve any discrepancies or disputes relating to accountings, reports, or information. 

479 (i) The parties acknowledge and agree that the efficient administration of this 

480 Contract is their mutual goal. Recognizing that experience has demonstrated that mechanisms, 

481 policies, and procedures used for establishing Rates, Charges, and the Tiered Pricing 

482 Component, and/or for making and allocating payments, other than those set forth in this Article 
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483 may be in the mutual best interest of the parties, it is expressly agreed that the parties may enter 

484 into agreements to modify the mechanisms, policies, and procedures for any of those purposes 

485 while this Contract is in effect without amending this Contract. 

486 (j) (1) Beginning at such time as deliveries of Project Water in a Year 

487 exceed 80 percent of the Contract Total, then before the end of the month following the month of 

488 delivery the Contractor shall make an additional payment to the United States equal to the 

489 applicable Tiered Pricing Component. The Tiered Pricing Component for the amount of Water 

490 Delivered in excess of 80 percent of the Contract Total, but less than or equal to 90 percent of the 

491 Contract Total, shall equal one-half of the difference between the Rate established under 

492 subdivision (a) of this Article and the M&I Full Cost Water Rate. The Tiered Pricing 

493 Component for the amount of Water Delivered which exceeds 90 percent of the Contract Total 

494 shall equal the difference between (i) the Rate established under subdivision (a) of this Article 

495 and (ii) the M&I Full Cost Water Rate. 

496 (2) Omitted. 

497 (3) For purposes of determining the applicability of the Tiered Pricing 

498 Component pursuant to this Article, Water Delivered shall include Project Water that the 

499 Contractor transfers to others but shall not include Project Water transferred to the Contractor, 

500 nor shall it include the additional water provided to the Contractor under the provisions of 

501 subdivision (f) of Article 3 of this Contract. 

502 (k) For the term of this Contract, Rates under the respective ratesetting 

503 policies will be established to recover only reimbursable O&M (including any deficits) and 

504 capital costs of the Project, as those terms are used in the then-current Project ratesetting 

505 policies, and interest, where appropriate, except in instances where a minimum Rate is applicable 

506 in accordance with the relevant Project ratesetting policy. Changes of significance in practices 

507 which implement the Contracting Officer’s ratesetting policies will not be implemented until the 
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508 Contracting Officer has provided the Contractor an opportunity to discuss the nature, need, and 

509 impact of the proposed change. 

510 (l) Except as provided in subsections 3405(a)(1)(B) and 3405(f) of the 

511 CVPIA, the Rates for Project Water transferred by the Contractor shall be the Contractor’s Rates 

512 adjusted upward or downward to reflect the changed costs, if any, incurred by the Contracting 

513 Officer in the delivery of the transferred Project Water to the transferee’s point of delivery in 

514 accordance with the then applicable Project ratesetting policy. If the Contractor is receiving 

515 lower Rates and Charges because of inability to pay and is transferring Project Water to another 

516 entity whose Rates and Charges are not adjusted due to inability to pay, the Rates and Charges 

517 for transferred Project Water shall be the Contractor’s Rates and Charges and will not be 

518 adjusted to reflect the Contractor’s inability to pay. 

519 (m) Pursuant to the Act of October 27, 1986 (100 Stat. 3050), the Contracting 

520 Officer is authorized to adjust determinations of ability to pay every five years. 

521 (n) With respect to the Rates for M&I Water, the Contractor asserts that it is 

522 not legally obligated to pay any Project deficits claimed by the United States to have accrued as 

523 of the date of this Contract or deficit-related interest charges thereon. By entering into this 

524 Contract, the Contractor does not waive any legal rights or remedies that it may have with 

525 respect to such disputed issues. Notwithstanding the execution of this Contract and payments 

526 made hereunder, the Contractor may challenge in the appropriate administrative or judicial 

527 forums: (1) the existence, computation, or imposition of any deficit charges accruing during the 

528 term of the Existing Contract and any preceding interim renewal contracts, if applicable; (2) 

529 interest accruing on any such deficits; (3) the inclusion of any such deficit charges or interest in 

530 the Rates; (4) the application by the United States of payments made by the Contractor under its 

531 Existing Contract and any preceding interim renewal contracts, if applicable; and (5) the 

532 application of such payments in the Rates. The Contracting Officer agrees that the Contractor 

533 shall be entitled to the benefit of any administrative or judicial ruling in favor of any Project 
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534 M&I contractor on any of these issues, and credits for payments heretofore made, Provided, That 

535 the basis for such ruling is applicable to the Contractor.

536 NON-INTEREST BEARING OPERATION AND MAINTENANCE DEFICITS

537 8. The Contractor and the Contracting Officer concur that, as of the effective date of 

538 this Contract, the Contractor has no non-interest bearing O&M deficits and shall have no further 

539 liability therefor. 

540 SALES, TRANSFERS, OR EXCHANGES OF WATER

541 9. (a) The right to receive Project Water provided for in this Contract may be 

542 sold, transferred, or exchanged to others for reasonable and beneficial uses within the State of 

543 California if such sale, transfer, or exchange is authorized by applicable Federal and State laws, 

544 and applicable guidelines or regulations then in effect. No sale, transfer, or exchange of Project 

545 Water under this Contract may take place without the prior written approval of the Contracting 

546 Officer, except as provided for in subdivision (b) of this Article, and no such sales, transfers, or 

547 exchanges shall be approved absent all appropriate environmental documentation, including but 

548 not limited to documents prepared pursuant to NEPA and ESA. Such environmental 

549 documentation should include, as appropriate, an analysis of ground-water impacts and 

550 economic and social effects, including environmental justice, of the proposed water transfers on 

551 both the transferor and transferee. 

