R.O. Draft 05/15-2002 

Contract No. 

Standard Irrigation District Form 

SRSC Draft 05/22/02 

SRSC Draft 05/31/02

UNITED STATES

DEPARTMENT OF THE INTERIOR

BUREAU OF RECLAMATION

Central Valley Project, California

WATER RIGHTS SETTLEMENT CONTRACT BETWEEN THE UNITED STATES 

AND 

___________________________________________________ 

DIVERTER OF WATER FROM SACRAMENTO RIVER SOURCES PROVIDING 

FOR PROJECT WATER SERVICE AND AGREEMENT ON DIVERSION OF 

WATER

Table of Contents

Article No. Title Page No. 

Preamble 1 

Explanatory Recitals 2-3 

1 Definitions 3-6 

2 Term of Contract 6-7 

3 Water to be Furnished to Contractor 7-9 10

4 Return Flow 9 10-11

5 Constraints on the Availability of Water 10-11-12

6 Integrated Water Management and Partnerships 12-13

6 7 Use of Water Furnished to Contractor 11 13

7 8 Rate and Method of Payment for Water 11-16 14-18

8 9 Agreement on Water Quantities 16-18 19-21

9 10 Measurement of Water 18-20 21-23

10 11 Rules and Regulations 20-21 23

11 12 General Obligation – Benefits Conditioned 

Upon Payment 21 23-24

12 13 Charges For Delinquent Payments 21 24

13 14 Quality of Water 22 24-25

14 15 Water and Air Pollution Control 22 25

15 16 Equal Opportunity 22-23 25-26

16 17 Compliance With Civil Rights Laws 

And Regulations 23-24 26-27
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Table of Contents – continued

Article No. Title Page No.

17 18 Mingling of Contractor’s Project and 

Non-Project Water 24-25 27-28

18 19 Books, Records, and Reports 25-26 28

19 20 Change Of Place Of Use Or Organization 26 28-29

20 21 Consolidation Of Contracting Entities 26 29

21 22 Notices 26-27 29

22 23 Assignment Limited – Successors and 

Assigns Obligated 27 29-30

23 24 Officials Not to Benefit 27 30

24 25 Contingent Upon Appropriation or 

Allotment of Funds 27 30

25 26 Confirmation of Contract 27 30

26 27 Unavoidable Groundwater Percolation 28 30

27 28 Privacy Act Compliance 28 31

28 29 Water Conservation 29-30 31-33

29 30 Opinions And Determinations 30-31 33

30 31 Contractor to Pay Certain Miscellaneous Costs 31 34

31 32 Waiver of Default 31 34

 Signatures 32 35

Exhibit A Schedule of Monthly Diversions of Water 

Exhibit B Map of Contractor’s Ownership 

Exhibit C Unit Duties 

Exhibit D Rates and Charges 
1 R.O. Draft 05/15-2002 

2 Contract No. 

3 Standard Irrigation District Form 

4 SRSC Draft 05/02/02 

5 SRSC Draft 05/22/02 

6 SRSC Draft 05/31/02

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8 

9 UNITED STATES

10 DEPARTMENT OF THE INTERIOR

11 BUREAU OF RECLAMATION

12 Central Valley Project, California

13 

14 WATER RIGHTS SETTLEMENT CONTRACT BETWEEN THE UNITED STATES 

15 AND 

16 _______________________________________________ 

17 DIVERTER OF WATER FROM SACRAMENTO RIVER SOURCES PROVIDING 

18 FOR PROJECT WATER SERVICE AND AGREEMENT ON DIVERSION OF 

19 WATER

20 

21 THIS CONTRACT, hereinafter referred to as “Settlement Contract,” is 

22 entered into by THE UNITED STATES OF AMERICA, hereinafter referred to as the 

23 United States, made this _____ day of ____________________, 2002, in pursuance

24 pursuant to the applicable authority granted to it generally of in the Act of June 17, 1902 

25 (32 Stat. 388), and acts amendatory or supplementary thereto, including, but not limited 

26 to, the Acts of August 26, 1937 (50 Stat. 844), as amended and supplemented, August 4, 

27 1939 (53 Stat. 1187), as amended and supplemented, including but not limited to Section 

28 14 thereto, July 2, 1956 (70 Stat. 483), June 21, 1963 (77 Stat. 68), October 12, 1982 (96 

29 Stat. 1262), October 27, 1986 (100 Stat. 3050), as amended, and Title XXXIV of the Act 

30 of October 30, 1992 (106 Stat. 4706), all collectively hereinafter referred to as Federal 

31 Reclamation law, between THE UNITED STATES OF AMERICA, hereinafter referred 

32 to as the United States, and _______________________, hereinafter referred to as the 

33 Contractor, a public agency of the State of California, duly organized, existing, and 
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1 acting pursuant to the laws thereof, with its principal place of business in California; 

2 (may change depending on contracting entity) 

3 WITNESSETH, That that: 

4 EXPLANATORY RECITALS

5 WHEREAS, the United States has constructed and is operating the Central Valley 

6 Project, California, for diversion, storage, carriage, distribution and beneficial use, for 

7 flood control, irrigation, municipal, domestic, industrial, fish and wildlife mitigation, 

8 protection and restoration, generation and distribution of electric energy, salinity control, 

9 navigation and other beneficial uses, of waters of the Sacramento River, the American 

10 River, the Trinity River, and the San Joaquin River and their tributaries; and 

11 WHEREAS, the Contractor asserts that it has rights to divert, is diverting, and 

12 will continue to divert for reasonable beneficial use, water from the natural flow of the 

13 Sacramento River and tributaries thereto, that would have been flowing therein if the 

14 Central Valley Project were not in existence; and 

15 WHEREAS, the construction and operation of the integrated and coordinated 

16 Central Valley Project has changed and will further change the regimen of the 

17 Sacramento, American, San Joaquin, and Trinity Rivers and the Sacramento-San Joaquin 

18 Delta from unregulated flow to regulated flow; and 

19 WHEREAS, the United States asserts that it has rights to divert, is diverting, and 

20 will continue to divert waters from said Rivers and said Delta in connection with the 

21 operation of said Central Valley Project, and 

22 WHEREAS, the Contractor and the United States had a dispute over the nature, 

23 extent and relative priority of their respective water rights which threatened to result in 
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1 the initiation of an adjudication of the relevant stream systems and as a means to settle 

2 that dispute entered into Contract No. ______________, as amended, hereinafter referred 

3 to as the Existing Contract, which established terms for the delivery to the Contractor of 

4 Central Valley Project Water and the quantities of Base Supply the Contractor may has a 

5 right to divert from the Sacramento River from ____________ through 

6 ______________________; and 

7 WHEREAS, the United States and the Contractor have a current dispute over the 

8 meaning and intent of Articles 9 and 5 of the Existing Contract, including litigation, but 

9 nonetheless without prejudicing the respective parties’ positions with respect to that 

10 litigation has requested desire to enter into the long-term renewal of the Existing 

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

12 the laws of the State of California, and the United States has determined that the 

13 Contractor has Parties have fulfilled all of its their respective obligations under the 

14 Existing Contract; and

15 WHEREAS, to assure the Contractor of the enjoyment and use of the regulated 

16 flow of the said Rivers and the Delta, and to provide for the economical operation of the 

17 Central Valley Project by, and the reimbursement to, the United States for expenditures 

18 made for said Project; 

19 NOW, THEREFORE, in consideration of the performance of the herein 

20 contained provisions, conditions, and covenants, it is agreed as follows:

21 DEFINITIONS

22 1. When used herein, unless otherwise expressed or incompatible with the intent 

