Irrigation and Other 

Contract No.14-06-200-4020E 

UNITED STATES 

DEPARTMENT OF THE INTERIOR 

BUREAU OF RECLAMATION 

Central Valley Project, California 

CONTRACT BETWEEN THE UNITED STATES

AND

MADERA IRRIGATION DISTRICT

PROVIDING FOR PROJECT WATER SERVICE FROM 

HIDDEN UNIT AND 

FOR FACILITIES REPAYMENT

Table of Contents

Article No. Title Page No.

 Preamble 

 Explanatory Recitals 

1 Definitions 

2 Effective Date of Contract 

3 Water to be Made Available and Delivered to the Contractor 

4 Reservoir Operation – Use and Sale of Water 

5 Point of Diversion and Responsibility for Distribution of Water 

6 Measurement of Water within the Service Area 

7 Rates, Method of Payment for Water, and Accelerated Repayment of Facilities 

8 Non-Interest Bearing Operation and Maintenance Deficits 

9 Omitted 

10 Sales, Transfers, and Exchanges of Water 

11 Application of Payments and Adjustments 

12 Temporary Reductions--Return Flows 

13 Constraints on the Availability of Water 

14 Unavoidable Groundwater Percolation 

15 Acreage Limitation 

16 Compliance With Federal Reclamation Laws 

17 Protection of Water and Air Quality 

18 Water Acquired By the Contractor Other Than From the United States 

19 Opinions and Determinations 

20 Coordination and Cooperation 

21 Charges for Delinquent Payments 

22 Equal Employment Opportunity 
23 General Obligation--Benefits Conditioned Upon Payment 

24 Compliance with Civil Rights Laws and Regulations 

25 Privacy Act Compliance 

26 Contractor to Pay Certain Miscellaneous Costs 

27 Water Conservation 

28 Existing or Acquired Water or Water Rights 

29 Omitted 

30 Contingent on Appropriation or Allotment of Funds 

31 Books, Records, and Reports 

32 Assignment Limited--Successors and Assigns Obligated 

33 Severability 

34 Resolution of Disputes 

35 Officials Not to Benefit 

36 Changes in Contractor's Service Area 

37 Federal Laws 

38 Omitted

39 Medium for Transmitting Payment 

40 Notices 

41 Confirmation of Contract 

42 Contract Drafting Considerations 

 Signature Page 

 Exhibit A Contractor’s Map or Description of Service Area 

 Exhibit B Rates and Charges 

 Exhibit C-1 Repayment Schedule – Lump Sum Option 

 Exhibit C-2 Repayment Schedule – Installment Option 

 Exhibit D Computation of Financing Costs Offset 

 Exhibit E Restated Contract 

 
Contract No. 14-06-200-4020E 

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UNITED STATES 

DEPARTMENT OF THE INTERIOR 

BUREAU OF RECLAMATION 

Central Valley Project, California 

5 CONTRACT BETWEEN THE UNITED STATES

6 AND

7 MADERA IRRIGATION DISTRICT

8 PROVIDING FOR PROJECT WATER SERVICE FROM 

9 HIDDEN UNIT AND 

10 FACILITIES REPAYMENT

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 THIS CONTRACT, made this _____ day of ____________________, 2010, is entered into 

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

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

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

483), June 21, 1963 (77 Stat. 68), October 12, 1982 (96 Stat. 1262), October 27, 1986 (100 Stat. 

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

Subtitle A, of the Act of March 30, 2009 (123 Stat. 1349), also referred to as the San Joaquin River 

Restoration Settlement Act hereinafter referred to as SJRRSA, all collectively hereinafter referred to 

as Federal Reclamation law, between THE UNITED STATES OF AMERICA, hereinafter referred to 

as the United States and MADERA IRRIGATION DISTRICT, hereinafter referred to as the 

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

the laws thereof, with its principal place of business in California; 

 WITNESSETH, That 

25 EXPLANATORY RECITALS

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

Project, California, for diversion, storage, carriage, distribution and beneficial use, for flood control, 
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irrigation, municipal, domestic, industrial, fish and wildlife mitigation, protection and restoration, 

generation and distribution of electric energy, salinity control, navigation and other beneficial uses, of 

waters of the Sacramento River, the American River, the Trinity River, and the San Joaquin River 

and their tributaries; and 

[2nd] WHEREAS, pursuant to Title II of the Flood Control Act of October 23, 1962 (76 

Stat. 1180), and supporting documents, the United States constructed Hidden Dam on the Fresno 

River (thereby creating Hensley Lake), hereinafter referred to as the Hidden Unit, which is operated 

by the Corps of Engineers for flood control, recreation and other incidental uses; and

 [3rd] WHEREAS, the United States and the Contractor entered into Contract Number 14-

06-200-4020A, as amended, providing the Contractor the right to the entire yield from the Hidden 

Unit available for conservation purposes from August 5, 1962 through February 28, 1994; and 

 [4th] WHEREAS, the Contractor and the United States have, pursuant to subsection 

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

interim renewal contract(s), identified as Contract Number (s) 14-06-200-4020A-IR2, IR3, IR4, and 

IR5, which provided for the continued water service to Contractor from March 1, 1995 through 

February 28, 2001, and subsequently entered into a long-term renewal contract, identified as Contract 

Number 14-06-200-4020A-LTR1, which provided for continued water service to Contractor through 

February 28, 2026, which was amended January 22, 2007, and is herein referred to as the "Existing 

Contract”; and 

[5th] WHEREAS, pursuant to Section 8 of the Act of June 17, 1902 (32 Stat. 388), the 

United States has acquired water rights and other rights to the flows of the Fresno River, including 
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without limitation the permits issued as the result of Decision 1407 by the California State Water 

Resource Control Board pursuant to which the Contracting Officer develops, diverts, stores and 

delivers Project Water stored or flowing through Hensley Lake in accordance with State and Federal 

law for the benefit of the Contractor in the Hidden Unit and for other specified Project purposes; and 

 [6th] WHEREAS, the water supplied to the Contractor pursuant to this Contract is Project 

Water developed through the exercise of the rights described in the fifth (5th) Explanatory Recital of 

this Contract; and 

 [7th] WHEREAS, as a result of litigation entitled “Natural Resources Defense Council, et 

al. v Kirk Rogers, et al.” No. CIV-S-88-1658LLK/GGH, certain contractors from the Friant Division 

entered into a Stipulation of Settlement dated September 13, 2006, (the “Settlement”), which 

settlement prescribes a Restoration Goal and a Water Management Goal and which Settlement was 

subsequently confirmed and implemented through the SJRRSA; and 

[8th] WHEREAS, the SJRRSA authorizes and directs the Secretary to convert the Existing 

Contract to a repayment contract under subsection (d) of Section 9 of the Act of August 4, 1939, no 

later than December 31, 2010, and further directs that such contract shall require the accelerated 

repayment of the Contractors’ allocated share of construction costs, either as a lump sum payment by 

January 31, 2011 or in annual installments by January 31, 2014, which funds will in turn be made 

available for implementation of the Settlement and SJRRSA, and which costs otherwise would have 

been payable through annual water rates, with full repayment by 2030; and 
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[9th] WHEREAS, such repayment of costs will assist the United States with 

implementation of actions required under the Settlement and the SJRRSA and provide the Contractor 

the benefits provided in Section 10010 of the SJRRSA; and 

[10th] WHEREAS, subsection (4) of Section 1 of the Act of July 2, 1956 (1956 Act) directs 

the Secretary to provide that the other party to any contract entered into pursuant to subsection (d) of 

Section 9 of the Act of August 4, 1939 (repayment contract) or pursuant to subsection (e) of Section 9 

of the Act of August 4, 1939 (water service contract) shall “have the first right (to which the rights of 

the holders of any other type of irrigation water contract shall be subordinate) to a stated share or 

quantity of the project’s available water supply for beneficial use on the irrigable lands within the 

boundaries of, or owned by, the party and a permanent right to such share or quantity upon 

completion of payment of the amount assigned for ultimate return” by the contractor subject to 

fulfillment of all obligations under the contract; and 

 [11th] WHEREAS, among other things, this Contract includes provisions granting the 

Contractor the permanent right to the entire yield from the Hidden Unit available for conservation 

purposes as described in the tenth (10th) Explanatory Recital; and 

 [12th] WHEREAS, the Contractor has demonstrated to the satisfaction of the Contracting 

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

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

Contractor has the capability and expects to utilize fully for reasonable and beneficial use the quantity 

of Project Water to be made available to it pursuant to this Contract; and 
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 [13th] WHEREAS, water obtained from the Central Valley Project has been relied upon by 

urban and agricultural areas within California for more than fifty (50) years and is considered by the 

Contractor as an essential portion of its water supply; and 

 [14th] WHEREAS, the economies of regions within the Central Valley Project, including the 

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

Central Valley Project; and 

 [15th] WHEREAS, the Secretary intends through coordination, cooperation, and partnerships 

to pursue measures to improve water supply, water quality, and reliability of the Project for all 

Project purposes; and 

 [16th] WHEREAS, the mutual goals of the United States and the Contractor include: to 

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

the Central Valley Project as required by law; to guard reasonably against Project Water shortages; to 

achieve a reasonable balance among competing demands for use of Project Water; and to comply 

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

States relative to the Central Valley Project; and 

 [17th] Omitted; and 

 [18th] Omitted; and 

 [19th] WHEREAS, the United States has determined that the Contractor has fulfilled all of 

its obligations under the Existing Contract. 

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

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

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

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

 (a) “Additional Capital Obligation” shall mean any additional construction costs 

or other capitalized costs incurred after the effective date of this Contract or not reflected in the 

Existing Capital Obligation as provided in Section 10010(a)(3)(B) of the SJRRSA and any amounts 

payable by Contractor as determined through the final adjustment described and required by Section 

10010(b) of the SJRRSA; 

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

dates inclusive; 

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

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

annually by the Contracting Officer pursuant to this Contract and consistent with the SJRRSA; 

 (d) Omitted; 

 (e) Omitted; 

 (f) Omitted; 

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

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

regulation; 

 (h) "Contract Total" shall mean the amount of Project Water to which the 

Contractor is entitled under subdivision (a) of Article 3 of this Contract and is the stated share or 
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quantity of Water to which the Contractor will have a permanent right in accordance with the 1956 

Act and the terms of this Contract, upon the Contractor's complete payment of the Repayment 

Obligation, notwithstanding any Additional Capital Obligation that may later be established, which 

right shall not be disturbed so long as the Contractor fulfills all of its obligations under this Contract; 

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

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

which may be modified from time to time in accordance with Article 36 of this Contract without 

amendment of this Contract; 

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

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

 (j2) “District Engineer” shall mean the District Engineer, United States Army 

Corps of Engineers, or his authorized representative; 

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

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

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

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

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

Reclamation law; 

(m) “Existing Capital Obligation” shall mean the remaining amount of construction 

costs of the Contractor identified in the Central Valley Project Irrigation Water Rates and/or 

Municipal and Industrial Water Rates, respectively, dated January 25, 2007, as adjusted to reflect 
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payments not reflected in such schedule, pursuant to Section 10010(a)(3)(A) of the SJRRSA. The 

Contracting Officer has computed the Existing Capital Obligation in a manner consistent with the 

SJRRSA and such amount is set forth in Exhibits “C-1” and “C-2”, incorporated herein by reference; 

 (n) “Financing Costs”, for purposes of computing the reduction of certain charges 

as specified in subdivision (c) of Article 7 of this Contract, shall mean the difference between the net 

present value of the Existing Capital Obligation discounted using the full Treasury rate and the 

Existing Capital Obligation discounted using one-half the Treasury Rate, as set forth in Section 

10010(d)(3) of the SJRRA; 

 (o) “Full Cost Rate” shall mean that water rate described in Sections 205(a)(3) or 

202(3) of the RRA, whichever is applicable;

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

delivered in accordance with Section 204 of the RRA; 

 (q) “Irrigation Full Cost Water Rate” shall have the same meaning as “full cost” as 

that term is used in Paragraph (3) of Section 202 of the RRA; 

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

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

thereto, and watering of livestock. Irrigation water shall not include water used for the purposes such 

as the watering of landscaping or pasture for animals (e.g., horses) which are kept for personal 

enjoyment or water delivered to landholdings operated in units of less than five (5) acres unless the 

Contractor establishes to the satisfaction of the Contracting Officer that the use of the water delivered 

to any such landholding is a use described in this subdivision of this Article of this Contract; 
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 (s) “Landholder” shall mean a party that directly or indirectly owns or leases 

nonexempt land, as provided in 43 CFR 426.2; 

 (t) Omitted; 

 (u) Omitted. 