552 (b) In order to facilitate efficient water management by means of water 

553 transfers of the type historically carried out among Project Contractors located within the same 

554 geographical area and to allow the Contractor to participate in an accelerated water transfer 

555 program during the term of this Contract, the Contracting Officer shall prepare, as appropriate, 

556 all necessary environmental documentation including, but not limited to, documents prepared 

557 pursuant to NEPA and ESA, analyzing annual transfers within such geographical areas, and the 

558 Contracting Officer shall determine whether such transfers comply with applicable law. 

559 Following the completion of the environmental documentation, such transfers addressed in such 
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560 documentation shall be conducted with advance notice to the Contracting Officer, but shall not 

561 require prior written approval by the Contracting Officer. Such environmental documentation 

562 and the Contracting Officer’s compliance determination shall be reviewed every five years and 

563 updated, as necessary, prior to the expiration of the then-existing five-year period. All 

564 subsequent environmental documentation shall include an alternative to evaluate not less than the 

565 quantity of Project Water historically transferred within the same geographical area. 

566 (c) For a water transfer to qualify under subdivision (b) of this Article, such 

567 water transfer must: (i) be for irrigation purposes for lands irrigated within the previous three 

568 years, for M&I use, ground-water recharge, water banking, similar ground-water activities, 

569 surface water storage, or fish and wildlife resources; not lead to land conversion; and be 

570 delivered to established cropland, wildlife refuges, ground-water basins or M&I use; (ii) occur 

571 within a single Year; (iii) occur between a willing seller and a willing buyer; (iv) convey water 

572 through existing facilities with no new construction or modifications to facilities and be between 

573 existing Project Contractors and/or the Contractor and the United States, Department of the 

574 Interior; and (v) comply with all applicable Federal, State, and local or tribal laws and 

575 requirements imposed for protection of the environment and Indian Trust Assets, as defined 

576 under Federal law. 

577 (d) For the purpose of determining whether Section 3405(a)(1)(M) of the 

578 CVPIA applies to the Contractor as a transferor or transferee of Project Water, the Contracting 

579 Officer acknowledges that the Contractor is within a county, watershed, or other area of origin, 

580 as those terms are utilized under California law, of water that constitutes the natural flow of the 

581 Sacramento River and its tributaries above the confluence of the American and Sacramento 

582 Rivers. 

583 APPLICATION OF PAYMENTS AND ADJUSTMENTS 

584 10. (a) The amount of any overpayment by the Contractor of the Contractor’s 

585 O&M, capital, and deficit (if any) obligations for the Year shall be applied first to any current 
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586 liabilities of the Contractor arising out of this Contract then due and payable. Overpayments of 

587 more than $1,000 shall be refunded at the Contractor’s request. In lieu of a refund, any amount 

588 of such overpayment, at the option of the Contractor, may be credited against amounts to become 

589 due to the United States by the Contractor. With respect to overpayment, such refund or 

590 adjustment shall constitute the sole remedy of the Contractor or anyone having or claiming to 

591 have the right to the use of any of the Project Water supply provided for herein. All credits and 

592 refunds of overpayments shall be made within 30 days of the Contracting Officer obtaining 

593 direction as to how to credit or refund such overpayment in response to the notice to the 

594 Contractor that it has finalized the accounts for the Year in which the overpayment was made. 

595 (b) All advances for miscellaneous costs incurred for work requested by the 

596 Contractor pursuant to Article 25 of this Contract shall be adjusted to reflect the actual costs 

597 when the work has been completed. If the advances exceed the actual costs incurred, the 

598 difference will be refunded to the Contractor. If the actual costs exceed the Contractor's 

599 advances, the Contractor will be billed for the additional costs pursuant to Article 25. 

600 TEMPORARY REDUCTIONS--RETURN FLOWS

601 11. (a) Subject to: (i) the authorized purposes and priorities of the Project and the 

602 requirements of Federal law; and (ii) the obligations of the United States under existing 

603 contracts, or renewals thereof, providing for water deliveries from the Project, the Contracting 

604 Officer shall make all reasonable efforts to optimize Project Water deliveries to the Contractor as 

605 provided in this Contract. 

606 (b) The Contracting Officer may temporarily discontinue or reduce the 

607 quantity of Water Delivered to the Contractor as herein provided for the purposes of 

608 investigation, inspection, maintenance, repair, or replacement of any of the Project facilities or 

609 any part thereof necessary for the delivery of Project Water to the Contractor, but so far as 

610 feasible the Contracting Officer will give the Contractor due notice in advance of such temporary 

611 discontinuance or reduction, except in case of emergency, in which case no notice need be given; 
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612 Provided, That the United States shall use its best efforts to avoid any discontinuance or 

613 reduction in such service. Upon resumption of service after such reduction or discontinuance, 

614 and if requested by the Contractor, the United States will, if possible, deliver the quantity of 

615 Project Water which would have been delivered hereunder in the absence of such discontinuance 

616 or reduction. 

617 (c) The United States reserves the right to all seepage and return flow water 

618 derived from Water Delivered to the Contractor hereunder which escapes or is discharged 

619 beyond the Contractor's Service Area; Provided, That this shall not be construed as claiming for 

620 the United States any right to seepage or return flow being put to reasonable and beneficial use 

621 pursuant to this Contract within the Contractor’s Service Area by the Contractor or those 

622 claiming by, through, or under the Contractor. 