23 hereof, the term: 
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1 (a) “Base Supply” shall mean the quantity of water established in Articles 3 

2 and 5 which the United States agrees may be diverted by that the Contractor has a right to 

3 divert from the Sacramento River each month during the period April through October of 

4 each Year without payment to the United States for such quantities diverted; 

5 (b) “Charges” shall mean the payments for Project Water required by Federal 

6 Reclamation law agreed to pursuant to this Settlement Contract in addition to the “Rates”

7 specified in this Contract. The nature and extent of Charges as well as categories of 

8 Charges is specified in the attached Exhibit “D” as determined annually by the 

9 Contracting Officer pursuant to this Contract; 

10 (c) “Contract Total” shall mean the sum of the Base Supply and Project 

11 Water available for diversion by the Contractor for the period April 1 through October 

12 31; 

13 (d) “Critical Year” shall mean any Year in which either of the following 

14 eventualities exists: 

15 (1) The forecasted full natural inflow to Shasta Lake for the current Water 

16 Year, as such forecast is made by the United States on or before February 15 and 

17 reviewed as frequently thereafter as conditions and information warrant, is equal to or 

18 less than three million two hundred thousand (3,200,000) acre-feet; or 

19 (2) The total accumulated actual deficiencies below four million 

20 (4,000,000) acre-feet in the immediately prior Water Year or series of successive prior 

21 Water Years each of which had inflows of less than four million (4,000,000) acre-feet, 

22 together with the forecasted deficiency for the current Water Year, exceed eight hundred 

23 thousand (800,000) acre-feet. For the purpose of determining a Critical Year the 
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1 computed inflow to Shasta Lake as it would have existed under present upstream 

2 development above Shasta Lake as of September 1, 1963 shall be used as the full natural 

3 inflow to Shasta Lake. In the event that major construction occurs above Shasta Lake 

4 after April 1, 2004, which materially alters the present regimen of the stream systems 

5 contributing to Shasta Lake, the computed inflow to Shasta Lake used to define a Critical 

6 Year will, be adjusted to eliminate the effect of such material alterations. After 

7 consultation with the State of California, the National Weather Service, and other 

8 recognized forecasting agencies, the Contracting Officer will select the forecast to be 

9 used and will make the details of it available to the Contractor. The same forecasts used 

10 by the United States for the operation of the Project shall be used to make the forecasts 

11 hereunder; 

12 (e) “CVPIA” shall mean the Central Valley Project Improvement Act, Title 

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

14 (f) “Eligible Lands” shall mean all lands to which Project Water may be 

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

16 1982 (96 Stat. 1263), as amended, hereinafter referred to as RRA;

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

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

19 Federal Reclamation law; 

20 (h) “Full Cost Rate” shall mean that water rate described in Sections 

21 205(a)(3) or 202(3) of the RRA, whichever is applicable; 

22 (i) “Ineligible Lands” shall mean all lands to which Project Water may not be 

23 delivered in accordance with Section 204 of the RRA; 
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1 (j) “Landholder” shall mean a party that directly or indirectly owns or leases 

2 nonexempt land, as provided in 43 CFR 426.2; 

3 (k) “Project” shall mean the Central Valley Project owned by the United 

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

5 (l) “Project Water” shall mean all water diverted or scheduled to be diverted 

6 each month during the period April through October of each Year by the Contractor from 

7 the Sacramento River which is in excess of the Base Supply. The United States 

8 recognizes the right of the Contractor to make arrangements for acquisition of water from 

9 projects of others than the United States for delivery through the Sacramento River and 

10 tributaries subject to written agreement between Contractor and the United States as to 

11 identification of such water which water when so identified shall not be deemed Project 

12 Water under this contract Settlement Contract; 

13 (m) “Rates” shall mean the payments for Project Water determined annually 

14 by the Contracting Officer in accordance with the then current applicable water 

15 ratesetting policies for the Project, as described in subdivision (a) of Article 8 of this 

16 Settlement Contract; 

17 (n) “Secretary” or “Contracting Officer” shall mean the Secretary of the 

18 Interior, a duly appointed successor, or an authorized representative acting pursuant to 

19 any authority of the Secretary and through any agency of the Department of the Interior; 

20 (o) “Water Year” shall mean the period commencing with October 1 of one 

21 year and extending through September 30 of the next; and 

22 (p) “Year” shall mean a calendar year. 
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1 TERM OF SETTLEMENT CONTRACT

2 2. This contract Settlement Contract shall become effective April 1, 2004, and 

3 shall remain in effect until and including March 31, 2044: Provided, That that under 

4 terms and conditions mutually agreeable to the parties hereto, renewals may be made for 

5 successive periods not to exceed forty (40) years each. The terms and conditions of each 

6 renewal shall be agreed upon not later than one (1) year prior to the expiration of the then 

7 existing contract Settlement Contract: Provided further, That that, with respect to Project 

8 Water and the portions of this Settlement Contract pertaining thereto, upon written 

9 request by the Contractor of the Secretary made not later than one (1) year prior to the 

10 expiration of this contract Settlement Contract, whenever, account being taken of the 

11 amount then credited to the costs of construction of water supply works, the remaining 

12 amount of construction costs of water supply work which is properly assignable for 

13 ultimate return by the Contractor as established by the Secretary of the Interior pursuant 

14 to (3) of Section 1 of Public Law 643 (70 Stat. 483), probably can be repaid to the United 

15 States within the term of a contract under subsection 9(d), Section 9 of the1939 

16 Reclamation Project Act (53 Stat. 1187), the relevant portions of this contract Settlement 

17 Contract may be converted to a contract under said subsection 9(d) upon terms and 

18 conditions mutually agreeable to the United States and the Contractor. Notwithstanding 

19 any provision of this contract Settlement Contract, the Contractor reserves and shall have 

20 all rights and benefits under Public Law 643. 

21 WATER TO BE FURNISHED TO CONTRACTOR

22 3. (a) Subject to the conditions, limitations, and provisions hereinafter expressed, 

23 the Contractor is hereby entitled and authorized to divert from the Sacramento River at 
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1 the locations shown in identified on Exhibit A and shown on Exhibit B, for beneficial use 

2 within the area delineated on Exhibit B, (both Exhibits are attached hereto and made a 

3 part hereof), the Contract Total designated in Exhibit A, or any revision thereof, in 

4 accordance with the monthly operating schedule required by Article 3(b) of this contract

5 Settlement Contract. The quantity of any surface water diverted under this Settlement 

6 Contract from the Sacramento River for use on any lands delineated on Exhibit B, by the 

7 owner of such lands or otherwise shall constitute a part of the Contract Total as shown on 

8 Exhibit A and shall be subject to all the provisions of this contract Settlement Contract

9 relating to such Contract Total as if such diversion were made by the Contractor. 

10 [NOTE: contractor-specific language dealing with individual water rights may be 

11 needed.]

12 (b) The United States recognizes the need of the Contractor to vary from time 

13 to time its monthly diversions of water from the quantities shown in Exhibit A, or any 

14 revision thereof. Before April 1 of each Year the Contractor shall submit a written 

15 schedule to the Contracting Officer indicating the Contract Total to be diverted by the 

16 Contractor during each month. The United States shall furnish water to the Contractor in 

17 accordance with the monthly operating schedule or any revisions thereof: Provided, That

18 that in no event shall the total quantity scheduled for diversion by the Contractor from the 

19 Sacramento River: 

20 (1) During the period April through October exceed the aggregate of the 

21 Contract Total for those months shown in Exhibit A or any revision thereof; 

22 (2) During the period July through September exceed the aggregate of the 

23 Contract Total for those months shown in Exhibit A or any revision thereof; and 
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1 Provided, further, That that with the prior written approval of the Contracting Officer, 

2 water to be diverted in April, May, or June may be diverted in September or October, or 

3 vice versa. The Contractor shall be charged a fee based upon the appropriate components 

4 of the water ratesetting policy for the Project for the Base Supply scheduled for diversion 

5 in April, May, or June that is diverted in September or October, or vice versa. 

