Irrigation and M&I 

R. O. Draft 11/29-2004 

Contract No. 

14-06-200-3365A-LTR1-B 

UNITED STATES 

DEPARTMENT OF THE INTERIOR 

BUREAU OF RECLAMATION 

Central Valley Project, California 

LONG-TERM RENEWAL CONTRACT AMONG THE UNITED STATES

PAJARO VALLEY WATER MANAGEMENT AGENCY,

WESTLANDS WATER DISTRICT DISTRIBUTION DISTRICT NO. 1,

AND SANTA CLARA VALLEY WATER DISTRICT

PROVIDING FOR PROJECT WATER SERVICE

FROM THE DELTA DIVISION

Table of Contents

Article No. Title Page No.

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

 Explanatory Recitals ............................................................................................ 2-5 

 1 Definitions.......................................................................................................... 6-10 

 2 Term of Contract..............................................................................................10-14

 3 Water to be Made Available and Delivered to the Contractor.........................14-18 

 4 Time for Delivery of Water .............................................................................18-19 

 5 Point of Diversion and Responsibility for Distribution of Water.................... 19-21 

 6 Measurement of Water Within the Contractor’s Service Area........................ 21-23 

 7 Rates and Method of Payment for Water.........................................................23-29 

 8 Non-Interest Bearing Operation and Maintenance Deficits.................................. 30 

 9 Sales, Transfers, or Exchanges of Water .........................................................30-31 

 10 Application of Payments and Adjustments......................................................31-32 

 11 Temporary Reductions--Return Flows ............................................................ 32-33 

 12 Constraints on the Availability of Water ......................................................... 33-35 

 13 Unavoidable Groundwater Percolation............................................................ 35-36 

 14 Rules and Regulations........................................................................................... 36 

 15 Water and Air Pollution Control........................................................................... 36 

 16 Quality of Water .............................................................................................. 36-37 

 17 Water Acquired by the Contractor Other Than From the United States..........37-39 

 18 Opinions and Determinations ............................................................................... 40 

 19 Coordination and Cooperation......................................................................... 40-42 

 20 Charges for Delinquent Payments ........................................................................ 42
Contract No. 14-06-200-3365A-LTR1-B 

Table of Contents - continued

Article No. Title Page No.

 21 Equal Opportunity............................................................................................42-43 

 22 General Obligation--Benefits Conditioned Upon Payment .................................. 44 

 23 Compliance With Civil Rights Laws and Regulations ......................................... 44 

 24 Privacy Act Compliance ..................................................................................44-45 

 25 Contractor to Pay Certain Miscellaneous Costs.................................................... 45 

 26 Water Conservation .........................................................................................46-47 

 27 Existing or Acquired Water or Water Rights........................................................ 47 

 28 Operation and Maintenance by the San Luis & Delta-Mendota 

 Water Authority ..........................................................................................47-49 

 28.1 Operation and Maintenance by the California Department of 

 Water Resources .........................................................................................49-51 

 29 Contingent on Appropriation or Allotment of Funds ........................................... 51 

 30 Books, Records, and Reports................................................................................ 51 

 31 Assignment Limited--Successors and Assigns Obligated .................................... 52 

 32 Severability ......................................................................................................52-53 

 33 Resolution of Disputes.......................................................................................... 53 

 34 Officials Not to Benefit......................................................................................... 53 

 35 Changes in Contractor’s Service Area............................................................. 53-54 

 36 Federal Laws......................................................................................................... 54 

 37 Notices .................................................................................................................. 54

 38 Confirmation of Contract.................................................................................54-55 

 Signature Page ................................................................................................. 55-56 

 Exhibit A - Map of Contractor's Service Area 

 Exhibit B - Rates and Charges
R. O. Draft 11/29-2004 

Contract No. 

 14-06-200-3365A-LTR1-B

1 UNITED STATES 

2 DEPARTMENT OF THE INTERIOR 

3 BUREAU OF RECLAMATION 

4 Central Valley Project, California 

5 LONG-TERM RENEWAL CONTRACT AMONG THE UNITED STATES

6 PAJARO VALLEY WATER MANAGEMENT AGENCY,

7 WESTLANDS WATER DISTRICT DISTRIBUTION DISTRICT NO. 1,

8 AND SANTA CLARA VALLEY WATER DISTRICT

9 PROVIDING FOR PROJECT WATER SERVICE

10 FROM THE DELTA DIVISION

 THIS CONTRACT, made this 11 _____ day of ____________________, 2005, in pursuance 

12 generally of the Act of June 17, 1902 (32 Stat. 388), and acts amendatory or supplementary thereto, 

13 including, but not limited to, the Acts of August 26, 1937 (50 Stat. 844), as amended and 

14 supplemented, August 4, 1939 (53 Stat. 1187), as amended and supplemented, July 2, 1956 (70 Stat. 

15 483), June 21, 1963 (77 Stat. 68), October 12, 1982 (96 Stat. 1263), October 27, 1986 (100 Stat. 

16 3050), as amended, and Title XXXIV of the Act of October 30, 1992 (106 Stat. 4706), all 

17 collectively hereinafter referred to as Federal Reclamation law, between THE UNITED STATES 

18 OF AMERICA, hereinafter referred to as the United States, and PAJARO VALLEY WATER 

19 MANAGEMENT AGENCY (PVWMA), WESTLANDS WATER DISTRICT DISTRIBUTION 

20 DISTRICT NO. 1 (WWD-DD1), and SANTA CLARA VALLEY WATER DISTRICT (SCVWD), 

21 hereinafter collectively referred to as “the Contractors,” and each individually as “Contractor,” each 

22 a public agency of the State of California, duly organized, existing, and acting pursuant to the laws 

23 thereof; 

24 WITNESSETH, That:
Contract No. 14-06-200-3365A-LTR1-B

2

25 EXPLANATORY RECITALS

 [1st 26 ] WHEREAS, the United States has constructed and is operating the Central Valley 

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

28 flood control, irrigation, municipal, domestic, industrial, fish and wildlife mitigation, protection and 

29 restoration, generation and distribution of electric energy, salinity control, navigation and other 

30 beneficial uses, of waters of the Sacramento River, the American River, the Trinity River, and the 

31 San Joaquin River and their tributaries; and 

 [2nd 32 ] WHEREAS, the United States constructed the Delta Mendota Canal and related 

33 facilities, which will be used in part for the furnishing of water to the Contractor(s) pursuant to the 

34 terms of this Contract; and 

 [3rd 35 ] WHEREAS, the rights to Project Water were acquired by the United States pursuant 

36 to California law for operation of the Project; and 

 [4th 37 ] WHEREAS, the Mercy Springs Water District (MSWD) and the United States 

38 entered into Contract No. 14-06-200-3365, as amended, which established terms for the delivery to 

39 the MSWD of Project Water from the Delta Division Facilities from June 21, 1967,through 

40 February 28, 1995; and 

 [5th 41 ] WHEREAS, MSWD and the United States have pursuant to subsection 3404(c)(1) of 

42 the Central Valley Project Improvement Act (CVPIA), subsequently entered into interim renewal 

43 contracts identified as Contract No(s). 14-06-200-3365A-IR1 and 14-06-200-3365-IR2, which 

44 provided for the continued water service to MSWD from March 1, 1995, through February 29, 

45 2000; and 

46 [5.1] WHEREAS during the term of Contract No. 14-06-200-3365A-IR2 and following 

47 the approval of the United States, MSWD assigned to the Contractors on May 14, 1999, the right, 
Contract No. 14-06-200-3365A-LTR1-B

3

48 title, and interest in that portion of Contract No. 14-06-200-3365A-IR2 consisting of 6,260 acre-feet 

49 of Project Water, including any rights to renew that partial interest in Contract No. 14-06-200-

50 3365A-IR2 (this transaction is referred to as “the Assignment”); and 

51 [5.2] WHEREAS, concurrent with the Assignment, the Contractors entered into a separate 

52 agreement, entitled “Agreement Relating to Partial Assignment of Water Service Contract,” dated 

53 May 14, 1999, stating the terms and conditions by which the Contractors would share the assigned 

54 Project Water supply. Consistent with the Agreement Relating to Partial Assignment of Water 

55 Service Contract and SCVWD’s Integrated Water Resources Plan, water available to SCVWD 

56 under this Contract is used to provide a more reliable water supply to its customers when shortages 

57 occur in its CVP Water Service Contract No. 7-07-20-W0023 water supplies and other water 

58 supplies; and

59 [5.3] WHEREAS, the Contractors and the United States have subsequent to the 

60 Assignment entered into interim renewal contracts identified as Contract Nos. 14-06-200-3365A61 IR3-B, 14-06-200-3365A-IR4-B, 14-06-200-3365A-IR5-B, 14-06-200-3365A-IR6-B, 14-06-200-

62 3365A-IR7-B, and 14-06-200-3365A-IR8-B, the current of which is hereinafter referred to as the 

63 Existing Contract, which provided for continued water service to the Contractors from March 1, 

64 2004, through February 28, 2006; 

65 [5.4] WHEREAS, the United States and SCVWD entered into Contract 

66 No. 6-07-20-X0290 for the transfer of the operation and maintenance of certain San Felipe Division 

67 facilities to SCVWD, and said contract requires any entity receiving CVP water through San Felipe 

68 Division facilities to pay SCVWD an equitable share of the operation and maintenance of certain 

69 joint-use San Felipe Division facilities pursuant to the terms of that contract; and
Contract No. 14-06-200-3365A-LTR1-B

4

[6th 70 ] WHEREAS, Section 3404(c) of the CVPIA provides for long-term renewal of the 

71 Existing Contract following completion of appropriate environmental documentation, including a 

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

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

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

 [7th 75 ] WHEREAS, the United States has completed the PEIS and all other appropriate 

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

 [8th 77 ] WHEREAS, the Contractors have requested the long-term renewal of the Existing 

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

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

 [9th 80 ] WHEREAS, the United States has determined that each Contractor has fulfilled all 

81 of its obligations under the Existing Contract; and 

 [10th 82 ] WHEREAS, each Contractor has demonstrated to the satisfaction of the Contracting 

83 Officer that the Contractor has utilized the Project Water supplies available to it for reasonable and 

84 beneficial use and/or has demonstrated projected future demand for water use such that the 

85 Contractor has or will have the capability and expects to utilize fully for reasonable and beneficial 

86 use the quantity of Project Water to be made available to it pursuant to this Contract; and 

 [11th 87 ] WHEREAS, water obtained from the Project has been relied upon by urban and 

88 agricultural areas within California for more than 50 years, and is considered by each Contractor as 

89 an essential portion of its water supply; and 

 [12th 90 ] WHEREAS, the economies of regions within the Project, including the Contractors, 

91 depend upon the continued availability of water, including water service from the Project; and 
Contract No. 14-06-200-3365A-LTR1-B

5

 [13th 92 ] WHEREAS, the Secretary intends through coordination, cooperation, and 

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

94 Project for all Project purposes; and 

 [14th 95 ] WHEREAS, the mutual goals of the United States and the Contractors include: to 

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

97 of the Project as required by law; to guard reasonably against Project Water shortages; to achieve a 

98 reasonable balance among competing demands for use of Project Water; and to comply with all 

99 applicable environmental statutes, all consistent with the legal obligations of the United States 

100 relative to the Project; and 

 [15th 101 ] WHEREAS, the parties intend by this Contract to develop a more cooperative 

102 relationship in order to achieve their mutual goals; and 

103 [15.1] WHEREAS, each Contractor has utilized or may utilize transfers, contract 

104 assignments, rescheduling and conveyance of Project Water and non-Project water under this 

105 Contract as tools to minimize the impacts of Conditions of Shortage and to maximize the beneficial 

106 use of water; and 

107 [15.2] WHEREAS, the parties desire and intend that this Contract not provide a 

108 disincentive to the Contractors in continuing to carry out the beneficial activities set out in the 

109 Explanatory Recital immediately above; and 

 [16th 110 ] WHEREAS, the United States and the Contractors are willing to enter into this 