623 CONSTRAINTS ON THE AVAILABILITY OF WATER

624 12. (a) In its operation of the Project, the Contracting Officer will use all 

625 reasonable means to guard against a Condition of Shortage in the quantity of water to be made 

626 available to the Contractor pursuant to this Contract. In the event the Contracting Officer 

627 determines that a Condition of Shortage appears probable, the Contracting Officer will notify the 

628 Contractor of said determination as soon as practicable. 

629 (b) If there is a Condition of Shortage because of errors in physical operations 

630 of the Project, drought, other physical causes beyond the control of the Contracting Officer or 

631 actions taken by the Contracting Officer to meet legal obligations then, except as provided in 

632 subdivision (a) of Article 18 of this Contract, no liability shall accrue against the United States or 

633 any of its officers, agents, or employees for any damage, direct or indirect, arising therefrom. 

634 (c) Omitted. 

635 (d) Project Water furnished under this Contract will be allocated in 

636 accordance with the then-existing Project M&I Water Shortage Policy. Such policy shall be 

637 amended, modified, or superceded only through a public notice and comment procedure. 
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638 (e) By entering into this Contract, the Contractor does not waive any legal 

639 rights or remedies it may have to file or participate in any administrative or judicial proceeding 

640 contesting (i) the sufficiency of the manner in which any Project M&I Water Shortage Policy 

641 adopted after the effective date of this Contract was promulgated; (ii) the substance of such a 

642 policy; or (iii) the applicability of such a policy. By agreeing to the foregoing, the Contracting 

643 Officer does not waive any legal defenses or remedies that it may then have to assert in such a 

644 proceeding. 

645 UNAVOIDABLE GROUNDWATER PERCOLATION

646 13. Omitted. 

647 RULES AND REGULATIONS

648 14. The parties agree that the delivery of Project Water or use of Federal facilities 

649 pursuant to this Contract is subject to Federal Reclamation law, as amended and supplemented, 

650 and the rules and regulations promulgated by the Secretary of the Interior under Federal 

651 Reclamation law. 

652 WATER AND AIR POLLUTION CONTROL

653 15. The Contractor, in carrying out this Contract, shall comply with all applicable 

654 water and air pollution laws and regulations of the United States and the State of California, and 

655 shall obtain all required permits or licenses from the appropriate Federal, State, or local 

656 authorities. 

657 QUALITY OF WATER

658 16. (a) Project facilities used to deliver Project Water to the Contractor pursuant 

659 to this Contract shall be operated and maintained to enable the United States to deliver Project 

660 Water to the Contractor in accordance with the water quality standards specified in subsection 

661 2(b) of the Act of August 26, 1937 (50 Stat. 865), as added by Section 101 of the Act of 

662 October 27, 1986 (100 Stat. 3050) or other existing Federal laws. The United States is under no 

663 obligation to construct or furnish water treatment facilities to maintain or to improve the quality 
Contract No. 4-07-20-W1134-LTR1 

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664 of Water Delivered to the Contractor pursuant to this Contract. The United States does not 

665 warrant the quality of Water Delivered to the Contractor pursuant to this Contract. 

666 (b) The O&M of Project facilities shall be performed in such manner as is 

667 practicable to maintain the quality of raw water made available through such facilities at the 

668 highest level reasonably attainable as determined by the Contracting Officer. The Contractor 

669 shall be responsible for compliance with all State and Federal water quality standards applicable 

670 to surface and subsurface agricultural drainage discharges generated through the use of Federal 

671 or Contractor facilities or Project Water provided by the Contractor within the Contractor's 

672 Service Area. 

673 WATER ACQUIRED BY THE CONTRACTOR

674 OTHER THAN FROM THE UNITED STATES

675 17. (a) Omitted. 

676 (b) Water or water rights now owned or hereafter acquired by the Contractor, 

677 other than from the United States, may be stored, conveyed, and/or diverted through Project 

678 facilities, subject to the completion of appropriate environmental documentation, with the 

679 approval of the Contracting Officer and the execution of any contract determined by the 

680 Contracting Officer to be necessary, consistent with the following provisions: 

681 (1) The Contractor may introduce non-Project water into Project 

682 facilities and deliver said water to lands within the Contractor’s Service Area subject to payment 

683 to the United States of an appropriate rate as determined by the applicable Project ratesetting 

684 policy, the RRA, and the Project use power policy, if Project use power policy is applicable, each 

685 as amended, modified, or superceded from time to time. 

686 (2) Delivery of such non-Project water in and through Project facilities 

687 shall only be allowed to the extent such deliveries do not: (i) interfere with other Project 

688 purposes as determined by the Contracting Officer; (ii) reduce the quantity or quality of water 

689 available to other Project Contractors; (iii) interfere with the delivery of contractual water 
Contract No. 4-07-20-W1134-LTR1 

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690 entitlements to any other Project Contractors; or (iv) interfere with the physical maintenance of 

691 the Project facilities. 

692 (3) The United States shall not be responsible for control, care, or 

693 distribution of the non-Project water before it is introduced into or after it is delivered from the 

694 Project facilities. The Contractor hereby releases and agrees to defend and indemnify the United 

695 States and its respective officers, agents, and employees, from any claim for damage to persons 

696 or property, direct or indirect, resulting from acts of the Contractor, its officers’, employees’, 

697 agents’ or assigns’, act(s) in (i) extracting or diverting non-Project water from any source, or (ii) 

698 diverting such non-Project water into Project facilities. 