6 (c) In the event conditions warrant, the Contracting Officer reserves the right 

7 to require the Contractor to submit, at least seventy-two (72) hours prior to the beginning 

8 of each weekly period, its estimate of daily diversion requirements for each such period 

9 from the Sacramento River: Provided, however, That that changes during any such 

10 period may be made upon the giving of seventy-two (72) hours’ notice thereof to the 

11 Contracting Officer. 

12 (d) No sale, transfer, exchange, or other disposal of any water Project Water

13 or the right to the use thereof for use on land other than that shown on Exhibit B shall be 

14 made by the Contractor without: 

15 (1) First obtaining the written consent of the Contracting Officer; and 

16 (2) Compliance with all applicable State and Federal laws, including but 

17 not limited to the National Environmental Policy Act and the Endangered Species Act, 

18 and applicable guidelines or regulations then in effect. 

19 (e) The sale, transfer, exchange, or other disposal of any Base Supply or the 

20 right to the use thereof for use on land other than that shown on Exhibit B shall be made 

21 by the Contractor in compliance with all applicable State laws.

22 (e f) Nothing herein contained shall prevent the Contractor from diverting 

23 water during the months of November through March for beneficial use on the land 
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1 shown on Exhibit B or elsewhere to the extent authorized under the laws of the State of 

2 California. 

3 (f g) The United States assumes no responsibility for and neither it nor its 

4 officers, agents, or employees shall have any liability for or on account of: 

5 (1) The quality of water to be diverted by the Contractor; 

6 (2) The control, carriage, handling, use, disposal, or distribution of water 

7 diverted by the Contractor outside the facilities constructed and then being operated and 

8 maintained by or on behalf of the United States; 

9 (3) Claims of damage of any nature whatsoever, including but not limited 

10 to, property loss or damage, personal injury, or death arising out of or connected with the 

11 control, carriage, handling, use, disposal, or distribution of said water outside of the 

12 hereinabove referred to facilities; and 

13 (4) Any damage whether direct or indirect arising out of or in any manner 

14 caused by a shortage of water whether such shortage be on account of errors in operation,

15 drought, or unavoidable causes. 

16 RETURN FLOW

17 4. The United States reserves the right to the use of all waste, seepage, and return 

18 flow water derived from water Project Water diverted by the Contractor hereunder and 

19 which escapes or is discharged beyond the boundaries of the lands shown on Exhibit B. 

20 Nothing herein shall be construed as an abandonment or a relinquishment by the United 

21 States of the right to the use of any such water Project Water; Provided, That that this 

22 shall not be construed as claiming for the United States any right to such water Project 

23 Water which is recovered by the Contractor pursuant to California law from within the 
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1 boundaries of the lands shown on Exhibit B, and which is being used pursuant to this 

2 contract Settlement Contract for surface irrigation or underground storage on the lands 

3 shown on Exhibit B by the Contractor, nor is it intended to apply to waste, seepage, and 

4 return flow water derived from Base Supply or other non-Project Water diverted or 

5 otherwise obtained by Contractor. (Colusa Basin Drain language may be required) 

6 CONSTRAINTS ON THE AVAILABILITY OF WATER

7 5. (a) In any Water Year that (1) the forecasted full natural inflow to Shasta Lake 

8 for the current Water Year, as such forecast is made by the United States on or before 

9 February 15 and reviewed as frequently thereafter as conditions and information warrant, 

10 is equal to or less than three million eight hundred thousand (3,800,000) acre-feet; or 

11 (2) If the total accumulated actual deficiencies in the full natural inflow to Shasta Lake in 

12 the immediately prior Water Year or series of successive prior Water Years, each of 

13 which had inflows of less than four million (4,000,000) acre-feet, together with the 

14 forecasted deficiency for the current Water Year, are between 200,000 acre-feet and 

15 800,000 acre-feet, then the following reductions in the Contractor’s monthly Contract 

16 Total shall be imposed: 

17 Deficiency (acre-feet) Reduction

18 200,000 – 400,000 10 percent 

19 400,001 – 600,000 15 percent 

20 600,001 – 800,000 20 percent 

21 

22 (b) In consideration for the reductions in the Contractor’s monthly Contract 

23 Total imposed pursuant to the provisions of Article 5(a) above, the United States shall 

24 pay Contractor as follows:

25 Reduction Per Acre-Foot Compensation

26 10 percent $ X 
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1 15 percent $ Y for quantities from 10-15%

2 20 percent $ Z for quantities from 15-20%

3 

4 The dollar per-acre compensation shall be tied to or indexed to the increase of 

5 rates for Project Water or CPI [or other].

6 (b c) In a Critical Year, the Contractor’s Base Supply and Project Water 

7 agreed to be diverted during the period April through October of the Year in which the 

8 principal portion of the Critical Year occurs and, each monthly quantity of said period 

9 shall be reduced by twenty-five percent (25 percent %). 

10 (c d) The amount of any overpayment by the Contractor shall, at its option, be 

11 refunded or credited upon amounts to become due to the United States from the 

12 Contractor under the provisions hereof in the ensuing Year. To the extent of such 

13 deficiency such adjustment of overpayment shall constitute the sole remedy of the 

14 Contractor. 

15 INTEGRATED WATER MANAGEMENT AND PARTNERSHIPS

16 6. Contractor and United States desire to work together to maximize the 

17 reasonable beneficial use of water to their mutual benefit. As a consequence, the United 

18 States will work in partnership with Contractor and others within the Sacramento Valley, 

19 including other Contractors with Settlement Contracts, to facilitate the better integration 

20 within the Sacramento Valley of all water supplies including, but not limited to, the better 

21 management and integration of surface water and groundwater, the development and 

22 better utilization of surface water storage, the effective utilization of waste, seepage and 

23 return flow water, and other operational and management options that may be identified 

24 in the future. This will include, but not be limited to, the continuation of the Sacramento 

25 River Settlement Contractors’ pooling agreements, the agreements with respect to use 
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1 and re-use of water within the Colusa Basin Drain, and the Basin-Wide Water 

2 Management Plan process. 

3 USE OF WATER FURNISHED TO CONTRACTOR

4 6 7. (a) Project Water furnished to the Contractor pursuant to this contract

5 Settlement Contract shall not be delivered or furnished by the Contractor for any 

6 purposes other than agricultural purposes without the written consent of the Contracting 

7 Officer. , including, For purposes of this contract, “agricultural purposes” includes, but is

8 not restricted to, the watering of livestock, incidental domestic use including landscape 

9 irrigation, or underground water replenishment without written consent of the 

10 Contracting Officer. 

11 (b) Assuming a base-line that includes in excess of 40 years of diversions for 

12 agricultural uses of the quantities of water provided for in Article 3, the Contractor shall 

13 comply with requirements applicable to the Contractor in biological opinion(s) prepared 

14 as a result of a consultation regarding the execution of this Settlement Contract 

15 undertaken pursuant to Section 7 of the Endangered Species Act of 1973, as amended, 

16 that are within the Contractor’s legal authority to implement. The Contractor shall 

17 comply with the limitations or requirements imposed by environmental documentation 