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

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

113 contained, it is hereby mutually agreed by the parties hereto as follows: 
Contract No. 14-06-200-3365A-LTR1-B

6

114 DEFINITIONS

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

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

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

118 dates inclusive; 

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

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

121 annually by the Contracting Officer pursuant to this Contract; 

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

123 any Year such that the Contracting Officer is unable to deliver sufficient water to meet the Contract 

124 Total; 

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

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

127 regulation; 

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

129 Contractor(s) is(are) entitled under subdivision (a) of Article 3 of this Contract; 

130 (f) “Contractor's Service Area” shall mean the respective area to which each

131 Contractor is permitted to provide Project Water under this Contract as described in Exhibits “A-1,” 

132 “A-2,” and “A-3” attached hereto, each of which may be modified from time to time in accordance 

133 with Article 35 of this Contract without amendment of this Contract; 

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

135 XXXIV of the Act of October 30, 1992 (106 Stat. 4706); 
Contract No. 14-06-200-3365A-LTR1-B

7

136 (g.1) “Delta Division Facilities” shall mean those existing and future Project 

137 facilities in and south of the Sacramento-San Joaquin Rivers Delta, including, but not limited to, the 

138 Tracy Pumping Plant, the O’Neill Forebay, the O’Neill Pumping/Generating Plant, and the San Luis 

139 Reservoir, used to divert, store, and convey water to those Project Contractors entitled to receive 

140 water conveyed through the Delta-Mendota Canal; 

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

142 delivered in accordance with Section 204 of the Reclamation Reform Act of October 12, 1982 (96 

143 Stat. 1263), as amended, hereinafter referred to as RRA; 

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

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

146 Reclamation law; 

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

148 Officer that shall amortize the expenditures for construction properly allocable to the Project 

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

150 funded, less payments, over such periods as may be required under Federal Reclamation law, or 

151 applicable contract provisions. Interest will accrue on both the construction expenditures and 

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

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

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

155 operation, maintenance, and replacement costs consistent with Section 426.2 of the Rules and 

156 Regulations for the RRA; 

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

158 delivered in accordance with Section 204 of the RRA; 
Contract No. 14-06-200-3365A-LTR1-B

8

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

160 the delivery of Irrigation Water; 

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

162 used primarily in the production of agricultural crops or livestock, including domestic use incidental 

163 thereto, and watering of livestock; 

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

165 nonexempt land, as provided in 43 CFR 426.2; 

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

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

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

169 which are kept for personal enjoyment or water delivered to landholdings operated in units of less 

170 than five acres unless the Contractor establishes to the satisfaction of the Contracting Officer that 

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

172 Article; 

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

174 delivery of M&I Water; 

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

176 care, control, operation, repair, replacement (other than capital replacement), and maintenance of 

177 Project facilities; 

178 (r) “Operating Non-Federal Entity” shall mean the entity(ies), its (their) 

179 successors or assigns, which has (have) the obligation to operate and maintain all or a portion of the 

180 Delta Division Facilities pursuant to written agreement(s) with the United States. When this 

181 Contract was entered into, the Operating Non-Federal Entities were the San Luis & Delta-Mendota 
Contract No. 14-06-200-3365A-LTR1-B

9

182 Water Authority and, with respect to the San Luis Unit facilities, the California Department of 

183 Water Resources; 

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

185 and managed by the Department of the Interior, Bureau of Reclamation; 

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

187 for Project Water from the Project with the United States pursuant to Federal Reclamation law; 

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

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

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

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

192 Officer in accordance with the then current applicable water ratesetting policies for the Project, as 

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

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

195 the final forecast of Water Made Available to the Contractor(s) pursuant to this Contract or its 

196 preceding contract(s); 

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

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

199 through any agency of the Department of the Interior; 

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

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

202 (z) “Water Delivered” or “Delivered Water” shall mean Project Water diverted 

203 for use by the Contractor(s) at the point(s) of delivery approved by the Contracting Officer; 
Contract No. 14-06-200-3365A-LTR1-B

10

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

205 that can be delivered to the Contractor(s) for the upcoming Year as declared by the Contracting 

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

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

208 Contractor(s) for which times and quantities for delivery have been established by a Contractor and 

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

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

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

212 TERM OF CONTRACT

213 2. (a) This Contract shall be effective March 1, 2005, through February 28, 2030, 

214 and supersedes the Existing Contract. In the event the Contractor(s) wish(es) to renew this Contract 

215 beyond February 28, 2030, the Contractor(s) shall submit a request for renewal in writing to the 

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

217 this Contract insofar as it pertains to the furnishing of Irrigation Water to the Contractor(s) shall be 

218 governed by subdivision (b) of this Article, and the renewal of this Contract insofar as it pertains to 

219 the furnishing of M&I Water to the Contractor(s) shall be governed by subdivision (c) of this 

220 Article. 

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

222 agreeable to the United States and the Contractor(s) requesting renewal, and upon a determination 

223 by the Contracting Officer that at the time of contract renewal the conditions set forth in subdivision 

224 (b) (2) of this Article are met, and subject to Federal and State law, this Contract, insofar as it 

225 pertains to the furnishing of Irrigation Water to the Contractor(s), shall be renewed for a period of 

226 25 years. 
Contract No. 14-06-200-3365A-LTR1-B

11

227 (2) For each Contractor seeking renewal, the conditions which must be 

228 met for this Contract to be renewed by that Contractor are: (i) the Contractor has prepared a water 

229 conservation plan that has been determined by the Contracting Officer in accordance with Article 26 

230 of this Contract to meet the conservation and efficiency criteria for evaluating such plans 

231 established under Federal law; (ii) the Contractor is implementing an effective water conservation 

232 and efficiency program based on the Contractor’s water conservation plan as required by Article 26 

233 of this Contract; (iii) the Contractor is operating and maintaining all water measuring devices and 

234 implementing all water measurement methods as approved by the Contracting Officer pursuant to 

235 Article 6 of this Contract; (iv) the Contractor has reasonably and beneficially used the Project Water 

236 supplies made available to it and, based on projected demands, is reasonably anticipated and expects 

237 to fully utilize for reasonable and beneficial use the quantity of Project Water to be made available 

238 to it pursuant to such renewal; (v) the Contractor is complying with all terms and conditions of this 

239 Contract; and (vi) the Contractor has or will have the physical and legal ability to deliver Project 

240 Water. A failure by any Contractor to meet the conditions set forth in this subdivision will not 

241 preclude the United States and any other Contractor which has met the conditions set forth in this 

242 subdivision from renewing this Contract.

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

244 subdivision (b)(1) of this Article and any subsequent renewal contracts shall be developed 

245 consistent with the parties’ respective legal rights and obligations, and in consideration of all 

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

247 without limitation, the need by the Contractor(s) seeking renewal for continued delivery of Project 

248 Water; environmental conditions affected by implementation of the Contract to be renewed, and 

249 specifically changes in those conditions that occurred during the life of the Contract to be renewed; 
Contract No. 14-06-200-3365A-LTR1-B

12

250 the Secretary’s progress toward achieving the purposes of the CVPIA as set out in Section 3402 and 

251 in implementing the specific provisions of the CVPIA; and current and anticipated economic 

252 circumstances of the region served by the Contractor(s) seeking renewal. 

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

254 Contractor(s) seeking renewal, shall be renewed for successive periods of up to 40 years each, 

255 which periods shall be consistent with the then-existing Reclamation-wide policy, under terms and 

256 conditions mutually agreeable to the parties and consistent with Federal and State law. Each 

257 Contractor shall be afforded the opportunity to comment to the Contracting Officer on the proposed 

258 adoption and application of any revised policy applicable to the delivery of M&I Water that would 

259 limit the term of any subsequent renewal contract with the Contractor(s) for the furnishing of M&I 

260 Water to less than 40 years. 

261 (d) The Contracting Officer shall make a determination ten years after the date of 

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

263 whether a conversion of the relevant portion of this Contract to a contract under subsection 9(d) of 

264 the Reclamation Project Act of 1939 can be accomplished pursuant to the Act of July 2, 1956 (70 

265 Stat 483). The Contracting Officer shall also make a determination ten years after the date of 

266 execution of this Contract and every five years thereafter during the term of this Contract of whether 

267 a conversion of the relevant portion of this Contract to a contract under subsection 9(c)(1) of the 

268 Reclamation Project Act of 1939 can be accomplished. Notwithstanding any provision of this 

269 Contract, each Contractor reserves and shall have all rights and benefits under the Act of July 2, 

270 1956 (70 Stat. 483). The Contracting Officer anticipates that during the term of this Contract, all 

271 authorized Project construction expected to occur will have occurred, and on that basis the 

272 Contracting Officer agrees upon such completion to allocate all costs that are properly assignable to 
Contract No. 14-06-200-3365A-LTR1-B

13

273 the Contractor(s), and agrees further that, at any time after such allocation is made, and subject to 

274 satisfaction of the condition set out in this subdivision, this Contract shall, at the request of the 

275 Contractor(s) that maintain(s) a right to Project Water pursuant to the agreement set forth in Recital 

276 5.2, be converted to a contract under subsection 9(d) or 9(c)(1), whichever is applicable, of the 

277 Reclamation Project Act of 1939, subject to applicable Federal law and under stated terms and 

278 conditions mutually agreeable to the Contractor(s) entitled to receive water under the converted 

279 contract and the Contracting Officer. A condition for such conversion to occur shall be a 

280 determination by the Contracting Officer that, account being taken of the amount credited to return 

281 by the Contractor(s) entitled to receive water under the converted contract as provided for under 

282 Federal Reclamation law, the remaining amount of construction costs assignable for ultimate return 

283 by the Contractor(s) entitled to receive water under the converted contract can probably be repaid to 

284 the United States within the term of a contract under subsection 9(d) or 9(c)(1), whichever is 

285 applicable. If the remaining amount of costs that are properly assignable to the Contractor(s)

286 entitled to receive water under the converted contract cannot be determined during the term of this 

287 Contract, the Contracting Officer shall notify the Contractor(s) entitled to receive water under the 

288 converted contract, and provide the reason(s) why such a determination could not be made. Further, 

289 the Contracting Officer shall make such a determination as soon thereafter as possible so as to 

290 permit, upon request of the Contractor(s) entitled to receive water under the converted contract and 

291 satisfaction of the conditions set out above, conversion to a contract under subsection 9(d) or 

292 9(c)(1), whichever is applicable. In the event such determination of costs has not been made at a 

293 time which allows conversion of this Contract during the term of this Contract or the Contractor(s) 

294 has not requested conversion of this Contract within such term, the parties shall incorporate in any 
Contract No. 14-06-200-3365A-LTR1-B

14

295 subsequent renewal contract as described in subdivision (b) of this Article a provision that carries 

296 forth in substantially identical terms the provisions of this subdivision. 

297 WATER TO BE MADE AVAILABLE AND DELIVERED TO THE CONTRACTOR

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

299 and licenses; Federal law; and subject to the provisions set forth in Articles 11 and 12 of this 

300 Contract, the Contracting Officer shall make available for delivery to the Contractor(s) up to a total 

301 of 6,260 acre-feet of Project Water for irrigation and M&I purposes. Water Delivered to the 

302 Contractor(s) in accordance with this subdivision shall be scheduled and paid for pursuant to the 

303 provisions of Articles 4 and 7 of this Contract. 

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

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

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

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

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

309 projected that the Contract Total set forth in this Contract will not be available to the Contractor in 

310 many years. During the most recent five years, the Recent Historic Average of Water Made 

311 Available to the Contractors was 4,119.08 acre-feet. Nothing in subdivision (b) of this Article shall 

312 affect the rights and obligations of the parties under any provision of this Contract. 

313 (c) Each Contractor shall utilize the Project Water in accordance with all 

314 applicable legal requirements. 