699 (4) Diversion of such non-Project water into Project facilities shall be 

700 consistent with all applicable laws, and if involving groundwater, consistent with any applicable 

701 ground-water management plan for the area from which it was extracted. 

702 (5) After Project purposes are met, as determined by the Contracting 

703 Officer, the United States and the Contractor shall share priority to utilize the remaining capacity 

704 of the facilities declared to be available by the Contracting Officer for conveyance and 

705 transportation of non-Project water prior to any such remaining capacity being made available to 

706 non-Project contractors. 

707 OPINIONS AND DETERMINATIONS

708 18. (a) Where the terms of this Contract provide for actions to be based upon the 

709 opinion or determination of either party to this Contract, said terms shall not be construed as 

710 permitting such action to be predicated upon arbitrary, capricious, or unreasonable opinions or 

711 determinations. Both parties, notwithstanding any other provisions of this Contract, expressly 

712 reserve the right to seek relief from and appropriate adjustment for any such arbitrary, capricious, 

713 or unreasonable opinion or determination. Each opinion or determination by either party shall be 

714 provided in a timely manner. Nothing in subdivision (a) of Article 18 of this Contract is 

715 intended to or shall affect or alter the standard of judicial review applicable under Federal law to 
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716 any opinion or determination implementing a specific provision of Federal law embodied in 

717 statute or regulation. 

718 (b) The Contracting Officer shall have the right to make determinations 

719 necessary to administer this Contract that are consistent with the provisions of this Contract, the 

720 laws of the United States and of the State of California, and the rules and regulations 

721 promulgated by the Secretary of the Interior. Such determinations shall be made in consultation 

722 with the Contractor to the extent reasonably practicable. 

723 COORDINATION AND COOPERATION

724 19. (a) In order to further their mutual goals and objectives, the Contracting 

725 Officer and the Contractor shall communicate, coordinate, and cooperate with each other, and 

726 with other affected Project Contractors, in order to improve the operation and management of the 

727 Project. The communication, coordination, and cooperation regarding operations and 

728 management shall include, but not be limited to, any action which will or may materially affect 

729 the quantity or quality of Project Water supply, the allocation of Project Water supply, and 

730 Project financial matters including, but not limited to, budget issues. The communication, 

731 coordination, and cooperation provided for hereunder shall extend to all provisions of this 

732 Contract. Each party shall retain exclusive decision making authority for all actions, opinions, 

733 and determinations to be made by the respective party. 

734 (b) Within 120 days following the effective date of this Contract, the 

735 Contractor, other affected Project Contractors, and the Contracting Officer shall arrange to meet 

736 with interested Project Contractors to develop a mutually agreeable, written Project-wide 

737 process, which may be amended as necessary separate and apart from this Contract. The goal of 

738 this process shall be to provide, to the extent practicable, the means of mutual communication 

739 and interaction regarding significant decisions concerning Project operation and management on 

740 a real-time basis. 
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741 (c) In light of the factors referred to in subdivision (b) of Article 3 of this 

742 Contract, it is the intent of the Secretary to improve water supply reliability. To carry out this 

743 intent: 

744 (1) The Contracting Officer will, at the request of the Contractor, 

745 assist in the development of integrated resource management plans for the Contractor. Further, 

746 the Contracting Officer will, as appropriate, seek authorizations for implementation of 

747 partnerships to improve water supply, water quality, and reliability. 

748 (2) The Secretary will, as appropriate, pursue program and project 

749 implementation and authorization in coordination with Project Contractors to improve the water 

750 supply, water quality, and reliability of the Project for all Project purposes. 

751 (3) The Secretary will coordinate with Project Contractors and the 

752 State of California to seek improved water resource management. 

753 (3.1) The Secretary and the Contractor desire to work together to 

754 maximize the reasonable beneficial use of water for their mutual benefit. As a consequence, the 

755 Secretary and the Contractor will work in partnership and with others in the region of the 

756 Redding Groundwater Basin, including other Contractors in the Shasta and Trinity Divisions of 

757 the Project, to facilitate the better integration with the region of the Redding Groundwater Basin 

758 of all water supplies including, but not limited to, the better management and integration of 

759 surface water and groundwater, transfers and exchanges of water, the development and better 

760 utilization of surface water storage, the effective utilization of waste, seepage and return flow 

761 water, and other operational and management options that may be identified in the future. 

762 (4) The Secretary will coordinate actions of agencies within the 

763 Department of the Interior that may impact the availability of water for Project purposes. 

764 (5) The Contracting Officer shall periodically, but not less than 

765 annually, hold division level meetings to discuss Project operations, division level water 

766 management activities, and other issues as appropriate. 
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767 (d) Without limiting the contractual obligations of the Contracting Officer 

768 under the other Articles of this Contract nothing in this Article shall be construed to limit or 

769 constrain the Contracting Officer’s ability to communicate, coordinate, and cooperate with the 

770 Contractor or other interested stakeholders or to make decisions in a timely fashion as needed to 

771 protect health, safety, or the physical integrity of structures or facilities. 

772 CHARGES FOR DELINQUENT PAYMENTS

773 20. (a) The Contractor shall be subject to interest, administrative and penalty 

774 charges on delinquent installments or payments. When a payment is not received by the due 

775 date, the Contractor shall pay an interest charge for each day the payment is delinquent beyond 

776 the due date. When a payment becomes sixty (60) days delinquent, the Contractor shall pay an 

777 administrative charge to cover additional costs of billing and processing the delinquent payment. 