18 applicable to the Contractor and within its legal authority to implement regarding specific 

19 activities, including conversion of Irrigation Water to M&I Water. Nothing herein shall 

20 be construed to prevent the Contractor from challenging or seeking judicial relief in a 

21 court of competent jurisdiction with respect to any biological opinion or other 

22 environmental documentation referred to in this Article. 
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1 RATE AND METHOD OF PAYMENT FOR WATER

2 7 8. (a) The Contractor shall make payments to the United States as provided in 

3 this Article for all Project Water shown in Exhibit A of this contract Settlement Contract 

4 and which is actually diverted by Contractor at Rates and Charges established in 

5 accordance with: (i) the Secretary’s then-current ratesetting policies for the Project; and 

6 (ii) applicable Reclamation law and associated rules and regulations, or policies.: 

7 Provided, That if the Contractor desires to use Project Water for other than agricultural 

8 use the Rates and Charges set forth above will be adjusted by the Contracting Officer to 

9 the applicable Rates and Charges for such use. The Rates and Charges applicable to the 

10 Contractor upon execution of this Settlement Contract are set forth in Exhibit “D”, as 

11 may be revised annually. The Secretary’s ratesetting policies for the Project shall be 

12 amended, modified, or superseded only through a public notice and comment procedure. 

13 (b) The Contracting Officer shall notify the Contractor of the Rates and 

14 Charges as follows: 

15 [(1) Prior to July 1 of each Year, the Contracting Officer shall provide the 

16 Contractor an estimate of the Charges for Project Water that will be applied to the period 

17 October 1, of the current Year, through September 30, of the following Year, and the 

18 basis for such estimate. The Contractor shall be allowed not less than two (2) months to 

19 review and comment on such estimates. On or before September 15 of each Year, the 

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

21 during the period October 1 of the current Year, through September 30, of the following 

Year, and such notification shall revise Exhibit “D.”1 22 ]

 

1

 We need a more specific idea and limit on what charges can be for. We need to define categories 

of acceptable Charges.
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1 (2) Prior to October 1 of each Year, the Contracting Officer shall make 

2 available to the Contractor an estimate of the Rates for Project Water for the following 

3 Year and the computations and cost allocations upon which those Rates are based. The 

4 Contractor shall be allowed not less than two (2) months to review and comment on such 

5 computations and cost allocations. By December 31 of each Year, the Contracting 

6 Officer shall provide the Contractor with the final Rates to be in effect for the upcoming 

7 Year, and such notification shall revise Exhibit “D”. 

8 (c) The Contractor shall pay the United States for Project Water in the 

9 following manner: 

10 (1) With respect to Rates, prior to May 1 of each Year, the Contractor 

11 shall pay the United States one-half (1/2) the total amount payable pursuant to 

12 subdivision (a) of this Article and the remainder shall be paid prior to July 1 or such later 

13 date or dates as may be specified by the United States in a written notice to the 

14 Contractor: Provided, however, That that if at any time during the Year the amount of 

15 Project Water diverted by the Contractor shall equal the amount for which payment has 

16 been made, the Contractor shall pay for the remaining amount of such water as shown in 

17 Exhibit A in advance of any further diversion of Project Water. 

18 (2) With respect to Charges, the Contractor shall also make a payment to 

19 the United States, in addition to the Rate(s) in subdivision (c)(1) of this Article, at the 

20 Charges then in effect, before the end of the month following the month of delivery or 

21 transfer. The payments shall be consistent with the quantities of Project Water delivered 

22 or transferred. Adjustment for overpayment or underpayment of Charges shall be made 

23 through the adjustment of payments due to the United States for Charges for the next 
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1 month. Any amount to be paid for past due payment of Charges shall be computed 

2 pursuant to Article 12 of this contract Settlement Contract. 

3 (d) Payments to be made by the Contractor to the United States under this 

4 contract Settlement Contract may be paid from any revenues available to the Contractor. 

5 (d1) (Contractor Specific)All revenues received by the United States from 

6 the Contractor relating to the delivery of Project Water or the delivery of non-Project 

7 water through Project facilities shall be allocated and applied in accordance with Federal 

8 Reclamation law and the associated rules or regulations, and the then current Project 

9 ratesetting policies for Irrigation Water.

10 (e) In order to allow Contractor to monitor the development of Rates and 

11 Charges, the Contracting Officer shall keep its accounts pertaining to the administration 

12 of the financial terms and conditions of its long-term water service and Settlement 

13 Contracts, in accordance with applicable Federal standards, so as to reflect the application 

14 of Project costs and revenues. The Contracting Officer shall, each Year upon request of 

15 the Contractor, provide to the Contractor a detailed accounting of all Project and 

16 Contractor expense allocations, the disposition of all Project and Contractor revenues, 

17 and a summary of all water delivery information. The Contracting Officer and the 

18 Contractor shall enter into good faith negotiations to resolve any discrepancies or 

19 disputes relating to accountings, reports, or information. 

20 (f) The parties acknowledge and agree that the efficient administration of this 

21 Settlement Contract is their mutual goal. Recognizing that experience has demonstrated 

22 that mechanisms, policies, and procedures used for establishing Rates and Charges and/or 

23 for making and allocating payments, other than those set forth in this Article may be in 
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1 the mutual best interest of the parties, it is expressly agreed that the parties may enter into 

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

3 while this Settlement Contract is in effect without amendment of this Settlement

4 Contract. 

5 (g) For the term of this contract Settlement Contract, Rates under the 

6 respective ratesetting policies for the Project will be established to recover only 

7 reimbursable operation and maintenance (including any deficits) and capital costs of the 

8 Project, as those terms are used in the then-current Project ratesetting policies, and 

9 interest, where appropriate, except in instances where a minimum Rate is applicable in 

10 accordance with the relevant Project ratesetting policy. Proposed changes of significance 

11 in practices which implement the ratesetting policies for the Project will not be 

12 implemented until the Contracting Officer has provided the Contractor an opportunity to 

13 discuss the nature, need, and impact of the proposed change. 

14 (h) Except as provided in subsections [3405(a)(1)(B) and 3405(f)] of the 

15 CVPIA, the Rates for Project Water transferred, exchanged, or otherwise disposed of, by 

16 the Contractor shall be the Contractor’s Rates adjusted upward or downward to reflect the 

17 changed costs of delivery (if any) of the transferred, exchanged, or otherwise disposed of 

18 Project Water to the transferee’s point of delivery in accordance with the then-current 

19 ratesetting policies for the Project. If the Contractor is receiving lower Rates and 

20 Charges because of inability to pay and is transferring, exchanging, or otherwise 

21 disposing of Project Water to another entity whose Rates and Charges are not adjusted 

22 due to inability to pay, the Rates and Charges for transferred, exchanged, or otherwise 
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1 disposed of Project Water shall be the Contractor’s Rates and Charges unadjusted for 

2 ability to pay. 

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

4 Officer is authorized to adjust determinations of ability to pay every five (5) years. 

5 (j) Each payment to be made pursuant to subdivisions (a) and (b) of this 

6 Article shall be made at the office of the Bureau of Reclamation, Mid-Pacific Region, 

7 File No. 11546, P.O Box 6000, San Francisco, California, 94160-1546, or at such other 

8 place as the United States may designate in a written notice to the said Contractor. 

