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1

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 _________________________________

8 PROVIDING FOR PROJECT WATER SERVICE

9 FROM DIVISION

10 THIS CONTRACT, made this _____ day of ____________________, 2004, 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 

18 ___________________________, hereinafter referred to as the Contractor, a public agency of 

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

20 WITNESSETH, That: 

21 EXPLANATORY RECITALS
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 [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 

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 _________________________, 

29 hereinafter collectively referred to as the _____________ [Division/Unit] facilities, which will 

30 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 and the United States entered into Contract 

35 No. ______________, as amended, which established terms for the delivery to the Contractor of 

36 Project Water from the __________ [Division/Unit] from ____________ through 

37 ______________________ [For binding agreement contractors only: (hereinafter referred to as 

38 the “Existing Contract,” ]; and [Contractor specific issue as to “as amended”] 

 [ 5th 39 ] [FOR IRC'S] WHEREAS, the Contractor and the United States have pursuant to 

40 subsection 3404(c)(1) of the Central Valley Project Improvement Act (CVPIA), subsequently 

41 entered into interim renewal contract(s) identified as Contract No(s).______________________, 

42 the current of which is hereinafter referred to as the Existing Contract, which provided for the 

43 continued water service to the Contractor from __________________________ through 

44 _________________________; and 
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 [5th 45 ] [For Binding Agreement Contractors] WHEREAS, the United States and the 

46 Contractor have, pursuant to Subsection 3404(c)(3) of the Central Valley Project Improvement 

Act (CVPIA)1 47 , subsequently entered into a binding agreement, identified as Binding Agreement 

48 No. _____________, which sets out the terms pursuant to which the Contractor agreed to renew 

49 the Existing Contract before its expiration date after completion of a programmatic 

50 environmental impact statement and other appropriate environmental documentation and 

51 negotiation of a renewal contract, and which also sets out the consequences of a subsequent 

52 decision not to renew; and

 [6th] WHEREAS, Section 3404(c) of the CVPIA2 53 provides for long-term renewal of 

54 the Existing Contract following completion of appropriate environmental documentation, 

55 including a programmatic environmental impact statement PEIS pursuant to the National 

56 Environmental Policy Act (NEPA), analyzing the direct and indirect impacts and benefits of 

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

58 and 

 [7th 59 ] WHEREAS, the United States has completed the PEIS and all other appropriate 

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

 [8th 61 ] WHEREAS, the Contractor has requested the long-term renewal of the Existing 

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

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

 [9th 64 ] WHEREAS, the United States has determined that the Contractor has fulfilled all 

65 of its obligations under the Existing Contract; and 

 

1

 Contractor Specific Issue: citation of Sec. 3404(c)(3) in M&I only contracts. 2

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 [10th 66 ] [CONTRACTOR SPECIFIC] WHEREAS, the Contractor has demonstrated to 

67 the satisfaction of the Contracting Officer that the Contractor has utilized the Project Water 

68 supplies available to it for reasonable and beneficial use and/or has demonstrated projected 

future demand for water use such that the Contractor has the capability3 69 and expects to utilize 

70 fully for reasonable and beneficial use the quantity of Project Water to be made available to it 

71 pursuant to this Contract; and 

 [11th 72 ] WHEREAS, water obtained from the Project has been relied upon by urban and 

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

74 as an essential portion of its water supply; and 

 [12th 75 ] WHEREAS, the economies of regions within the Project, including the 

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

77 Project; and 

 [13th 78 ] WHEREAS, the Secretary intends through coordination, cooperation, and 

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

80 Project for all Project purposes; and 

 [14th 81 ] WHEREAS, the mutual goals of the United States and the Contractor include: to 

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

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

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

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

 

3

 Contractor Specific issue - This recital may need to be modified for individual contractors who do not have the 

capability today to take Project Water but can demonstrate that they will have the capability to take Project Water prior to 

the delivery of water. 
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86 of the United States relative to the Project; and 

 [15th 87 ] WHEREAS, the parties intend by this Contract to develop a more cooperative 

88 relationship in order to achieve their mutual goals; and 

 [16th 89 ] WHEREAS, the United States and the Contractor are willing to enter into this 

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

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

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

93 DEFINITIONS

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

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

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

97 both dates inclusive; 

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

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

100 annually by the Contracting Officer pursuant to this Contract; 

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

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

Contract Total;4 103 

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

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

106 or regulation; 

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

 

4

 May need to be modified for some divisions, including a definition of interruption of supply.
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108 Contractor is entitled under subdivision (a) of Article 3 of this Contract; 

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

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

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

without amendment of this Contract;5 112 

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

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

115 (h) “Eligible Lands” shall mean all lands to which Irrigation Water may be 

116 delivered in accordance with Section 204 of the Reclamation Reform Act of October 12, 1982 

117 (96 Stat. 1263), as amended, hereinafter referred to as RRA; 

118 (i) “Excess Lands” shall mean all lands in excess of the limitations contained 

119 in Section 204 of the RRA, other than those lands exempt from acreage limitation under Federal 

120 Reclamation law; 

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

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

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

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

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

126 and funded O&M deficits from October 12, 1982, on costs outstanding at that date, or from the 

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

128 in accordance with subsections 202(3)(B) and (3)(C) of the RRA. The Full Cost Rate includes 

 

5 Some Contractors may propose alternate language. Some Contractors may use a legal description, others may use a 

map. 
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129 actual operation, maintenance, and replacement costs consistent with Section 426.2 of the Rules 

130 and Regulations for the RRA; 

131 (k) “Ineligible Lands” shall mean all lands to which Irrigation Water may not 

132 be delivered in accordance with Section 204 of the RRA; 

133 (l) “Irrigation Full Cost Water Rate” shall mean the Full Cost Rate applicable 

134 to the delivery of Irrigation Water; 

135 (m) “Irrigation Water” shall mean water made available from the Project that 

136 is used primarily in the production of agricultural crops or livestock, including domestic use 

137 incidental thereto, and watering of livestock; 

138 (n) “Landholder” shall mean a party that directly or indirectly owns or leases 

139 nonexempt land, as provided in 43 CFR 426.2; 

 (o) “Municipal and Industrial (M&I) Water”7 140 shall mean Project Water, other 

141 than Irrigation Water, made available to the Contractor. M&I Water shall include water used for 

142 human use and purposes such as the watering of landscaping or pasture for animals (e.g., horses) 

143 which are kept for personal enjoyment or water delivered to land holdings operated in units of 

144 less than five acres unless the Contractor establishes to the satisfaction of the Contracting Officer 

145 that the use of water delivered to any such landholding is a use described in subdivision (m) of 

146 this Article; 

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

148 the delivery of M&I Water; 

 

7

 Some Contractors may want to include “other water” definition in lieu of this definition. Individual Contractors with 

unique circumstances may negotiate a lower threshold.
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149 (q) “Operation and Maintenance” or “O&M” shall mean normal and 

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

151 maintenance of Project facilities; 

152 (r) “Operating Non-Federal Entity" shall mean the ___________, its 

153 successors or assigns, a non-Federal entity which has the obligation to operate and maintain all 

154 or a portion of the ____________ [Division/Unit] facilities pursuant to an agreement with the 

155 United States, and which may have funding obligations with respect thereto; 

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

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

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

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

160 Reclamation law; 

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

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

163 accordance with the terms and conditions of water rights acquired pursuant to California law; 

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

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

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

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

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

169 preceding contract(s); 

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

171 successor, or an authorized representative acting pursuant to any authority of the Secretary and 
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172 through any agency of the Department of the Interior; 

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

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

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

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

Officer8 177 ; 

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

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

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

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

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

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

184 (cc) "Year" shall mean the period from and including March 1 of each 

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

186 TERM OF CONTRACT 

187 2. (a) This Contract shall be effective March 1, 200_, through February 28, 

20__, and supercedes the Existing Contract.9 188 In the event the Contractor wishes to renew this 

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

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

191 renewal of this Contract insofar as it pertains to the furnishing of Irrigation Water to the 

 

8

 This language may be modified at the Contractor level.