 (v) “Municipal &Industrial (M&I) Full Cost Water Rate” shall mean the annual 

rate, which, as determined by the Contracting Officer, shall amortize the expenditures for 

construction allocable to Project M&I facilities in service, including, O&M deficits funded, less 

payments, over such periods as may be required under Federal Reclamation law with interest 

accruing from the dates such costs were first incurred plus the applicable rate for the O&M of such 

Project facilities. Interest rates used in the calculation of the M&I Full Cost Rate shall comply with 

the Interest Rate methodology contained in Section 202(3) (B) and (C) of the RRA; 

 (w) “Operation and Maintenance” or “O&M" shall mean normal and reasonable 

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

Project facilities; 

 (x) Omitted; 

 (y) “Other Water” shall mean water from the Project other than Irrigation Water as 

described in subdivision (r) of this Article of this Contract, which is used for a purpose that is 

considered to be an irrigation use pursuant to State law such as the watering of landscaping or pasture 

for animals (e.g., horse) which are kept for the personal enjoyment. For purposes of this Contract, 

Other Water shall be paid for at Rates and Charges identical to those established for M&I water 

pursuant to the then-existing M&I Ratesetting Policy; 
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 (y2) “Prior-Rights Water” shall mean that portion of the inflow to Hensley Lake 

which flows through or is released from Hidden Dam in recognition of prior downstream Fresno 

River water rights of the Contractor and others, subject to any necessary new water rights permit or 

permit revisions and in accordance with any applicable agreements relating to the operation of the 

Hidden Unit and approved by the Contracting Officer and the State Water Resources Control Board, 

as necessary; 

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

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

 (aa) “Project Contractors” shall mean all parties who have a long-term water 

service contract or repayment contract for Project Water from the Project with the United States 

pursuant to Federal Reclamation law; 

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

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

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

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

Officer in accordance with the then-existing applicable water ratesetting policies for the Project, as 

described in subdivision (a) of Article 7 of this Contract and illustrated in Exhibit “B”, attached 

hereto; 

 (dd) Omitted; 

 (ee) “Repayment Obligation”, as provided in subdivision (a)(2)(A) of Article 7 of 

this Contract, shall be the Existing Capital Obligation, as defined herein, discounted by one-half of 
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the Treasury rate and computed consistent with the provisions of Section 10010(3)(A) of the 

SJRRSA to be paid as either a lump sum payment by January 31, 2011 or in approximately equal 

annual installments by January 31, 2014; 

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

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

through any agency of the Department of the Interior; 

 (gg) “Settlement” shall mean the Stipulation of Settlement dated September 13, 

2006, the Order Approving Stipulation of Settlement, and the Judgment and further orders issued by 

the Court pursuant to the terms and conditions of the Settlement in Natural Resources Defense 

Council, et al. v. Rodgers, et al., No. CIV-S-88-1658 LLJ/GGH; 

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

each acre-foot of Water Delivered as described in subdivision (l)(1) of Article 7 of this Contract; 

 (ii) “Water Delivered” or “Delivered Water” shall mean Project Water diverted for 

use by the Contractor at Hidden Dam, other than Prior-Rights Water, and for pricing purposes shall 

be 24,000 acre-feet per Year; 

 (jj) Omitted; 

 (kk) Omitted; 

 (ll) Omitted; 

 (mm) "Year" shall mean the period from and including March 1 of each Calendar 

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

234 EFFECTIVE DATE OF CONTRACT
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2. (a) This Contract shall become effective on the date first hereinabove written and 

shall continue so long as the Contractor is making the annual payments required herein and paying 

any other amounts owing under this Contract and applicable law, unless it is terminated by the 

Contracting Officer by reason of a material uncured breach by the Contractor; Provided, That the 

Contracting Officer shall not seek to terminate this Contract by reason of an asserted material 

uncured breach by the Contractor unless it has first provided at least sixty (60) days written notice of 

the asserted breach to the Contractor and the Contractor has failed to cure such breach (or to 

diligently commence curative actions satisfactory to the Contracting Officer for a breach that cannot 

be fully cured within sixty (60) days) within the sixty (60)-day notice period; 

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Provided further, That 

this Contract may be terminated at any time by mutual consent of the parties hereto. 

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(b) Upon complete payment of the Repayment Obligation by the Contractor, and 

notwithstanding any Additional Capital Obligation that may later be established, the Tiered Pricing 

Component as that term is utilized in this Contract, the acreage limitations, reporting, and Full Cost 

pricing provisions of Federal Reclamation law, and subdivisions (k), (l), (o) through (q), (s), and (v) 

of Article 1, subdivisions (a)(2)(A), (l)(1), (l)(2), and (l)(3) of Article 7, Article 14, subdivision (a) of 

Article 18, and Article 25, all of this Contract, shall no longer be applicable to the Contractor. Upon 

complete payment of the Repayment Obligation by the Contractor, and notwithstanding any 

Additional Capital Obligation that may later be established, the terms of this Contract shall be as 

provided in the restated contract attached hereto as Exhibit “E”, which has been prepared solely as a 

matter of administrative convenience. Exhibit “E” makes no substantive revisions other than those 

required by this subdivision of this Article of this Contract. Accordingly, upon complete payment of 
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the Repayment Obligation by the Contractor, and notwithstanding any Additional Capital Obligation 

that may later be established, the parties shall refer to Exhibit “E” as their entire agreement under this 

Contract. 

 (c) This Contract supersedes in its entirety and is intended to replace in full the 

Existing Contract; Provided, That if this Contract is terminated or determined to be invalid or 

unenforceable for any reason other than a material uncured breach of this Contract by the Contractor, 

the Existing Contract shall not be superseded and shall be in full force and effect. 

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263 WATER TO BE MADE AVAILABLE AND DELIVERED TO THE CONTRACTOR

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

and licenses, Federal law, the Settlement including the SJRRSA, and subject to the provisions set 

forth in Articles 12 and 13 of this Contract, the Contracting Officer shall make available for delivery 

to the Contractor the entire quantity of Project Water from the Hidden Unit for irrigation purposes. 

The quantity of Water Delivered to the Contractor in accordance with this subdivision shall be paid 

for pursuant to the provisions of Article 7 of this Contract. 

(b) Upon complete payment of the Repayment Obligation by the Contractor, and 

notwithstanding any Additional Capital Obligation that may later be established, the Contractor shall 

have a permanent right to the Contract Total in accordance with the 1956 Act and the terms of this 

Contract. This right shall not be disturbed so long as the Contractor fulfills all of its obligations 

hereunder. The quantity of water made available for delivery in any given Year shall remain subject 

to the terms and conditions of subdivision (a) of this Article of this Contract. 
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 (c) The Contractor shall utilize the Project Water in accordance with all applicable 

legal requirements. 

 (d) The Contractor shall make reasonable and beneficial use of all Project Water 

or other water furnished pursuant to this Contract. Groundwater recharge programs, groundwater 

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

Water or other water furnished pursuant to this Contract conducted within the Contractor’s Service 

Area which are consistent with applicable State law and result in use consistent with applicable 

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

described in the Contractor’s Water Conservation Plan submitted pursuant to Article 27 of this 

Contract; 

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Provided further, That such Water Conservation Plan demonstrates sufficient lawful uses 

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

delivered pursuant to this Contract is demonstrated to be reasonable for such uses and in compliance 

with Federal Reclamation law. Groundwater recharge programs, groundwater banking programs, 

surface water storage programs, and other similar programs utilizing Project Water or other water 

furnished pursuant to this Contract conducted outside the Contractor’s Service Area may be permitted 

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

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

address such concerns in regulations, policies, or guidelines. 

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 (e) The Contractor, through this Contract, shall comply with requirements 

applicable to the Contractor in biological opinion(s) prepared as a result of the consultation regarding 

the execution of the Existing Contract undertaken pursuant to Section 7 of the Endangered Species 
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Act of 1973, as amended , as well as the requirements of any other biological opinions applicable to 

Project Water delivery under this Contract, that are within the Contractor’s legal authority to 

implement. The Contractor shall comply with the limitations or requirements imposed by 

environmental documentation applicable to the Contractor and within its legal authority to implement 

regarding specific activities. Nothing herein shall be construed to prevent the Contractor from 

challenging or seeking judicial relief in a court of competent jurisdiction with respect to any 

biological opinion or other environmental documentation referred to in this Article of this Contract. 

(f) Omitted. 

 (g) Omitted. 

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

State law to the reasonable and beneficial use of the Contract Total pursuant to this Contract shall not 

be disturbed so long as the Contractor shall fulfill all of its obligations under this Contract. Nothing 

in the preceding sentence shall affect the Contracting Officer’s ability to impose shortages under 

Article 12 or Article 13 of this Contract. 

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

delivered for purposes other than those described in subdivisions (r) and (y) of Article 1 of this 

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

conditions of such approval. 

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

rights and other rights described in the fifth (5th) Explanatory Recital of this Contract and to provide 

the water available under this Contract. The Contracting Officer shall not object to participation by 
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the Contractor, in the capacity and to the extent permitted by law, in administrative proceedings 

related to the water rights and other rights described in the fifth (5th) Explanatory Recital of this 

Contract; Provided however, That the Contracting Officer retains the right to object to the substance 

of the Contractor’s position in such a proceeding. 

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Provided further, that in such proceedings the 

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

use Project Water. 

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 (k) Omitted. 

 (l) Omitted. 

 (m) Nothing in this Contract, nor any action or inaction of the Contractor or 

Contracting Officer in connection with the implementation of this Contract, is intended to override, 

modify, supersede or otherwise interfere with any term or condition of the water rights and other 

rights referred in the fifth (5th) Explanatory Recital of this Contract. 

 (n) Omitted. 

 (o) Omitted. 

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 4. (a) At the request of the Contractor, pursuant to the terms and conditions of this 

Contract, the United States, acting through the District Engineer, shall store, regulate, and/or release 

all flows of Fresno River water at the Hidden Unit subject to the regulation of the Hidden Unit for 

flood control, as conclusively determined by the District Engineer, and further subject to Prior-Rights 

Water releases and the maintenance of a minimum pool of five thousand (5,000) acre-feet of water in 

Hensley Lake for recreational and incidental uses. 
Contract No. 14-06-200-4020E 

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339 

340 

341 

 (b) Project Water delivered to the Contractor pursuant to this Contract shall be 

used as Irrigation Water or Other Water only and shall not be sold or otherwise disposed of for use 

outside the Contractor’s Service Area without the written approval of the Contracting Officer. 

342 POINT OF DIVERSION AND RESPONSIBILITY FOR DISTRIBUTION OF WATER

343 

344 

345 

346 

347 

348 

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350 

351 

352 

353 

354 

355 

356 

357 

358 

359 

 5. (a) Project Water delivered pursuant to this Contract shall be delivered to the 

Contractor at Hidden Dam. 

 (b) Omitted. 

 (c) The Contractor shall not deliver Project Water to land outside the Contractor's 

Service Area unless approved in advance by the Contracting Officer. Until complete payment of the 

Repayment Obligation by the Contractor, and notwithstanding any Additional Capital Obligation that 

may later be established, the Contractor shall deliver Project Water in accordance with applicable 

acreage limitations, reporting, and Full Cost pricing provisions of Federal Reclamation law and any 

applicable land classification provisions of the associated regulations. 

 (d) Project Water delivered to the Contractor pursuant to this Contract shall be 

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

States at the point of delivery established pursuant to subdivision (a) of this Article of this Contract. 

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

be investigated, the accuracy of such measurements and shall take any necessary steps to adjust any 

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

the Contracting Officer shall consult with the Contractor prior to making a final determination of the 

quantity delivered for that period of time. 
Contract No. 14-06-200-4020E 

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360 

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362 

363 

364 

365 

366 

367 

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370 

371 

372 

373 

374 

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376 

377 

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

handling, use, disposal, or distribution of Project Water delivered to the Contractor pursuant to this 

Contract beyond the delivery point specified in subdivision (a) of this Article of this Contract. The 

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

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

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

carriage, handling, use, disposal, or distribution of such Project Water beyond such delivery point, 

except for any damage or claim arising out of: (i) acts or omissions of the Contracting Officer or any 

of its officers, employees, agents, or assigns, with the intent of creating the situation resulting in any 

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

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

or assigns; or (iv) damage or claims resulting from a malfunction of facilities owned and/or operated 

by the United States. 

 (f) The Contractor shall maintain a surface water measurement program 

satisfactory to the Contracting Officer to provide for the operation of the Hidden Unit facilities 

without interference to established rights including correlative rights easterly of the EastsideChowchilla Canal Bypass and keep records of data obtained from such program satisfactory to the 

Contracting Officer. 

378 MEASUREMENT OF WATER WITHIN THE SERVICE AREA

379 

380 

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

Contracting Officer; all surface water delivered for irrigation purposes within the Contractor’s 
Contract No. 14-06-200-4020E 

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381 

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383 

384 

385 

386 

387 

388 

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392 

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394 

395 

396 

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398 

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400 

401 

Service Area is measured at each agricultural turnout; and Other Water delivered by the Contractor is 

measured at each service connection. The water measuring devices or water measuring methods of 

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

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

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

use the information obtained from such water measuring devices or water measuring methods to 

ensure its proper management of the water, to bill water users for water delivered by the Contractor; 

and, if applicable, to record water delivered as Other Water. Nothing herein contained, however, 

shall preclude the Contractor from establishing and collecting any charges, assessments, or other 

revenues authorized by California law. 

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

of this Contract, the Contractor shall provide to the Contracting Officer a written report describing 

the measurement devices or water measuring methods being used or to be used to implement 

subdivision (a) of this Article of this Contract and identifying the agricultural turnouts and the Other 

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

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

identifying the locations at which such devices and/or methods are not yet being used including a 

time schedule for implementation at such locations. The Contracting Officer shall advise the 

Contractor in writing within sixty (60) days as to the adequacy of, and necessary modifications, if 

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

the Contracting Officer does not respond in such time, they shall be deemed adequate. If the 
Contract No. 14-06-200-4020E 

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402 

403 

404 

405 

406 

407 

408 

409 

410 

411 

412 

413 

Contracting Officer notifies the Contractor that the measuring devices or methods are inadequate, the 

parties shall within sixty (60) days following the Contracting Officer‘s response, negotiate in good 

faith the earliest practicable date by which the Contractor shall modify said measuring devices and/or 

measuring methods as required by the Contracting Officer to ensure compliance with subdivision (a) 

of this Article of this Contract. 

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

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

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

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

in writing by April 30 of each Year of the annual volume of Irrigation Water and Other Water 

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

 (e) Omitted. 

414 RATES, METHOD OF PAYMENT FOR WATER,

415 AND ACCELERATED REPAYMENT OF FACILITIES 

416 

417 

418 

419 

420 

421 

422 

423 

 7. (a) The Contractor’s cost obligations for all Delivered Water shall be determined 

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

Secretary’s then-existing ratesetting policy for M&I water, consistent with the SJRRSA, and such 

ratesetting policies shall be amended, modified, or superseded only through a public notice and 

comment procedure; (ii) applicable Federal Reclamation law and associated rules and regulations, or 

policies; and (iii) other applicable provisions of this Contract. 