315 (c.1) In the event any Project Contractor (other than a Cross Valley Contractor) 

316 that receives Project Water through the Delta Division Facilities obtains a contractual agreement 

317 that the Contracting Officer shall make Project Water available at a point or points of delivery in or 
Contract No. 14-06-200-3365A-LTR1-B

15

318 north of the Delta, at the request of the Contractor(s) and upon completion of any required 

319 environmental documentation, this Contract shall be amended to provide for deliveries in or north 

320 of the Delta on mutually agreeable terms. Such amendments to the Contract shall be limited solely 

321 to those changes made necessary by the addition of such alternate points of delivery in or north of 

322 the Delta; Provided, That the Contracting Officer’s use of the Harvey O. Banks Pumping Plant to 

323 deliver Project Water does not trigger this right of amendment. 

324 (d) Each Contractor shall make reasonable and beneficial use of all water 

325 furnished pursuant to this Contract. Groundwater recharge programs (direct, indirect, or in lieu), 

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

327 utilizing Project Water or other water furnished pursuant to this Contract conducted within a

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

329 with Federal Reclamation law will be allowed; Provided, That any direct recharge program(s) is 

330 (are) described in the Contractor’s water conservation plan submitted pursuant to Article 26 of this 

331 Contract; Provided, further, That such water conservation plan demonstrates sufficient lawful uses 

332 exist in the Contractor’s Service Area so that using a long-term average, the quantity of Delivered 

333 Water is demonstrated to be reasonable for such uses and in compliance with Federal Reclamation 

334 law. Groundwater recharge programs, groundwater banking programs, surface water storage 

335 programs, and other similar programs utilizing Project Water or other water furnished pursuant to 

336 this Contract conducted outside of a Contractor’s Service Area may be permitted upon written 

337 approval of the Contracting Officer, which approval will be based upon environmental 

338 documentation, Project Water rights, and Project operational concerns. The Contracting Officer 

339 will address such concerns in regulations, policies, or guidelines. 
Contract No. 14-06-200-3365A-LTR1-B

16

340 (e) Each Contractor shall comply with requirements applicable to that Contractor 

341 in biological opinion(s) prepared as a result of a consultation regarding the execution of this 

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

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

344 which evidences in excess of 37 years of diversions for irrigation and/or M&I purposes of the 

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

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

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

348 Contractor(s) from challenging or seeking judicial relief in a court of competent jurisdiction with 

349 respect to any biological opinion or other environmental documentation referred to in this Article.

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

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

352 available to the Project, can be made available to the Contractor(s) in addition to the Contract Total 

353 under this Article during the Year without adversely impacting other Project Contractors. At the 

354 request of the Contractor(s), the Contracting Officer will consult with the requesting Contractor(s), 

355 prior to making such a determination. If the Contracting Officer determines that Project Water, or 

356 other water available to the Project, can be made available to the Contractor(s), the Contracting 

357 Officer will announce the availability of such water and shall so notify the Contractor(s) as soon as 

358 practical. The Contracting Officer will thereafter meet with the Contractor(s) and other Project 

359 Contractors capable of taking such water to determine the most equitable and efficient allocation of 

360 such water. If the Contractor(s) request(s) the delivery of any quantity of such water, the 

361 Contracting Officer shall make such water available to the requesting Contractor(s) in accordance 

362 with applicable statutes, regulations, guidelines, and policies. Subject to existing long-term 
Contract No. 14-06-200-3365A-LTR1-B

17

363 contractual commitments, water rights and operational constraints, long-term Project Contractors 

364 shall have a first right to acquire such water, including Project Water made available pursuant to 

365 Section 215 of the RRA. 

366 (g) Any Contractor may request permission to reschedule for use during the 

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

368 referred to as “rescheduled water.” Any Contractor may request permission to use during the 

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

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

371 approval may permit such uses in accordance with applicable statutes, regulations, guidelines, and 

372 policies. 

373 (h) Each Contractor’s right pursuant to Federal Reclamation law and applicable 

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

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

376 during the terms thereof shall not be disturbed so long as the Contractor(s) shall fulfill all of its 

377 obligations under this Contract and any renewals thereof. Nothing in the preceding sentence shall 

378 affect the Contracting Officer’s ability to impose shortages under Article 11 or subdivision (b) of 

379 Article 12 of this Contract or applicable provisions of any subsequent renewal contracts. 

380 (i) Project Water furnished to a Contractor pursuant to this Contract may be 

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

382 Contract upon a request by that Contractor and written approval by the Contracting Officer in 

383 accordance with the terms and conditions of such approval. 

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

385 rights necessary for the Project and to provide the water available under this Contract. The 
Contract No. 14-06-200-3365A-LTR1-B

18

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

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

388 That the Contracting Officer retains the right to object to the substance of any Contractor’s position 

389 in such a proceeding; Provided further, That in such proceedings the Contracting Officer shall 

390 recognize that each Contractor has a legal right under the terms of this Contract to use Project 

391 Water. 

392 TIME FOR DELIVERY OF WATER

 4. (a) On or about February 20th 393 of each Calendar Year, the Contracting Officer 

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

395 declaration will be expressed in terms of both Water Made Available and the Recent Historic 

396 Average and will be updated monthly, and more frequently if necessary, based on then-current 

397 operational and hydrologic conditions, and a new declaration with changes, if any, to the Water 

398 Made Available will be made. The Contracting Officer shall provide forecasts of Project operations 

399 and the basis of the estimate, with relevant supporting information, upon the written request of a

400 Contractor. Concurrently with the declaration of the Water Made Available, the Contracting 

401 Officer shall provide the Contractor(s) with the updated Recent Historic Average. 

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

403 Contractors shall submit to the Contracting Officer the Contractor(s)’ (combined) written schedule, 

404 satisfactory to the Contracting Officer, showing the monthly quantities of Project Water to be 

405 delivered by the United States to the Contractor(s) pursuant to this Contract for the Year 

406 commencing on such March 1. The Contracting Officer shall use all reasonable means to deliver 

407 Project Water according to the approved schedule for the Year commencing on such March 1. 
Contract No. 14-06-200-3365A-LTR1-B

19

408 (c) A Contractor shall not schedule Project Water in excess of the quantity of 

409 Project Water that the Contractor(s) intend to put to reasonable and beneficial use within each

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

411 during any Year. 

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

413 Contract, the United States shall deliver Project Water to the Contractor(s) in accordance with the 

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

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

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

417 POINT OF DIVERSION AND RESPONSIBILITY FOR DISTRIBUTION OF WATER

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

419 Contract shall be delivered to the Contractor(s) at a point or points and any additional point or 

420 points of delivery either on Project facilities or another location or locations mutually agreed to in 

421 writing by the Contracting Officer and the Contractor(s). 

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

423 agreement(s) with the Operating Non-Federal Entity(ies), shall make all reasonable efforts to 

424 maintain sufficient flows and levels of water in Project facilitiesto deliver Project Water to the 

425 Contractor(s) at the point or points of delivery established pursuant to subdivision (a) of this Article. 

426 (c) Each Contractor shall deliver Irrigation Water in accordance with any 

427 applicable land classification provisions of Federal Reclamation law and the associated regulations. 

428 Each Contractor shall not deliver Project Water to land outside that Contractor's Service Area unless 

429 approved in advance by the Contracting Officer. 
Contract No. 14-06-200-3365A-LTR1-B

20

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

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

432 Contracting Officer either directly or indirectly through its written agreement(s) with the Operating 

433 Non-Federal Entity(ies), unless undertaken by a Contractor with the consent of the Contracting 

434 Officer, at the point or points of delivery established pursuant to subdivision (a) of this Article. 

435 Upon the request of any party to this Contract, the Contracting Officer shall investigate, or cause to 

436 be investigated by the appropriate Operating Non-Federal Entity(ies), the accuracy of such 

437 measurements and shall take any necessary steps to adjust any errors appearing therein. For any 

438 period of time when accurate measurements have not been made, the Contracting Officer shall 

439 consult with the Contractor that is the subject of the request and the appropriate Operating Non440 Federal Entity(ies), if any, prior to making a final determination of the quantity delivered for that 

441 period of time. 

442 (e) Absent a separate contrary written agreement with any Contractor, neither the 

443 Contracting Officer nor any Operating Non-Federal Entity(ies) shall be responsible for the control, 

444 carriage, handling, use, disposal, or distribution of Water Delivered to a Contractor pursuant to this 

445 Contract beyond the point or points of delivery established pursuant to subdivision (a) of this 

446 Article. Each Contractor shall indemnify the United States, its officers, employees, agents, and 

447 assigns on account of damage or claim of damage of any nature whatsoever for which there is legal 

448 responsibility, including property damage, personal injury, or death arising out of or connected with 

449 the control, carriage, handling, use, disposal, or distribution of such Water Delivered to a Contractor 

450 beyond such point or points of delivery, except for any damage or claim arising out of: (i) acts or 

451 omissions of the Contracting Officer or any of its officers, employees, agents, and assigns, 

452 including the Operating Non-Federal Entity(ies), with the intent of creating the situation resulting in 
Contract No. 14-06-200-3365A-LTR1-B

21

453 any damage or claim; (ii) willful misconduct of the Contracting Officer or any of its officers, 

454 employees, agents, and assigns, including the Operating Non-Federal Entity(ies); (iii) negligence of 

455 the Contracting Officer or any of its officers, employees, agents, and assigns including the 

456 Operating Non-Federal Entity(ies); or (iv) a malfunction of facilities owned and/or operated by the 

457 United States or the Operating Non-Federal Entity(ies). 

458 MEASUREMENT OF WATER WITHIN THE CONTRACTOR’S SERVICE AREA

459 6. (a) Each Contractor has established a measuring program satisfactory to the 

460 Contracting Officer. Each Contractor shall ensure that all surface water delivered for irrigation 

461 purposes to the Contractor’s customers within the Contractor’s Service Area is measured at each 

462 agricultural turnout and such water delivered for M&I purposes to the Contractor’s customers is 

463 measured at each M&I service connection. The water measuring devices or water measuring 

464 methods of comparable effectiveness must be acceptable to the Contracting Officer. PVWMA and 

465 WWD-DD1 shall be responsible for installing, operating, maintaining, and repairing all such 

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

467 States. SCVWD shall be responsible for ensuring that its retail customers are installing, operating, 

468 maintaining, and repairing all such measuring devices and implementing all such water measuring 

469 methods at no cost to the United States. Each Contractor shall use the information obtained from 

470 such water measuring devices or water measuring methods to ensure its proper management of the 

471 water; to bill water users for water delivered by that Contractor; and, if applicable, to record water 

472 delivered for M&I purposes by customer class as defined in that Contractor’s water conservation 

473 plan provided for in Article 26 of this Contract. Nothing herein contained, however, shall preclude 

474 a Contractor from establishing and collecting any charges, assessments, or other revenues 
Contract No. 14-06-200-3365A-LTR1-B

22

475 authorized by California law. Each Contractor shall include a summary of all its annual surface 

476 water deliveries in the annual report described in subdivision (c) of Article 26. 

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

478 execution of this Contract, each Contractor shall provide to the Contracting Officer a written report 

479 describing the measurement devices or water measuring methods being used or to be used by that 

480 Contractor to implement subdivision (a) of this Article and identifying the agricultural turnouts and 

481 the M&I service connections or alternative measurement programs approved by the Contracting 

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

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

484 including a time schedule for implementation at such locations. The Contracting Officer shall 

485 advise the appropriate Contractor(s) in writing within 60 days as to the adequacy, and necessary 

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

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

488 deemed adequate. If the Contracting Officer notifies a Contractor that the measuring devices or 

489 methods are inadequate, the parties shall within 60 days following the Contracting Officer’s 

490 response, negotiate in good faith the earliest practicable date by which that Contractor shall modify 

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

492 compliance with subdivision (a) of this Article. 