9

 Contractor specific-may need to include language regarding this contract superceding Existing Contract, in whole 

or in part. 
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192 Contractor shall be governed by subdivision (b) of this Article, and the renewal of this Contract 

193 insofar as it pertains to the furnishing of M&I Water to the Contractor shall be governed by 

194 subdivision (c) of this Article. 

195 (b) (1) Under terms and conditions of a renewal contract that are mutually 

196 agreeable to the parties hereto, and upon a determination by the Contracting Officer that at the 

197 time of contract renewal the conditions set forth in subdivision (b)(2) of this Article are met, and 

198 subject to Federal and State law, this Contract, insofar as it pertains to the furnishing of Irrigation 

199 Water to the Contractor, shall be renewed for a period of 25 years. 

200 (2) The conditions which must be met for this Contract to be renewed 

201 are: (i) the Contractor has prepared a water conservation plan that has been determined by the 

202 Contracting Officer in accordance with Article 26 of this Contract to meet the conservation and 

203 efficiency criteria for evaluating such plans established under Federal law; (ii) the Contractor is 

204 implementing an effective water conservation and efficiency program based on the Contractor’s 

205 water conservation plan as required by Article 26 of this Contract; (iii) the Contractor is 

206 maintaining all water measuring devices and implementing all water measurement methods as 

207 approved by the Contracting Officer pursuant to Article 6 of this Contract; (iv) the Contractor 

208 has reasonably and beneficially used the Project Water supplies made available to it and, based 

209 on projected demands, is reasonably anticipated and expects to fully utilize for reasonable and 

210 beneficial use the quantity of Project Water to be made available to it pursuant to such renewal; 

211 (v) the Contractor is complying with all terms and conditions of this Contract; and (vi) the 

212 Contractor has the physical and legal ability to deliver Project Water. 

213 (3) The terms and conditions of the renewal contract described in 

214 subdivision (b)(1) of this Article and any subsequent renewal contracts shall be developed 
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215 consistent with the parties’ respective legal rights and obligations, and in consideration of all 

216 relevant facts and circumstances, as those circumstances exist at the time of renewal, including, 

217 without limitation, the Contractor’s need for continued delivery of Project Water; environmental 

218 conditions affected by implementation of the Contract to be renewed, and specifically changes in 

219 those conditions that occurred during the life of the Contract to be renewed; the Secretary’s 

220 progress toward achieving the purposes of the CVPIA as set out in Section 3402 and in 

221 implementing the specific provisions of the CVPIA; and current and anticipated economic 

222 circumstances of the region served by the Contractor. 

223 (c) This Contract, insofar as it pertains to the furnishing of M&I Water to the 

224 Contractor, shall be renewed for successive periods of up to 40 years each, which periods shall 

225 be consistent with then-existing Reclamation-wide policy, under terms and conditions mutually 

226 agreeable to the parties and consistent with Federal and State law. The Contractor shall be 

227 afforded the opportunity to comment to the Contracting Officer on the proposed adoption and 

228 application of any revised policy applicable to the delivery of M&I Water that would limit the 

229 term of any subsequent renewal contract with the Contractor for the furnishing of M&I Water to 

230 less than 40 years. 

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

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

233 Contract, of whether a conversion of the relevant portion of this Contract to a contract under 

234 subsection 9(d) of the Reclamation Project Act of 1939 can be accomplished pursuant to the Act 

235 of July 2, 1956 (70 Stat 483). The Contracting Officer shall also make a determination ten years 

236 after the date of execution of this Contract and every five years thereafter during the term of this 

237 Contract of whether a conversion of the relevant portion of this Contract to a contract under 
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238 subsection 9(c)(1) of the Reclamation Project Act of 1939 can be accomplished. 

239 Notwithstanding any provision of this Contract, the Contractor reserves and shall have all rights 

240 and benefits under the Act of July 2, 1956 (70 Stat. 483). The Contracting Officer anticipates that 

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

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

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

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

245 Contract shall, at the request of the Contractor, be converted to a contract under subsection 9(d) 

246 or 9(c)(1), whichever is applicable, of the Reclamation Project Act of 1939, subject to applicable 

247 Federal law and under stated terms and conditions mutually agreeable to the Contractor and the 

248 Contracting Officer. A condition for such conversion to occur shall be a determination by the 

249 Contracting Officer that, account being taken of the amount credited to return by the Contractor 

250 as provided for under Federal Reclamation law, the remaining amount of construction costs 

251 assignable for ultimate return by the Contractor can probably be repaid to the United States 

252 within the term of a contract under subsection 9(d) or 9(c)(1), whichever is applicable. If the 

253 remaining amount of costs that are properly assignable to the Contractor cannot be determined 

254 during the term of this Contract, the Contracting Officer shall notify the Contractor, and provide 

255 the reason(s) why such a determination could not be made. Further, the Contracting Officer shall 

256 make such a determination as soon thereafter as possible so as to permit, upon request of the 

257 Contractor and satisfaction of the condition set out above, conversion to a contract under 

258 subsection 9(d) or 9(c)(1), whichever is applicable. In the event such determination of costs has 

259 not been made at a time which allows conversion of this Contract during the term of this 

260 Contract or the Contractor has not requested conversion of this Contract within such term, the 
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261 parties shall incorporate in any subsequent renewal contract as described in subdivision (b) of 

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

263 subdivision. 

264 WATER TO BE MADE AVAILABLE AND DELIVERED TO THE CONTRACTOR

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

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

267 this Contract, the Contracting Officer shall make available for delivery to the Contractor ______ 

268 acre-feet of Project Water for irrigation and M&I purposes. Water Delivered to the Contractor in 

269 accordance with this subdivision shall be scheduled and paid for pursuant to the provisions of 

270 Articles 4 and 7 of this Contract. 

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

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

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

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

275 Article in any given Year is uncertain. The Contracting Officer’s modeling referenced in the 

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

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

278 water made available to the Contractor was ____ acre-feet. Nothing in subdivision (b) of this 

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

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

281 applicable legal requirements. 