9 Payments shall be made by cash transaction, wire, or any other mechanism as may be 

10 agreed to in writing by the Contractor and the Contracting Officer. In event there should 

11 be a default in the payment of the amount due, the delinquent payment provisions of 

12 Article 12 shall apply. The Contractor shall not be relieved of the whole or any part of its 

13 said obligation by, on account of, or notwithstanding, as the case may be: 

14 (1) Its failure, refusal, or neglect to divert the quantity of Project Water as 

15 hereinabove provided; 

16 (2) The default in payment to it by any water user of assessments, tolls, or 

17 other charges levied by or owing to said Contractor; 

18 (3) Any judicial determination that any assessment, toll, or other charge 

19 referred to in subsection 8(c)(2) of this Settlement Contract is irregular, void, or 

20 ineffectual; or 

21 (4) Any injunctive process enjoining or restraining the Contractor from 

22 making or collecting any such assessment, toll, or other charge referred to in subsection 

23 8(c)(2) of this Settlement Contract.
 SRSC Draft 05/31/02

19

1 AGREEMENT ON WATER QUANTITIES

2 8 9. (a) During the term of this contract Settlement Contract and any renewals 

3 thereof: 

4 (1) It shall constitute full agreement as between the United States and the 

5 Contractor as to the quantities of water and the allocation thereof between Base Supply 

6 and Project Water which may be diverted by the Contractor from the Sacramento River 

7 for beneficial use on the land shown on Exhibit B which said diversion, use, and 

8 allocation shall not be disturbed so long as the Contractor shall fulfill all of its obligations 

9 hereunder; 

10 (2) The Contractor shall not claim any right against the United States in 

11 conflict with the provisions hereof, nor shall the United States claim any right against the 

12 Contractor in conflict with the provisions hereof. 

13 (b) Nothing herein contained is intended to or does limit rights of the 

14 Contractor against others than the United States or of the United States against any 

15 person other than the Contractor: Provided, however, That that in the event the 

16 Contractor, the United States, or any other person shall become a party to a general 

17 adjudication of rights to the use of water of the Sacramento River system, this contract

18 Settlement Contract shall not jeopardize the rights or position of either party hereto or of 

19 any other person and the rights of all such persons in respect to the use of such water 

20 shall be determined in such proceedings the same as if this contract Settlement Contract

21 had not been entered into, and if final judgment in any such general adjudication shall 

22 determine that the rights of the parties hereto are different from the rights as assumed 

23 herein, the United States shall submit it to the Contractor parties shall negotiate an 
 SRSC Draft 05/31/02

20

1 amendment to give effect to such judgment. In the event the parties are unable to agree 

2 on an appropriate amendment they shall, within 60 days of determining that there is an 

3 impasse, employ the services of a neutral mediator to assist in resolving the impasse. The 

4 cost of the mediation will be shared equally. A failure to reach agreement on an 

5 amendment within 60 days of the end of mediation will cause the immediate termination 

6 of this Settlement Contract. and the contract shall be deemed to have been amended 

7 accordingly unless within sixty (60) days after submission of such amendment to the 

8 Contractor, the Contractor elects to terminate the contract or within the same period of 

9 time the parties agree upon mutually satisfactory amendments to give effect to such 

10 judgment: Provided, further, That if, during the term of this Contract, the Contractor’s or 

11 the United States’ water rights are adjusted or affected, or the responsibility to meet flow, 

12 water quality and/or environmental requirements under those water rights is modified 

13 (e.g., changes to the Delta Water Quality Control Plan and associated water right 

14 actions), by or through any final administrative or judicial proceeding, the Contractor and 

15 the United States shall negotiate appropriate adjustments to this contract. 

16 (c) In the event this contract Settlement Contract terminates, the rights of the 

17 parties to thereafter divert and use water shall exist as if this contract Settlement Contract

18 had not been entered into; and the fact that as a compromise settlement of a controversy 

19 as to the respective rights of the parties to divert and use water and the yield of such 

20 rights during the term hereof, this contract Settlement Contract places a limit on the 

21 Contract Total to be diverted annually by the Contractor during the contract Settlement 

22 Contract term and segregates it into Base Supply and Project Water shall not jeopardize 

23 the rights or position of either party with respect to its water rights or the yield thereof at 
 SRSC Draft 05/31/02

21

1 all times after the contract Settlement Contract terminates. It is further agreed that the 

2 Contractor at all times will first use water to the use of which it is entitled by virtue of its 

3 own water rights, and neither the provisions of this contract Settlement Contract, action 

4 taken thereunder, nor payments made thereunder to the United States by the Contractor 

5 shall be construed as an admission that any part of the water used by the Contractor 

6 during the term of this contract Settlement Contract was in fact water to which it would 

7 not have been entitled under water rights owned by it nor shall receipt of payments 

8 thereunder by the United States from the Contractor be construed as an admission that 

9 any part of the water used by the Contractor during the term of this contract Settlement 

10 Contract was in fact water to which it would have been entitled under water rights owned 

11 by it. 

12 MEASUREMENT OF WATER

13 9 10. (a) All water diverted by the Contractor from Sacramento River will be 

14 diverted at the existing point or points of diversion shown on Exhibit A or at such other 

15 points as may be mutually agreed upon in writing by the Contracting Officer and the 

16 Contractor. 

17 (b) All water diverted from the Sacramento River pursuant to this contract

18 Settlement Contract will be measured or caused to be measured by the United States at 

19 each point of diversion with existing equipment or equipment to be installed, operated, 

20 and maintained by the United States, and/or others, under contract with and at the option 

21 of the United States. The equipment and methods used to make such measurement shall 

22 be in accordance with sound engineering practices. Upon request of the Contractor, the 
 SRSC Draft 05/31/02

22

1 accuracy of such measurements will be investigated by the Contracting Officer and any 

2 errors appearing therein will be corrected. 

3 (c) The right of ingress to and egress from all points of diversion is hereby 

4 granted to all authorized employees of the United States. The Contractor also hereby 

5 grants to the United States the right to install, operate, maintain and replace such 

6 equipment on diversion or carriage facilities at each point of diversion as the Contracting 

7 Officer deems necessary. 

8 (d) The Contractor shall not modify, alter, remove, or replace diversion 

9 facilities or do any other act which would alter the effectiveness or accuracy of the 

10 measuring equipment installed by the United States or its representatives unless and until 

11 the Contracting Officer has been notified with due diligence and has been given an 

12 opportunity to modify such measuring equipment in such manner as may be necessary or 

13 appropriate. In the event of an emergency the Contractor shall notify the United States 

14 within a reasonable time thereafter as to the existence of the emergency and the nature 

15 and extent of such modification, alteration, removal, or replacement of diversion 

16 facilities. 

17 (e) Unless the Contractor has itself already incurred the relevant expenses, the 

18 Contractor shall pay the United States for the costs to repair, relocate, or replace 

19 measurement equipment when the Contractor modifies, alters, removes, or replaces 

20 diversion or carriage facilities. 

21 (f) (Contractor Specific) By __________________[DATE] ________, the 

22 Contractor shall ensure that, unless the Contractor establishes an alternative measurement 

23 program satisfactory to the Contracting Officer, all surface water delivered for irrigation 
 SRSC Draft 05/31/02

23

1 purposes on the lands delineated on Exhibit B is measured at each agricultural turnout. 

2 The water measuring devices or water measuring methods of comparable effectiveness 

3 must be acceptable to the Contracting Officer. The Contractor shall be responsible for 

4 installing, operating, and maintaining and repairing all such measuring devices and 

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

6 Contractor shall inform the Contracting Officer in writing by April 30 of each Year of the 

7 monthly volume of surface water delivered to the lands delineated on Exhibit B during 

8 the previous Year. This information will be used by Reclamation to satisfy the water 

9 measurement requirements of the Contractor’s water conservation plan, as set forth in 

10 Article 28 of this Contract.

11 (g) All new surface water delivery systems installed within the lands 

12 delineated on Exhibit B after the effective date of this Contract shall also comply with the 

13 measurement provisions described in this Article.