(1) The Contractor shall pay the United States as provided for in this 

Article of this Contract for the Delivered Water at Rates and Charges determined in accordance with 
Contract No. 14-06-200-4020E 

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424 

425 

426 

427 

428 

429 

430 

431 

432 

433 

434 

435 

436 

437 

438 

439 

440 

441 

442 

443 

444 

policies for Irrigation Water and M&I water. The Contractor’s Rates shall be established to recover 

its estimated reimbursable costs included in the O&M Component of the Rate and amounts 

established to recover other charges and deficits, other than the construction costs. The Rates for 

O&M costs and Charges shall be adjusted, as appropriate, in accordance with the provisions of the 

SJRRSA. 

 (2) In accordance with the SJRRSA, the Contractor’s allocable share of 

Project construction costs will be repaid pursuant to the provisions of this Contract. 

 (A) The amount due and payable to the United States, pursuant to 

the SJRRSA, shall be the Repayment Obligation. The Repayment Obligation has been computed by 

the Contracting Officer in a manner consistent with the SJRRSA and is set forth, both as a lump sum 

payment payable by January 31, 2011 and as four (4) approximately equal annual installments, which 

amounts together with the manner in which such amounts were calculated are set forth in Exhibits 

“C-1” and “C-2”. The Repayment Obligation is due in lump sum by January 31, 2011 or in 

approximate equal annual installments by January 31, 2014, as provided by the SJRRSA. The 

Contractor must provide appropriate notice to the Contracting Officer in writing not later than thirty 

(30) days prior to January 31, 2011 if electing to repay the amount due using the lump sum 

alternative. If such notice is not provided by such date, the Contractor shall be deemed to have 

elected the installment payment alternative, in which case, the first such payment shall be made no 

later than May 1, 2011, the second payment shall be made no later than the first anniversary of the 

first payment date, the third payment shall be made no later than the second anniversary of the first 

payment date, and the final payment shall be made no later than January 31, 2014. If the installment 
Contract No. 14-06-200-4020E 

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445 

446 

447 

448 

449 

450 

451 

452 

453 

454 

455 

456 

457 

458 

459 

460 

461 

462 

463 

464 

465 

payment option is elected by the Contractor, the Contractor may pre-pay the remaining portion of the 

Repayment Obligation by giving the Contracting Officer sixty (60) days written notice, in which 

case, the Contracting Officer shall re-compute the remaining amount due to reflect the pre-payment 

using the same methodology as was used to compute the initial annual installment payment amount, 

which is illustrated in Exhibit “C-2”. Upon complete payment of the Repayment Obligation by the 

Contractor, and notwithstanding any Additional Capital Obligation that may later be established, the 

Contractor shall be fully and permanently released from any obligation to pay and shall be deemed to 

have fully satisfied, the Existing Capital Obligation. 

 (B) Project construction costs or other capitalized costs attributable 

to capital additions to the Project incurred after the effective date of this Contract or that are not 

reflected in the schedules referenced in Exhibits “C-1” and “C-2” and properly assignable to the 

Contractor, shall be repaid as prescribed by the SJRRSA without interest except as required by law. 

Consistent with Federal Reclamation law, interest shall continue to accrue on the M&I portion of 

unpaid Project construction costs or other capitalized cost assigned to the Contractor until such costs 

are paid. Increases or decreases in Project construction costs or other capitalized costs assigned to the 

Contractor caused solely by annual adjustment of Project construction costs or other capitalized costs 

assigned to each CVP contractor by the Secretary shall not be considered in determining the amounts 

to be paid pursuant to this subdivision (a)(2)(B), but will be considered under subdivision (b) of this 

Article. A separate repayment agreement shall be established by the Contractor and the Contracting 

Officer to accomplish repayment of all additional Project construction costs or other capitalized costs 

assigned to the Contractor within the timeframe prescribed by the SJRRSA subject to the following: 
Contract No. 14-06-200-4020E 

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466 

467 

468 

469 

470 

(1) If the collective annual Project construction costs or 

other capitalized costs that are incurred after the effective date of this Contract and properly 

assignable to the contractors are less than $5,000,000, then the portion of such costs properly 

assignable to the Contractor shall be repaid in not more than five (5) years after notification of the 

allocation. This amount is the result of a collective annual allocation of Project construction costs to 

the contractors exercising contract conversions; Provided, That the reference to the amount of 

$5,000,000 shall not be a precedent in any other context. 

471 

472 

473 

474 

475 

476 

477 

(2) If the collective annual Project construction costs or 

other capitalized costs that are incurred after the effective date of this Contract and properly 

assignable to the contractors are $5,000,000 or greater, then the portion of such costs properly 

assignable to the Contractor shall be repaid as provided by applicable Federal Reclamation law. This 

amount is the result of a collective annual allocation of Project construction costs to the contractors 

exercising contract conversions; Provided, That the reference to the amount of $5,000,000 shall not 

be a precedent in any other context. 

478 

479 

480 

481 

482 

483 

484 

485 

486 

 (b) Consistent with Section 10010(b) of the SJRRSA, following a final cost 

allocation by the Secretary upon completion of the construction of the Central Valley Project, the 

amounts paid by the Contractor shall be subject to adjustment to reflect the effect of any reallocation 

of Project construction costs or other capitalized costs assigned to the Contractor that may have 

occurred between the determination of Contractor’s Existing Capital Obligation and the final cost 

allocation. In the event that the final cost allocation, as determined by the Secretary, indicates that 

the costs properly assignable to the Contractor, as determined by the Contracting Officer, are greater 
Contract No. 14-06-200-4020E 

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487 

488 

489 

490 

491 

492 

493 

494 

495 

496 

497 

498 

499 

500 

501 

502 

503 

504 

505 

506 

507 

than the Existing Capital Obligation and other amounts of Project construction costs or other 

capitalized costs paid by the Contractor, then the Contractor shall be obligated to pay the remaining 

allocated costs. The term of such additional repayment contract shall be no less than one (1) year and 

no more than ten (10) years, however, mutually agreeable provisions regarding the rate of repayment 

of such amount may be developed by the parties. In the event that the final cost allocation, as 

determined by the Secretary, indicates that the costs properly assignable to the Contractor, as 

determined by the Contracting Officer, are less than the Existing Capital Obligation and other 

amounts of Project construction costs or other capitalized costs paid by the Contractor, then the 

Contracting Officer shall credit such overpayment as an offset against any outstanding or future 

obligation of the Contractor, consistent with the SJRRSA. This Contract shall be implemented in a 

manner consistent with Section 10010(f) of the SJRRSA. 

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

Contractor an estimate of the Charges for Project Water that will be applied to the period October 1, 

of the current Calendar Year, through September 30, of the following Calendar Year, and the basis 

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

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

Officer shall notify the Contractor in writing of the Charges to be in effect during the period October 

1 of the current Calendar Year, through September 30 of the following Calendar Year, and such 

notification shall revise Exhibit “B”. Charges shall be subject to reduction consistent with the 

SJRRSA based upon the average annual delivery amount agreed to by the Contracting Officer and the 

Contractor. 
Contract No. 14-06-200-4020E 

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508 

509 

510 

511 

512 

513 

514 

515 

516 

517 

518 

519 

520 

521 

522 

523 

524 

525 

526 

527 

 (1) Upon complete payment of the Repayment Obligation by the 

Contractor, and notwithstanding any Additional Capital Obligation that may later be established, for 

the years 2020 through 2039 inclusive, outstanding or future obligations of the Contractor shall be 

reduced consistent with Section 10010(d)(2) of the SJRRSA. The amount of such reduction in 

outstanding or future obligations of the Contractor after October 1, 2010 has been computed by the 

Contracting Officer, and as computed, such amount is set forth in Exhibit “D”.

 (d) Prior to October 1 of each Calendar Year, the Contracting Officer shall make 

available to the Contractor an estimate of the Rates and Tiered Pricing Component for Project Water 

for the following Year and the computations and cost allocations upon which those Rates are based. 

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

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

shall provide the Contractor with the final Rates and Tiered Pricing Component to be in effect for the 

upcoming Year, and such notification shall revise Exhibit “B”. The O&M component of the Rate 

may be reduced as provided in the SJRRSA. 

 (e) Before March 1 and again before July 1 of each Year, the Contractor shall pay 

to the United States, at the Rates and Charges provided in subdivision (a) of this Article of this 

Contract, for one-half (1/2) of the Delivered Water (i.e. 12,000 acre-feet) regardless of the quantity of 

Irrigation Water and Other Water actually made available to the Contractor during the Year. 

 (f) Omitted. 

 (g) Omitted. 
Contract No. 14-06-200-4020E 

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528 

529 

530 

531 

532 

533 

534 

535 

536 

537 

538 

539 

540 

541 

542 

543 

544 

545 

546 

547 

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

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

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

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

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

regulations, the then-existing Project Ratesetting policies for M&I water or Irrigation Water, and 

consistent with the SJRRSA. 

 (j) The Contracting Officer shall keep its accounts, pertaining to the 

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

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

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

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

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

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

relating to accountings, reports, or information. 

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

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

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

making and allocating payments, other than those set forth in this Article of this Contract, may be in 

the mutual best interest of the parties, it is expressly agreed that the parties may enter into 
Contract No. 14-06-200-4020E 

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548 

549 

550 

551 

552 

553 

554 

555 

556 

557 

558 

559 

560 

561 

562 

563 

564 

565 

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

Contract is in effect without amending this Contract. 

 (l) (1) For tiered pricing calculation purposes, the amount of Delivered Water 

in excess of eighty percent (80%) but less than or equal to ninety percent (90%) of Water Delivered 

shall remain fixed at 2,400 acre-feet per Year and the applicable Tiered Pricing Component on this 

2,400 acre-feet shall equal one-half of the difference between the Rate established under subdivision 

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

Rate, whichever is applicable. Likewise, the amount of Delivered Water in excess of ninety percent 

(90%) of Water Delivered shall remain fixed at 2,400 acre-feet per Year and the applicable Tiered 

Pricing Component on this 2,400 acre-feet shall equal the difference between (i) the Rate established 

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

M&I Full Cost Water Rate, whichever is applicable. Before July 1 of each Year the Contractor shall 

make payment to the United States equal to the sum of the multiplication products of the applicable 

Tiered Pricing Component and such 2,400 acre-feet amounts. 

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

may request and receive an exemption from such Tiered Pricing Components for Project Water 

delivered pursuant to this Contract to produce a crop which the Contracting Officer determines will 

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

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

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

566 

567 
Contract No. 14-06-200-4020E 

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568 

569 

570 

571 

572 

573 

574 

575 

576 

577 

578 

579 

580 

581 

582 

583 

584 

585 

586 

587 

588 

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

use of such water. 

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

Components pursuant to this Article of this Contract, Water Delivered shall include Project Water 

that the Contractor transfers to others but shall not include Project Water transferred and delivered to 

the Contractor. 

 (m) Rates under the respective ratesetting policies will be established to recover 

only reimbursable O&M (including any deficits) costs of the Project, as those terms are used in the 

then-existing Project ratesetting policies, and consistent with the SJRRSA, and interest, where 

appropriate, except in instances where a minimum Rate is applicable in accordance with the relevant 

Project ratesetting policy. Changes of significance in practices which implement the Contracting 

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

Contractor an opportunity to discuss the nature, need, and impact of the proposed change. 

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

the Rates for Project Water transferred by the Contractor shall be the Contractor’s Rates adjusted 

upward or downward to reflect the changed costs of delivery (if any) incurred by the Contracting 

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

accordance with the then-existing Central Valley Project Ratesetting Policy. 

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

Officer is authorized to adjust determinations of ability to pay every five (5) years. 
Contract No. 14-06-200-4020E 

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589 NON-INTEREST BEARING OPERATION AND MAINTENANCE DEFICITS

590 

591 

592 

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

Contract, the Contractor has no non-interest bearing operation and maintenance deficits and therefore 

shall have no further liability. 

593 RECOVERED WATER ACCOUNT

594 9. Omitted. 

595 SALES, TRANSFERS, AND EXCHANGES OF WATER

596 

597 

598 

599 

600 

601 

602 

603 

604 

605 

606 

607 

608 

609 

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

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

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

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

Contract may take place without the prior written approval of the Contracting Officer. No such 

Project Water sales, transfers, or exchanges shall be approved, where approval is required, absent 

compliance with appropriate environmental documentation including but not limited to the National 

Environmental Policy Act and the Endangered Species Act. Such environmental documentation must 

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

including environmental justice, of the proposed Project Water sales, transfers and exchanges on both 

the transferor/exchanger and transferee/exchange recipient. 

(b) Omitted. 

(c) Omitted. 

 (d) Omitted. 
Contract No. 14-06-200-4020E 

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610 

611 

612 

613 

614 

615 

616 

617 

618 

619 

620 

621 

622 

(e) Omitted 

(f) Omitted. 

 (1) Omitted. 

(2) Omitted. 

 (3) Omitted. 

 (4) Omitted. 

 (g) Upon complete payment of the Repayment Obligation by the Contractor, and 

notwithstanding any Additional Capital Obligation that may later be established, in the case of a sale 

or transfer of Irrigation Water to another contractor which is otherwise subject to the acreage 

limitations, reporting and Full Cost pricing provisions of the RRA, such sold or transferred Irrigation 

Water shall not be subject to such RRA provisions, however, in the case of a sale or transfer of 

Irrigation Water to the Contractor from another contractor which is subject to RRA provisions, such 

RRA provisions shall apply to delivery of such water.

623 APPLICATION OF PAYMENTS AND ADJUSTMENTS

624 

625 

626 

627 

628 

629 

630 

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

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

the Contractor arising out of this Contract then due and payable. Overpayments of more than One 

Thousand Dollars ($1,000) shall be refunded at the Contractor’s request. In lieu of a refund, any 

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

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

adjustment shall constitute the sole remedy of the Contractor or anyone having or claiming to have 
Contract No. 14-06-200-4020E 

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631 

632 

633 

634 

635 

636 

637 

638 

639 

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

overpayments shall be made within thirty (30) days of the Contracting Officer obtaining direction as 

to how to credit or refund such overpayment in response to the notice to the Contractor that it has 

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

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

Contractor pursuant to Article 26 of this Contract shall be adjusted to reflect the actual costs when the 

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

refunded to the Contractor. If the actual costs exceed the Contractor's advances, the Contractor will 

be billed for the additional costs pursuant to Article 26 of this Contract. 