282 (d) The Contractor shall make reasonable and beneficial use of all water 
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283 furnished pursuant to this Contract. Groundwater recharge programs (direct, indirect, or in lieu), 

284 groundwater banking programs, surface water storage programs, and other similar programs 

285 utilizing Project Water or other water furnished pursuant to this Contract conducted within the 

286 Contractor’s Service Area which are consistent with applicable State law and result in use 

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

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

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

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

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

292 compliance with Federal Reclamation law. Groundwater recharge programs, groundwater 

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

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

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

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

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

298 guidelines. 

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

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

301 of this Contract undertaken pursuant to Section 7 of the Endangered Species Act of 1973 (ESA), 

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

which evidences in excess of ___years of diversions for irrigation and/or M&I purposes11 303 of the 

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

 

11 Specific Contract Issue: The type of water diverted will be addressed on a contractor specific basis. 
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305 developing an appropriate baseline for biological assessment(s) prepared pursuant to the ESA, 

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

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

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

Article.12 309 

310 (f) Following the declaration of Water Made Available under Article 4 of this 

311 Contract, the Contracting Officer will make a determination whether Project Water, or other 

312 water available to the Project, can be made available to the Contractor in addition to the Contract 

313 Total under Article 3 of this Contract during the Year without adversely impacting other Project 

314 Contractors. At the request of the Contractor, the Contracting Officer will consult with the 

315 Contractor prior to making such a determination. If the Contracting Officer determines that 

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

317 the Contracting Officer will announce the availability of such water and shall so notify the 

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

319 and other Project Contractors capable of taking such water to determine the most equitable and 

320 efficient allocation of such water. If the Contractor requests the delivery of any quantity of such 

321 water, the Contracting Officer shall make such water available to the Contractor in accordance 

322 with applicable statutes, regulations, guidelines, and policies. 

323 [DIVISIONAL ISSUE-SECTION 215 WATER] 

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

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

 

12 Specific Contract Issue: As an example,the concern over land use authority may be the subject of discussion with 

individual contractors. 
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Year, referred to as “carryover.”13 326 The Contractor may request permission to use during the 

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

328 the Contractor during the subsequent Year, referred to as “preuse.” The Contracting Officer’s 

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

330 guidelines, and policies. 

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

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

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

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

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

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

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

338 contracts. 

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

340 delivered for purposes other than those described in subdivisions (m) and (o) of Article 1 of this 

341 Contract upon written approval by the Contracting Officer in accordance with the terms and 

342 conditions of such approval. 

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

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

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

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

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

 

13 “Rescheduled” in some divisions. 
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348 Contractor’s position in such a proceeding; Provided further, That in such proceedings the 

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

350 Contract to use Project Water. 

351 TIME FOR DELIVERY OF WATER

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

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

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

355 Historic Average and will be updated monthly, and more frequently if necessary, based on then356 current operational and hydrologic conditions and a new declaration with changes, if any, to the 

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

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

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

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

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

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

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

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

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

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

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

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

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

370 during any Year. 
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371 (d) Subject to the conditions set forth in subdivision (a) of Article 3 of this 

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

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

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

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

376 POINT OF DIVERSION AND RESPONSIBILITY FOR DISTRIBUTION OF WATER

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

378 Contract shall be delivered to the Contractor at __________________________and any 

379 additional point or points of delivery either on Project facilities or another location or locations 

380 mutually agreed to in writing by the Contracting Officer and the Contractor. 

381 (b) The Contracting Officer, either directly or through its written 

382 agreement(s) with the Operating Non-Federal Entity/Entities [Contractor specific issue-reference 

383 to Entities] shall make all reasonable efforts to maintain sufficient flows and levels of water in 

384 Project facilities to deliver Project Water to the Contractor at specific turnouts established 

385 pursuant to subdivision (a) of this Article. 

386 (c) The Contractor shall deliver Irrigation Water in accordance with any 

387 applicable land classification provisions of Federal Reclamation law and the associated 

388 regulations. The Contractor shall not deliver Project Water to land outside the Contractor's 

389 Service Area unless approved in advance by the Contracting Officer. 

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

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

United States, or the Operating Non-Federal Entity/Entities 14 392 at the point or points of delivery 

 
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393 established pursuant to subdivision (a) of this Article. Upon the request of either party to this 

394 Contract, the Contracting Officer shall investigate, or cause to be investigated by the appropriate 

395 Operating Non-Federal Entity/Entities, the accuracy of such measurements and shall take any 

396 necessary steps to adjust any errors appearing therein. For any period of time when accurate 

397 measurements have not been made, the Contracting Officer shall consult with the Contractor and 

398 the appropriate Operating Non-Federal Entity/Entities prior to making a final determination of 

399 the quantity delivered for that period of time. 

400 (e) Neither the Contracting Officer nor any Operating Non-Federal 

401 Entity/Entities shall be responsible for the control, carriage, handling, use, disposal, or 

402 distribution of Water Delivered to the Contractor pursuant to this Contract beyond the delivery 

403 points specified in subdivision (a) of this Article. The Contractor shall indemnify the United 

404 States, its officers, employees, agents, and assigns on account of damage or claim of damage of 

405 any nature whatsoever for which there is legal responsibility, including property damage, 

406 personal injury, or death arising out of or connected with the control, carriage, handling, use, 

407 disposal, or distribution of such Water Delivered beyond such delivery points, except for any 

408 damage or claim arising out of (i) acts or omissions of the Contracting Officer or any of its 

409 officers, employees, agents, or assigns, including the Operating Non-Federal Entity/Entities, with 

410 the intent of creating the situation resulting in any damage or claim, (ii) willful misconduct of the 

411 Contracting Officer or any of its officers, employees, agents, or assigns, including theOperating 

412 Non-Federal Entity/Entities, (iii) negligence of the Contracting Officer or any of its officers, 

413 employees, agents, or assigns including the Operating Non-Federal Entity/Entities, or (iv) 

414 damage or claims resulting from a malfunction of facilities owned and/or operated by the United 

415 States or the Operating Non-Federal Entity/Entities 
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MEASUREMENT OF WATER WITHIN THE CONTRACTOR’S SERVICE AREA15 416 

417 6. (Contractor Specific)(a) The Contractor has established a measuring program 

418 satisfactory to the Contracting Officer.The Contractor shall ensure that all surface water 

419 delivered for irrigation purposes within the Contractor’s Service Area is measured at each 

420 agricultural turnout and such water delivered for M&I purposes is measured at each M&I service 

421 connection. The water measuring devices or water measuring methods of comparable 

422 effectiveness must be acceptable to the Contracting Officer. The Contractor shall be responsible 

423 for installing, operating, and maintaining and repairing all such measuring devices and 

424 implementing all such water measuring methods at no cost to the United States. The Contractor 

425 shall use the information obtained from such water measuring devices or water measuring 

426 methods to ensure its proper management of the water, to bill water users for water delivered by 

427 the Contractor; and, if applicable, to record water delivered for M&I purposes by customer class 

428 as defined in the Contractor’s water conservation plan provided for in Article 26 of this Contract. 

429 Nothing herein contained, however, shall preclude the Contractor from establishing and 

430 collecting any charges, assessments, or other revenues authorized by California law. The 

431 Contractor shall include a summary of all its annual surface water deliveries in the annual report 

432 described in subdivision (c) of Article 26. 