14 RULES AND REGULATIONS

15 10 11. The parties agree that the delivery of Project Water for irrigation use or 

16 use of Federal facilities pursuant to this Settlement Contract is subject to Federal 

17 Reclamation law, including but not limited to, the Reclamation Reform Act of 1982 (43 

18 U.S.C.390aa et seq.), as amended and supplemented, and the rules and regulations 

19 promulgated by the Secretary of the Interior under Federal Reclamation law. 

20 GENERAL OBLIGATION--BENEFITS CONDITIONED UPON PAYMENT

21 

22 11 12. (a) The obligation of the Contractor to pay the United States as provided 

23 in this Settlement Contract is a general obligation of the Contractor notwithstanding the 

24 manner in which the obligation may be distributed among the Contractor's water users 

25 and notwithstanding the default of individual water users in their obligations to the 

26 Contractor. 

27 
 SRSC Draft 05/31/02

24

1 (b) The payment of Charges becoming due hereunder is a condition precedent 

2 to receiving benefits under this Settlement Contract. The United States shall not make 

3 water available to the Contractor through Project facilities during any period in which the 

4 Contractor may be in arrears in the advance payment of water Rates due the United 

5 States. The Contractor shall not furnish water made available pursuant to this Settlement

6 Contract for lands or parties which are in arrears in the advance payment of water rates 

7 levied or established by the Contractor. 

8 

9 (c) With respect to subdivision (b) of this Article, the Contractor shall have 

10 no obligation to require advance payment for water Rates which it levies. 

11 

12 CHARGES FOR DELINQUENT PAYMENTS

13 

14 12 13. (a) The Contractor shall be subject to interest, administrative and penalty 

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

16 due date, the Contractor shall pay an interest charge for each day the payment is 

17 delinquent beyond the due date. When a payment becomes sixty (60) days delinquent, 

18 the Contractor shall pay an administrative charge to cover additional costs of billing and 

19 processing the delinquent payment. When a payment is delinquent ninety (90) days or 

20 more, the Contractor shall pay an additional penalty charge of six (6%) percent per year 

21 for each day the payment is delinquent beyond the due date. Further, the Contractor shall 

22 pay any fees incurred for debt collection services associated with a delinquent payment. 

23 

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

25 in the Federal Register by the Department of the Treasury for application to overdue 

26 payments, or the interest rate of one-half of one (0.5%) percent per month prescribed by 

27 Section 6 of the Reclamation Project Act of 1939 (Public Law 76-260). The interest 

28 charge rate shall be determined as of the due date and remain fixed for the duration of the 

29 delinquent period. 

30 

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

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

33 to the accrued interest, and finally to the overdue payment. 

34 

35 QUALITY OF WATER

36 13 14. The operation and maintenance of Project facilities shall be performed in 

37 such manner as is practicable to maintain the quality of raw water made available through 

38 such facilities at the highest level reasonably attainable as determined by the Contracting 

39 Officer. The United States does not warrant the quality of water and is under no 
 SRSC Draft 05/31/02

25

1 obligation to construct or furnish water treatment facilities to maintain or better the 

2 quality of water. 

3 WATER AND AIR POLLUTION CONTROL

4 14 15. The Contractor, in carrying out this Settlement Contract, shall comply 

5 with all applicable water and air pollution laws and regulations of the United States and 

6 the State of California, and shall obtain all required permits or licenses from the 

7 appropriate Federal, State, or local authorities. 

8 EQUAL OPPORTUNITY

9 

10 15 16. During the performance of this Settlement Contract, the Contractor agrees 

11 as follows: 

12 

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

14 for employment because of race, color, religion, sex, or national origin. The Contractor 

15 will take affirmative action to ensure that applicants are employed, and that employees 

16 are treated during employment, without regard to their race, color, religion, sex, or 

17 national origin. Such action shall include, but not be limited to, the following: 

18 Employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; 

19 layoff or termination, rates of payment or other forms of compensation; and selection for 

20 training, including apprenticeship. The Contractor agrees to post in conspicuous places, 

21 available to employees and applicants for employment, notices to be provided by the 

22 Contracting Officer setting forth the provisions of this nondiscrimination clause. 

23 

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

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

26 consideration for employment without discrimination because of race, color, religion, 

27 sex, or national origin. 

28 

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

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

31 notice, to be provided by the Contracting Officer, advising the said labor union or 

32 workers' representative of the Contractor's commitments under Section 202 of Executive 

33 Order 11246 of September 24, 1965, and shall post copies of the notice in conspicuous 

34 places available to employees and applicants for employment. 

35 

36 (d) The Contractor will comply with all provisions of Executive Order No. 

37 11246 of September 24, 1965, as amended, and of the rules, regulations, and relevant 

38 orders of the Secretary of Labor. 

39 
 SRSC Draft 05/31/02

26

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

2 amended Executive Order and by the rules, regulations, and orders of the Secretary of 

3 Labor, or pursuant thereto, and will permit access to its books, records, and accounts by 

4 the Contracting Officer and the Secretary of Labor for purposes of investigation to 

5 ascertain compliance with such rules, regulations, and orders. 

6 

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

8 clauses of this Settlement Contract or with any of the said rules, regulations, or orders, 

9 this Settlement Contract may be canceled, terminated, or suspended, in whole or in part, 

10 and the Contractor may be declared ineligible for further Government contracts in 

11 accordance with procedures authorized in said amended Executive Order, and such other 

12 sanctions may be imposed and remedies invoked as provided in said Executive Order, or 

13 by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law. 

14 

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

16 in every subcontract or purchase order unless exempted by the rules, regulations, or 

17 orders of the Secretary of Labor issued pursuant to Section 204 of said amended 

18 Executive Order, so that such provisions will be binding upon each subcontractor or 

19 vendor. The Contractor will take such action with respect to any subcontract or purchase 

20 order as may be directed by the Secretary of Labor as a means of enforcing such 

21 provisions, including sanctions for noncompliance: Provided, however, That that in the 

22 event the Contractor becomes involved in, or is threatened with, litigation with a 

23 subcontractor or vendor as a result of such direction, the Contractor may request the 

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

25 

26 COMPLIANCE WITH CIVIL RIGHTS LAWS AND REGULATIONS

27 (For Districts Only) 

28 

29 16 17. (a) The Contractor shall comply with Title VI of the Civil Rights Act of 

30 1964 (42 U.S.C. 2000d), Section 504 of the Rehabilitation Act of 1975 (P.L. 93-112, as 

31 amended), the Age Discrimination Act of 1975 (42 U.S.C. 6101, et seq.) and any other 

32 applicable civil rights laws, as well as with their respective implementing regulations and 

33 guidelines imposed by the U.S. Department of the Interior and/or Bureau of Reclamation. 

34 

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

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

37 in, be denied the benefits of, or be otherwise subjected to discrimination under any 

38 program or activity receiving financial assistance from the Bureau of Reclamation. By 

39 executing this Settlement Contract, the Contractor agrees to immediately take any 

40 measures necessary to implement this obligation, including permitting officials of the 

41 United States to inspect premises, programs, and documents. 

42 

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

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

45 other Federal financial assistance extended after the date hereof to the Contractor by the 

46 Bureau of Reclamation, including installment payments after such date on account of 
 SRSC Draft 05/31/02

27

1 arrangements for Federal financial assistance which were approved before such date. 