640 TEMPORARY REDUCTIONS—RETURN FLOWS

641 

642 

643 

644 

645 

646 

647 

648 

649 

650 

 12. (a) The Contracting Officer shall make all reasonable efforts to optimize delivery 

of the Contract Total subject to: (i) the authorized purposes and priorities of the Project; (ii) the 

requirements of Federal law and the Settlement; and (iii) the obligations of the United States under 

existing contracts, or renewals thereof, providing for water deliveries from the Project. 

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

Project Water delivered to the Contractor pursuant to this Contract as herein provided for the 

purposes of investigation, inspection, maintenance, repair, or replacement of any of the Project 

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

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

discontinuance or reduction, except in case of emergency, in which case no notice need be given; 

651 Provided, That the United States shall use its best efforts to avoid any discontinuance or reduction in 
Contract No. 14-06-200-4020E 

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652 

653 

654 

655 

656 

such service. Upon resumption of service after such reduction or discontinuance, and if requested by 

the Contractor, the United States will, if possible, deliver the quantity of Project Water which would 

have been delivered hereunder in the absence of such discontinuance or reduction. 

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

derived from Project Water delivered to the Contractor pursuant to this Contract which escapes or is 

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

claiming for the United States any right as seepage or return flow to water being used pursuant to this 

Contract for surface irrigation or underground storage either being put to reasonable and beneficial 

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

claiming by, through, or under the Contractor. For purposes of this subdivision, groundwater 

recharge, groundwater banking and all similar groundwater activities will be deemed to be 

underground storage. 

657 

658 

659 

660 

661 

662 

663 

664 CONSTRAINTS ON THE AVAILABILITY OF WATER

665 

666 

667 

668 

669 

 13. If there is a reduction in total water supply because of errors in physical operations of 

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

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

of Article 19 of this Contract, no liability shall accrue against the United States or any of its officers, 

agents, or employees for any damage, direct or indirect, arising therefrom. 

670 UNAVOIDABLE GROUNDWATER PERCOLATION

671 

672 

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

Irrigation Water to Excess Lands and Ineligible Lands within the meaning of this Contract if such 
Contract No. 14-06-200-4020E 

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673 

674 

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

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

675 ACREAGE LIMITATION

676 

677 

678 

679 

680 

681 

682 

683 

684 

685 

686 

687 

688 

689 

690 

691 

692 

693 

 15. (a) Notwithstanding the application of the acreage limitation provisions to 

activities referred to in subdivision (b) of this Article, subdivision (a) of Article 16, and Article 18 of 

this Contract, upon complete payment of the Repayment Obligation by the Contractor, and 

notwithstanding any Additional Capital Obligation that may later be established, the provisions of 

section 213(a) and (b) of the RRA shall apply to lands in the Contractor’s Service Area, with the 

effect that acreage limitations, reporting, and Full Cost pricing provisions of the RRA shall no longer 

apply to lands in the Contractor’s Service Area with respect to Project Water delivered pursuant to 

this Contract. Upon receiving the complete payment of the Repayment Obligation from the 

Contractor, Reclamation will conduct a final water district review for the purpose of determining 

compliance with the acreage limitations, reporting, and Full Cost pricing provisions of the RRA from 

the date of the last water district review until the date when payment to Reclamation of the 

Repayment Obligation is completed. 

 (b) Project Water now owned or hereafter acquired by the Contractor through a 

separate contract, other than this Contract, that is subject to Federal Reclamation law, may be 

delivered to lands within the Contractor’s Service Area. Upon complete payment of the Repayment 

Obligation by the Contractor, and notwithstanding any Additional Capital Obligation that may later 

be established, Project Water delivered under this Contract may be mixed with Project Water 

delivered pursuant to a contract with the United States, other than this Contract, to which acreage 
Contract No. 14-06-200-4020E 

 34

694 

695 

limitations, reporting, and the Full Cost pricing provisions of Federal Reclamation law apply without 

causing the application of the acreage limitations, reporting, and the Full Cost pricing provisions of 

Federal Reclamation law to the Project Water delivered pursuant to this Contract; Provided, The 

terms and conditions in such other contract shall continue to apply, and if such terms and conditions 

so require, the lands to receive Project Water under such other contract shall be properly designated 

by the Contractor and such Project Water is to be delivered in accordance with the RRA including 

any applicable acreage limitations, reporting, and the Full Cost pricing provisions. 

696 

697 

698 

699 

700 

701 COMPLIANCE WITH FEDERAL RECLAMATION LAWS

702 

703 

704 

705 

706 

707 

708 

 16. (a) The parties agree that the delivery of irrigation water or use of Federal 

facilities pursuant to this Contract is subject to Federal reclamation law, including but not limited to 

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

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

(b) The terms of this Contract are subject to the Settlement and the SJRRSA. 

Nothing in this Contract shall be interpreted to limit or interfere with the full implementation of the 

Settlement and the SJRRSA. 

709 PROTECTION OF WATER AND AIR QUALITY

710 

711 

17. (a) Project facilities used to make available and deliver water to the Contractor 

shall be operated and maintained in the most practical manner to maintain the quality of the water at 

the highest level possible as determined by the Contracting Officer: Provided, That the United States 

does not warrant the quality of the water delivered to the Contractor and is under no obligation to 

furnish or construct water treatment facilities to maintain or improve the quality of water delivered to 

the Contractor. 

712 

713 

714 

715 

716 

717 

718 

719 

720 

721 

722 

 (b) The Contractor shall comply with all applicable water and air pollution laws 

and regulations of the United States and the State of California; and shall obtain all required permits 

or licenses from the appropriate Federal, State, or local authorities necessary for the delivery of water 

by the Contractor; and shall be responsible for compliance with all Federal, State, and local water 

quality standards applicable to surface and subsurface drainage and/or discharges generated through 

the use of Federal or Contractor facilities or project water provided by the Contractor within the 

Contractor’s Project Water Service Area. 
Contract No. 14-06-200-4020E 

 35

723 

724 

 

 (c) This article shall not affect or alter any legal obligations of the Secretary to 

provide drainage or other discharge services. 

725 WATER ACQUIRED BY THE CONTRACTOR

726 OTHER THAN FROM THE UNITED STATES

727 

728 

729 

730 

731 

732 

733 

734 

735 

736 

737 

738 

739 

740 

741 

742 

743 

 18. (a) Until complete payment of the Repayment Obligation by the Contractor, and 

notwithstanding any Additional Capital Obligation that may later be established, water or water rights 

now owned or hereafter acquired by the Contractor other than from the United States and Irrigation 

Water furnished pursuant to the terms of this Contract may be simultaneously transported through the 

same distribution facilities of the Contractor subject to the following: (i) if the facilities utilized for 

commingling Irrigation Water and non-project water were constructed without funds made available 

pursuant to Federal Reclamation law, the acreage limitations, reporting, and Full Cost pricing 

provisions of Federal Reclamation law will be applicable only to the Landholders of lands which 

receive Irrigation Water; (ii) the eligibility of land to receive Irrigation Water must be established 

through the certification requirements as specified in the Acreage Limitation Rules and Regulations 

(43 CFR Part 426); and (iii) the water requirements of Eligible Lands within the Contractor's Service 

Area can be established and the quantity of Irrigation Water to be utilized is less than or equal to the 

quantity necessary to irrigate such Eligible Lands. The Contractor and the Contracting Officer 

acknowledge that the Contractor’s distribution system that was constructed with funds made 

available pursuant to Federal Reclamation law was, prior to effective date of this Contract, repaid in 

full but title to the facilities has not been transferred to the Contractor. As such, when such facilities 

are utilized for commingling Irrigation Water and non-project water, the acreage limitations, 
Contract No. 14-06-200-4020E 

 36

744 

745 

746 

747 

748 

749 

750 

751 

752 

753 

754 

755 

756 

757 

758 

759 

760 

761 

762 

763 

764 

reporting, and Full Cost pricing provisions of Federal Reclamation law will be applicable only to the 

Landholders of lands which receive Irrigation Water. 

 (b) Upon complete payment of the Repayment Obligation by the Contractor, and 

notwithstanding any Additional Capital Obligation that may later be established, water or water rights 

now owned or hereafter acquired by the Contractor other than from the United States pursuant to this 

Contract and Irrigation Water furnished pursuant to the terms of this Contract may be simultaneously 

transported through the same distribution facilities of the Contractor without the payment of fees to 

the United States and without application of Federal Reclamation law to Project Water delivered 

pursuant to this Contract or to lands which receive Project Water delivered to Contractor pursuant to 

this Contract.

 (c) Water or water rights now owned or hereafter acquired by the Contractor, other 

than from the United States or adverse to the Project or its contractors (i.e., non-project water), may 

be stored, conveyed and/or diverted through Project facilities, other than Hidden Unit facilities, 

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

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

necessary, consistent with the following provisions: 

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

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

subject to payment to the United States of an appropriate rate as determined by the Contracting 

Officer. In addition, if electrical power is required to pump non-project water, the Contractor shall be 

responsible for obtaining the necessary power and paying the necessary charges therefor. 
Contract No. 14-06-200-4020E 

 37

765 

766 

767 

768 

769 

770 

771 

772 

773 

774 

775 

776 

777 

778 

779 

780 

781 

782 

783 

784 

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

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

determined by the Contracting Officer; (ii) reduce the quantity or quality of water available to other 

Project Contractors; (iii) interfere with the delivery of contractual water entitlements to any other 

Project Contractors; (iv) interfere with the physical maintenance of the Project facilities; or (v) result 

in the United States incurring any liability or unreimbursed costs or expenses thereby. 

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

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

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

States and its officers, agents, and employees, from any claim for damage to persons or property, 

direct or indirect, resulting from Contractor’s diversion or extraction of non-project water from any 

source. 

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

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

management plan for the area from which it was extracted. 

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

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

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

non-project Water prior to any such remaining capacity being made available to non-project 

contractors. 
Contract No. 14-06-200-4020E 

 38

785 

786 

787 

788 

789 

 (d) Non-project water may be stored, conveyed and/or diverted through Hidden 

Unit facilities, subject to the prior completion of appropriate environmental documentation and 

approval of the Contracting Officer without execution of a separate contract, consistent with 

subdivisions (c)(1) through (c)(5) of this Article and any other condition determined to be appropriate 

by the Contracting Officer. 

790 OPINIONS AND DETERMINATIONS

791 

792 

793 

794 

795 

796 

797 

798 

799 

800 

801 

802 

803 

804 

805 

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

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

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

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

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

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

provided in a timely manner. Nothing in this Article of this Contract is intended to or shall affect or 

alter the standard of judicial review applicable under Federal law to any opinion or determination 

implementing a specific provision of Federal law embodied in statute or regulation. 

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

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

United States and the State of California, and the rules and regulations promulgated by the Secretary. 

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

practicable. 
Contract No. 14-06-200-4020E 

 39

806 COORDINATION AND COOPERATION

807 

808 

809 

810 

811 

812 

813 

814 

815 

816 

817 

818 

819 

820 

821 

822 

823 

824 

825 

826 

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

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

affected Project Contractors, in order to improve the operation and management of the Project. The 

communication, coordination, and cooperation regarding operations and management shall include, 

but not limited to, any action which will or may materially affect the quantity or quality of Project 

Water supply, the allocation of Project Water supply, and Project financial matters including, but not 

limited to, budget issues. The communication, coordination, and cooperation provided for hereunder 

shall extend to all provisions of this Contract. Each party shall retain exclusive decision making 

authority for all actions, opinions, and determinations to be made by the respective party. 

 (b) It is the intent of the Secretary to improve water supply reliability. To carry 

out this intent: 

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

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

Contracting Officer will, as appropriate, seek authorizations for implementation of partnerships to 

improve water supply, water quality, and reliability. 

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

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

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

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

California to seek improved water resource management. 
Contract No. 14-06-200-4020E 

 40

827 

828 

829 

830 

831 

832 

833 

834 

835 

836 

837 

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

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

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

hold division level meetings to discuss Project operations, division level water management 

activities, and other issues as appropriate. 

 (c) Without limiting the contractual obligations of the Contracting Officer 

hereunder, nothing in this Contract shall be construed to limit or constrain the Contracting Officer’s 

ability to communicate, coordinate, and cooperate with the Contractor or other interested 

stakeholders or to make decisions in a timely fashion as needed to protect health, safety, physical 

integrity of structures or facilities, or the Contracting Officer’s ability to comply with applicable 

laws. 

838 CHARGES FOR DELINQUENT PAYMENTS

839 

840 

841 

842 

843 

844 

845 

846 

847 

848 

849 

850 

851 

852 

853 

854 

855 

 21. (a) The Contractor shall be subject to interest, administrative and penalty charges 

on delinquent installments or payments. When a payment is not received by the due date, the 

Contractor shall pay an interest charge for each day the payment is delinquent beyond the due date. 

When a payment becomes sixty (60) days delinquent, the Contractor shall pay an administrative 

charge to cover additional costs of billing and processing the delinquent payment. When a payment 

is delinquent ninety (90) days or more, the Contractor shall pay an additional penalty charge of six 

(6%) percent per year for each day the payment is delinquent beyond the due date. Further, the 

Contractor shall pay any fees incurred for debt collection services associated with a delinquent 

payment. 

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

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

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

Project Act of 1939 (Public Law 76-260). The interest charge rate shall be determined as of the due 

date and remain fixed for the duration of the delinquent period. 

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

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

accrued interest, and finally to the overdue payment. 
Contract No. 14-06-200-4020E 

 41

856 EQUAL EMPLOYMENT OPPORTUNITY

857 

858 

859 

860 

861 

862 

863 

864 

865 

866 

867 

868 

869 

870 

871 

872 

873 

874 

875 

876 

877 

878 

879 

880 

881 

882 

883 

884 

885 

886 

887 

888 

889 

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

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

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

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

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

action shall include, but not be limited to the following: employment, upgrading, demotion, or 

transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of 

compensation; and selection for training, including apprenticeship. The Contractor agrees to post in 

conspicuous places, available to employees and applicants for employment, notices to be provided by 

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

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

or on behalf of the Contractor, state that all qualified applicants will receive consideration for 

employment without regard to race, color, religion, sex, disability, or national origin. 