433 (b) (Contractor Specific) To the extent the information has not otherwise 

434 been provided, upon execution of this Contract, the Contractor shall provide to the Contracting 

435 Officer a written report describing the measurement devices or water measuring methods being 

436 used or to be used to implement subdivision (a) of this Article and identifying the agricultural 

437 turnouts and the M&I service connections or alternative measurement programs approved by the 

 

15 Recognize unique circumstances at Contractor level may require negotiation of different language.
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438 Contracting Officer, at which such measurement devices or water measuring methods are being 

439 used, and, if applicable, identifying the locations at which such devices and/or methods are not 

440 yet being used including a time schedule for implementation at such locations. The Contracting 

441 Officer shall advise the Contractor in writing within 60 days as to the adequacy and necessary 

442 modifications, if any, of the measuring devices or water measuring methods identified in the 

443 Contractor’s report and if the Contracting Officer does not respond in such time, they shall be 

444 deemed adequate. If the Contracting Officer notifies the Contractor that the measuring devices 

445 or methods are inadequate, the parties shall within 60 days following the Contracting Officer‘s 

446 response, negotiate in good faith the earliest practicable date by which the Contractor shall 

447 modify said measuring devices and/or measuring methods as required by the Contracting Officer 

448 to ensure compliance with subdivision (a) of this Article. 

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

Service Area after the effective date of this Contract shall also16 450 comply with the measurement 

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

452 (d) (Contractor Specific) The Contractor shall inform the Contracting Officer 

453 and the State of California in writing by April 30 of each Year of the monthly volume of surface 

454 water delivered within the Contractor’s Service Area during the previous Year. 

455 (e) (Contractor Specific) The Contractor shall inform the Contracting Officer 

and the Operating Non-Federal Entity on or before the 20th 456 calendar day of each month of the 

457 quantity of Irrigation and M&I Water taken during the preceding month. 

458 RATES AND METHOD OF PAYMENT FOR WATER

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

 

16 Some Contractors may propose alternate date.
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460 all Delivered Water at Rates, Charges, and the Tiered Pricing Component established in 

461 accordance with (i) the Secretary’s ratesetting policy for Irrigation Water adopted in 1988 and 

462 the Secretary’s then-existing ratesetting policy for M&I Water. Such ratesetting policies shall be 

463 amended, modified, or superceded only through a public notice and comment procedure; (ii) 

464 applicable Federal Reclamation law and associated rules and regulations, or policies; and (iii) 

465 other applicable provisions of this Contract. Payments shall be made by cash transaction, 

466 electronic funds transfer, or any other mechanism as may be agreed to in writing by the 

467 Contractor and the Contracting Officer. The Rates, Charges, and Tiered Pricing Component 

468 applicable to the Contractor upon execution of this Contract are set forth in Exhibit “B,” as may 

469 be revised annually. 

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

471 and Tiered Pricing Component as follows: 

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

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

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

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

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

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

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

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

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

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

482 for Project Water for the following Year and the computations and cost allocations upon which 
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483 those Rates are based. The Contractor shall be allowed not less than two months to review and 

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

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

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

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

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

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

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

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

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

493 Contractor shall make an advance payment to the United States, at the Rate(s) set under 

494 subdivision (a) of this Article, for the Water Scheduled to be delivered pursuant to this Contract 

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

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

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

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

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

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

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

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

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

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

505 between the advance payments for the Water Scheduled and payments for the quantities of Water 
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506 Delivered during each Year pursuant to this Contract shall be made as soon as practicable, but no 

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

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

509 day of February. 

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

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

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

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

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

515 consistent with the quantities of Irrigation Water and M&I Water Delivered as shown in the 

516 water delivery report for the subject month prepared by the Operating Non-Federal 

517 Entity/Entities or, if there is no Operating Non-Federal Entity/Entities, by the Contracting 

518 Officer. The water delivery report shall be deemed a bill for the payment of Charges and the 

519 applicable Tiered Pricing Component for Water Delivered. Adjustment for overpayment or 

520 underpayment of Charges shall be made through the adjustment of payments due to the United 

521 States for Charges for the next month. Any amount to be paid for past due payment of Charges 

522 and the Tiered Pricing Component shall be computed pursuant to Article 20 of this Contract. 

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

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

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

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

527 Contract shall be no more than the otherwise applicable Rate for Irrigation Water or M&I Water 

528 under subdivision (a) of this Article. 
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529 (f) Payments to be made by the Contractor to the United States under this 

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

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

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

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

534 regulations, and the then-current Project ratesetting policies for M&I Water or Irrigation Water. 

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

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

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

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

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

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

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

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

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

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

545 policies, and procedures used for establishing Rates, Charges, and Tiered Pricing Components, 

546 and/or for making and allocating payments, other than those set forth in this Article may be in 

547 the mutual best interest of the parties, it is expressly agreed that the parties may enter into 

548 agreements to modify the mechanisms, policies, and procedures for any of those purposes while 

549 this Contract is in effect without amending this Contract. 

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

551 exceed 80 percent of the Contract Total, then before the end of the month following the month of 
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552 delivery the Contractor shall make an additional payment to the United States equal to the 

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

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

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

556 subdivision (a) of this Article and the Irrigation Full Cost Water Rate or M&I Full Cost Water 

557 Rate, whichever is applicable. The Tiered Pricing Component for the amount of Water 

558 Delivered which exceeds 90 percent of the Contract Total shall equal the difference between (i) 

559 the Rate established under subdivision (a) of this Article and (ii) the Irrigation Full Cost Water 

560 Rate or M&I Full Cost Water Rate, whichever is applicable. For all Water Delivered pursuant to 

561 subdivision (a) of Article 3 of this Contract which is in excess of 80 percent of the Contract 

562 Total, this increment shall be deemed to be divided between Irrigation Water and M&I Water in 

the same proportion as actual deliveries of each bear to the cumulative total Water Delivered.17 563 

564 (2) Subject to the Contracting Officer’s written approval, the 

565 Contractor may request and receive an exemption from such Tiered Pricing Components for 

566 Project Water delivered to produce a crop which the Contracting Officer determines will provide 

567 significant and quantifiable habitat values for waterfowl in fields where the water is used and the 

568 crops are produced; Provided, That the exemption from the Tiered Pricing Component for 

569 Irrigation Water shall apply only if such habitat values can be assured consistent with the 

570 purposes of the CVPIA through binding agreements executed with or approved by the 

571 Contracting Officer prior to use of such water. 

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

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

 

17 Deletion of the last sentence or alternate language may be negotiated by individual districts. 
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574 Contractor transfers to others but shall not include Project Water transferred to the Contractor, 

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

subdivision (f) of Article 3 of this Contract.18 576 

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

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

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

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

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

582 which implement the Contracting Officer’s ratesetting policies will not be implemented until the 

583 Contracting Officer has provided the Contractor an opportunity to discuss the nature, need, and 

584 impact of the proposed change. 