2 The Contractor recognizes and agrees that such Federal assistance will be extended in 

3 reliance on the representations and agreements made in this Article, and that the United 

4 States reserves the right to seek judicial enforcement thereof. 

5 

6 MINGLING OF CONTRACTOR’S PROJECT AND NON-PROJECT WATER

7 17 18. (a) Project Water must of necessity be transported by the Contractor to its 

8 water users by means of the same works and channels used for the transport of its non9 Project Water including Base Supply. Notwithstanding such mingling of water, the 

10 provisions of Article 11 hereof shall be applicable only to Project Water, and such 

11 mingling of water shall not in any manner subject to the provisions of Article 11 hereof 

12 the Contractor’s non-Project water including Base Supply. 

13 (b) If required in accordance with subdivision (c) of this Article, the 

14 Contractor shall install and maintain such measuring equipment and distribution facilities 

15 and maintain such records as may be necessary to determine the amounts of water 

16 delivered to Excess Lands served by the Contractor. The Contractor shall not within any 

17 month deliver to Ineligible Lands water in excess of the non-Project Water, including 

18 Base Supply, for that month. The Contracting Officer or authorized representative shall 

19 have the right at all reasonable times to inspect such records and measuring equipment. 

20 (c) The Contractor will not be considered in violation of the requirement that 

21 Project Water be delivered only to Eligible Lands during any month of the irrigation 

22 season that the water requirement for beneficial use on Eligible Lands for that month is 

23 equal to or in excess of the Project Water for that month as shown on Exhibit A or any 

24 revision thereof pursuant to subdivision (b) of Article 3. The water requirement for 

25 beneficial use on Eligible Lands will be determined by multiplying: 
 SRSC Draft 05/31/02

28

1 (1) the number of irrigable acres of the particular types of crops grown in 

2 that year on the acreage designated as eligible by 

3 (2) the Unit Duties as set forth in Exhibit C attached hereto and made a 

4 part hereof, or by such other Unit Duties mutually agreed upon by the Contractor and the 

5 Contracting Officer. In order to make the computation of the water requirement for 

6 Eligible Lands, on April 1 of each Year and concurrently with its order for water for the 

7 irrigation season, the Contractor shall designate the acreage of and type of crops to be 

8 grown on its Eligible Lands that irrigation season. During any month the water 

9 requirement as above determined for crops growing on Eligible Lands during such month 

10 is equal to or in excess of the Project Water for that month as provided herein the 

11 Contractor shall not be required to measure the water delivered to Excess Lands. Any 

12 month the said water requirement is less than the amount of Project Water as provided 

13 herein, the Contractor will be required to measure water delivered to excess land in 

14 accordance with subdivision (b) hereof. 

15 BOOKS, RECORDS, AND REPORTS

16 18 19. The Contractor shall establish and maintain accounts and other books and 

17 records pertaining to administration of the terms and conditions of this Settlement

18 Contract, including: the Contractor's financial transactions, water supply data, and 

19 Project land and right-of-way agreements; the water users' land-use (crop census), land 

20 ownership, land-leasing and water use data; and other matters that the Contracting 

21 Officer may require. Reports thereon shall be furnished to the Contracting Officer in 

22 such form and on such date or dates as the Contracting Officer may require. Subject to 

23 applicable Federal laws and regulations, each party to this Settlement Contract shall have 

24 the right during office hours to examine and make copies of each other’s books and 

25 official records relating to matters covered by this Settlement Contract. 

26 

27 CHANGE OF PLACE OF USE OR ORGANIZATION

28 19 20. (a) Unless the written consent of the United States is first obtained

29 consulted no change shall be made in the place of water use shown on Exhibit B. 
 SRSC Draft 05/31/02

29

1 (b) While this contract Settlement Contract is in effect, no change shall be 

2 made in the area of the Contractor as shown on its Exhibit B, by inclusion or exclusion of 

3 lands, by dissolution, consolidation, or merger or otherwise, except upon unless the 

4 Contracting Officer’s written assent thereto Officer is first consulted. 

5 (c) In the event lands are excluded from the area of the Contractor, as 

6 provided herein, the quantity of Project Water to be diverted may be decreased pursuant 

7 to a supplemental agreement to be executed in respect thereto. 

8 CONSOLIDATION OF CONTRACTING ENTITIES

9 

10 20 21. Consolidation of Contractors may will be approved by the Contracting 

11 Officer upon request provided: (i) the Contracting Officer approves the form and 

12 organization of the resulting entity and the utilization by it of the Contract Total; and (ii) 

13 the obligations of the Contractors are assumed by such the resulting entity. 

14 No such consolidation shall be valid unless and until approved by the Contracting 

15 Officer.

16 NOTICES

17 21 22. Any notice, demand, or request authorized or required by this Settlement

18 Contract shall be deemed to have been given, on behalf of the Contractor, when mailed, 

19 postage prepaid, or delivered to the Area Manager, Northern California Area Office, 

20 Bureau of Reclamation, 16349 Shasta Dam Blvd., Shasta Lake, California, 96019, and on 

21 behalf of the United States, when mailed, postage prepaid, or delivered to the Board of 

22 Directors /City Council of the ________________________. The designation of the 

23 addressee or the address may be changed by notice given in the same manner as provided 

24 in this Article for other notices. 

25 

26 ASSIGNMENT LIMITED--SUCCESSORS AND ASSIGNS OBLIGATED

27 

28 22 23. (a) The provisions of this Settlement Contract shall apply to and bind the 

29 successors and assigns of the parties hereto, but no assignment or transfer of this 

30 Settlement Contract or any right or interest therein shall be valid until approved in writing 

31 by the Contracting Officer. 

32 
 SRSC Draft 05/31/02

30

1 (b) The assignment of any right or interest in this Settlement Contract by 

2 either party shall not interfere with the rights or obligations of the other party to this 

3 Settlement Contract absent the written concurrence of said other party. 

4 

5 (c) The Contracting Officer shall not unreasonably condition or withhold his 

6 approval of any proposed assignment. 

7 

8 OFFICIALS NOT TO BENEFIT

9 

10 23 24. (a) No Member of or Delegate to Congress, Resident Commissioner, or 

11 official of the Contractor shall benefit from this Settlement Contract other than as a water 

12 user or landowner in the same manner as other water users or landowners. 

13 

14 (b) No officer or member of the governing board of the Contractor shall 

15 receive any benefit that may arise by reason of this contract Settlement Contract other 

16 than as a landowner within the Contractor’s service area and in the same manner as other 

17 landowners within the said service area. 

18 

19 CONTINGENT UPON APPROPRIATION OR ALLOTMENT OF FUNDS

20 

21 24 25. The expenditure or advance of any money or the performance of any 

22 obligation of the United States under this Settlement Contract shall be contingent upon 

23 appropriation or allotment of funds. Absence of appropriation or allotment of funds shall 

24 not relieve the Contractor from any obligations under this Settlement Contract. No 

25 liability shall accrue to the United States in case funds are not appropriated or allotted. 