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

which it has a collective bargaining agreement or other contract or understanding, a notice, to be 

provided by the Contracting Officer, advising the labor union or workers’ representative of the 

Contractor’s commitments under Section 202 of Executive Order 11246 of September 24, 1965, and 

shall post copies of the notice in conspicuous places available to employees and applicants for 

employment. 

(d) The Contractor will comply with all provisions of Executive Order No. 11246 of 

September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. 

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

Order 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of 

Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the 

Contracting Agency and the Secretary of Labor for purposes of investigation to ascertain compliance 

with such rules, regulations, and orders. 

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

of this contract or with any of such rules, regulations, or orders, this contract may be canceled, 

terminated or suspended in whole or in part and the Contractor may be declared ineligible for further 

Government contracts in accordance with procedures authorized in Executive Order 11246 of 

September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in 

Executive Order 11246 of September 24, 1965 or by rule, regulation, or order of the Secretary of 

Labor, or as otherwise provided by law. 
Contract No. 14-06-200-4020E 

 42

890 

891 

892 

893 

894 

(g) The Contractor will include the provisions of paragraphs (1) through (7) in every 

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

Labor issued pursuant to Section 204 of Executive Order 11246 of September 24, 1965, so that such 

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

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

means of enforcing such provisions, including sanctions for noncompliance: Provided, however, that 

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

or vendor as a result of such direction, the Contractor may request the United States to enter into such 

litigation to protect the interests of the United States. 

895 

896 

897 

898 

899 GENERAL OBLIGATION--BENEFITS CONDITIONED UPON PAYMENT

900 

901 

902 

903 

904 

905 

906 

907 

908 

909 

910 

911 

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

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

may be distributed among the Contractor's water users and notwithstanding the default of individual 

water users in their obligations to the Contractor. 

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

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

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

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

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

payment of water rates levied or established by the Contractor. 

 (c) With respect to subdivision (b) of this Article of this Contract, the Contractor 

shall have no obligation to require advance payment for water rates which it levies. 

912 COMPLIANCE WITH CIVIL RIGHTS LAWS AND REGULATIONS

913 

914 

915 

916 

917 

918 

919 

920 

921 

922 

923 

 24. (a) The Contractor shall comply with Title VI of the Civil Rights Act of 1964 (42 

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

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

well as with their respective implementing regulations and guidelines imposed by the U.S. 

Department of the Interior and/or Bureau of Reclamation. 

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

of race, color, national origin, handicap, or age, be excluded from participation in, be denied the 

benefits of, or be otherwise subjected to discrimination under any program or activity receiving 

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

agrees to immediately take any measures necessary to implement this obligation, including permitting 

officials of the United States to inspect premises, programs, and documents. 
Contract No. 14-06-200-4020E 

 43

924 

925 

926 

927 

928 

929 

930 

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

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

assistance extended after the date hereof to the Contractor by the Bureau of Reclamation, including 

installment payments after such date on account of arrangements for Federal financial assistance 

which were approved before such date. The Contractor recognizes and agrees that such Federal 

assistance will be extended in reliance on the representations and agreements made in this Article, 

and that the United States reserves the right to seek judicial enforcement thereof. 

931 PRIVACY ACT COMPLIANCE

932 

933 

934 

935 

936 

937 

938 

939 

940 

941 

942 

943 

944 

945 

946 

947 

948 

949 

950 

951 

952 

953 

954 

955 

956 

957 

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

Act) and the Department of the Interior rules and regulations under the Act (43 CFR 2.45 et seq.) in 

maintaining Landholder acreage certification and reporting records, required to be submitted to the 

Contractor for compliance with Sections 206 and 228 of the Reclamation Reform Act of 1982 (96 

Stat. 1266), and pursuant to 43 CFR 426.18. 

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

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

for maintaining the certification and reporting records referenced in (a) above are considered to be 

employees of the Department of the Interior. See 5 U.S.C. 552a(m). 

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

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

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

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

contained in the Landholder's certification and reporting records. 

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

Reclamation to be the System Manager who shall be responsible for making decisions on denials 

pursuant to 43 CFR 2.61 and 2.64 amendment requests pursuant to 43 CFR 2.72. The Contractor is 

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

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

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

43 CFR 2.71; notify the requester accordingly of such referral; and provide the System Manager with 

information and records necessary to prepare an appropriate response to the requester. These 

requirements do not apply to individuals seeking access to their own certification and reporting forms 

filed with the Contractor pursuant to 43 CFR 426.18, unless the requester elects to cite the Privacy 

Act as a basis for the request. 
Contract No. 14-06-200-4020E 

 44

958 CONTRACTOR TO PAY CERTAIN MISCELLANEOUS COSTS

959 

960 

961 

962 

963 

964 

965 

966 

 26. In addition to all other payments to be made by the Contractor pursuant to this 

Contract, the Contractor shall pay to the United States, within sixty (60) days after receipt of a bill 

and detailed statement submitted by the Contracting Officer to the Contractor for such specific items 

of direct cost incurred by the United States for work requested by the Contractor associated with this 

Contract plus indirect costs in accordance with applicable Bureau of Reclamation policies and 

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

agreed to in writing in advance by the Contractor. This Article of this Contract shall not apply to 

costs for routine contract administration. 

967 WATER CONSERVATION

968 

969 

970 

971 

972 

973 

974 

975 

976 

977 

978 

 27. (a) Prior to the delivery of water provided from or conveyed through Federally 

constructed or Federally financed facilities pursuant to this Contract, the Contractor shall be 

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

conservation plan that has been determined by the Contracting Officer to meet the conservation and 

efficiency criteria for evaluating water conservation plans established under Federal law. The water 

conservation and efficiency program shall contain definite water conservation objectives, appropriate 

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

Continued Project Water delivery pursuant to this Contract shall be contingent upon the Contractor’s 

continued implementation of such water conservation program. In the event the Contractor's water 

conservation plan or any revised water conservation plan completed pursuant to subdivision (d) of 

this Article of this Contract have not yet been determined by the Contracting Officer to meet such 
Contract No. 14-06-200-4020E 

 45

979 

980 

981 

982 

983 

984 

985 

986 

987 

988 

989 

990 

991 

992 

993 

994 

995 

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

Contractor, water deliveries shall be made under this Contract so long as the Contractor diligently 

works with the Contracting Officer to obtain such determination at the earliest practicable date, and 

thereafter the Contractor immediately begins implementing its water conservation and efficiency 

program in accordance with the time schedules therein. 

 (b) Omitted. 

 (c) The Contractor shall submit to the Contracting Officer a report on the status of 

its implementation of the water conservation plan on the reporting dates specified in the then-existing 

conservation and efficiency criteria established under Federal law. 

 (d) At five (5) -year intervals, the Contractor shall revise its water conservation 

plan to reflect the then-existing conservation and efficiency criteria for evaluating water conservation 

plans established under Federal law and submit such revised water management plan to the 

Contracting Officer for review and evaluation. The Contracting Officer will then determine if the 

water conservation plan meets Reclamation’s then-existing conservation and efficiency criteria for 

evaluating water conservation plans established under Federal law. 

 (e) If the Contractor is engaged in direct groundwater recharge, such activity shall 

be described in the Contractor’s water conservation plan. 

996 EXISTING OR ACQUIRED WATER OR WATER RIGHTS

997 

998 

999 

 28. Except as specifically provided in Article 18 of this Contract, the provisions of this 

Contract shall not be applicable to or affect non-project water or water rights now owned or hereafter 

acquired by the Contractor or any user of such water within the Contractor's Service Area, including, 
Contract No. 14-06-200-4020E 

 46

1000 

1001 

1002 

1003 

without limitation, Prior-Rights Water. Any such water shall not be considered Project Water under 

this Contract. In addition, this Contract shall not be construed as limiting or curtailing any rights 

which the Contractor or any water user within the Contractor's Service Area acquires or has available 

under any other contract pursuant to Federal Reclamation law. 

1004 OPERATION AND MAINTENANCE BY OPERATING NON-FEDERAL ENTITY

1005 29. Omitted. 

1006 CONTINGENT ON APPROPRIATION OR ALLOTMENT OF FUNDS

1007 

1008 

1009 

1010 

1011 

 30. The expenditure or advance of any money or the performance of any obligation of the 

United States under this Contract shall be contingent upon appropriation or allotment of funds. 

Absence of appropriation or allotment of funds shall not relieve the Contractor from any obligations 

under this Contract. No liability shall accrue to the United States in case funds are not appropriated 

or allotted. 

1012 BOOKS, RECORDS, AND REPORTS

1013 

1014 

1015 

1016 

1017 

1018 

1019 

1020 

1021 

1022 

1023 

1024 

1025 

1026 

 31. (a) The Contractor shall establish and maintain accounts and other books and 

records pertaining to administration of the terms and conditions of this Contract, including: the 

Contractor's financial transactions, water supply data, and Project land and right-of-way agreements; 

the water users' land-use (crop census), land ownership, land-leasing and water use data; and other 

matters that the Contracting Officer may require. Reports thereon shall be furnished to the 

Contracting Officer in such form and on such date or dates as the Contracting Officer may require. 

Subject to applicable Federal laws and regulations, each party to this Contract shall have the right 

during office hours to examine and make copies of the other party's books and records relating to 

matters covered by this Contract. 

 (b) Notwithstanding the provisions of subdivision (a) of this Article of this 

Contract, no books, records, or other information shall be requested from the Contractor by the 

Contracting Officer unless such books, records, or information are reasonably related to the 

administration or performance of this Contract. Any such request shall allow the Contractor a 

reasonable period of time within which to provide the requested books, records, or information. 
Contract No. 14-06-200-4020E 

 47

1027 (c) Omitted. 

1028 ASSIGNMENT LIMITED--SUCCESSORS AND ASSIGNS OBLIGATED

1029 

1030 

1031 

1032 

1033 

1034 

1035 

1036 

 32. (a) The provisions of this Contract shall apply to and bind the successors and 

assigns of the parties hereto, but no assignment or transfer of this Contract or any right or interest 

therein shall be valid until approved in writing by the Contracting Officer. 

(b) The assignment of any right or interest in this Contract by either party shall not 

interfere with the rights or obligations of the other party to this Contract absent the written 

concurrence of said other party. 

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

of any proposed assignment. 

1037 SEVERABILITY

1038 

1039 

1040 

1041 

1042 

1043 

1044 

1045 

1046 

1047 

1048 

 33. In the event that a person or entity who is neither (i) a party to a Project contract, nor 

(ii) a person or entity that receives Project Water from a party to a Project contract, nor (iii) an 

association or other form of organization whose primary function is to represent parties to Project 

contracts, brings an action in a court of competent jurisdiction challenging the legality or 

enforceability of a provision included in this Contract and said person, entity, association, or 

organization obtains a final court decision holding that such provision is legally invalid or 

unenforceable and the Contractor has not intervened in that lawsuit in support of the plaintiff(s), the 

parties to this Contract shall use their best efforts to (i) within thirty (30) days of the date of such final 

court decision identify by mutual agreement the provisions in this Contract which must be revised 

and (ii) within three (3) months thereafter promptly agree on the appropriate revision(s). The time 

periods specified above may be extended by mutual agreement of the parties. Pending the 
Contract No. 14-06-200-4020E 

 48

1049 

1050 

1051 

1052 

completion of the actions designated above, to the extent it can do so without violating any applicable 

provisions of law, the United States shall continue to make the quantities of Project Water specified 

in this Contract available to the Contractor pursuant to the provisions of this Contract which were not 

found to be legally invalid or unenforceable in the final court decision. 

1053 RESOLUTION OF DISPUTES

1054 

1055 

1056 

1057 

 34. Should any dispute arise concerning any provisions of this Contract, or the parties’ 

rights and obligations thereunder, the parties shall meet and confer in an attempt to resolve the 

dispute. Prior to the Contractor commencing any legal action, or the Contracting Officer referring 

any matter to Department of Justice, the party shall provide to the other party thirty (30) days written 

notice of the intent to take such action; Provided, That such notice shall not be required where a delay 

in commencing an action would prejudice the interests of the party that intends to file suit. During 

the thirty (30) day notice period, the Contractor and the Contracting Officer shall meet and confer in 

an attempt to resolve the dispute. Except as specifically provided, nothing herein is intended to 

waive or abridge any right or remedy that the Contractor or the United States may have. 

1058 

1059 

1060 

1061 

1062 

1063 OFFICIALS NOT TO BENEFIT

1064 

1065 

1066 

 35. No Member of or Delegate to Congress, Resident Commissioner, or official of the 

Contractor shall benefit from this Contract other than as a water user or landowner in the same 

manner as other water users or landowners. 

1067 CHANGES IN CONTRACTOR’S SERVICE AREA

1068 

1069 

1070 

 36. (a) While this Contract is in effect, no change may be made in the Contractor's 

Service Area or boundaries, by inclusion or exclusion of lands, dissolution, consolidation, merger, or 

otherwise, except upon the Contracting Officer's written consent. 
Contract No. 14-06-200-4020E 

 49

1071 

1072 

1073 

1074 

1075 

1076 

1077 

1078 

1079 

1080 

1081 

 (b) Within thirty (30) days of receipt of a request for such a change, the 

Contracting Officer will notify the Contractor of any additional information required by the 

Contracting Officer for processing said request, and both parties will meet to establish a mutually 

agreeable schedule for timely completion of the process. Such process will analyze whether the 

proposed change is likely to: (i) result in the use of Project Water contrary to the terms of this 

Contract; (ii) impair the ability of the Contractor to pay for Project Water furnished under this 

Contract or to pay for any Federally-constructed facilities for which the Contractor is responsible; 

and (iii) have an impact on any Project Water rights applications, permits, or licenses. In addition, 

the Contracting Officer shall comply with the National Environmental Policy Act and the Endangered 

Species Act. The Contractor will be responsible for all costs incurred by the Contracting Officer in 

this process, and such costs will be paid in accordance with Article 26 of this Contract. 