778 When a payment is delinquent ninety (90) days or more, the Contractor shall pay an additional 

779 penalty charge of six (6%) percent per year for each day the payment is delinquent beyond the 

780 due date. Further, the Contractor shall pay any fees incurred for debt collection services 

781 associated with a delinquent payment. 

782 (b) The interest charge rate shall be the greater of the rate prescribed quarterly 

783 in the Federal Register by the Department of the Treasury for application to overdue payments, 

784 or the interest rate of one-half of one (0.5%) percent per month prescribed by Section 6 of the 

785 Reclamation Project Act of 1939 (Public Law 76-260). The interest charge rate shall be 

786 determined as of the due date and remain fixed for the duration of the delinquent period. 

787 (c) When a partial payment on a delinquent account is received, the amount 

788 received shall be applied, first to the penalty, second to the administrative charges, third to the 

789 accrued interest, and finally to the overdue payment. 

790 EQUAL OPPORTUNITY

791 21. During the performance of this Contract, the Contractor agrees as follows: 

792 (a) The Contractor will not discriminate against any employee or applicant for 

793 employment because of race, color, religion, sex, or national origin. The Contractor will take 

794 affirmative action to ensure that applicants are employed, and that employees are treated during 

795 employment, without regard to their race, color, religion, sex, or national origin. Such action 

796 shall include, but not be limited to, the following: Employment, upgrading, demotion, or 

797 transfer; recruitment or recruitment advertising; layoff or termination, rates of payment or other 

798 forms of compensation; and selection for training, including apprenticeship. The Contractor 

799 agrees to post in conspicuous places, available to employees and applicants for employment, 

800 notices to be provided by the Contracting Officer setting forth the provisions of this 

801 nondiscrimination clause. 
Contract No. 4-07-20-W1134-LTR1 

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802 (b) The Contractor will, in all solicitations or advertisements for employees 

803 placed by or on behalf of the Contractor, state that all qualified applicants will receive 

804 consideration for employment without discrimination because of race, color, religion, sex, or 

805 national origin. 

806 (c) The Contractor will send to each labor union or representative of workers 

807 with which it has a collective bargaining agreement or other contract or understanding, a notice, 

808 to be provided by the Contracting Officer, advising the said labor union or workers' 

809 representative of the Contractor's commitments under Section 202 of Executive Order 11246 of 

810 September 24, 1965, and shall post copies of the notice in conspicuous places available to 

811 employees and applicants for employment. 

812 (d) The Contractor will comply with all provisions of Executive Order 

813 No. 11246 of September 24, 1965, as amended, and of the rules, regulations, and relevant orders 

814 of the Secretary of Labor. 

815 (e) The Contractor will furnish all information and reports required by said 

816 amended Executive Order and by the rules, regulations, and orders of the Secretary of Labor, or 

817 pursuant thereto, and will permit access to its books, records, and accounts by the Contracting 

818 Officer and the Secretary of Labor for purposes of investigation to ascertain compliance with 

819 such rules, regulations, and orders. 

820 (f) In the event of the Contractor's noncompliance with the nondiscrimination 

821 clauses of this Contract or with any of the said rules, regulations, or orders, this Contract may be 

822 canceled, terminated, or suspended, in whole or in part, and the Contractor may be declared 

823 ineligible for further Government contracts in accordance with procedures authorized in said 

824 amended Executive Order, and such other sanctions may be imposed and remedies invoked as 

825 provided in said Executive Order, or by rule, regulation, or order of the Secretary of Labor, or as 

826 otherwise provided by law. 

827 (g) The Contractor will include the provisions of paragraphs (a) through (g) in 

828 every subcontract or purchase order unless exempted by the rules, regulations, or orders of the 

829 Secretary of Labor issued pursuant to Section 204 of said amended Executive Order, so that such 

830 provisions will be binding upon each subcontractor or vendor. The Contractor will take such 

831 action with respect to any subcontract or purchase order as may be directed by the Secretary of 

832 Labor as a means of enforcing such provisions, including sanctions for noncompliance: 

833 Provided, however, That in the event the Contractor becomes involved in, or is threatened with, 

834 litigation with a subcontractor or vendor as a result of such direction, the Contractor may request 

835 the United States to enter into such litigation to protect the interests of the United States. 

836 GENERAL OBLIGATION--BENEFITS CONDITIONED UPON PAYMENT

837 22. (a) The obligation of the Contractor to pay the United States as provided in 

838 this Contract is a general obligation of the Contractor notwithstanding the manner in which the 

839 obligation may be distributed among the Contractor's water users and notwithstanding the default 

840 of individual water users in their obligations to the Contractor. 
Contract No. 4-07-20-W1134-LTR1 

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841 (b) The payment of charges becoming due hereunder is a condition precedent 

842 to receiving benefits under this Contract. The United States shall not make water available to the 

843 Contractor through Project facilities during any period in which the Contractor may be in arrears 

844 in the advance payment of water rates due the United States. The Contractor shall not furnish 

845 water made available pursuant to this Contract for lands or parties which are in arrears in the 

846 advance payment of water rates levied or established by the Contractor. 

847 (c) With respect to subdivision (b) of this Article, the Contractor shall have no 

848 obligation to require advance payment for water rates which it levies. 