26 

27 CONFIRMATION OF SETTLEMENT CONTRACT

28 25 26. The Contractor, after the execution of this Settlement Contract, shall 

29 promptly seek to secure a decree of a court of competent jurisdiction of the State of 

30 California, if appropriate, confirming the execution of this contract Settlement Contract. 

31 The Contractor shall furnish the United States a certified copy of the final decree, the 

32 validation proceedings, and all pertinent supporting records of the court approving and 

33 confirming this Settlement Contract, and decreeing and adjudging it to be lawful, valid, 

34 and binding on the Contractor. This Settlement Contract shall not be binding on the 

35 United States until such final decree has been secured. 

36 

37 UNAVOIDABLE GROUNDWATER PERCOLATION

38 26 27. To the extent applicable, the Contractor shall not be deemed to have 

39 delivered Project Water to Excess Lands or Ineligible Lands if such lands are irrigated 

40 with groundwater that reaches the underground strata as an unavoidable result of the 

41 delivery of Project Water by the Contractor to Eligible Lands. 
 SRSC Draft 05/31/02

31

1 PRIVACY ACT COMPLIANCE

2 

3 27 28. (a) The Contractor shall comply with the Privacy Act of 1974 (5 U.S.C. 

4 552a) (the Act) and the Department of the Interior rules and regulations under the Act (43 

5 CFR 2.45 et seq.) in maintaining Landholder acreage certification and reporting records, 

6 required to be submitted to the Contractor for compliance with Sections 206 and 228 of 

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

8 

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

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

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

12 are considered to be employees of the Department of the Interior. See 5 U.S.C. 552a(m). 

13 

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

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

16 Bureau of Reclamation Federal Register Privacy Act System of Records Notice (Acreage 

17 Limitation--Interior, Reclamation-31) which govern the maintenance, safeguarding, and 

18 disclosure of information contained in the Landholder's certification and reporting 

19 records. 

20 

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

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

23 decisions on denials pursuant to 43 CFR 2.61 and 2.64 amendment requests pursuant to 

24 43 CFR 2.72. The Contractor is authorized to grant requests by individuals for access to 

25 their own records. 

26 

27 (e) The Contractor shall forward promptly to the System Manager each 

28 proposed denial of access under 43 CFR 2.64; and each request for amendment of records 

29 filed under 43 CFR 2.71; notify the requester accordingly of such referral; and provide 

30 the System Manager with information and records necessary to prepare an appropriate 

31 response to the requester. These requirements do not apply to individuals seeking access 

32 to their own certification and reporting forms filed with the Contractor pursuant to 43 

33 CFR 426.18, unless the requester elects to cite the Privacy Act as a basis for the request. 

34 

35 WATER CONSERVATION

36 28 29. [TO BE REPLACED]. (a) Prior to the diversion of Project Water, the 

37 Contractor shall be implementing an effective water conservation and efficiency program 

38 based on the Contractor's water conservation plan that has been determined by the 

39 Contracting Officer to meet the conservation and efficiency criteria for evaluating water 

40 conservation plans established under Federal law. The water conservation and efficiency 
 SRSC Draft 05/31/02

32

1 program shall contain definite water conservation objectives, appropriate economically 

2 feasible water conservation measures, and time schedules for meeting those objectives. 

3 Continued diversion of Project Water pursuant to this Settlement Contract shall be 

4 contingent upon the Contractor’s continued implementation of such water conservation 

5 program. In the event the Contractor's water conservation plan or any revised water 

6 conservation plan completed pursuant to subdivision (c) of Article 28 of this Settlement

7 Contract have not yet been determined by the Contracting Officer to meet such criteria, 

8 due to circumstances which the Contracting Officer determines are beyond the control of 

9 the Contractor, Project Water deliveries shall be made under this Settlement Contract so 

10 long as the Contractor diligently works with the Contracting Officer to obtain such 

11 determination at the earliest practicable date, and thereafter the Contractor immediately 

12 begins implementing its water conservation and efficiency program in accordance with 

13 the time schedules therein.

14 (b) The Contractor shall submit to the Contracting Officer a report on the 

15 status of its implementation of the water conservation plan on the reporting dates 

16 specified in the then existing conservation and efficiency criteria established under 

17 Federal law.

18 (c) At five (5)-year intervals, the Contractor shall revise its water 

19 conservation plan to reflect the then current conservation and efficiency criteria for 

20 evaluating water conservation plans established under Federal law and submit such 

21 revised water management plan to the Contracting Officer for review and evaluation. 

22 The Contracting Officer will then determine if the water conservation plan meets 
 SRSC Draft 05/31/02

33

1 Reclamation’s then current conservation and efficiency criteria for evaluating water 

2 conservation plans established under Federal law. 

3 (d) If the Contractor is engaged in direct ground-water recharge, such activity 

4 shall be described in the Contractor’s water conservation plan.

5 OPINIONS AND DETERMINATIONS

6 

7 29 30. (a) Where the terms of this Settlement Contract provide for actions to be 

8 based upon the opinion or determination of either party to this Settlement Contract, said 

9 terms shall not be construed as permitting such action to be predicated upon arbitrary, 

10 capricious, or unreasonable opinions or determinations. Both parties, notwithstanding 

11 any other provisions of this Settlement Contract, expressly reserve the right to seek relief 

12 from and appropriate adjustment for any such arbitrary, capricious, or unreasonable 

13 opinion or determination. Each opinion or determination by either party shall be 

14 provided in a timely manner. Nothing in subdivision (a) of Article 29 of this Settlement

15 Contract is intended to or shall affect or alter the standard of judicial review applicable 

16 under federal law to any opinion or determination implementing a specific provision of 

17 federal law embodied in statute or regulation. 

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

19 necessary to administer this Settlement Contract that are consistent with the provisions of 

20 this Settlement Contract, the laws of the United States and of the State of California, and 

21 the rules and regulations promulgated by the Secretary of the Interior. Such 

22 determinations shall be made in consultation with the Contractor to the extent reasonably 

23 practicable. 
 SRSC Draft 05/31/02

34

1 CONTRACTOR TO PAY CERTAIN MISCELLANEOUS COSTS

2 30 31. (a) In addition to all other payments to be made by the Contractor 

3 pursuant to this Settlement Contract, the Contractor shall pay to the United States, within 

4 sixty (60) days after receipt of a bill and detailed statement submitted by the Contracting 

5 Officer to the Contractor for such specific items of direct cost incurred by the United 

6 States for work requested by the Contractor associated with this Settlement Contract plus 

7 indirect costs in accordance with applicable Bureau of Reclamation policies and 

8 procedures. All such amounts referred to in this Article shall not exceed the amount 

9 agreed to in writing in advance by the Contractor. This Article shall not apply to costs 

10 for routine contract Settlement Contract administration. 

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

12 Contractor pursuant to Article 30 of this Settlement Contract shall be adjusted to reflect 

13 the actual costs when the work has been completed. If the advances exceed the actual 

14 costs incurred, the difference will be refunded to the Contractor. If the actual costs 

15 exceed the Contractor's advances, the Contractor will be billed for the additional costs 

16 pursuant to Article 30 of this Settlement Contract. 

17 WAIVER OF DEFAULT

18 31 32. The waiver by either party to this contract Settlement Contract as to any 

19 default shall not be construed as a waiver of any other default or as authority of the other 

20 party to continue such default or to make, do, or perform, or not to make, do, or perform, 

21 as the case may be, any act or thing which would constitute a default. 
 SRSC Draft 05/31/02

35

1 IN WITNESS WHEREOF, the parties hereto have executed this contract

2 Settlement Contract as of the day and year first hereinabove written. 

3 

4 THE UNITED STATES OF AMERICA 

5 

6 

7 

8 By: __________________________ 

9 Regional Director, Mid-Pacific Region 

10 Bureau of Reclamation 

11 

12 

13 (SEAL) 

14 

15 

16 (Contractor) 

17 

18 

19 By:______________________________ 

20 President 

21 

22 

23 ATTEST: 

24 

25 

26 ________________________________ 

27 Secretary 

28 

29 

30 (I:\sac river renewal\Sac R Long Form Draft.doc) 

31