1082 FEDERAL LAWS

1083 

1084 

 37. By entering into this Contract, the Contractor does not waive its rights to contest the 

validity or application in connection with the performance of the terms and conditions of this 

Contract of any Federal law or regulation; Provided, That the Contractor agrees to comply with the 

terms and conditions of this Contract unless and until relief from application of such Federal law or 

regulation to the implementing provision of the Contract is granted by a court of competent 

jurisdiction. 

1085 

1086 

1087 

1088 

1089 EMERGENCY RESERVE FUND

1090 

1091 

 38. Omitted. 
Contract No. 14-06-200-4020E 

 50

1092 MEDIUM FOR TRANSMITTING PAYMENT

1093 

1094 

1095 

1096 

1097 

1098 

1099 

1100 

39. (a) All payments from the Contractor to the United States under this contract 

shall be by the medium requested by the United States on or before the date payment is due. The 

required method of payment may include checks, wire transfers, or other types of payment specified 

by the United States. 

 (b) Upon execution of the contract, the Contractor shall furnish the Contracting 

Officer with the Contractor’s taxpayer’s identification number (TIN). The purpose for requiring the 

Contractor’s TIN is for collecting and reporting any delinquent amounts arising out of the 

Contractor’s relationship with the United States. 

1101 NOTICES

1102 

1103 

1104 

1105 

1106 

1107 

1108 

 40. Any notice, demand, or request authorized or required by this Contract shall be 

deemed to have been given, on behalf of the Contractor, when mailed, postage prepaid, or delivered 

to the Area Manager, South-Central California Area Office, 1243 “N” Street, Fresno, California 

93721, and on behalf of the United States, when mailed, postage prepaid, or delivered to the Board of 

Directors of Madera Irrigation District, 12152 Road 28 1⁄4, Madera, California 93637. The 

designation of the addressee or the address may be changed by notice given in the same manner as 

provided in this Article of this Contract for other notices. 

1109 CONFIRMATION OF CONTRACT

1110 

1111 

1112 

1113 

1114 

1115 

 41. The Contractor, after the execution of this Contract, shall promptly provide to the 

Contracting Officer a decree of a court of competent jurisdiction of the State of California, 

confirming the execution of this Contract. The Contractor shall furnish the United States a certified 

copy of the final decree, the validation proceedings, and all pertinent supporting records of the court 

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

binding on the Contractor. 

1116 CONTRACT DRAFTING CONSIDERATIONS

1117 

1118 

1119 

1120 

1121 

1122 

1123 

 42. Articles 1 through 8, Articles 10 through 15, subdivision (b) of Article 16, Articles 18 

through 20, subdivision (c) of Article 23, Articles 26 through 28, subdivision (b) of Article 31, 

subdivisions (b) and (c) of Article 32, Articles 33 through 34, subdivision (b) of Article 36, and 

Article 37 of this Contract have been drafted, negotiated, and reviewed by the parties hereto, each of 

whom is sophisticated in the matters to which this Contract pertains, and no one party shall be 

considered to have drafted the stated Articles. 
Contract No. 14-06-200-4020E 

 51

1124 

1125 

 IN WITNESS WHEREOF, the parties hereto have executed this Contract as of the day and 

year first above written. 

THE UNITED STATES OF AMERICA 

By:_________________________________ 

Regional Director, Mid-Pacific Region 

Bureau of Reclamation 

MADERA IRRIGATION DISTRICT 

By: _________________________________ 

TITLE OF AUTHORIZED SIGNATORY 

Attest: 

By: _______________________________ 

TITLE 
Contract No. 14-06-200-4020E 

 52

EXHIBIT A

Map or Description of Service Area 
Irrigation and Other

Contract No. 14-06-200-4020E

Irrigation Other 1

Water Water

Class 1

$6.01

$6.57

$0.04

$12.62

$24.41

$27.72

IRRIGATION FULL-COST RATE (RRA)

Section 205(a)(3) Rate is applicable to a Limited Recipient that did not 

receive irrigation water on or before October 1, 1981.

Section 202(3) Rate is applicable to a Qualified Recipient or to a Limited 

Recipient receiving irrigation water on or before October 1, 1981.

Storage

Conveyance 2

TOTAL COS (Tier 1 Rate)

EXHIBIT B

MADERA IRRIGATION DISTRICT - HIDDEN UNIT

2010 Rates and Charges

Water Marketing

COST-OF-SERVICE (COS) RATES

(Per Acre-Foot)

O&M Components

$5.90

$11.79

$9.11

$0.11

EXPLANATORY NOTES

IRRIGATION

CHARGES AND ASSESSMENTS (Payments in addition to Rates)

P.L. 106-377 Assessment (Trinity Public Utilities District) 4 [Appendix B, 

Section 203]

Tier 2 Rate : >80% <=90% of Contract Total [Section 202(3) Irrigation 

Full-Cost Rate - COS Rate]/2 (Amount to be added to Tier 1 Rate)

P.L. 102-575 Surcharges 3

Restoration Fund Payments [Section 3407(d)(2)(A)]

TIERED PRICING COMPONENTS (In Addition to Total COS Rate Above)

Tier 3 Rate : >90% of Contract Total [Section 202(3) Irrigation Full-Cost 

Rate - COS Rate] (Amount to be added to Tier 1 Rate)
Irrigation and Other

Contract No. 14-06-200-4020E

EXHIBIT B

MADERA IRRIGATION DISTRICT - HIDDEN UNIT

2010 Rates and Charges

(Per Acre-Foot)

1

2

3

4

Conveyance and Conveyance Pumping Operation and Maintenance costs were removed for ratesetting 

purposes and are to be billed direct.

http://www.usbr.gov/mp/cvpwaterrates/ratebooks/index.html

Additional detail of rate components is available on the Internet at 

The surcharges were determined pursuant to Tital XXXIV of P.L. 102-575. Restoration Fund 

surcharges under P.L. 102-575 are determined on a fiscal year basis (10/1-9/30).

The Contractor has not projected any delivery of Other Water for the 2010 contract year. A temporary 

Rate will be applied upon any Other Water delivery.

The Trinity Public Utilities District Assessment is applicable to each acre-foot of water delivered from 

3/1/2010-2/28/2011 and is adjusted annually.
Irrigation and Other

Contract No. 14-06-200-4020E

Irrigation Other 1

Water Water

Class 1

$6.01

$6.57

$0.04

$12.62

$24.41

$27.72

IRRIGATION FULL-COST RATE (RRA)

Section 205(a)(3) Rate is applicable to a Limited Recipient that did not 

receive irrigation water on or before October 1, 1981.

Section 202(3) Rate is applicable to a Qualified Recipient or to a Limited 

Recipient receiving irrigation water on or before October 1, 1981.

Storage

Conveyance 2

TOTAL COS (Tier 1 Rate)

EXHIBIT B

MADERA IRRIGATION DISTRICT - HIDDEN UNIT

2010 Rates and Charges

Water Marketing

COST-OF-SERVICE (COS) RATES

(Per Acre-Foot)

O&M Components

$5.90

$11.79

$9.11

$0.11

EXPLANATORY NOTES

IRRIGATION

CHARGES AND ASSESSMENTS (Payments in addition to Rates)

P.L. 106-377 Assessment (Trinity Public Utilities District) 4 [Appendix B, 

Section 203]

Tier 2 Rate : >80% <=90% of Contract Total [Section 202(3) Irrigation 

Full-Cost Rate - COS Rate]/2 (Amount to be added to Tier 1 Rate)

P.L. 102-575 Surcharges 3

Restoration Fund Payments [Section 3407(d)(2)(A)]

TIERED PRICING COMPONENTS (In Addition to Total COS Rate Above)

Tier 3 Rate : >90% of Contract Total [Section 202(3) Irrigation Full-Cost 

Rate - COS Rate] (Amount to be added to Tier 1 Rate)
Irrigation and Other

Contract No. 14-06-200-4020E

EXHIBIT B

MADERA IRRIGATION DISTRICT - HIDDEN UNIT

2010 Rates and Charges

(Per Acre-Foot)

1

2

3

4

Conveyance and Conveyance Pumping Operation and Maintenance costs were removed for ratesetting 

purposes and are to be billed direct.

http://www.usbr.gov/mp/cvpwaterrates/ratebooks/index.html

Additional detail of rate components is available on the Internet at 

The surcharges were determined pursuant to Tital XXXIV of P.L. 102-575. Restoration Fund 

surcharges under P.L. 102-575 are determined on a fiscal year basis (10/1-9/30).

The Contractor has not projected any delivery of Other Water for the 2010 contract year. A temporary 

Rate will be applied upon any Other Water delivery.

The Trinity Public Utilities District Assessment is applicable to each acre-foot of water delivered from 

3/1/2010-2/28/2011 and is adjusted annually.
Exhibit C-1

Repayment Obligation - Lump Sum Option

Friant Contractor: Madera ID - Hidden Unit

San Joaquin River Restoration Act

Existing Capital Obligation (Article 1(m)) 2,491,828.92 $ 

Irrigation portion of Existing Capital Obligation 2,491,828.92 $ 

20yr CMT as of : 10/01/10 4.050%

Discount Rate (1/2 20yr CMT) 2.025%

Discounted Irrigation Capital $ 2,032,342.26

Non-Discounted M&I Portion of 

Existing Capital Obligation $ -

$ 2,032,342.26

Irrigation Portion of

Beginning Straight Line

Year Balance Repayment

2011 2,491,829 $ 124,591 $ 

2012 2,367,237 $ 124,591 $ 

2013 2,242,646 $ 124,591 $ 

2014 2,118,055 $ 124,591 $ 

2015 1,993,463 $ 124,591 $ 

2016 1,868,872 $ 124,591 $ 

2017 1,744,280 $ 124,591 $ 

2018 1,619,689 $ 124,591 $ 

2019 $ 1 495 097 $ 124 591

Allocated Capital Cost

Repayment Obligation - Lump Sum Option (per Article 

7(a)(2)(A)

2019 $ 1,495,097 $ 124,591

2020 1,370,506 $ 124,591 $ 

2021 1,245,914 $ 124,591 $ 

2022 1,121,323 $ 124,591 $ 

2023 996,732 $ 124,591 $ 

2024 872,140 $ 124,591 $ 

2025 747,549 $ 124,591 $ 

2026 622,957 $ 124,591 $ 

2027 498,366 $ 124,591 $ 

2028 373,774 $ 124,591 $ 

2029 249,183 $ 124,591 $ 

2030 124,591 $ 124,591 $ 

$ 2,491,829
Exhibit C-2

Repayment Obligation - Installment Payment Option

Friant Contractor: Madera ID ‐ Hidden Unit

$ 2,491,828.92$ 2,491,828.92 Payment Due Date

Irrigation Portion of

Repayment

Obligation

Non‐discounted

M&I Portion of

Existing Capital

Obligation

1st Installment 5/1/2011 523,265.53 $                 ‐ $ $ 

20yr CMT ­ 10/1/2010 4.050% 2nd Installment 5/1/2012 523,028.46 $                 ‐ $ $ 

Discount Rate (1/2 20yr CMT) 2.025% 3rd Installment 5/1/2013 523,403.35 $                 ‐ $ $ 

4th Installment 1/31/2014 524,194.27 $                 ‐ $ $ 

$ ­ $              ‐ 2,093,891.60 $ $ 

Irrigation Portion of

Beginning Straight Line

Year Balance Repayment $523,265.53 $523,028.46 $523,403.35 $524,194.27

2011 2,491,829 $ 124,591 $ 124,591 $ 

2012 2,367,237 $ 124,591 $ 26,164 $ 98,427 $ 2013 2,242,646 $ 124,591 $ 26,164 $ 29,092 $ 69,335 $ 

2014 $ 2 118 055 $ 124 591 $ 26 164 $ 29 092 $ 32 581 $ 36 754

Allocated Capital Cost

Discounted Capital Amount

Installment Schedule

Non­Discounted M&I Existing Capital

Obligation

Total Repayment Obligation ‐ 

Installment Option (per Article

7(a)(2)(A):

Irrigation Portion of Existing Capital

ObligationExisting Capital Obligation (Article1(m))

2014 $ 2,118,055 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754

2015 1,993,463 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2016 1,868,872 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2017 1,744,280 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2018 1,619,689 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2019 1,495,097 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2020 1,370,506 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2021 1,245,914 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2022 1,121,323 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2023 996,732 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2024 872,140 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2025 747,549 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2026 622,957 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2027 498,366 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2028 373,774 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 2029 249,183 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 

2030 124,591 $ 124,591 $ 26,164 $ 29,092 $ 32,581 $ 36,754 $ 

$ 621,711 2,491,829 $ 622,085 $ 623,206 $ 624,826 $ 
Exhibit D

Computation of Financing Costs Offset

Friant Contractor:

San Joaquin River Restoration Act Madera ID - Hidden Unit

Average Annual Delivery ‐ Forecasted for 2020‐2039 n/a

Total Projected deliveries (over 20 yr period)

Article 7(c) n/a

4.050%

2.025%

Irrigation Portion of Existing Capital Obligation $2,491,829

NPV at Half CMT (Repayment Obligation) $2,032,342

$1,685,766

Financing Cost Offset: @  (Article 7(c)(1)) $346,576

NPV of FS Reduction $0

$346,576

$495,424

CVPIA Friant 

Surcharges

Year Beginning Balance Straight Line Repayment

2011 2,491,829 $ 124,591 $ n/a n/a n/a 346,575.96 $ 

2012 2,367,237 $ 124,591 $ n/a n/a n/a 360,612.28 $ 

2013 2,242,646 $ 124,591 $ n/a n/a n/a 375,217.08 $ 

2014 2,118,055 $ 124,591 $ n/a n/a n/a 390,413.37 $ 

2015 1,993,463 $ 124,591 $ n/a n/a n/a 406,225.11 $ 

2016 1,868,872 $ 124,591 $ n/a n/a n/a 422,677.23 $ 

2017 1,744,280 $ 124,591 $ n/a n/a n/a 439,795.66 $ 

2018 1,619,689 $ 124,591 $ n/a n/a n/a 457,607.38 $ 

2019 1,495,097 $ 124,591 $ n/a n/a n/a 476,140.48 $ 

2020 1,370,506 $ 124,591 $ n/a n/a n/a n/a 495,424.17 $ 

2021 1,245,914 $ 124,591 $ n/a n/a n/a n/a

2022 1,121,323 $ 124,591 $ n/a n/a n/a n/a

2023 996,732 $ 124,591 $ n/a n/a n/a n/a

2024 872,140 $ 124,591 $ n/a n/a n/a n/a

2025 747 $ 124 ,549 $ n/ ,591 a n/a n/a n/a

 2020 Other 

Obligation Credit 

Calculation (Art. 