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

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

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

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

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

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

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

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

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

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

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

 

18 Divisions/Districts may propose alternative language.
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596 (n) [For contractors with M&I water]: With respect to the Rates for M&I 

597 Water the Contractor asserts that it is not legally obligated to pay any Project deficits claimed by 

598 the United States to have accrued as of the date of this Contract or deficit-related interest charges 

599 thereon. By entering into this Contract, the Contractor does not waive any legal rights or 

600 remedies that it may have with respect to such disputed issues. Notwithstanding the execution of 

601 this Contract and payments made hereunder, the Contractor may challenge in the appropriate 

602 administrative or judicial forums: (1) the existence, computation, or imposition of any deficit 

603 charges accruing during the term of the Existing Contract and any preceding interim renewal 

604 contracts, if applicable; (2) interest accruing on any such deficits; (3) the inclusion of any such 

605 deficit charges or interest in the Rates; (4) the application by the United States of payments made 

606 by the Contractor under its Existing Contract and any preceding interim renewal contracts, if 

607 applicable; and (5) the application of such payments in the Rates. The Contracting Officer 

608 agrees that the Contractor shall be entitled to the benefit of any administrative or judicial ruling 

609 in favor of any Project M&I contractor on any of these issues, and credits for payments 

heretofore made, Provided, That the basis for such ruling is applicable to the Contractor.19 610 

NON-INTEREST BEARING OPERATION AND MAINTENANCE DEFICITS20 611 

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

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

614 liability therefor. 

615 [Or,] 

616 The Contractor and the Contracting Officer have entered into a written agreement 

 

19 Contractors may opt-out of including this subarticle in the contract. 

20 Contractor Specific 
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617 specifying a mutually acceptable mechanism through which the Contractor will retire its 

618 outstanding non-interest-bearing OO&M deficits. 

619 SALES, TRANSFERS, OR EXCHANGES OF WATER

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

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

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

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

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

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

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

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

628 documentation should include, as appropriate, an analysis of groundwater impacts and economic 

629 and social effects, including environmental justice, of the proposed water transfers on both the 

630 transferor and transferee. 

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

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

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

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

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

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

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

638 Following the completion of the environmental documentation, such transfers addressed in such 

639 documentation shall be conducted with advance notice to the Contracting Officer, but shall not 
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640 require prior written approval by the Contracting Officer. Such environmental documentation 

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

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

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

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

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

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

647 years, for M&I use, groundwater recharge, water banking, or fish and wildlife resources; not lead 

648 to land conversion; and be delivered to established cropland, wildlife refuges, groundwater 

649 basins or M&I use; (ii) occur within a single Year; (iii) occur between a willing seller and a 

650 willing buyer; (iv) convey water through existing facilities with no new construction or 

651 modifications to facilities and be between existing Project Contractors and/or the Contractor and 

652 the United States, Department of the Interior; and (v) comply with all applicable Federal, State, 

653 and local or tribal laws and requirements imposed for protection of the environment and Indian 

654 Trust Assets, as defined under Federal law. 

655 APPLICATION OF PAYMENTS AND ADJUSTMENTS 

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

657 O&M, capital, and deficit (if any) obligations for the Year shall be applied first to any current 

658 liabilities of the Contractor arising out of this Contract then due and payable. Overpayments of 

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

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

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

662 adjustment shall constitute the sole remedy of the Contractor or anyone having or claiming to 
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663 have the right to the use of any of the Project Water supply provided for herein. All credits and 

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

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

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

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

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

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

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

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

672 TEMPORARY REDUCTIONS-RETURN FLOWS

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

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

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

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

677 provided in this Contract. 

678 (b) The Contracting Officer or Operating Non-Federal Entity/Entitiesmay 

679 temporarily discontinue or reduce the quantity of Water Delivered to the Contractor as herein 

680 provided for the purposes of investigation, inspection, maintenance, repair, or replacement of any 

681 of the Project facilities or any part thereof necessary for the delivery of Project Water to the 

682 Contractor, but so far as feasible the Contracting Officer or Operating Non-Federal Entity will 

683 give the Contractor due notice in advance of such temporary discontinuance or reduction, except 

684 in case of emergency, in which case no notice need be given; Provided, That the United States 

685 shall use its best efforts to avoid any discontinuance or reduction in such service. Upon 
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686 resumption of service after such reduction or discontinuance, and if requested by the Contractor, 

687 the United States will, if possible, deliver the quantity of Project Water which would have been 

688 delivered hereunder in the absence of such discontinuance or reduction. 

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

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

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

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

pursuant to this Contract within the Contractor’s Service Area21 693 by the Contractor or those 

694 claiming by, through, or under the Contractor. 

695 CONSTRAINTS ON THE AVAILABILITY OF WATER

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

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

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

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

700 Contractor of said determination as soon as practicable. 

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

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

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

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

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

706 (c) DIVISIONAL ISSUE - APPORTIONMENT AMONG CONTRACTORS. 

707 (d) DIVISIONAL ISSUE - M&I Water Service Contracts 

 

21 Divisions may propose alternate language 
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708 (e) DIVISIONAL ISSUE – Reservation of Rights re M&I Shortage Policy 

709 UNAVOIDABLE GROUNDWATER PERCOLATION

710 13. To the extent applicable, the Contractor shall not be deemed to have delivered 

711 Irrigation Water to Excess Lands or Ineligible Lands within the meaning of this Contract if such 

712 lands are irrigated with groundwater that reaches the underground strata as an unavoidable result 

713 of the delivery of Irrigation Water by the Contractor to Eligible Lands. 

RULES AND REGULATIONS22 714 

715 

716 14. The parties agree that the delivery of Irrigation Water or use of Federal facilities 

717 pursuant to this Contract is subject to Federal Reclamation law, including but not limited to the 

718 Reclamation Reform Act of 1982 (43 U.S.C.390aa et seq.), as amended and supplemented, and 

719 the rules and regulations promulgated by the Secretary of the Interior under Federal Reclamation 

720 law. 

721 WATER AND AIR POLLUTION CONTROL

722 

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

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

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

726 authorities. 

QUALITY OF WATER23 727 

728 

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

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

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

732 2(b) of the Act of August 26, 1937 (50 Stat. 865), as added by Section 101 of the Act of October 

733 27, 1986 (100 Stat. 3050) or other existing Federal laws. The United States is under no 

 

22 Contractor Specific Issue - This may need to be modified on an individual contractor basis. Some contractors may be 

precluded by law to agreeing to all or part of this Article. 
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734 obligation to construct or furnish water treatment facilities to maintain or to improve the quality 

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

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

737 

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

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

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

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

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

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

744 Service Area. 

745 

746 (c) [DIVISIONAL ISSUE – DRAINAGE, WHERE APPLICABLE] 

747 WATER ACQUIRED BY THE CONTRACTOR

748 OTHER THAN FROM THE UNITED STATES

749 17. (a) Water or water rights now owned or hereafter acquired by the Contractor 

750 other than from the United States and Irrigation Water furnished pursuant to the terms of this 

751 Contract may be simultaneously transported through the same distribution facilities of the 

752 Contractor subject to the following: (i) if the facilities utilized for commingling Irrigation Water 

753 and non-Project water were constructed without funds made available pursuant to Federal 

754 Reclamation law, the provisions of Federal Reclamation law will be applicable only to the 

755 Landholders of lands which receive Irrigation Water; (ii) the eligibility of land to receive 

 23 Some Contractors may request tailored language regarding water quality.
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756 Irrigation Water must be established through the certification requirements as specified in the 