493 (c) All new surface water delivery systems installed within a Contractor's 

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

495 provisions described in subdivision (a) of this Article. 
Contract No. 14-06-200-3365A-LTR1-B

23

496 (d) Each Contractor shall inform the Contracting Officer and the State of 

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

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

499 (e) Each Contractor shall inform the Contracting Officer and the Operating 

500 Non-Federal Entity on or before the 20th calendar day of each month of the quantity of Irrigation 

501 Water and M&I Water taken during the preceding month. 

502 RATES AND METHOD OF PAYMENT FOR WATER

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

504 Water Delivered to that Contractor at Rates, Charges, and the Tiered Pricing Component established 

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

506 the Secretary’s then-existing ratesetting policy for M&I Water, which ratesetting policies shall be 

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

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

509 applicable provisions of this Contract. Payments shall be made by cash transaction, electronic funds 

510 transfer, or any other mechanism as may be agreed to in writing by a Contractor and the Contracting 

511 Officer. The Rates, Charges, and Tiered Pricing Component applicable to each Contractor upon 

512 execution of this Contract are set forth in Exhibits “B-1,” “B-2,” and “B-3” as may be revised 

513 annually. 

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

515 and Tiered Pricing Component as follows: 

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

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

518 period October 1, of the current Calendar Year, through September 30, of the following Calendar 
Contract No. 14-06-200-3365A-LTR1-B

24

519 Year, and the basis for such estimate. Each Contractor shall be allowed not less than two months to 

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

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

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

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

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

525 shall make available to each Contractor an estimate of the Rates and Tiered Pricing Component for 

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

527 Rates are based. Each Contractor shall be allowed not less than two months to review and comment 

528 on such computations and cost allocations. By December 31 of each Calendar Year, the 

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

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

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

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

533 Contractor scheduled to receive Delivered Water shall make an advance payment to the United 

534 States equal to the total amount payable pursuant to the applicable Rate(s) set under subdivision (a) 

535 of this Article, for the Project Water scheduled to be delivered to that Contractor pursuant to this 

536 Contract during the first two calendar months of the Year. Before the end of the first month and 

537 before the end of each calendar month thereafter, the Contractor(s) scheduled to receive Delivered 

538 Water shall make an advance payment to the United States, at the Rate(s) set under subdivision (a) 

539 of this Article, for the Water Scheduled pursuant to this Contract during the second month 

540 immediately following. Adjustments between advance payments for Water Scheduled and 

541 payments at Rates due for Water Delivered shall be made before the end of the following month; 
Contract No. 14-06-200-3365A-LTR1-B

25

542 Provided, That any revised schedule submitted by a Contractor pursuant to Article 4 of this Contract 

543 which increases the amount of Water Delivered pursuant to this Contract during any month shall be 

544 accompanied with appropriate advance payment, at the Rates then in effect, to assure that Project 

545 Water is not delivered to the Contractor(s) in advance of such payment. In any month in which the 

546 quantity of Water Delivered to the Contractor(s) pursuant to this Contract equals the quantity of 

547 Water Scheduled and paid for by the Contractor(s), no additional Project Water shall be delivered to 

548 the Contractor(s) unless and until an advance payment at the Rates then in effect for such additional 

549 Project Water is made. Final adjustment between the advance payments for the Water Scheduled 

550 and payments for the quantities of Water Delivered during each Year pursuant to this Contract shall 

551 be made as soon as practicable but no later than April 30th of the following Year, or 60 days after 

552 the delivery of Project Water rescheduled under subdivision (g) of Article 3 of this Contract if such 

553 water is not delivered by the last day of February. 

554 (d) Each Contractor shall also make a payment in addition to the Rate(s) in 

555 subdivision (c) of this Article to the United States for Water Delivered to that Contractor, at the 

556 Charges and the appropriate Tiered Pricing Component then in effect, before the end of the month 

557 following the month of delivery; Provided, That any Contractor may be granted an exception from 

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

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

560 delivery report for the subject month prepared by the Operating Non-Federal Entity(ies) or, if there 

561 is no Operating Non-Federal Entity, by the Contracting Officer. The water delivery report shall be 

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

563 Delivered. Adjustment for overpayment or underpayment of Charges shall be made through the 

564 adjustment of payments due to the United States for Charges for the next month. Any amount to be 
Contract No. 14-06-200-3365A-LTR1-B

26

565 paid for past due payment of Charges and the Tiered Pricing Component shall be computed 

566 pursuant to Article 20 of this Contract. 

567 (e) Each Contractor shall pay for any Water Delivered to that Contractor under 

568 subdivision (a), (f), or (g) of Article 3 of this Contract as determined by the Contracting Officer 

569 pursuant to applicable statutes, associated regulations, any applicable provisions of guidelines or 

570 ratesetting policies; Provided, That the Rate for Water Delivered under subdivision (d) of Article 3 

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

572 Water under subdivision (a) of this Article. 

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

574 Contract may be paid from any revenues available to that Contractor. 

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

576 delivery of Project Water or the delivery of non-Project water to that Contractor through Project 

577 facilities shall be allocated and applied in accordance with Federal Reclamation law and the 

578 associated rules or regulations, and the then current Project ratesetting policies for M&I Water or 

579 Irrigation Water. 

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

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

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

583 Contracting Officer shall, each Year upon request of any Contractor, provide to that Contractor a 

584 detailed accounting of all Project and Contractor expense allocations, the disposition of all Project 

585 and Contractor revenues, and a summary of all water delivery information. The Contracting Officer 

586 and the Contractor shall enter into good faith negotiations to resolve any discrepancies or disputes 

587 relating to accountings, reports, or information. 
Contract No. 14-06-200-3365A-LTR1-B

27

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

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

590 policies, and procedures used for establishing Rates, Charges, and Tiered Pricing Component, 

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

592 mutual best interest of the parties, it is expressly agreed that the parties may enter into agreements to 

593 modify the mechanisms, policies, and procedures for any of those purposes while this Contract is in 

594 effect without amending this Contract. 

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

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

597 delivery the Contractor(s) shall make an additional payment to the United States equal to the 

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

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

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

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

602 whichever is applicable. The Tiered Pricing Component for the amount of Water Delivered which 

603 exceeds 90 percent of the Contract Total shall equal the difference between (i) the Rate established 

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

605 Water Rate, whichever is applicable. 

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

607 Contractor(s) may request and receive an exemption from such Tiered Pricing Component for 

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

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

610 crops are produced; Provided, That the exemption from the Tiered Pricing Component for Irrigation 
Contract No. 14-06-200-3365A-LTR1-B

28

611 Water shall apply only if such habitat values can be assured consistent with the purposes of the

612 CVPIA through binding agreements executed with or approved by the Contracting Officer prior to 

613 use of such water. 

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

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

616 Contractor(s) transfer(s) to others but shall not include Project Water transferred to the 

617 Contractor(s), nor shall it include the additional water provided to the Contractor(s) under the 

618 provisions of subdivision (f) of Article 3 of this Contract. 

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

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

621 costs of the Project, as those terms are used in the then-current Project ratesetting policies, and 

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

623 with the relevant Project ratesetting policy. Changes of significance in practices which implement 

624 the Contracting Officer’s ratesetting policies will not be implemented until the Contracting Officer 

625 has provided the Contractor an opportunity to discuss the nature, need, and impact of the proposed 

626 change. 

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

628 the Rates for Project Water transferred by the Contractor shall be the Contractor’s Rates, in 

629 accordance with the applicable Project ratesetting policy, adjusted upward or downward to reflect 

630 the changed costs, if any, incurred by the Contracting Officer in the delivery of the transferred 

631 Project Water to the transferee’s point of delivery. If any Contractor is receiving lower Rates and 

632 Charges because of inability to pay and is transferring Project Water to another entity whose Rates 
Contract No. 14-06-200-3365A-LTR1-B

29

633 and Charges are not adjusted due to inability to pay, the Rates and Charges for transferred Project 

634 Water shall not be adjusted to reflect the Contractor’s inability to pay. 

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

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

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

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

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

640 each Contractor does not waive any legal rights or remedies that it may have with respect to such 

641 disputed issues. Notwithstanding the execution of this Contract and payments made hereunder, 

642 each Contractor may challenge in the appropriate administrative or judicial forums; (1) the 

643 existence, computation, or imposition of any deficit charges accruing during the term of the 

644 Existing Contract and any preceding interim renewal contracts, if applicable; (2) interest accruing 

645 on any such deficits; (3) the inclusion of any such deficit charges or interest in the Rates; (4) the 

646 application by the United States of payments made by the Contractor under its Existing Contract 

647 and any preceding interim renewal contracts if applicable; and (5) the application of such payments 

648 in the Rates. The Contracting Officer agrees that each Contractor shall be entitled to the benefit of 

649 any administrative or judicial ruling in favor of any Project M&I contractor on any of these issues, 

650 and credits for payments heretofore made, provided that the basis for such ruling is applicable to 

that Contractor.1 651 

 

1

 Additional language may be included for SCVWD pending settlement negotiations 
Contract No. 14-06-200-3365A-LTR1-B

30

652 NON-INTEREST BEARING OPERATION AND MAINTENANCE DEFICITS

653 8. Each Contractor and the Contracting Officer concur that, as of the effective date of 

654 this Contract, that Contractor does not have a non-interest bearing O&M deficits under this Contract 

655 and shall have no further liability therefore. 

656 SALES, TRANSFERS, OR EXCHANGES OF WATER

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

658 transferred, or exchanged to others for reasonable and beneficial uses within the State of California 

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

660 guidelines or regulations then in effect. No sale, transfer, or exchange of Project Water under this 

661 Contract may take place without the prior written approval of the Contracting Officer, except as 

662 provided for in subdivision (b) of this Article, and no such sales, transfers, or exchanges shall be 

663 approved absent all appropriate environmental documentation, including but not limited to, 

664 documents prepared pursuant to the NEPA and ESA. Such environmental documentation should 

665 include, as appropriate, an analysis of groundwater impacts and economic and social effects, 

666 including environmental justice, of the proposed water transfers on both the transferor and 

667 transferee. 

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

669 of the type historically carried out among Project Contractors located within the same geographical 

670 area and to allow each Contractor to participate in an accelerated water transfer program during the 

671 term of this Contract, the Contracting Officer shall prepare, as appropriate, all necessary 

672 environmental documentation, including but not limited to documents prepared pursuant to NEPA 

673 and ESA, analyzing annual transfers within such geographical areas and the Contracting Officer 

674 shall determine whether such transfers comply with applicable law. Following the completion of 
Contract No. 14-06-200-3365A-LTR1-B

31

675 the environmental documentation, such transfers addressed in such documentation shall be 

676 conducted with advance notice to the Contracting Officer, but shall not require prior written 

677 approval by the Contracting Officer. Such environmental documentation and the Contracting 

678 Officer’s compliance determination shall be reviewed every five years and updated, as necessary, 

679 prior to the expiration of the then existing five-year period. All subsequent environmental 

680 documentation shall include an alternative to evaluate not less than the quantity of Project Water 

681 historically transferred within the same geographical area. 

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

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

684 for M&I use, groundwater recharge, groundwater banking, or similar groundwater activities, surface 

685 water storage, or fish and wildlife resources; not lead to land conversion; and be delivered to 

686 established cropland, wildlife refuges, groundwater basins or M&I use; (ii) occur within a single 

687 Year; (iii) occur between a willing seller and a willing buyer; (iv) convey water through existing 

688 facilities with no new construction or modifications to facilities and be between existing Project 

689 Contractors and/or any Contractor and the United States, Department of the Interior; and (v) comply 

690 with all applicable Federal, State, and local or tribal laws and requirements imposed for protection 

691 of the environment and Indian Trust Assets, as defined under Federal law. 

692 APPLICATION OF PAYMENTS AND ADJUSTMENTS 

693 10. (a) The amount of any overpayment by a Contractor of the Contractor’s O&M, 

694 capital, and deficit (if any) obligations for the Year shall be applied first to any current liabilities of 

695 that Contractor arising out of this Contract then due and payable. Overpayments of more than 

696 $1,000 shall be refunded at the Contractor’s request. In lieu of a refund, any amount of such 

697 overpayment at the option of that Contractor may be credited against amounts to become due to the 
Contract No. 14-06-200-3365A-LTR1-B

32

698 United States by that Contractor. With respect to overpayment, such refund or adjustment shall 

699 constitute the sole remedy of that Contractor or anyone having or claiming to have the right to the 

700 use of any of the Project Water supply provided for herein. All credits and refunds of overpayments 

701 shall be made within 30 days of the Contracting Officer obtaining direction as to how to credit or 

702 refund such overpayment in response to the notice to the overpaying Contractor that it has finalized 

703 the accounts for the Year in which the overpayment was made. 