849 COMPLIANCE WITH CIVIL RIGHTS LAWS AND REGULATIONS

850 23. (a) The Contractor shall comply with Title VI of the Civil Rights Act of 1964 

851 (42 U.S.C. 2000d), Section 504 of the Rehabilitation Act of 1975 (P.L. 93-112, as amended), the 

852 Age Discrimination Act of 1975 (42 U.S.C. 6101, et seq.) and any other applicable civil rights 

853 laws, as well as with their respective implementing regulations and guidelines imposed by the 

854 U.S. Department of the Interior and/or Bureau of Reclamation. 

855 (b) These statutes require that no person in the United States shall, on the 

856 grounds of race, color, national origin, handicap, or age, be excluded from participation in, be 

857 denied the benefits of, or be otherwise subjected to discrimination under any program or activity 

858 receiving financial assistance from the Bureau of Reclamation. By executing this Contract, the 

859 Contractor agrees to immediately take any measures necessary to implement this obligation, 

860 including permitting officials of the United States to inspect premises, programs, and documents. 

861 (c) The Contractor makes this agreement in consideration of and for the 

862 purpose of obtaining any and all Federal grants, loans, contracts, property discounts, or other 

863 Federal financial assistance extended after the date hereof to the Contractor by the Bureau of 

864 Reclamation, including installment payments after such date on account of arrangements for 

865 Federal financial assistance which were approved before such date. The Contractor recognizes 

866 and agrees that such Federal assistance will be extended in reliance on the representations and 

867 agreements made in this Article, and that the United States reserves the right to seek judicial 

868 enforcement thereof. 

869 PRIVACY ACT COMPLIANCE

870 24. (a) The Contractor shall comply with the Privacy Act of 1974 (5 U.S.C. 552a) 

871 (the Act) and the Department of the Interior rules and regulations under the Act (43 CFR 2.45 et 

872 seq.) in maintaining Landholder acreage certification and reporting records, required to be 

873 submitted to the Contractor for compliance with Sections 206 and 228 of the Reclamation 

874 Reform Act of 1982 (96 Stat. 1266), and pursuant to 43 CFR 426.18. 

875 (b) With respect to the application and administration of the criminal penalty 

876 provisions of the Act (5 U.S.C. 552a(i)), the Contractor and the Contractor's employees 

877 responsible for maintaining the certification and reporting records referenced in (a) above are 

878 considered to be employees of the Department of the Interior. See 5 U.S.C. 552a(m). 
Contract No. 4-07-20-W1134-LTR1 

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879 (c) The Contracting Officer or a designated representative shall provide the 

880 Contractor with current copies of the Interior Department Privacy Act regulations and the Bureau 

881 of Reclamation Federal Register Privacy Act System of Records Notice (Acreage Limitation--

882 Interior, Reclamation-31) which govern the maintenance, safeguarding, and disclosure of 

883 information contained in the Landholder's certification and reporting records. 

884 (d) The Contracting Officer shall designate a full-time employee of the 

885 Bureau of Reclamation to be the System Manager who shall be responsible for making decisions 

886 on denials pursuant to 43 CFR 2.61 and 2.64 amendment requests pursuant to 43 CFR 2.72. The 

887 Contractor is authorized to grant requests by individuals for access to their own records. 

888 (e) The Contractor shall forward promptly to the System Manager each 

889 proposed denial of access under 43 CFR 2.64; and each request for amendment of records filed 

890 under 43 CFR 2.71; notify the requester accordingly of such referral; and provide the System 

891 Manager with information and records necessary to prepare an appropriate response to the 

892 requester. These requirements do not apply to individuals seeking access to their own 

893 certification and reporting forms filed with the Contractor pursuant to 43 CFR 426.18, unless the 

894 requester elects to cite the Privacy Act as a basis for the request. 

895 CONTRACTOR TO PAY CERTAIN MISCELLANEOUS COSTS

896 25. In addition to all other payments to be made by the Contractor pursuant to this 

897 Contract, the Contractor shall pay to the United States, within 60 days after receipt of a bill and 

898 detailed statement submitted by the Contracting Officer to the Contractor for such specific items 

899 of direct cost incurred by the United States for work requested by the Contractor associated with 

900 this Contract plus indirect costs in accordance with applicable Bureau of Reclamation policies 

901 and procedures. All such amounts referred to in this Article shall not exceed the amount agreed 

902 to in writing in advance by the Contractor. This Article shall not apply to costs for routine 

903 contract administration. 

904 WATER CONSERVATION

905 26. (a) Prior to the delivery of water provided from or conveyed through 

906 Federally constructed or Federally financed facilities pursuant to this Contract, the Contractor 

907 shall be implementing an effective water conservation and efficiency program based on the 

908 Contractor's water conservation plan that has been determined by the Contracting Officer to meet 

909 the conservation and efficiency criteria for evaluating water conservation plans established under 

910 Federal law. The water conservation and efficiency program shall contain definite water 
Contract No. 4-07-20-W1134-LTR1 

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911 conservation objectives, appropriate economically feasible water conservation measures, and 

912 time schedules for meeting those objectives. Continued Project Water delivery pursuant to this 

913 Contract shall be contingent upon the Contractor’s continued implementation of such water 

914 conservation program. In the event the Contractor's water conservation plan or any revised water 

915 conservation plan completed pursuant to subdivision (d) of Article 26 of this Contract have not 

916 yet been determined by the Contracting Officer to meet such criteria, due to circumstances which 

917 the Contracting Officer determines are beyond the control of the Contractor, water deliveries 

918 shall be made under this Contract so long as the Contractor diligently works with the Contracting 

919 Officer to obtain such determination at the earliest practicable date, and thereafter the Contractor 

920 immediately begins implementing its water conservation and efficiency program in accordance 

921 with the time schedules therein. 