757 Acreage Limitation Rules and Regulations (43 CFR Part 426); (iii) the water requirements of 

758 Eligible Lands within the Contractor's Service Area can be established and the quantity of 

759 Irrigation Water to be utilized is less than or equal to the quantity necessary to irrigate such 

760 Eligible Lands; and (iv) if the facilities utilized for commingling Irrigation Water and non761 Project water are/were constructed with funds made available pursuant to Federal Reclamation 

762 law, the non-Project water will be subject to the acreage limitation provisions of Federal 

763 Reclamation law, unless the Contractor pays to the United States the incremental fee described in 

764 43 CFR 426.15. In determining the incremental fee, the Contracting Officer will calculate 

765 annually the cost to the Federal Government, including interest, of storing or delivering non766 Project water, which for purposes of this Contract shall be determined as follows: The quotient 

767 shall be the unpaid distribution system costs divided by the total irrigable acreage within the 

768 Contractor's Service Area. The incremental fee per acre is the mathematical result of such 

769 quotient times the interest rate determined using Section 202 (3) of the Act of October 12, 1982 

770 (96 Stat. 1263). Such incremental fee will be charged to each acre of excess or full cost land 

771 within the Contractor’s Service Area that receives non-Project water through Federally financed 

772 or constructed facilities. The incremental fee calculation methodology will continue during the 

773 term of this Contract absent the promulgation of a contrary Reclamation-wide rule, regulation, or 

774 policy adopted after the Contractor has been afforded the opportunity to review and comment on 

775 the proposed rule, regulation, or policy. If such rule, regulation, or policy is adopted it shall 

776 supercede this provision. 

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

778 other than from the United States, may be stored, conveyed, and/or diverted through Project 
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779 facilities, subject to the completion of appropriate environmental documentation, with the 

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

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

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

783 facilities and deliver said water to lands within the Contractor’s Service Area, including 

784 Ineligible Lands, subject to payment to the United States and/or to any applicable Operating 

785 Non-Federal Entity of an appropriate rate as determined by the applicable Project ratesetting 

786 policy, the R R A, and the Project use power policy, if such Project use power policy is 

787 applicable,each as amended, modified, or superceded from time to time. (2) Delivery of suc

788 or quality of water available to other Project Contractors; (iii) interfere with the delivery of 

789 contractual waterentitlements to any other Project Contractors; or (iv) interfere with the physical 

790 maintenance of the Project facilities. 

791 (3) Neither the United States nor the Operating Non-Federal Entity 

792 shall be responsible for control, care, or distribution of the non-Project water before it is 

793 introduced into or after it is delivered from the Project facilities. The Contractor hereby releases 

794 and agrees to defend and indemnify the United States and the Operating Non-Federal Entity, and 

795 their respective officers, agents, and employees, from any claim for damage to persons or 

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

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

798 diverting such non-Project water into Project facilities. 

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

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

801 groundwater management plan for the area from which it was extracted. 
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802 (5) After Project purposes are met, as determined by the Contracting 

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

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

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

806 non-Project contractors. [DIVISIONAL ISSUE – DIVISIONS MAY SEEK LANGUAGE 

807 PROVIDING FOR WHEELING AND NON-PROJECT WATER PURSUANT TO CVPIA 

808 SECTION 3408(c), ETC.]

809 OPINIONS AND DETERMINATIONS

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

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

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

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

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

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

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

817 intended to or shall affect or alter the standard of judicial review applicable under Federal law to 

818 any opinion or determination implementing a specific provision of Federal law embodied in 

819 statute or regulation. 

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

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

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

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

824 with the Contractor to the extent reasonably practicable. 
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825 COORDINATION AND COOPERATION

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

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

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

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

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

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

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

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

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

835 and determinations to be made by the respective party. 

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

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

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

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

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

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

842 a real-time basis. 

843 (c) In light of the factors referred to in subdivision (b) of Article 3 of this 

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

845 intent: 

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

847 assist in the development of integrated resource management plans for the Contractor. Further, 
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848 the Contracting Officer will, as appropriate, seek authorizations for implementation of 

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

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

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

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

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

854 State of California to seek improved water resource management. 

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

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

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

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

859 management activities, and other issues as appropriate. 

860 (d) Without limiting the contractual obligations of the Contracting Officer 

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

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

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

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

865 CHARGES FOR DELINQUENT PAYMENTS

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

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

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

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

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

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

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

873 due date. Further, the Contractor shall pay any fees incurred for debt collection services 
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874 associated with a delinquent payment. 

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

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

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

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

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

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

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

882 accrued interest, and finally to the overdue payment. 

883 EQUAL OPPORTUNITY

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

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

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

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

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

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

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

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

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

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

894 nondiscrimination clause. 

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

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

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

898 national origin. 

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

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

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

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

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

904 employees and applicants for employment. 

905 (d) The Contractor will comply with all provisions of Executive Order 
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906 No. 11246 of September 24, 1965, as amended, and of the rules, regulations, and relevant orders 

907 of the Secretary of Labor. 

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

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

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

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

912 such rules, regulations, and orders. 

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

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

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

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

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

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

919 otherwise provided by law. 

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

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

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

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

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

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

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

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

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

929 GENERAL OBLIGATION--BENEFITS CONDITIONED UPON PAYMENT

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

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

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

933 of individual water users in their obligations to the Contractor. 

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

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

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

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

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

939 advance payment of water rates levied or established by the Contractor. 
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940 (c) With respect to subdivision (b) of this Article, the Contractor shall have no 

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

942 COMPLIANCE WITH CIVIL RIGHTS LAWS AND REGULATIONS

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

944 (42 U.S.C. 2000d), Section 504 of the Rehabilitation Act of 1975 (P.L. 93-112, as amended), the 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

961 enforcement thereof. 

962 PRIVACY ACT COMPLIANCE

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

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

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

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

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

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

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

970 responsible for maintaining the certification and reporting records referenced in (a) above are 
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971 considered to be employees of the Department of the Interior. See 5 U.S.C. 552a(m). 

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

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

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

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

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

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

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

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

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

981 (e) The Contractor shall forward promptly to the System Manager each 

982 proposed denial of access under 43 CFR 2.64; and each request for amendment of records filed 

983 under 43 CFR 2.71; notify the requester accordingly of such referral; and provide the System 

984 Manager with information and records necessary to prepare an appropriate response to the 

985 requester. These requirements do not apply to individuals seeking access to their own 

986 certification and reporting forms filed with the Contractor pursuant to 43 CFR 426.18, unless the 

987 requester elects to cite the Privacy Act as a basis for the request. 

988 

989 CONTRACTOR TO PAY CERTAIN MISCELLANEOUS COSTS

990 25. In addition to all other payments to be made by the Contractor pursuant to this 

991 Contract, the Contractor shall pay to the United States, within 60 days after receipt of a bill and 

992 detailed statement submitted by the Contracting Officer to the Contractor for such specific items 

993 of direct cost incurred by the United States for work requested by the Contractor associated with 

994 this Contract plus indirect costs in accordance with applicable Bureau of Reclamation policies 

995 and procedures. All such amounts referred to in this Article shall not exceed the amount agreed 

996 to in writing in advance by the Contractor. This Article shall not apply to costs for routine 

997 contract administration. 