704 (b) All advances for miscellaneous costs incurred for work requested by a 

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

706 the work has been completed. If the advances exceed the actual costs incurred, the difference will 

707 be refunded to the requesting Contractor. If the actual costs exceed that Contractor's advances, that 

708 Contractor will be billed for the additional costs pursuant to Article 25. 

709 TEMPORARY REDUCTIONS--RETURN FLOWS

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

711 requirements of Federal law and (ii) the obligations of the United States under existing contracts, or 

712 renewals thereof, providing for water deliveries from the Project, the Contracting Officer shall make 

713 all reasonable efforts to optimize Project Water deliveries to each Contractor as provided in this 

714 Contract. 

715 (b) The Contracting Officer or Operating Non-Federal Entity(ies) may 

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

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

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

719 Contractor, but so far as feasible the Contracting Officer or Operating Non-Federal Entity(ies) will 

720 give that Contractor due notice in advance of such temporary discontinuance or reduction, except in 
Contract No. 14-06-200-3365A-LTR1-B

33

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

722 use its best efforts to avoid any discontinuance or reduction in such service. Upon resumption of 

723 service after such reduction or discontinuance, and if requested by the affected Contractor, the 

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

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

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

727 derived from Water Delivered to a Contractor hereunder which escapes or is discharged beyond that 

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

729 States any right to seepage or return flow being put to reasonable and beneficial use pursuant to this 

730 Contract within a Contractor’s Service Area by that Contractor or those claiming by, through, or 

731 under the Contractor. 

732 CONSTRAINTS ON THE AVAILABILITY OF WATER

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

734 means to guard against a Condition of Shortage in the quantity of water to be made available to the

735 Contractor(s) pursuant to this Contract. In the event the Contracting Officer determines that a 

736 Condition of Shortage appears probable, the Contracting Officer will notify the Contractors of said 

737 determination as soon as practicable. 

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

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

740 taken by the Contracting Officer to meet legal obligations then, except as provided in subdivision 

741 (a) of Article 18 of this Contract, no liability shall accrue against the United States or any of its 

742 officers, agents, or employees for any damage, direct or indirect, arising therefrom. 
Contract No. 14-06-200-3365A-LTR1-B

34

743 (c) In any Year in which there may occur a Condition of Shortage for any of the 

744 reasons specified in subdivision (b) of this Article, and subject to subdivision (d) of this Article, the 

745 Contracting Officer will first allocate the available Project Water consistent with the Central Valley 

746 Project M&I Water Shortage Policy in its form on the effective date of this Contract for determining 

747 the amount of Project Water available for delivery to the Project Contractors. Subject to the 

748 foregoing allocation, in any year in which there may occur a Condition of Shortage, the Contracting 

749 Officer shall then apportion Project Water among the Contractor(s) and others entitled to Project 

750 Water from Delta Division Facilities under long-term water service or repayment contracts (or 

751 renewals thereof or binding commitments therefore) in force on February 28, 2005, as follows: 

752 (1) The Contracting Officer shall make an initial and subsequent 

753 determination as necessary of the total quantity of Project Water estimated to be scheduled or 

754 actually scheduled under subdivision (b) of Article 4 of this Contract and under all other long-term 

755 water service or repayment contracts then in force for the delivery of Project Water by the United 

756 States from Delta Division Facilities during the relevant Year, the quantity so determined being 

757 hereinafter referred to as the scheduled total; 

758 (2) A determination shall be made of the total quantity of Project Water 

759 that is available for meeting the scheduled total, the quantity so determined being hereinafter 

760 referred to as the available supply; 

761 (3) The total quantity of Project Water estimated to be scheduled or 

762 actually scheduled by the Contractor(s) during the relevant Year, under subdivision (b) of Article 4 

763 hereof, shall be divided by the scheduled total, the quotient thus obtained being hereinafter referred 

764 to as the Contractor(s)’ proportionate share; and 
Contract No. 14-06-200-3365A-LTR1-B

35

765 (4) The available supply shall be multiplied by the Contractor(s)’ 

766 proportionate share and the result shall be the quantity of Project Water made available by the 

767 United States to the Contractor(s) for the relevant Year in accordance with the schedule developed 

768 by the Contracting Officer under subdivision (c) (1) of this Article, but in no event shall such 

769 amount exceed the Contract Total. In the event the Contracting Officer subsequently determines 

770 that the Contracting Officer can increase or needs to decrease the available supply for delivery from 

771 Delta Division Facilities to long-term water service and repayment Contractors during the relevant 

772 Year, such additions or reductions to the available supply shall be apportioned consistent with 

773 subparagraphs (1) through (4), inclusive. 

774 (d) By entering into this Contract, no Contractor waives any legal rights or 

775 remedies it may have to file or participate in any administrative or judicial proceeding contesting (i) 

776 the sufficiency of the Central Valley Project M&I Water Shortage Policy (ii) the substance of such a 

777 policy; (iii) the applicability of such a policy; or (iv) the manner in which such policy is 

778 implemented in order to allocate Project Water between municipal and industrial and irrigation 

779 purposes; Provided, that any Contractor seeking to do so has commenced any such judicial 

780 challenge or any administrative procedures necessary to institute any judicial challenge within six 

781 months of the policy becoming final. By agreeing to the foregoing, the Contracting Officer does not 

782 waive any legal defenses or remedies that it may have to assert in such a proceeding. Nothing 

783 contained herein shall be interpreted to validate or invalidate the Central Valley Project M&I Water 

784 Shortage Policy. 

785 UNAVOIDABLE GROUNDWATER PERCOLATION

786 13. To the extent applicable, the Contractor(s) shall not be deemed to have delivered 

787 Irrigation Water to Excess Lands or Ineligible Lands within the meaning of this Contract if such 
Contract No. 14-06-200-3365A-LTR1-B

36

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

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

790 RULES AND REGULATIONS

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

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

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

794 rules and regulations promulgated by the Secretary of the Interior under Federal Reclamation law. 

795 WATER AND AIR POLLUTION CONTROL

796 15. Each Contractor, in carrying out this Contract, shall comply with all applicable water 

797 and air pollution laws and regulations of the United States and the State of California, and shall 

798 obtain all required permits or licenses from the appropriate Federal, State, or local authorities. 

 

799 QUALITY OF WATER

800 16. (a) Project facilities used to deliver Project Water to the Contractors pursuant to 

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

802 to the Contractors in accordance with the water quality standards specified in subsection 2(b) of the 

803 Act of August 26, 1937 (50 Stat. 865), as added by Section 101 of the Act of October 27, 1986 (100 

804 Stat. 3050) or other existing Federal laws. The United States is under no obligation to construct or 

805 furnish water treatment facilities to maintain or to improve the quality of Water Delivered to any

806 Contractor pursuant to this Contract. The United States does not warrant the quality of Water 

807 Delivered to the Contractors pursuant to this Contract. 

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

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

810 level reasonably attainable as determined by the Contracting Officer. Each Contractor shall be 

811 responsible for compliance with all State and Federal water quality standards applicable to surface 

812 and subsurface agricultural drainage discharges generated through the use of Federal or that 
Contract No. 14-06-200-3365A-LTR1-B

37

813 Contractor’s facilities or Project Water provided by that Contractor within the Contractor's Service 

814 Area. 

815 (c) Omitted. 

816 WATER ACQUIRED BY THE CONTRACTOR

817 OTHER THAN FROM THE UNITED STATES

818 17. (a) Water or water rights now owned or hereafter acquired by any Contractor 

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

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

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

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

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

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

825 Water must be established through the certification requirements as specified in the Acreage 

826 Limitation Rules and Regulations (43 CFR Part 426); (iii) the water requirements of Eligible Lands 

827 within that Contractor's Service Area can be established and the quantity of Irrigation Water to be 

828 utilized is less than or equal to the quantity necessary to irrigate such Eligible Lands; and (iv) if the 

829 facilities utilized for commingling Irrigation Water and non-Project water are/were constructed with 

830 funds made available pursuant to Federal Reclamation law, the non-Project water will be subject to 

831 the acreage limitation provisions of Federal Reclamation law, unless that Contractor pays to the 

832 United States the incremental fee described in 43 CFR 426.15. In determining the incremental fee, 

833 the Contracting Officer will calculate annually the cost to the Federal Government, including 

834 interest of storing or delivering non-Project water, which for purposes of this Contract shall be 

835 determined as follows: The quotient shall be the unpaid distribution system costs divided by the 
Contract No. 14-06-200-3365A-LTR1-B

38

836 total irrigable acreage within that Contractor’s Service Area. The incremental fee per acre is the 

837 mathematical result of such quotient times the interest rate determined using Section 202 (3) of the 

838 Act of October 12, 1982 (96 Stat. 1263). Such incremental fee will be charged to each acre of 

839 excess or full cost land within that Contractor’s Service Area that receives non-Project water 

840 through Federally financed or constructed facilities. The incremental fee calculation methodology 

841 will continue during the term of this Contract absent the promulgation of a contrary Reclamation842 wide rule, regulation, or policy adopted after each Contractor has been afforded the opportunity to 

843 review and comment on the proposed rule, regulation, or policy. If such rule, regulation, or policy 

844 is adopted it shall supersede this provision. 

845 (b) Water or water rights now owned or hereafter acquired by a Contractor, other 

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

847 subject to the completion of appropriate environmental documentation, with the approval of the 

848 Contracting Officer and the execution of any contract determined by the Contracting Officer to be 

849 necessary, consistent with the following provisions: 

850 (1) A Contractor may introduce non-Project water into Project facilities 

851 and deliver said water to lands within that Contractor’s Service Area, including Ineligible Lands, 

852 subject to payment to the United States and/or to any applicable Operating Non-Federal Entity of an 

853 appropriate rate as determined by the applicable Project ratesetting policy, the RRA, and the Project 

854 use power policy, if such Project use power policy is applicable, each as amended, modified or 

855 superseded from time to time. 

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

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

858 as determined by the Contracting Officer; (ii) reduce the quantity or quality of water available to 
Contract No. 14-06-200-3365A-LTR1-B

39

859 other Project Contractors; (iii) interfere with the delivery of contractual water entitlements to any 

860 other Project Contractors; or (iv) interfere with the physical maintenance of the Project facilities. 

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

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

863 into or after it is delivered from the Project facilities. Each Contractor hereby releases and agrees to 

864 defend and indemnify the United States and the Operating Non-Federal Entity(ies), and their 

865 respective officers, agents, and employees, from any claim for damage to persons or property, direct 

866 or indirect, resulting from the act(s) of the respective Contractor’s, its officers, employees, agents, 

867 or assigns, in (i) extracting or diverting non-Project water from any source, or (ii) diverting such 

868 non-Project water into Project facilities. 

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

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

871 groundwater management plan for the area from which it was extracted. 

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

873 Officer, the United States and Project Contractors entitled to Project Water from Delta Division 

874 Facilities shall share priority to utilize the remaining capacity of the facilities declared to be 

875 available by the Contracting Officer for conveyance and transportation of non-Project water prior to 

876 any such remaining capacity being made available to non-Project contractors. Other Project 

877 Contractors shall have a second priority to any remaining capacity of facilities declared to be 

878 available by the Contracting Officer for conveyance and transportation of non-Project water prior to 

879 any such remaining capacity being made available to non-Project contractors. 
Contract No. 14-06-200-3365A-LTR1-B

40

880 OPINIONS AND DETERMINATIONS

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

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

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

884 determinations. The parties, notwithstanding any other provisions of this Contract, expressly 

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

886 unreasonable opinion or determination. Each opinion or determination by any party shall be 

887 provided in a timely manner. Nothing in this subdivision (a) of this Article is intended to or shall 

888 affect or alter the standard of judicial review applicable under Federal law to any opinion or 

889 determination implementing a specific provision of Federal law embodied in statute or regulation.