20 yr CMT as of 10/1/2010

1/2 20 yr CMT as of 10/1/2010

NPV at Full CMT

Difference between Financing Cost Offset and NPV of FS Reduction

2020 Other Obligation Credit (FV of difference) 

(Art. 7(c)(1))***

Irrigation portion of Allocated Capital Cost Reduction in Friant Surcharge

Surcharge per AcreFoot Before Reduction

Friant 

Surcharge 

Reduction per 

 Friant 

Surcharge 

due per A/F 

Projected 

Total Annual 

Credit

2025 $ 747,549 $ 124,591 n/a n/a n/a n/a

2026 622,957 $ 124,591 $ n/a n/a n/a n/a

2027 498,366 $ 124,591 $ n/a n/a n/a n/a

2028 373,774 $ 124,591 $ n/a n/a n/a n/a

2029 249,183 $ 124,591 $ n/a n/a n/a n/a

2030 124,591 $ 124,591 $ n/a n/a n/a n/a

2031 n/a n/a n/a n/a

2032 n/a n/a n/a n/a

2033 n/a n/a n/a n/a

2034 n/a n/a n/a n/a

2035 n/a n/a n/a n/a

2036 n/a n/a n/a n/a

2037 n/a n/a n/a n/a

2038 n/a n/a n/a n/a

2039 n/a n/a n/a n/a

$ 2,491,829 $0
Exhibit D

Computation of Financing Costs Offset

@ Amount of reduction in Friant Surcharge is computed using FPV of Financing Costs 

adjusted to Yr 2020. Annual Friant Surcharge reduction to fully offset Financing

costs is computed and presented on per a/f basis. Friant surcharge may be 

reduced up to $3 per a/f.

Friant Surcharge (FS) Reduction Calculations

FV of Total Financing Cost for Offset $ 515,489

Annual Credit Target $ (36,616)

FS Reduction w/o limit n/a

FS Reduction limit n/a

Footnotes

*** The difference represents the amount of financing costs that are not offset through the 

reduced Friant Surcharge computed on this schedule. Pursuant to Section 7(c)(2), this 

amount shall offset the Contractor's other outstanding or future obligations. After 2020, the 

contractors other obligations shall be reduced in the following order to fully offset this 

amount: 1) Payments or prepayments due for O&M expenses and, to the extent applicable, 

2) Additional Capital Obligation. 
1

 Pursuant to subdivision (b) of Article 2 of the Contract to which this exhibit is attached, this Exhibit “E” makes no 

substantive revisions to the Contract to which it is attached and is prepared solely as a matter of administrative 

convenience. In this Exhibit “E”, references to “Contract” or “this Contract” refers to this Restated Contract. 

EXHIBIT E

Restated Contract1

Irrigation and Other 

Contract No. 14-06-200-4020E 

UNITED STATES 

DEPARTMENT OF THE INTERIOR 

BUREAU OF RECLAMATION 

Central Valley Project, California 

CONTRACT BETWEEN THE UNITED STATES

AND

MADERA IRRIGATION DISTRICT

PROVIDING FOR PROJECT WATER SERVICE FROM 

HIDDEN UNIT AND 

FOR FACILITIES REPAYMENT

Table of Contents

Article No. Title Page No.

 Preamble 

 Explanatory Recitals 

1 Definitions 

2 Effective Date of Contract 

3 Water to be Made Available and Delivered to the Contractor 

4 Reservoir Operation – Use and Sale of Water 

5 Point of Diversion and Responsibility for Distribution of Water 

6 Measurement of Water within the Service Area 

7 Rates, Method of Payment for Water, and Accelerated Repayment of Facilities 

8 Non-Interest Bearing Operation and Maintenance Deficits 

9 Omitted 

10 Sales, Transfers, and Exchanges of Water 

11 Application of Payments and Adjustments 

12 Temporary Reductions--Return Flows 

13 Constraints on the Availability of Water 

14 Omitted 
15 Acreage Limitation 

16 Compliance With Federal Reclamation Laws 

17 Protection of Water and Air Quality 

18 Water Acquired By the Contractor Other Than From the United States 

19 Opinions and Determinations 

20 Coordination and Cooperation 

21 Charges for Delinquent Payments 

22 Equal Employment Opportunity 

23 General Obligation--Benefits Conditioned Upon Payment 

24 Compliance with Civil Rights Laws and Regulations 

25 Omitted 

26 Contractor to Pay Certain Miscellaneous Costs 

27 Water Conservation 

28 Existing or Acquired Water or Water Rights 

29 Omitted 

30 Contingent on Appropriation or Allotment of Funds 

31 Books, Records, and Reports 

32 Assignment Limited--Successors and Assigns Obligated 

33 Severability 

34 Resolution of Disputes 

35 Officials Not to Benefit 

36 Changes in Contractor's Service Area 

37 Federal Laws 

38 Omitted

39 Medium for Transmitting Payment 

40 Notices 

41 Confirmation of Contract 

42 Contract Drafting Considerations 

 Signature Page 

 Exhibit A Contractor’s Map or Description of Service Area 

 Exhibit B Rates and Charges 

 Exhibit C-1 Repayment Schedule – Lump Sum Option 

 Exhibit C-2 Repayment Schedule – Installment Option 

 Exhibit D Computation of Financing Costs Offset 

 Exhibit E Omitted 

 

 
Contract No. 14-06-200-4020E 

1 

2 

3 

4 

UNITED STATES 

DEPARTMENT OF THE INTERIOR 

BUREAU OF RECLAMATION 

Central Valley Project, California 

5 CONTRACT BETWEEN THE UNITED STATES

6 AND

7 MADERA IRRIGATION DISTRICT

8 PROVIDING FOR PROJECT WATER SERVICE FROM 

9 HIDDEN UNIT AND 

10 FACILITIES REPAYMENT

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

 THIS CONTRACT, made this _____ day of ____________________, 2010, is entered into 

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

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

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

483), June 21, 1963 (77 Stat. 68), October 12, 1982 (96 Stat. 1262), October 27, 1986 (100 Stat. 

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

Subtitle A, of the Act of March 30, 2009 (123 Stat. 1349), also referred to as the San Joaquin River 

Restoration Settlement Act hereinafter referred to as SJRRSA, all collectively hereinafter referred to 

as Federal Reclamation law, between THE UNITED STATES OF AMERICA, hereinafter referred to 

as the United States and MADERA IRRIGATION DISTRICT, hereinafter referred to as the 

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

the laws thereof, with its principal place of business in California; 

 WITNESSETH, That 

24 EXPLANATORY RECITALS

25 

26 

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

Project, California, for diversion, storage, carriage, distribution and beneficial use, for flood control, 
Contract No. 14-06-200-4020E 

 2

27 

28 

29 

30 

31 

32 

33 

34 

35 

36 

37 

38 

39 

40 

41 

42 

43 

44 

45 

46 

47 

irrigation, municipal, domestic, industrial, fish and wildlife mitigation, protection and restoration, 

generation and distribution of electric energy, salinity control, navigation and other beneficial uses, of 

waters of the Sacramento River, the American River, the Trinity River, and the San Joaquin River 

and their tributaries; and 

[2nd] WHEREAS, pursuant to Title II of the Flood Control Act of October 23, 1962 (76 

Stat. 1180), and supporting documents, the United States constructed Hidden Dam on the Fresno 

River (thereby creating Hensley Lake), hereinafter referred to as the Hidden Unit, which is operated 

by the Corps of Engineers for flood control, recreation and other incidental uses; and 

 [3rd] WHEREAS, the United States and the Contractor entered into Contract Number 14-

06-200-4020A, as amended, providing the Contractor the right to the entire yield from the Hidden 

Unit available for conservation purposes from August 5, 1962 through February 28, 1994; and 

 [4th] WHEREAS, the Contractor and the United States have, pursuant to subsection 

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

interim renewal contract(s), identified as Contract Number (s) 14-06-200-4020A-IR2, IR3, IR4, and 

IR5, which provided for the continued water service to Contractor from March 1, 1995 through 

February 28, 2001, and subsequently entered into a long-term renewal contract, identified as Contract 

Number 14-06-200-4020A-LTR1, which provided for continued water service to Contractor through 

February 28, 2026, which was amended January 22, 2007, and is herein referred to as the "Existing 

Contract”; and 

[5th] WHEREAS, pursuant to Section 8 of the Act of June 17, 1902 (32 Stat. 388), the 

United States has acquired water rights and other rights to the flows of the Fresno River, including 
Contract No. 14-06-200-4020E 

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48 

49 

50 

51 

52 

53 

54 

55 

56 

57 

58 

59 

60 

61 

62 

63 

64 

65 

66 

without limitation the permits issued as the result of Decision 1407 by the California State Water 

Resource Control Board pursuant to which the Contracting Officer develops, diverts, stores and 

delivers Project Water stored or flowing through Hensley Lake in accordance with State and Federal 

law for the benefit of the Contractor in the Hidden Unit and for other specified Project purposes; and 

 [6th] WHEREAS, the water supplied to the Contractor pursuant to this Contract is Project 

Water developed through the exercise of the rights described in the fifth (5th) Explanatory Recital of 

this Contract; and 

 [7th] WHEREAS, as a result of litigation entitled “Natural Resources Defense Council, et 

al. v Kirk Rogers, et al.” No. CIV-S-88-1658LLK/GGH, certain contractors from the Friant Division 

entered into a Stipulation of Settlement dated September 13, 2006, (the “Settlement”), which 

settlement prescribes a Restoration Goal and a Water Management Goal and which Settlement was 

subsequently confirmed and implemented through the SJRRSA; and 

[8th] WHEREAS, the SJRRSA authorizes and directs the Secretary to convert the Existing 

Contract to a repayment contract under subsection (d) of Section 9 of the Act of August 4, 1939, no 

later than December 31, 2010, and further directs that such contract shall require the accelerated 

repayment of the Contractors’ allocated share of construction costs, either as a lump sum payment by 

January 31, 2011 or in annual installments by January 31, 2014, which funds will in turn be made 

available for implementation of the Settlement and SJRRSA, and which costs otherwise would have 

been payable through annual water rates, with full repayment by 2030; and 
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[9th] WHEREAS, such repayment of costs will assist the United States with 

implementation of actions required under the Settlement and the SJRRSA and provide the Contractor 

the benefits provided in Section 10010 of the SJRRSA; and 

[10th] WHEREAS, subsection (4) of Section 1 of the Act of July 2, 1956 (1956 Act) directs 

the Secretary to provide that the other party to any contract entered into pursuant to subsection (d) of 

Section 9 of the Act of August 4, 1939 (repayment contract) or pursuant to subsection (e) of Section 9 

of the Act of August 4, 1939 (water service contract) shall “have the first right (to which the rights of 

the holders of any other type of irrigation water contract shall be subordinate) to a stated share or 

quantity of the project’s available water supply for beneficial use on the irrigable lands within the 

boundaries of, or owned by, the party and a permanent right to such share or quantity upon 

completion of payment of the amount assigned for ultimate return” by the contractor subject to 

fulfillment of all obligations under the contract; and 

 [11th] WHEREAS, among other things, this Contract includes provisions granting the 

Contractor the permanent right to the entire yield from the Hidden Unit available for conservation 

purposes as described in the tenth (10th) Explanatory Recital; and 

 [12th] WHEREAS, the Contractor has demonstrated to the satisfaction of the Contracting 

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

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

Contractor has the capability and expects to utilize fully for reasonable and beneficial use the quantity 

of Project Water to be made available to it pursuant to this Contract; and 
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 [13th] WHEREAS, water obtained from the Central Valley Project has been relied upon by 

urban and agricultural areas within California for more than fifty (50) years and is considered by the 

Contractor as an essential portion of its water supply; and 

 [14th] WHEREAS, the economies of regions within the Central Valley Project, including the 

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

Central Valley Project; and 

 [15th] WHEREAS, the Secretary intends through coordination, cooperation, and partnerships 

to pursue measures to improve water supply, water quality, and reliability of the Project for all 

Project purposes; and 

 [16th] WHEREAS, the mutual goals of the United States and the Contractor include: to 

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

the Central Valley Project as required by law; to guard reasonably against Project Water shortages; to 

achieve a reasonable balance among competing demands for use of Project Water; and to comply 

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

States relative to the Central Valley Project; and 

 [17th] Omitted; and 

 [18th] Omitted; and 

 [19th] WHEREAS, the United States has determined that the Contractor has fulfilled all of 

its obligations under the Existing Contract. 