998 WATER CONSERVATION

999 26. (a) Prior to the delivery of water provided from or conveyed through 
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1000 Federally constructed or Federally financed facilities pursuant to this Contract, the Contractor 

1001 shall be implementing an effective water conservation and efficiency program based on the 

1002 Contractor's water conservation plan that has been determined by the Contracting Officer to meet 

1003 the conservation and efficiency criteria for evaluating water conservation plans established under 

1004 Federal law. The water conservation and efficiency program shall contain definite water 

1005 conservation objectives, appropriate economically feasible water conservation measures, and 

1006 time schedules for meeting those objectives. Continued Project Water delivery pursuant to this 

1007 Contract shall be contingent upon the Contractor’s continued implementation of such water 

1008 conservation program. In the event the Contractor's water conservation plan or any revised water 

1009 conservation plan completed pursuant to subdivision (d) of Article 26 of this Contract have not 

1010 yet been determined by the Contracting Officer to meet such criteria, due to circumstances which 

1011 the Contracting Officer determines are beyond the control of the Contractor, water deliveries 

1012 shall be made under this Contract so long as the Contractor diligently works with the Contracting 

1013 Officer to obtain such determination at the earliest practicable date, and thereafter the Contractor 

1014 immediately begins implementing its water conservation and efficiency program in accordance 

1015 with the time schedules therein. 

1016 (b) Should the amount of M&I Water delivered pursuant to subdivision (a) of 

1017 Article 3 of this Contract equal or exceed 2,000 acre-feet per Year, the Contractor shall 

1018 implement the Best Management Practices identified by the time frames issued by the California 

1019 Urban Water Conservation Council for such M&I Water unless any such practice is determined 

1020 by the Contracting Officer to be inappropriate for the Contractor. 

1021 (c) The Contractor shall submit to the Contracting Officer a report on the 

1022 status of its implementation of the water conservation plan on the reporting dates specified in the 
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1023 then existing conservation and efficiency criteria established under Federal law. 

1024 (d) At five-year intervals, the Contractor shall revise its water conservation 

1025 plan to reflect the then-current conservation and efficiency criteria for evaluating water 

1026 conservation plans established under Federal law and submit such revised water management 

1027 plan to the Contracting Officer for review and evaluation. The Contracting Officer will then 

1028 determine if the water conservation plan meets Reclamation’s then-current conservation and 

1029 efficiency criteria for evaluating water conservation plans established under Federal law. 

1030 (e) If the Contractor is engaged in direct groundwater recharge, such activity 

1031 shall be described in the Contractor’s water conservation plan. 

1032 EXISTING OR ACQUIRED WATER OR WATER RIGHTS

1033 27. Except as specifically provided in Article 17 of this Contract, the provisions of 

1034 this Contract shall not be applicable to or affect non-Project water or water rights now owned or 

1035 hereafter acquired by the Contractor or any user of such water within the Contractor's Service 

1036 Area. Any such water shall not be considered Project Water under this Contract. In addition, 

1037 this Contract shall not be construed as limiting or curtailing any rights which the Contractor or 

1038 any water user within the Contractor's Service Area acquires or has available under any other 

1039 contract pursuant to Federal Reclamation law. 

OPERATION AND MAINTENANCE BY OPERATING NON-FEDERAL ENTITY24 1040 

1041 28. (a) The O&M of a portion of the Project facilities which serve the Contractor, 

1042 and responsibility for funding a portion of the costs of such O&M, have been transferred to the 

1043 Operating Non-Federal Entity by separate agreement between the United States and the 

 

24 Include where applicable. 
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1044 Operating Non-Federal Entity. That separate agreement shall not interfere with or affect the 

1045 rights or obligations of the Contractor or the United States hereunder. 

1046 (b) The Contracting Officer has previously notified the Contractor in writing 

1047 that the O&M of a portion of the Project facilities which serve the Contractor has been 

1048 transferred to the Operating Non-Federal Entity, and therefore, the Contractor shall pay directly 

1049 to the Operating Non-Federal Entity, or to any successor approved by the Contracting Officer 

1050 under the terms and conditions of the separate agreement between the United States and the 

1051 Operating Non-Federal Entity described in subdivision (a) of this Article, all rates, charges, or 

1052 assessments of any kind, including any assessment for reserve funds, which the Operating Non1053 Federal Entity or such successor determines, sets, or establishes for the O&M of the portion of 

1054 the Project facilities operated and maintained by the Operating Non-Federal Entity or such 

1055 successor. Such direct payments to the Operating Non-Federal Entity or such successor shall not 

1056 relieve the Contractor of its obligation to pay directly to the United States the Contractor’s share 

1057 of the Project Rates, Charges, and Tiered Pricing Component(s) except to the extent the 

1058 Operating Non-Federal Entity collects payments on behalf of the United States in accordance 

1059 with the separate agreement identified in subdivision (a) of this Article. 

1060 (c) For so long as the O&M of any portion of the Project facilities serving the 

1061 Contractor is performed by the Operating Non-Federal Entity, or any successor thereto, the 

1062 Contracting Officer shall adjust those components of the Rates for Water 

1063 Delivered under this Contract representing the cost associated with the activity being performed 

1064 by the Operating Non-Federal Entity or its successor. 

1065 (d) In the event the O&M of the Project facilities operated and maintained by 

1066 the Operating Non-Federal Entity is re-assumed by the United States during the term of this 
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1067 Contract, the Contracting Officer shall so notify the Contractor, in writing, and present to the 

1068 Contractor a revised Exhibit “B” which shall include the portion of the Rates to be paid by the 

1069 Contractor for Project Water under this Contract representing the O&M costs of the portion of 

1070 such Project facilities which have been re-assumed. The Contractor shall, thereafter, in the 

1071 absence of written notification from the Contracting Officer to the contrary, pay the Rates, 

1072 Charges, and Tiered Pricing Component(s) specified in the revised Exhibit “B” directly to the 

1073 United States in compliance with Article 7 of this Contract. 

1074 [Divisional Issue – inclusion of new Article 28.1 for contracts involving additional 

1075 OperatingCONTINGENT ON APPROPRIATION OR ALLOTMENT OF FUNDS

 29. The expenditure or advance of any money or the performance of any obligation of 

the United States under this Contract shall be contingent upon appropriation or allotment of 

funds. Absence of appropriation or allotment of funds shall not relieve the Contractor from any 

obligations under this Contract. No liability shall accrue to the United States in case funds are 

not appropriated or allotted. 

1076 BOOKS, RECORDS, AND REPORTS

1077 30. (a) The Contractor shall establish and maintain accounts and other books and 

1078 records pertaining to administration of the terms and conditions of this Contract, including: the 

1079 Contractor's financial transactions, water supply data, and Project land and right-of-way 

1080 agreements; the water users' land-use (crop census), land ownership, land-leasing and water use 

1081 data; and other matters that the Contracting Officer may require. Reports thereon shall be 

1082 furnished to the Contracting Officer in such form and on such date or dates as the Contracting 

1083 Officer may require. Subject to applicable Federal laws and regulations, each party to this 

1084 Contract shall have the right during office hours to examine and make copies of the other party's 

1085 books and records relating to matters covered by this Contract.