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

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

892 laws of the United States and of the State of California, and the rules and regulations promulgated 

893 by the Secretary of the Interior. Such determinations shall be made in consultation with each 

894 Contractor to the extent reasonably practicable. 

895 COORDINATION AND COOPERATION

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

897 and each Contractor shall communicate, coordinate, and cooperate with each other, and with other 

898 affected Project Contractors, in order to improve the operation and management of the Project. The 

899 communication, coordination, and cooperation regarding operations and management shall include, 

900 but not be limited to, any action which will or may materially affect the quantity or quality of 

901 Project Water supply, the allocation of Project Water supply, and Project financial matters 

902 including, but not limited to, budget issues. The communication, coordination, and cooperation 
Contract No. 14-06-200-3365A-LTR1-B

41

903 provided for hereunder shall extend to all provisions of this Contract. Each party shall retain 

904 exclusive decision making authority for all actions, opinions, and determinations to be made by the 

905 respective party. 

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

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

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

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

910 shall be to provide, to the extent practicable, the means of mutual communication and interaction 

911 regarding significant decisions concerning Project operation and management on a real-time basis. 

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

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

914 intent: 

915 (1) The Contracting Officer will, at the request of any Contractor, assist 

916 in the development of integrated resource management plans for the requesting Contractor. Further, 

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

918 to improve water supply, water quality, and reliability. 

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

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

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

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

923 of California to seek improved water resource management. 

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

925 Department of the Interior that may impact the availability of water for Project purposes. 
Contract No. 14-06-200-3365A-LTR1-B

42

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

927 hold division level meetings to discuss Project operations, division level water management 

928 activities, and other issues as appropriate. 

929 (d) Without limiting the contractual obligations of the Contracting Officer under 

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

931 Contracting Officer’s ability to communicate, coordinate, and cooperate with each Contractor or 

932 other interested stakeholders or to make decisions in a timely fashion as needed to protect health, 

933 safety, or the physical integrity of structures or facilities. 

934 CHARGES FOR DELINQUENT PAYMENTS

935 20. (a) Each Contractor shall be subject to interest, administrative and penalty 

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

937 the late Contractor shall pay an interest charge for each day the payment is delinquent beyond the 

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

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

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

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

942 date. Further, the late Contractor shall pay any fees incurred for debt collection services associated 

943 with a delinquent payment. 

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

945 the Federal Register by the Department of the Treasury for application to overdue payments, or the 

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

947 Project Act of 1939 (Public Law 76-260). The interest charge rate shall be determined as of the due 

948 date and remain fixed for the duration of the delinquent period. 

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

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

951 accrued interest, and finally to the overdue payment. 

952 EQUAL OPPORTUNITY

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

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

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

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

957 employment, without regard to their race, color, religion, sex, or national origin. Such action shall 
Contract No. 14-06-200-3365A-LTR1-B

43

958 include, but not be limited to, the following: Employment, upgrading, demotion, or transfer; 

959 recruitment or recruitment advertising; layoff or termination, rates of payment or other forms of 

960 compensation; and selection for training, including apprenticeship. The Contractor agrees to post in 

961 conspicuous places, available to employees and applicants for employment, notices to be provided 

962 by the Contracting Officer setting forth the provisions of this nondiscrimination clause. 

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

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

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

966 national origin. 

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

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

969 be provided by the Contracting Officer, advising the said labor union or workers' representative of 

970 that Contractor's commitments under Section 202 of Executive Order 11246 of September 24, 1965, 

971 and shall post copies of the notice in conspicuous places available to employees and applicants for 

972 employment. 

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

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

975 the Secretary of Labor. 

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

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

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

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

980 rules, regulations, and orders. 

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

982 clauses of this Contract or with any of the said rules, regulations, or orders, this Contract, as to the 

983 non-complying Contractor, may be canceled, terminated, or suspended, in whole or in part, and that 

984 Contractor may be declared ineligible for further Government contracts in accordance with 

985 procedures authorized in said amended Executive Order, and such other sanctions may be imposed 

986 and remedies invoked as provided in said Executive Order, or by rule, regulation, or order of the 

987 Secretary of Labor, or as otherwise provided by law. 

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

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

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

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

992 with respect to any subcontract or purchase order as may be directed by the Secretary of Labor as a 

993 means of enforcing such provisions, including sanctions for noncompliance: Provided, however, 

994 That in the event that Contractor becomes involved in, or is threatened with, litigation with a 

995 subcontractor or vendor as a result of such direction, that Contractor may request the United States 

996 to enter into such litigation to protect the interests of the United States. 
Contract No. 14-06-200-3365A-LTR1-B

44

997 GENERAL OBLIGATION--BENEFITS CONDITIONED UPON PAYMENT

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

999 Contract is a general obligation of that Contractor notwithstanding the manner in which the 

1000 obligation may be distributed among the Contractor's water users and notwithstanding the default of 

1001 individual water users in their obligations to that Contractor. 

1002 (b) The payment of charges becoming due hereunder is a condition precedent to 

1003 receiving benefits under this Contract. The United States shall not make water available to a 

1004 Contractor through Project facilities during any period in which that Contractor may be in arrears in 

1005 the advance payment of water rates due the United States. Each Contractor shall not furnish water 

1006 made available pursuant to this Contract for lands or parties which are in arrears in the advance 

1007 payment of water rates levied or established by that Contractor. 

1008 (c) With respect to subdivision (b) of this Article, each Contractor shall have no 

1009 obligation to require advance payment for water rates which it levies. 

1010 COMPLIANCE WITH CIVIL RIGHTS LAWS AND REGULATIONS

1011 23. (a) Each Contractor shall comply with Title VI of the Civil Rights Act of 1964 

1012 (42 U.S.C. 2000d), Section 504 of the Rehabilitation Act of 1975 (P.L. 93-112, as amended), the 

1013 Age Discrimination Act of 1975 (42 U.S.C. 6101, et seq.) and any other applicable civil rights laws, 

1014 as well as with their respective implementing regulations and guidelines imposed by the U.S. 

1015 Department of the Interior and/or Bureau of Reclamation. 

1016 (b) These statutes require that no person in the United States shall, on the 

1017 grounds of race, color, national origin, handicap, or age, be excluded from participation in, be 

1018 denied the benefits of, or be otherwise subjected to discrimination under any program or activity 

1019 receiving financial assistance from the Bureau of Reclamation. By executing this Contract, each 

1020 Contractor agrees to immediately take any measures necessary to implement this obligation, 

1021 including permitting officials of the United States to inspect premises, programs, and documents. 

1022 (c) Each Contractor makes this agreement in consideration of and for the purpose 

1023 of obtaining any and all Federal grants, loans, contracts, property discounts, or other Federal 

1024 financial assistance extended after the date hereof to that Contractor by the Bureau of Reclamation, 

1025 including installment payments after such date on account of arrangements for Federal financial 

1026 assistance which were approved before such date. Each Contractor recognizes and agrees that such 

1027 Federal assistance will be extended in reliance on the representations and agreements made in this 

1028 Article, and that the United States reserves the right to seek judicial enforcement thereof. 

1029 PRIVACY ACT COMPLIANCE

1030 24. (a) Each Contractor shall comply with the Privacy Act of 1974 (5 U.S.C. 552a) 

1031 (the Act) and the Department of the Interior rules and regulations under the Act (43 CFR 2.45 et 

1032 seq.) in maintaining Landholder acreage certification and reporting records, required to be 
Contract No. 14-06-200-3365A-LTR1-B

45

1033 submitted to the Contractor for compliance with Sections 206 and 228 of the Reclamation Reform 

1034 Act of 1982 (96 Stat. 1266), and pursuant to 43 CFR 426.18. 

1035 (b) With respect to the application and administration of the criminal penalty 

1036 provisions of the Act (5 U.S.C. 552a(i)), each Contractor and the Contractor's employees 

1037 responsible for maintaining the certification and reporting records referenced in (a) above are 

1038 considered to be employees of the Department of the Interior. See 5 U.S.C. 552a(m). 

1039 (c) The Contracting Officer or a designated representative shall provide each 

1040 Contractor with current copies of the Interior Department Privacy Act regulations and the Bureau of 

1041 Reclamation Federal Register Privacy Act System of Records Notice (Acreage Limitation--Interior, 

1042 Reclamation-31) which govern the maintenance, safeguarding, and disclosure of information 

1043 contained in the Landholder's certification and reporting records. 

1044 (d) The Contracting Officer shall designate a full-time employee of the Bureau of 

1045 Reclamation to be the System Manager who shall be responsible for making decisions on denials 

1046 pursuant to 43 CFR 2.61 and 2.64 amendment requests pursuant to 43 CFR 2.72. Each Contractor 

1047 is authorized to grant requests by individuals for access to its own records. 

1048 (e) Each Contractor shall forward promptly to the System Manager each 

1049 proposed denial of access under 43 CFR 2.64; and each request for amendment of records filed 

1050 under 43 CFR 2.71; notify the requester accordingly of such referral; and provide the System 

1051 Manager with information and records necessary to prepare an appropriate response to the 

1052 requester. These requirements do not apply to individuals seeking access to their own certification 

1053 and reporting forms filed with a Contractor pursuant to 43 CFR 426.18, unless the requester elects 

1054 to cite the Privacy Act as a basis for the request. 

1055 CONTRACTOR TO PAY CERTAIN MISCELLANEOUS COSTS

1056 25. In addition to all other payments to be made by each Contractor pursuant to this 

1057 Contract, each Contractor shall pay to the United States, within 60 days after receipt of a bill and 

1058 detailed statement submitted by the Contracting Officer to that Contractor for such specific items of 

1059 direct cost incurred by the United States for work requested by that Contractor associated with this 

1060 Contract plus indirect costs in accordance with applicable Bureau of Reclamation policies and 

1061 procedures. All such amounts referred to in this Article shall not exceed the amount agreed to in 

1062 writing in advance by that Contractor. This Article shall not apply to costs for routine contract 

1063 administration. 
Contract No. 14-06-200-3365A-LTR1-B

46

1064 WATER CONSERVATION

1065 26. (a) Prior to the delivery of water to a Contractor provided from or conveyed 

1066 through Federally constructed or Federally financed facilities pursuant to this Contract, that 

1067 Contractor shall be implementing an effective water conservation and efficiency program based on 

1068 the Contractor's water conservation plan that has been determined by the Contracting Officer to 

1069 meet the conservation and efficiency criteria for evaluating water conservation plans established 

1070 under Federal law. The water conservation and efficiency program shall contain definite water 

1071 conservation objectives, appropriate economically feasible water conservation measures, and time 

1072 schedules for meeting those objectives. Continued Project Water delivery to that Contractor 

1073 pursuant to this Contract shall be contingent upon that Contractor’s continued implementation of 

1074 such water conservation program. In the event a Contractor's water conservation plan or any 

1075 revised water conservation plan completed pursuant to subdivision (d) of Article 26 of this Contract 

1076 has not yet been determined by the Contracting Officer to meet such criteria, due to circumstances 

1077 which the Contracting Officer determines are beyond the control of that Contractor, water deliveries 

1078 shall be made under this Contract so long as that Contractor diligently works with the Contracting 

1079 Officer to obtain such determination at the earliest practicable date, and thereafter the Contractor 

1080 immediately begins implementing its water conservation and efficiency program in accordance with 

1081 the time schedules therein. 

1082 (b) Should the amount of M&I Water delivered pursuant to subdivision (a) of 

1083 Article 3 of this Contract equal or exceed 2,000 acre-feet per Year, the Contractor receiving M&I 

1084 water shall implement the Best Management Practices identified by the time frames issued by the 

1085 California Urban Water Conservation Council for such M&I Water unless any such practice is 

1086 determined by the Contracting Officer to be inappropriate for that Contractor. 
Contract No. 14-06-200-3365A-LTR1-B

47

1087 (c) Each Contractor shall submit to the Contracting Officer a report on the status 

1088 of its implementation of the water conservation plan on the reporting dates specified in the then 

1089 existing conservation and efficiency criteria established under Federal law. 