922 (b) Should the amount of M&I Water delivered pursuant to subdivision (a) of 

923 Article 3 of this Contract equal or exceed 2,000 acre-feet per Year, the Contractor shall 

924 implement the Best Management Practices identified by the time frames issued by the California 

925 Urban Water Conservation Council for such M&I Water unless any such practice is determined 

926 by the Contracting Officer to be inappropriate for the Contractor. 

927 (c) The Contractor shall submit to the Contracting Officer a report on the 

928 status of its implementation of the water conservation plan on the reporting dates specified in the 

929 then existing conservation and efficiency criteria established under Federal law. 

930 (d) At five-year intervals, the Contractor shall revise its water conservation 

931 plan to reflect the then-current conservation and efficiency criteria for evaluating water 

932 conservation plans established under Federal law and submit such revised water management 

933 plan to the Contracting Officer for review and evaluation. The Contracting Officer will then 

934 determine if the water conservation plan meets Reclamation’s then-current conservation and 

935 efficiency criteria for evaluating water conservation plans established under Federal law. 
Contract No. 4-07-20-W1134-LTR1 

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936 (e) If the Contractor is engaged in direct ground-water recharge, such activity 

937 shall be described in the Contractor’s water conservation plan. 

938 EXISTING OR ACQUIRED WATER OR WATER RIGHTS

939 27. Except as specifically provided in Article 17 of this Contract, the provisions of 

940 this Contract shall not be applicable to or affect non-Project water or water rights now owned or 

941 hereafter acquired by the Contractor or any user of such water within the Contractor's Service 

942 Area. Any such water shall not be considered Project Water under this Contract. In addition, 

943 this Contract shall not be construed as limiting or curtailing any rights which the Contractor or 

944 any water user within the Contractor's Service Area acquires or has available under any other 

945 contract pursuant to Federal Reclamation law. 

946 OPERATION AND MAINTENANCE BY OPERATING NON-FEDERAL ENTITY

947 28. Omitted. 

948 CONTINGENT ON APPROPRIATION OR ALLOTMENT OF FUNDS

949 29. The expenditure or advance of any money or the performance of any obligation of 

950 the United States under this Contract shall be contingent upon appropriation or allotment of 

951 funds. Absence of appropriation or allotment of funds shall not relieve the Contractor from any 

952 obligations under this Contract. No liability shall accrue to the United States in case funds are 

953 not appropriated or allotted. 

954 BOOKS, RECORDS, AND REPORTS

955 30. (a) The Contractor shall establish and maintain accounts and other books and 

956 records pertaining to administration of the terms and conditions of this Contract, including: the 

957 Contractor's financial transactions, water supply data, and Project land and right-of-way 

958 agreements; the water users' land-use (crop census), land ownership, land-leasing and water use 

959 data; and other matters that the Contracting Officer may require. Reports thereon shall be 

960 furnished to the Contracting Officer in such form and on such date or dates as the Contracting 

961 Officer may require. Subject to applicable Federal laws and regulations, each party to this 

962 Contract shall have the right during office hours to examine and make copies of the other party's 

963 books and records relating to matters covered by this Contract. 

964 (b) Notwithstanding the provisions of subdivision (a) of this Article, no 

965 books, records, or other information shall be requested from the Contractor by the Contracting 

966 Officer unless such books, records, or information are reasonably related to the administration or 
Contract No. 4-07-20-W1134-LTR1 

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967 performance of this Contract. Any such request shall allow the Contractor a reasonable period of 

968 time within which to provide the requested books, records, or information. 

969 (c) Omitted. 

970 ASSIGNMENT LIMITED--SUCCESSORS AND ASSIGNS OBLIGATED

971 31. (a) The provisions of this Contract shall apply to and bind the successors and 

972 assigns of the parties hereto, but no assignment or transfer of this Contract or any right or interest 

973 therein shall be valid until approved in writing by the Contracting Officer. 

974 (b) The assignment of any right or interest in this Contract by either party 

975 shall not interfere with the rights or obligations of the other party to this Contract absent the 

976 written concurrence of said other party. 

977 (c) The Contracting Officer shall not unreasonably condition or withhold his 

978 approval of any proposed assignment. 

979 SEVERABILITY

980 32. In the event that a person or entity who is neither (i) a party to a Project contract, 

981 nor (ii) a person or entity that receives Project Water from a party to a Project contract, nor (iii) 

982 an association or other form of organization whose primary function is to represent parties to 

983 Project contracts, brings an action in a court of competent jurisdiction challenging the legality or 

984 enforceability of a provision included in this Contract and said person, entity, association, or 

985 organization obtains a final court decision holding that such provision is legally invalid or 

986 unenforceable and the Contractor has not intervened in that lawsuit in support of the plaintiff(s), 

987 the parties to this Contract shall use their best efforts to (i) within 30 days of the date of such 

988 final court decision identify by mutual agreement the provisions in this Contract which must be 

989 revised, and (ii) within three months thereafter promptly agree on the appropriate revision(s). 