1086 (b) Notwithstanding the provisions of subdivision (a) of this Article, no 

1087 books, records, or other information shall be requested from the Contractor by the Contracting 

1088 Officer unless such books, records, or information are reasonably related to the administration or 

1089 performance of this Contract. Any such request shall allow the Contractor a reasonable period of 
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1090 time within which to provide the requested books, records, or information. 

1091 (c) At such time as the Contractor provides information to the Contracting 

1092 Officer pursuant to subdivision (a) of this Article, a copy of such information shall be provided 

1093 to the Operating Non-Federal Entity. 

1094 ASSIGNMENT LIMITED--SUCCESSORS AND ASSIGNS OBLIGATED

1095 31. (a) The provisions of this Contract shall apply to and bind the successors and 

1096 assigns of the parties hereto, but no assignment or transfer of this Contract or any right or interest 

1097 therein shall be valid until approved in writing by the Contracting Officer. 

1098 (b) The assignment of any right or interest in this Contract by either party 

1099 shall not interfere with the rights or obligations of the other party to this Contract absent the 

1100 written concurrence of said other party. 

1101 (c) The Contracting Officer shall not unreasonably condition or withhold his 

1102 approval of any proposed assignment. 

1103 SEVERABILITY

1104 32. In the event that a person or entity who is neither (i) a party to a Project contract, 

1105 nor (ii) a person or entity that receives Project Water from a party to a Project contract, nor (iii) 

1106 an association or other form of organization whose primary function is to represent parties to 

1107 Project contracts, brings an action in a court of competent jurisdiction challenging the legality or 

1108 enforceability of a provision included in this Contract and said person, entity, association, or 

1109 organization obtains a final court decision holding that such provision is legally invalid or 

1110 unenforceable and the Contractor has not intervened in that lawsuit in support of the plaintiff(s), 

1111 the parties to this Contract shall use their best efforts to (i) within 30 days of the date of such 

1112 final court decision identify by mutual agreement the provisions in this Contract which must be 
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1113 revised, and (ii) within three months thereafter promptly agree on the appropriate revision(s). 

1114 The time periods specified above may be extended by mutual agreement of the parties. Pending 

1115 the completion of the actions designated above, to the extent it can do so without violating any 

1116 applicable provisions of law, the United States shall continue to make the quantities of Project 

1117 Water specified in this Contract available to the Contractor pursuant to the provisions of this 

1118 Contract which were not found to be legally invalid or unenforceable in the final court decision. 

1119 RESOLUTION OF DISPUTES

1120 33. Should any dispute arise concerning any provisions of this Contract, or the 

1121 parties’ rights and obligations thereunder, the parties shall meet and confer in an attempt to 

1122 resolve the dispute. Prior to the Contractor commencing any legal action, or the Contracting 

1123 Officer referring any matter to Department of Justice, the party shall provide to the other party 

1124 30 days’ written notice of the intent to take such action; Provided, That such notice shall not be 

1125 required where a delay in commencing an action would prejudice the interests of the party that 

1126 intends to file suit. During the 30-day notice period, the Contractor and the Contracting Officer 

1127 shall meet and confer in an attempt to resolve the dispute. Except as specifically provided, 

1128 nothing herein is intended to waive or abridge any right or remedy that the Contractor or the 

1129 United States may have. 

1130 OFFICIALS NOT TO BENEFIT

1131 34. No Member of or Delegate to Congress, Resident Commissioner, or official of the 

1132 Contractor shall benefit from this Contract other than as a water user or landowner in the same 

1133 manner as other water users or landowners. 

1134 CHANGES IN CONTRACTOR’S SERVICE AREA

1135 35. (a) While this Contract is in effect, no change may be made in the 

1136 Contractor's Service Area, by inclusion or exclusion of lands, dissolution, consolidation, merger, 

1137 or otherwise, except upon the Contracting Officer's written consent. 
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1138 (b) Within 30 days of receipt of a request for such a change, the Contracting 

1139 Officer will notify the Contractor of any additional information required by the Contracting 

1140 Officer for processing said request, and both parties will meet to establish a mutually agreeable 

1141 schedule for timely completion of the process. Such process will analyze whether the proposed 

1142 change is likely to: (i) result in the use of Project Water contrary to the terms of this Contract; 

1143 (ii) impair the ability of the Contractor to pay for Project Water furnished under this Contract or 

1144 to pay for any Federally-constructed facilities for which the Contractor is responsible; and (iii) 

1145 have an impact on any Project Water rights applications, permits, or licenses. In addition, the 

1146 Contracting Officer shall comply with the NEPA and the ESA. The Contractor will be 

1147 responsible for all costs incurred by the Contracting Officer in this process, and such costs will 

1148 be paid in accordance with Article 25 of this Contract. 

1149 FEDERAL LAWS

1150 36. By entering into this Contract, the Contractor does not waive its rights to contest 

1151 the validity or application in connection with the performance of the terms and conditions of this 

1152 Contract of any Federal law or regulation; Provided, That the Contractor agrees to comply with 

1153 the terms and conditions of this Contract unless and until relief from application of such Federal 

1154 law or regulation to the implementing provision of the Contract is granted by a court of 

1155 competent jurisdiction. 

1156 NOTICES

1157 

1158 37. Any notice, demand, or request authorized or required by this Contract shall be 

1159 deemed to have been given, on behalf of the Contractor, when mailed, postage prepaid, or 

1160 delivered to the Area Manager __________________________________________ , and on 

1161 behalf of the United States, when mailed, postage prepaid, or delivered to the Board of 

1162 Directors/City Council of the ____________________________. The designation of the 

1163 addressee or the address may be changed by notice given in the same manner as provided in this 

1164 Article for other notices. 
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CONFIRMATION OF CONTRACT25 1165 

1166 

1167 38. The Contractor, after the execution of this Contract, shall promptly seek to secure 

1168 a decree of a court of competent jurisdiction of the State of California, confirming the execution 

1169 of this Contract. The Contractor shall furnish the United States a certified copy of the final 

1170 decree, the validation proceedings, and all pertinent supporting records of the court approving 

1171 and confirming this Contract, and decreeing and adjudging it to be lawful, valid, and binding on 

1172 the Contractor. 

 

25 Permission is pending to use alternate provision for M&I only contractors. 
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1173 IN WITNESS WHEREOF, the parties hereto have executed this Contract as of 

1174 the day and year first above written. 

1175 THE UNITED STATES OF AMERICA 

1176 By: ________________________________ 

1177 Regional Director, Mid-Pacific Region 

1178 Bureau of Reclamation 

1179 [NAME OF CONTRACTOR] 

1180 By: _______________________________ 

1181 President of the Board of Directors 

1182 Attest: 

1183 By: _____________________________ 

1184 Secretary of the Board of Directors 
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EXHIBIT A

[Map or Description of Service Area]
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2000 

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EXHIBIT B 

[Initial Rates and Charges]