1090 (d) At five-year intervals, each Contractor shall revise its water conservation plan 

1091 to reflect the then current conservation and efficiency criteria for evaluating water conservation 

1092 plans established under Federal law and submit such revised water management plan to the 

1093 Contracting Officer for review and evaluation. The Contracting Officer will then determine if the 

1094 water conservation plan meets Reclamation’s then current conservation and efficiency criteria for 

1095 evaluating water conservation plans established under Federal law. 

1096 (e) If a Contractor is engaged in direct groundwater recharge, such activity shall 

1097 be described in the Contractor’s water conservation plan. 

1098 EXISTING OR ACQUIRED WATER OR WATER RIGHTS

1099 27. Except as specifically provided in Article 17 of this Contract, the provisions of this 

1100 Contract shall not be applicable to or affect non-Project water or water rights now owned or 

1101 hereafter acquired by each Contractor or any user of such water within any Contractor's Service 

1102 Area. Any such water shall not be considered Project Water under this Contract. In addition, this 

1103 Contract shall not be construed as limiting or curtailing any rights which any Contractor or any 

1104 water user within the Contractor's Service Area acquires or has available under any other contract 

1105 pursuant to Federal Reclamation law. 

1106 OPERATION AND MAINTENANCE BY THE 

1107 SAN LUIS & DELTA-MENDOTA WATER AUTHORITY

1108 28. (a) The O&M of a portion of the Project facilities which serve each Contractor, 

1109 and responsibility for funding a portion of the costs of such O&M, have been transferred to the San 

1110 Luis & Delta-Mendota Water Authority, an Operating Non-Federal Entity by separate agreement 
Contract No. 14-06-200-3365A-LTR1-B

48

1111 (8-07-20-X0354) between the United States and the Operating Non-Federal Entity San Luis & 

1112 Delta-Mendota Water Authority. That separate agreement shall not interfere with or affect the 

1113 rights or obligations of each Contractor or the United States hereunder. 

1114 (b) The Contracting Officer has previously notified the Contractor in writing that 

1115 the O&M of a portion of the Project facilities which serve each Contractor has been transferred to 

1116 the Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority, and therefore, each 

1117 Contractor shall pay directly to the Operating Non-Federal Entity San Luis & Delta-Mendota Water 

1118 Authority, or to any successor approved by the Contracting Officer under the terms and conditions 

1119 of the separate agreement between the United States and the Operating Non-Federal Entity San Luis 

1120 & Delta-Mendota Water Authority described in subdivision (a) of this Article, all rates, charges, or 

1121 assessments of any kind, including any assessment for reserve funds, which the Operating Non1122 Federal Entity San Luis & Delta-Mendota Water Authority or such successor determines, sets, or 

1123 establishes for the O&M of the portion of the Project facilities operated and maintained by the 

1124 Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority or such successor. Such 

1125 direct payments to the Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority or 

1126 such successor shall not relieve any Contractor of its obligation to pay directly to the United States 

1127 that Contractor’s share of the Project Rates, Charges, and Tiered Pricing Component except to the 

1128 extent the Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority collects 

1129 payments on behalf of the United States in accordance with subdivision (a) of this Article. 

1130 (c) For so long as the O&M of any portion of the Project facilities serving the

1131 Contractor(s) is performed by the Operating Non-Federal Entity San Luis & Delta-Mendota Water 

1132 Authority, or any successor thereto, the Contracting Officer shall adjust those components of the 

1133 Rates for Water Delivered under this Contract representing the cost associated with the activity 
Contract No. 14-06-200-3365A-LTR1-B

49

1134 being performed by the Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority

1135 or its successor. 

1136 (d) In the event the O&M of the Project facilities operated and maintained by the 

1137 Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority is re-assumed by the 

1138 United States during the term of this Contract, the Contracting Officer shall so notify the 

1139 Contractor(s), in writing, and present to each Contractor a revised Exhibit “B” which shall include 

1140 the portion of the Rates to be paid by each Contractor for Project Water under this Contract 

1141 representing the O&M costs of the portion of such Project facilities which have been re-assumed. 

1142 Each Contractor shall, thereafter, in the absence of written notification from the Contracting Officer 

1143 to the contrary, pay the Rates, Charges, and Tiered Pricing Component specified in the revised 

1144 Exhibit “B” directly to the United States in compliance with Article 7 of this Contract. 

1145 OPERATION AND MAINTENANCE BY THE 

1146 CALIFORNIA DEPARTMENT OF WATER RESOURCES

1147 28.1 (a) The O&M of a portion of the Project facilities which serve the Contractor, 

1148 and responsibility for funding a portion of the costs of such O&M, have been transferred to the 

1149 California Department of Water Resources, an Operating Non-Federal Entity by a separate 

1150 agreement (14-06-200-9755) between the United States and Operating Non-Federal Entity 

1151 California Department of Water Resources. This separate agreement shall not interfere with or 

1152 affect the rights or obligations of the Contractor or the United States hereunder. 

1153 (b) The Contracting Officer has previously notified the Contractor in writing that 

1154 the O&M of a portion of the Project facilities which serve the Contractor has been transferred to 

1155 Operating Non-Federal Entity California Department of Water Resources, and the Contractor shall 

1156 pay directly to Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority, or to any 

1157 successor approved by the Contracting Officer under the terms and conditions of the separate 
Contract No. 14-06-200-3365A-LTR1-B

50

1158 agreement between the United States and Operating Non-Federal Entity San Luis & Delta-Mendota 

1159 Water Authority, described in subdivision (a) of Article 28 of this Contract, all rates, charges, or 

1160 assessments of any kind, including any assessment for reserve funds, which Operating Non-Federal 

1161 Entity California Department of Water Resources, or such successor determines, sets, or establishes 

1162 for the O&M of the portion of the Project facilities operated and maintained by Operating Non1163 Federal Entity California Department of Water Resources, or such successor. Such direct 

1164 payments to Operating Non-Federal Entity San Luis & Delta-Mendota Water Authority, or such 

1165 successor shall not relieve the Contractor of its obligation to pay directly to the United States the 

1166 Contractor’s share of the Project Rates, Charges, and Tiered Pricing Components except to the 

1167 extent the Operating Non-Federal Entity collects payments on behalf of the United States in 

1168 accordance with subdivision (a) of Article 28 of this Contract. 

1169 (c) For so long as the O&M of any portion of the Project facilities serving the 

1170 Contractor(s) is performed by Operating Non-Federal Entity California Department of Water 

1171 Resources, or any successor thereto, the Contracting Officer shall adjust those components of the 

1172 Rates for Water Delivered under this Contract representing the cost associated with the activity 

1173 being performed by Operating Non-Federal Entity California Department of Water Resources, or its 

1174 successor. 

1175 (d) In the event the O&M of the Project facilities operated and maintained by 

1176 Operating Non-Federal Entity California Department of Water Resources, is re-assumed by the 

1177 United States during the term of this Contract, the Contracting Officer shall so notify the 

1178 Contractor(s), in writing, and present to each Contractor a revised Exhibit “B” which shall include 

1179 the portion of the Rates, Charges, and Tiered Pricing Component to be paid by the Contractor for 

1180 Project Water under this Contract representing the O&M costs of the portion of such Project 
Contract No. 14-06-200-3365A-LTR1-B

51

1181 facilities which have been re-assumed. The Contractor shall, thereafter, in the absence of written 

1182 notification from the Contracting Officer to the contrary, pay the Rates, Charges, and Tiered Pricing 

1183 Component specified in the revised Exhibit “B” directly to the United States in compliance with 

1184 Article 7 of this Contract. 

1185 CONTINGENT ON APPROPRIATION OR ALLOTMENT OF FUNDS

1186 29. The expenditure or advance of any money or the performance of any obligation of 

1187 the United States under this Contract shall be contingent upon appropriation or allotment of funds. 

1188 Absence of appropriation or allotment of funds shall not relieve any Contractor from any 

1189 obligations under this Contract. No liability shall accrue to the United States in case funds are not 

1190 appropriated or allotted. 

1191 BOOKS, RECORDS, AND REPORTS

1192 30. (a) Each Contractor shall establish and maintain accounts and other books and 

1193 records pertaining to administration of the terms and conditions of this Contract, including: each 

1194 Contractor's financial transactions, water supply data, and Project land and right-of-way 

1195 agreements; the water users' land-use (crop census), land ownership, land-leasing and water use 

1196 data; and other matters that the Contracting Officer may require. Reports thereon shall be furnished 

1197 to the Contracting Officer in such form and on such date or dates as the Contracting Officer may 

1198 require. Subject to applicable Federal laws and regulations, the Contractor(s) and the United States 

1199 shall have the right during office hours to examine and make copies of the other party's books and 

1200 records relating to matters covered by this Contract. 

1201 (b) Notwithstanding the provisions of subdivision (a) of this Article, no books, 

1202 records, or other information shall be requested from any Contractor by the Contracting Officer 

1203 unless such books, records, or information are reasonably related to the administration or 

1204 performance of this Contract. Any such request shall allow the Contractor to which the request is 

1205 made a reasonable period of time within which to provide the requested books, records, or 

1206 information. 

1207 (c) At such time as the Contractor to which the request is made provides 

1208 information to the Contracting Officer pursuant to subdivision (a) of this Article, a copy of such 

1209 information shall be provided to the Operating Non-Federal Entity(ies). 
Contract No. 14-06-200-3365A-LTR1-B

52

1210 ASSIGNMENT LIMITED--SUCCESSORS AND ASSIGNS OBLIGATED

1211 31. (a) The provisions of this Contract shall apply to and bind the successors and 

1212 assigns of the parties hereto, but no assignment or transfer of this Contract or any right or interest 

1213 therein shall be valid until approved in writing by the Contracting Officer. 

1214 (b) The assignment of any right or interest in this Contract by the Contractor(s) 

1215 or the United States shall not interfere with the rights or obligations of the other party to this 

1216 Contract absent the written concurrence of said other party. 

1217 (c) The Contracting Officer shall not unreasonably condition or withhold 

1218 approval of any proposed assignment. 

1219 SEVERABILITY

1220 32. In the event that a person or entity who is neither (i) a party to a Project contract, nor 

1221 (ii) a person or entity that receives Project Water from a party to a Project contract, nor (iii) an 

1222 association or other form of organization whose primary function is to represent parties to Project 

1223 contracts, brings an action in a court of competent jurisdiction challenging the legality or 

1224 enforceability of a provision included in this Contract and said person, entity, association, or 

1225 organization obtains a final court decision holding that such provision is legally invalid or 

1226 unenforceable and any Contractor has not intervened in that lawsuit in support of the plaintiff(s), the 

1227 parties to this Contract shall use their best efforts to (i) within 30 days of the date of such final court 

1228 decision identify by mutual agreement the provisions in this Contract which must be revised and (ii) 

1229 within three months thereafter promptly agree on the appropriate revision(s). The time periods 

1230 specified above may be extended by mutual agreement of the parties. Pending the completion of 

1231 the actions designated above, to the extent it can do so without violating any applicable provisions 

1232 of law, the United States shall continue to make the quantities of Project Water specified in this 
Contract No. 14-06-200-3365A-LTR1-B

53

1233 Contract available to each Contractor pursuant to the provisions of this Contract which were not 

1234 found to be legally invalid or unenforceable in the final court decision. 

1235 RESOLUTION OF DISPUTES

1236 33. Should any dispute arise concerning any provisions of this Contract, or the parties’ 

1237 rights and obligations thereunder, the parties shall meet and confer in an attempt to resolve the 

1238 dispute. Prior to any Contractor commencing any legal action, or the Contracting Officer referring 

1239 any matter to the Department of Justice, the party shall provide to the other party 30 days’ written 

1240 notice of the intent to take such action; Provided, That such notice shall not be required where a 

1241 delay in commencing an action would prejudice the interests of the party that intends to file suit. 