990 The time periods specified above may be extended by mutual agreement of the parties. Pending 

991 the completion of the actions designated above, to the extent it can do so without violating any 

992 applicable provisions of law, the United States shall continue to make the quantities of Project 
Contract No. 4-07-20-W1134-LTR1 

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993 Water specified in this Contract available to the Contractor pursuant to the provisions of this 

994 Contract which were not found to be legally invalid or unenforceable in the final court decision. 

995 RESOLUTION OF DISPUTES

996 33. Should any dispute arise concerning any provisions of this Contract, or the 

997 parties’ rights and obligations thereunder, the parties shall meet and confer in an attempt to 

998 resolve the dispute. Prior to the Contractor commencing any legal action, or the Contracting 

999 Officer referring any matter to Department of Justice, the party shall provide to the other party 

1000 30 days’ written notice of the intent to take such action; Provided, That such notice shall not be 

1001 required where a delay in commencing an action would prejudice the interests of the party that 

1002 intends to file suit. During the 30-day notice period, the Contractor and the Contracting Officer 

1003 shall meet and confer in an attempt to resolve the dispute. Except as specifically provided, 

1004 nothing herein is intended to waive or abridge any right or remedy that the Contractor or the 

1005 United States may have. 

1006 OFFICIALS NOT TO BENEFIT

1007 34. No Member of or Delegate to Congress, Resident Commissioner, or official of the 

1008 Contractor shall benefit from this Contract other than as a water user or landowner in the same 

1009 manner as other water users or landowners. 

1010 CHANGES IN CONTRACTOR’S SERVICE AREA

1011 35. (a) While this Contract is in effect, no change may be made in the 

1012 Contractor's Service Area, by inclusion or exclusion of lands, dissolution, consolidation, merger, 

1013 or otherwise, except upon the Contracting Officer's written consent. 

1014 (b) Within 30 days of receipt of a request for such a change, the Contracting 

1015 Officer will notify the Contractor of any additional information required by the Contracting 

1016 Officer for processing said request, and both parties will meet to establish a mutually agreeable 

1017 schedule for timely completion of the process. Such process will analyze whether the proposed 

1018 change is likely to: (i) result in the use of Project Water contrary to the terms of this Contract; 

1019 (ii) impair the ability of the Contractor to pay for Project Water furnished under this Contract or 

1020 to pay for any Federally-constructed facilities for which the Contractor is responsible; and (iii) 
Contract No. 4-07-20-W1134-LTR1 

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1021 have an impact on any Project Water rights applications, permits, or licenses. In addition, the 

1022 Contracting Officer shall comply with the NEPA and the ESA. The Contractor will be 

1023 responsible for all costs incurred by the Contracting Officer in this process, and such costs will 

1024 be paid in accordance with Article 25 of this Contract. 

1025 FEDERAL LAWS

1026 36. By entering into this Contract, the Contractor does not waive its rights to contest 

1027 the validity or application in connection with the performance of the terms and conditions of this 

1028 Contract of any Federal law or regulation; Provided, That the Contractor agrees to comply with 

1029 the terms and conditions of this Contract unless and until relief from application of such Federal 

1030 law or regulation to the implementing provision of the Contract is granted by a court of 

1031 competent jurisdiction. 

1032 NOTICES

1033 37. Any notice, demand, or request authorized or required by this Contract shall be 

1034 deemed to have been given, on behalf of the Contractor, when mailed, postage prepaid, or 

1035 delivered to the Area Manager, Bureau of Reclamation, Northern California Area Office, 16349 

1036 Shasta Dam Boulevard, Shasta Lake, California 96019, and on behalf of the United States, when 

1037 mailed, postage prepaid, or delivered to the City Mayor of the City of Shasta Lake, PO Box 777, 

1038 1650 Stanton Drive, Shasta Lake, California 96019. The designation of the addressee or the 

1039 address may be changed by notice given in the same manner as provided in this Article for other 

1040 notices. 

1041 CONFIRMATION OF CONTRACT

1042 38. The Contractor, after the execution of this Contract, shall furnish to the 

1043 Contracting Officer evidence that pursuant to the laws of the State of California, the Contractor 

1044 is a legally constituted entity and the Contract is lawful, valid, and binding on the Contractor. 

1045 This Contract shall not be binding on the United States until such evidence has been provided to 

1046 the Contracting Officer’s satisfaction. 
Contract No. 4-07-20-W1134-LTR1 

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1047 IN WITNESS WHEREOF, the parties hereto have executed this Contract as of 

1048 the day and year first above written. 

1049 THE UNITED STATES OF AMERICA 

1050 By: ______________________________________ 

1051 Regional Director, Mid-Pacific Region 

1052 Bureau of Reclamation 

1053 CITY OF SHASTA LAKE 

1054 By: ______________________________________ 

1055 Mayor 

1056 Attest: 

1057 By: _____________________________ 

1058 City Clerk 

1059 (I:\LTRC\Draft LTRC\04-19-2004 City of Shasta Lake LTRC Final Draft Contract.doc) 
Contract No. 4-07-20-W1134-LTR1 

EXHIBIT A

[Map or Description of Contractor’s Service Area]
Contract No. 4-07-20-W1134-LTR1 

EXHIBIT B 

2004 Water Rates and Charges

City of Shasta Lake - Toyon Pipeline

 M&I

COST OF SERVICE RATES:

Capital Rate $ 6.79 

O&M Rates: 

Water Marketing 5.01 

Storage 6.38 

Direct Pumping 5.78 

Deficit Rate: 0.00 

CFO/PRF Adjustment Rate 1/ 0.00

TOTAL $23.97

FULL COST RATE $28.03

CHARGES UNDER P.L. 102-575 TO THE

RESTORATION FUND 2/ 

 Restoration Charges (3407(d)(2)(A)) $15.64

1/ Chief Financial Officer (CFO) adjustment and Provision for Replacement (PFR) expense is 

being distributed over a 5-year period beginning in FY 2003 for those contractors that requested 

those costs be deferred. 

2/ Restoration fund charges are payments in addition to the water rates and were determined 

pursuant to Title XXXIV of Public Law 102-575. Restoration fund charges are on a fiscal year 

basis (10/1 - 9/30).