1242 During the 30-day notice period, the Contractor and the Contracting Officer shall meet and confer in 

1243 an attempt to resolve the dispute. Except as specifically provided, nothing herein is intended to 

1244 waive or abridge any right or remedy that any Contractor or the United States may have. 

1245 OFFICIALS NOT TO BENEFIT

1246 34. No Member of or Delegate to Congress, Resident Commissioner, or official of any 

1247 Contractor shall benefit from this Contract other than as a water user or landowner in the same 

1248 manner as other water users or landowners. 

1249 CHANGES IN CONTRACTOR’S SERVICE AREA

1250 35. (a) While this Contract is in effect, no change may be made in any Contractor's 

1251 Service Area, by inclusion or exclusion of lands, dissolution, consolidation, merger, or otherwise, 

1252 except upon the Contracting Officer's written consent. 

1253 (b) Within 30 days of receipt of a request for such a change, the Contracting 

1254 Officer will notify each Contractor of any additional information required by the Contracting 

1255 Officer for processing said request, and both parties will meet to establish a mutually agreeable 

1256 schedule for timely completion of the process. Such process will analyze whether the proposed 

1257 change is likely to: (i) result in the use of Project Water contrary to the terms of this Contract; (ii) 
Contract No. 14-06-200-3365A-LTR1-B

54

1258 impair the ability of the Contractor to pay for Project Water furnished under this Contract or to pay 

1259 for any Federally-constructed facilities for which the Contractor are responsible; and (iii) have an 

1260 impact on any Project Water rights applications, permits, or licenses. In addition, the Contracting 

1261 Officer shall comply with the NEPA and the ESA. The Contractor will be responsible for all costs 

1262 incurred by the Contracting Officer in this process, and such costs will be paid in accordance with 

1263 Article 25 of this Contract. 

1264 FEDERAL LAWS

1265 36. By entering into this Contract, no Contractor waives its right to contest the validity 

1266 or application in connection with the performance of the terms and conditions of this Contract of 

1267 any Federal law or regulation; Provided, That the Contractor agrees to comply with the terms and 

1268 conditions of this Contract unless and until relief from application of such Federal law or regulation 

1269 to the implementing provision of the Contract is granted by a court of competent jurisdiction. 

1270 NOTICES

1271 37. Any notice, demand, or request authorized or required by this Contract shall be 

1272 deemed to have been given, on behalf of the Contractor, when mailed by that Contractor, postage 

1273 prepaid, or delivered by that Contractor to the Area Manager, South-Central California Area Office, 

1274 1243 N Street, Fresno, California 93721, and on behalf of the United States, when mailed, postage 

1275 prepaid, or delivered to the Board of Directors/City Council of the Pajaro Valley Water 

1276 Management Agency, 36 Brennan Street, Watsonville, California 95076; Santa Clara Valley Water 

1277 District, 570 Almaden Expressway, San Jose, California 95118-3686; and Westlands Water District 

1278 Distribution District No. 1, P. O. Box 6065, Fresno, California 93703-6065. The designation of the 

1279 addressee or the address may be changed by notice given in the same manner as provided in this 

1280 Article for other notices. 

1281 CONFIRMATION OF CONTRACT

1282 38. (a) Each Contractor, after the execution of this Contract, shall promptly seek to 

1283 secure a decree of a court of competent jurisdiction of the State of California, confirming the 

1284 execution of this Contract. The Contractor shall furnish the United States a certified copy of the 

1285 final decree, the validation proceedings, and all pertinent supporting records of the court approving 
Contract No. 14-06-200-3365A-LTR1-B

55

1286 and confirming this Contract, and decreeing and adjudging it to be lawful, valid, and binding on the 

1287 Contractor. 

1288 IN WITNESS WHEREOF, the parties hereto have executed this Contract as of the day and 

1289 year first above written. 

1290 THE UNITED STATES OF AMERICA 

1291 By: __________________________________ 

1292 Regional Director, Mid-Pacific Region 

1293 Bureau of Reclamation 

1294 (SEAL) 

1295 PAJARO VALLEY WATER 

1296 MANAGEMENT AGENCY 

1297 By: __________________________________ 

1298 President of the Board of Directors 

1299 Attest: 

1300 By: _______________________________ 

1301 Secretary of the Board of Directors
Contract No. 14-06-200-3365A-LTR1-B

56

1302 SANTA CLARA VALLEY WATER 

1303 DISTRICT

1304 By: __________________________________ 

1305 President of the Board of Directors 

1306 Attest: 

1307 By: ________________________________ 

1308 Secretary of the Board of Directors 

1309 WESTLANDS WATER DISTRICT 

1310 DISTRIBUTION DISTRICT NO. 1

1311 By: __________________________________ 

1312 President of the Board of Directors 

1313 Attest: 

1314 By: ________________________________ 

1315 Secretary of the Board of Directors 

1316 (H:\LTRC\Final Draft LTRC’s – Fresno, Tracy\11-29-04 Pajaro. SCWD, WWDDD1 Final Draft 

1317 LTRC with exhibits.doc)
HERNANDEZ

RESERVOIR

COLLEGE LAKE

UVAS RESERVOIR

CHESBRO RESERVOIR

EASTMAN LAKE

WOODWARD RES

MODESTO

RESERVOIR

TURLOCK LAKE

LAKE

MCCLURE

S. FORK LOS BANOS CR

ANDERSON LAKE

LAKE

DEL VALLE

UPPER

SAN LEANDRO

RES

CISCO BAY

SAN ANTONIO

RESERVOIR

COYOTE LAKE

CALERO RES

GUADALUPE RES

VASONA RES

LAKE ELSMAN

CRYSTAL

S RES

L TI TLE PANOCHE CR EEK

MUD SL O UGH

ALAM E D A CREEK

SO SAN R AMON CREEK

CALAVERAS

RESERVOIR

LAKE

CHABOT

CLIFTON COURT

FOREBAY

DON PEDRO

RESERVOIR

SAN LUIS RES

LOS

BANOS RES

NACIMIENTO

RESERVOIR

SAN JUSTO RESERVOIR

D

URE ISLAND

M IDDLE

S. F.

STEVENS

C REEK S AR ATO GA C R EEK GATOS CREEK

LONE

STANISLAUS

CREEK

SAN JOAQUIN

SAN FELIPE LAKE

ARROYO VALLE

AR ROYO MO CHO

TREE

RIVER

TUOL UM NE

MER CED

MERCED

RIVER

R IVER

TUOLUMN E

RIVE R

BANOS

LOS CREEK

SAN LORE NZO

RIVER

SALINAS

RIVER

BENITO

SAN

RIVER

SILVER

C

PA N

R

OCHE

CR EEK

CANTUA CREEK

GA TOS

LO S

WAR THAN

CREEK

CREEK

COYOTE CR

ESTR ELLA

RIVER

C H OWCHILLA

ASH

SLOUGH

FRESNO RIV

CR

DRY

MADERA

LAKE

C OTT ONWOO D

CR

LON E

WILLOW S LOU GH

FRESNO S A N

J O AQU IN

C RE EK BEAR

MU RPH Y

OL S

C O YOTE HI L LS SLOUGH

SAN ANTONIO

RESERVOIR

SLOU GH

BERE NDA SLOU GH

JAMES BYPASS

BEAR RESERVOIR

OWENS RESERVOIR MARIPOSA RESERVOIR

O`NEILL FOREBAY

OWENS

CREEK

OWE N S

C R EEK

BEAR

CREEK

BANTA CARB ONA

CERES MAIN

MAIN CANAL

PACHECO CONDUIT

SANTA CLARA C O NDUIT

LIFT CANAL

CANAL

SAN LUIS C AN A L

T U RLOCK

EAST

SIDE

CANAL

SO

AQUEDUCT

BAY

AQUEDUCT

HETCH-HETCHY

AQUEDUCT

CALIFORNIA

DELTACANAL

MENDOTA

MOD ESTO MAIN CANAL

MAIN C ANAL

HETCH-HETCHY

AQUEDUCT

AR R OYO CANAL

MAIN CANAL

OUTSIDE

C ANAL DELTA-MENDOTA CANAL

HOLLISTER CONDUIT

CHOWCHILLA CANAL

MADERA CANAL

CRESCENT

DITCH

CALIFORNIA

AQUEDUCT

CALIFORNIA AQ U E DUCT

COALINGA CANAL

Santa Clara Valley WD

Pajaro Valley WMA

Westlands WD Distribution

District #1

WARTHAN CREEK

FFRREESSNNOO CCOO

MMOONNTTEERREEYY CCOO

MMEERRCCEEDD CCOO

KKIINNG

MMAARRIIPPOOSSAA CCOO

SSTTAANNIISSLLAAUUSS CCOO

SSAANN BBEENNIITTOO CCOO

AALLAAMMEEDDAA CCOO

SSAANN JJOOAAQQUUIINN CCOO TTUUOOLLUUMMNNEE CCOO

SSAANNTTAA CCRRUUZZ CCOO

CCOONNTTRRAA CCOOSSTTAA CCOO

SSAANNTTAA CCLLAARRAA CCOO

EEOO CCOO

KKEERRNN CCOO

OO CCOO

SSAANN LLUUIISS OOBBIISSPPOO CCOO

CCAALLAAVVEERRAASS CCOO

TRACY

MADERA

MERCED

AVENAL

MONTEREY

HOLLISTER

Pajaro Valley W.M.A. - Santa Clara Valley W.D.

Westlands W.D. Distribution District #1 District Boundary

Contractor's Service Area Contract No. 14-06-200-3365A-B-LTR1

Exhibit A

0 5 10 20

Miles

805-208-3984 Date: October 28, 2004

File Name: N:\districts\contracts\pajaro-santaclara-westdd#1\pajaro-santaclara-westdd#1.mxd
Contract No. 14-06-200-3365A-LTR1-B

EXHIBIT B

PAJARO VALLEY WATER MANAGEMENT AGENCY, SANTA CLARA VALLEY WATER 

DISTRICT, AND WESTLANDS WATER DISTRICT DISTRUBITON DISTRICT NO. 1

Water Rates and Charges

Note: Rates and Charges are 2004 rates. This exhibit will be updated prior to execution of the 

 contract to reflect the current Rates and Charges. 

 2004 Rates per Acre-Foot Irrigation Water M&I Water 1/ 

COST-OF-SERVICE RATES: 

 Westlands Santa Clara

Capital Rates $15.69 $ 8.57 

O&M Rates: 

Water Marketing 7.59 7.59 

Storage 5.83 5.62 

San Luis Drain .71 

Direct Pumping 1.46 6.86 

 Conveyance 

 Conveyance Pumping 

Deficit Rates: 

 Non-Interest Bearing 

 Interest Bearing 

CFO/PFR Adj. Rate 2/ 4.27 

TOTAL COST-OF-SERVICE-RATES $31.27 $32.91 _1/_

FULL-COST RATES

Section 202(3) Rate is applicable to a 

 Qualified Recipient or to a Limited 

 Recipient receiving irrigation water 

 on or before October 1, 1981. $55.32 $48.52 

Section 205(a)(3) Rate is 

 applicable to a Limited Recipient that 

 did not receive irrigation water on or before October 1, 1981. $70.24 $57.13 

CHARGES UNDER P.L. 102-575 TO RESTORATION FUND 3/ 

 Restoration Payments (3407(d)(2)(A)) $ 7.82 $ 7.82 $15.64 

1/ To be provided as needed. 

2/ Rate represents Chief Financial Officers (CFO) adjustment and Provision for Replacement 

(PFR) credit for option 2 cost deferment to be distributed over 5-year period beginning with 2003 

water rates. 

 

3/ Restoration fund charges are payments in addition to the water rates and were determined 

pursuant to Title XXXIV of Public Law 102-575. Restoration fund charges are on a fiscal year basis 

(10/1-9/30).