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

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

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

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

 (a) “Additional Capital Obligation” shall mean any additional construction costs 

or other capitalized costs incurred after the effective date of this Contract or not reflected in the 

Existing Capital Obligation as provided in Section 10010(a)(3)(B) of the SJRRSA and any amounts 

payable by Contractor as determined through the final adjustment described and required by Section 

10010(b) of the SJRRSA; 

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

dates inclusive; 

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

addition to the Rates specified in this Contract as determined annually by the Contracting Officer 

pursuant to this Contract and consistent with the SJRRSA; 

 (d) Omitted; 

 (e) Omitted; 

 (f) Omitted; 

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

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

regulation; 

 (h) "Contract Total" shall mean the amount of Project Water to which the 

Contractor is entitled under subdivision (a) of Article 3 of this Contract and is the stated share or 
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quantity of Water to which the Contractor has a permanent right in accordance with the 1956 Act and 

the terms of this Contract, due to the Contractor's complete payment of the Repayment Obligation, 

notwithstanding any Additional Capital Obligation that may later be established, which right shall not 

be disturbed so long as the Contractor fulfills all of its obligations under this Contract; 

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

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

which may be modified from time to time in accordance with Article 36 of this Contract without 

amendment of this Contract; 

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

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

 (j2) “District Engineer” shall mean the District Engineer, United States Army 

Corps of Engineers, or his authorized representative; 

 (k) Omitted; 

 (l) Omitted; 

(m) “Existing Capital Obligation” shall mean the remaining amount of construction 

costs of the Contractor identified in the Central Valley Project Irrigation Water Rates and/or 

Municipal and Industrial Water Rates, respectively, dated January 25, 2007, as adjusted to reflect 

payments not reflected in such schedule, pursuant to Section 10010(a)(3)(A) of the SJRRSA. The 

Contracting Officer has computed the Existing Capital Obligation in a manner consistent with the 

SJRRSA and such amount is set forth in Exhibits “C-1” and “C-2”, incorporated herein by reference; 
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 (n) “Financing Costs”, for purposes of computing the reduction of certain charges 

as specified in subdivision (c) of Article 7 of this Contract, shall mean the difference between the net 

present value of the Existing Capital Obligation discounted using the full Treasury rate and the 

Existing Capital Obligation discounted using one-half the Treasury Rate, as set forth in Section 

10010(d)(3) of the SJRRA; 

 (o) Omitted; 

 (p) Omitted; 

 (q) Omitted; 

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

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

thereto, and watering of livestock. Irrigation water shall not include water used for the purposes such 

as the watering of landscaping or pasture for animals (e.g., horses) which are kept for personal 

enjoyment or water delivered to landholdings operated in units of less than five (5) acres unless the 

Contractor establishes to the satisfaction of the Contracting Officer that the use of the water delivered 

to any such landholding is a use described in this subdivision of this Article of this Contract; 

 (s) Omitted; 

 (t) Omitted; 

 (u) Omitted; 

 (v) Omitted; 
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 (w) “Operation and Maintenance” or “O&M" shall mean normal and reasonable 

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

Project facilities; 

 (x) Omitted; 

 (y) “Other Water” shall mean water from the Project other than Irrigation Water as 

described in subdivision (r) of this Article of this Contract, which is used for a purpose that is 

considered to be an irrigation use pursuant to State law such as the watering of landscaping or pasture 

for animals (e.g., horse) which are kept for the personal enjoyment. For purposes of this Contract, 

Other Water shall be paid for at Rates and Charges identical to those established for municipal and 

industrial water pursuant to the then-existing Municipal and Industrial Ratesetting Policy; 

 (y2) “Prior-Rights Water” shall mean that portion of the inflow to Hensley Lake 

which flows through or is released from Hidden Dam in recognition of prior downstream Fresno 

River water rights of the Contractor and others, subject to any necessary new water rights permit or 

permit revisions and in accordance with any applicable agreements relating to the operation of the 

Hidden Unit and approved by the Contracting Officer and the State Water Resources Control Board, 

as necessary; 

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

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

 (aa) “Project Contractors” shall mean all parties who have a long-term water 

service contract or repayment contract for Project Water from the Project with the United States 

pursuant to Federal Reclamation law; 
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 (bb) “Project Water” shall mean all water that is developed, diverted, stored, or 

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

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

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

Officer in accordance with the then-existing applicable water ratesetting policies for the Project, as 

described in subdivision (a) of Article 7 of this Contract and illustrated in Exhibit “B”, attached 

hereto; 

 (dd) Omitted; 

 (ee) “Repayment Obligation”, as provided in subdivision (a)(2)(A) of Article 7 of 

this Contract, shall be the Existing Capital Obligation, as defined herein, discounted by one-half of 

the Treasury rate and computed consistent with the provisions of Section 10010(3)(A) of the 

SJRRSA to be paid as either a lump sum payment by January 31, 2011 or in approximately equal 

annual installments by January 31, 2014; 

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

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

through any agency of the Department of the Interior; 

 (gg) “Settlement” shall mean the Stipulation of Settlement dated September 13, 

2006, the Order Approving Stipulation of Settlement, and the Judgment and further orders issued by 

the Court pursuant to the terms and conditions of the Settlement in Natural Resources Defense 

Council, et al. v. Rodgers, et al., No. CIV-S-88-1658 LLJ/GGH; 

 (hh) Omitted; 
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 (ii) “Water Delivered” or “Delivered Water” shall mean Project Water diverted for 

use by the Contractor at Hidden Dam, other than Prior-Rights Water, and for pricing purposes shall 

be 24,000 acre-feet per Year; 

 (jj) Omitted; 

 (kk) Omitted; 

 (ll) Omitted; 

 (mm) "Year" shall mean the period from and including March 1 of each Calendar 

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

218 EFFECTIVE DATE OF CONTRACT

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2. (a) This Contract shall become effective on the date first hereinabove written and 

shall continue so long as the Contractor is making the annual payments required herein and paying 

any other amounts owing under this Contract and applicable law, unless it is terminated by the 

Contracting Officer by reason of a material uncured breach by the Contractor; Provided, That the 

Contracting Officer shall not seek to terminate this Contract by reason of an asserted material 

uncured breach by the Contractor unless it has first provided at least sixty (60) days written notice of 

the asserted breach to the Contractor and the Contractor has failed to cure such breach (or to 

diligently commence curative actions satisfactory to the Contracting Officer for a breach that cannot 

be fully cured within sixty (60) days) within the sixty (60)-day notice period; 

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Provided further, That 

this Contract may be terminated at any time by mutual consent of the parties hereto. 

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(b) The Contractor has paid the Repayment Obligation, and notwithstanding any 

Additional Capital Obligation that may later be established, the tiered pricing component and the 
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acreage limitations, reporting, and Full Cost pricing provisions of Federal Reclamation law, shall no 

longer be applicable to the Contractor. 

(c) This Contract supersedes in its entirety and is intended to replace in full the 

Existing Contract; Provided, That if this Contract is terminated or determined to be invalid or 

unenforceable for any reason other than a material uncured breach of this Contract by the Contractor, 

the Existing Contract shall not be superseded and shall be in full force and effect. 

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237 WATER TO BE MADE AVAILABLE AND DELIVERED TO THE CONTRACTOR

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

and licenses, Federal law, the Settlement including the SJRRSA, and subject to the provisions set 

forth in Articles 12 and 13 of this Contract, the Contracting Officer shall make available for delivery 

to the Contractor the entire quantity of Project Water from the Hidden Unit for irrigation purposes. 

The quantity of Water Delivered to the Contractor in accordance with this subdivision shall be paid 

for pursuant to the provisions of Article 7 of this Contract. 

(b) The Contractor has paid the Repayment Obligation, and notwithstanding any 

Additional Capital Obligation that may later be established, the Contractor has a permanent right to 

the Contract Total in accordance with the 1956 Act and the terms of this Contract. This right shall 

not be disturbed so long as the Contractor fulfills all of its obligations hereunder. The quantity of 

water made available for delivery in any given Year shall remain subject to the terms and conditions 

of subdivision (a) of this Article of this Contract. 

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

legal requirements. 
Contract No. 14-06-200-4020E 

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 (d) The Contractor shall make reasonable and beneficial use of all Project Water 

or other water furnished pursuant to this Contract. Groundwater recharge programs, groundwater 

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

Water or other water furnished pursuant to this Contract conducted within the Contractor’s Service 

Area which are consistent with applicable State law and result in use consistent with applicable 

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

described in the Contractor’s Water Conservation Plan submitted pursuant to Article 27 of this 

Contract; 

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Provided further, That such Water Conservation Plan demonstrates sufficient lawful uses 

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

delivered, pursuant to this Contract, is demonstrated to be reasonable for such uses and in compliance 

with Federal Reclamation law. Groundwater recharge programs, groundwater banking programs, 

surface water storage programs, and other similar programs utilizing Project Water or other water 

furnished pursuant to this Contract conducted outside the Contractor’s Service Area may be permitted 

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

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

address such concerns in regulations, policies, or guidelines. 

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 (e) The Contractor, through this Contract, shall comply with requirements 

applicable to the Contractor in biological opinion(s) prepared as a result of the consultation regarding 

the execution of the Existing Contract undertaken pursuant to Section 7 of the Endangered Species 

Act of 1973, as amended, as well as the requirements of any other biological opinions applicable to 

Project Water delivery under this Contract, that are within the Contractor’s legal authority to 
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implement. The Contractor shall comply with the limitations or requirements imposed by 

environmental documentation applicable to the Contractor and within its legal authority to implement 

regarding specific activities. Nothing herein shall be construed to prevent the Contractor from 

challenging or seeking judicial relief in a court of competent jurisdiction with respect to any 

biological opinion or other environmental documentation referred to in this Article of this Contract. 

(f) Omitted. 

 (g) Omitted. 

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

State law to the reasonable and beneficial use of the Contract Total pursuant to this Contract shall not 

be disturbed so long as the Contractor shall fulfill all of its obligations under this Contract. Nothing 

in the preceding sentence shall affect the Contracting Officer’s ability to impose shortages under 

Article 12 or Article 13 of this Contract. 

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

delivered for purposes other than those described in subdivisions (r) and (y) of Article 1 of this 

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

conditions of such approval. 

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

rights and other rights described in the fifth (5th) Explanatory Recital of this Contract and to provide 

the water available under this Contract. The Contracting Officer shall not object to participation by 

the Contractor, in the capacity and to the extent permitted by law, in administrative proceedings 

related to the water rights and other rights described in the fifth (5th) Explanatory Recital of this 
Contract No. 14-06-200-4020E 

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Contract; Provided however, That the Contracting Officer retains the right to object to the substance 

of the Contractor’s position in such a proceeding. 

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Provided further, that in such proceedings the 

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

use Project Water. 

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 (k) Omitted. 

 (l) Omitted. 

 (m) Nothing in this Contract, nor any action or inaction of the Contractor or 

Contracting Officer in connection with the implementation of this Contract, is intended to override, 

modify, supersede or otherwise interfere with any term or condition of the water rights and other 

rights referred in the fifth (5th) Explanatory Recital of this Contract. 

 (n) Omitted. 

 (o) Omitted. 

306 RESERVOIR OPERATION – USE AND SALE OF WATER

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 4. (a) At the request of the Contractor, pursuant to the terms and conditions of this 

Contract, the United States, acting through the District Engineer, shall store, regulate, and/or release 

all flows of Fresno River water at the Hidden Unit subject to the regulation of the Hidden Unit for 

flood control, as conclusively determined by the District Engineer, and further subject to Prior-Rights 

Water releases and the maintenance of a minimum pool of five thousand (5,000) acre-feet of water in 

Hensley Lake for recreational and incidental uses. 
Contract No. 14-06-200-4020E 

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 (b) Project Water delivered to the Contractor pursuant to this Contract shall be 

used as Irrigation Water or Other Water only and shall not be sold or otherwise disposed of for use 

outside the Contractor’s Service Area without the written approval of the Contracting Officer. 

316 POINT OF DIVERSION AND RESPONSIBILITY FOR DISTRIBUTION OF WATER

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 5. (a) Project Water delivered, pursuant to this Contract, shall be delivered to the 

Contractor at Hidden Dam. 

 (b) Omitted. 

 (c) The Contractor shall not deliver Project Water to land outside the Contractor's 

Service Area unless approved in advance by the Contracting Officer. The Contractor shall deliver 

Project Water in accordance with applicable Federal Reclamation law. 

 (d) Project Water delivered to the Contractor pursuant to this Contract shall be 

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

States at the point of delivery established pursuant to subdivision (a) of this Article of this Contract. 

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

be investigated, the accuracy of such measurements and shall take any necessary steps to adjust any 

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

the Contracting Officer shall consult with the Contractor prior to making a final determination of the 

quantity delivered for that period of time. 

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

handling, use, disposal, or distribution of Project Water delivered to the Contractor pursuant to this 

Contract beyond the delivery point specified in subdivision (a) of this Article of this Contract. The 
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Contractor shall indemnify the United States, its officers, employees, agents, and assigns on account 

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

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

carriage, handling, use, disposal, or distribution of such Project Water beyond such delivery point, 

except for any damage or claim arising out of: (i) acts or omissions of the Contracting Officer or any 

of its officers, employees, agents, or assigns, with the intent of creating the situation resulting in any 

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

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

or assigns; or (iv) damage or claims resulting from a malfunction of facilities owned and/or operated 

by the United States. 

 (f) The Contractor shall maintain a surface water measurement program 

satisfactory to the Contracting Officer to provide for the operation of the Hidden Unit facilities 

without interference to established rights including correlative rights easterly of the EastsideChowchilla Canal Bypass and keep records of data obtained from such program satisfactory to the 

Contracting Officer. 

349 MEASUREMENT OF WATER WITHIN THE SERVICE AREA

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

Contracting Officer; all surface water delivered for irrigation purposes within the Contractor’s 

Service Area is measured at each agricultural turnout; and Other Water delivered by the Contractor is 

measured at each service connection. The water measuring devices or water measuring methods of 

comparable effectiveness must be acceptable to the Contracting Officer. The Contractor shall be 
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responsible for installing, operating, and maintaining and repairing all such measuring devices and 

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

use the information obtained from such water measuring devices or water measuring methods to 

ensure its proper management of the water, to bill water users for water delivered by the Contractor; 

and, if applicable, to record water delivered as Other Water. Nothing herein contained, however, 

shall preclude the Contractor from establishing and collecting any charges, assessments, or other 

revenues authorized by California law. 

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

of this Contract, the Contractor shall provide to the Contracting Officer a written report describing 

the measurement devices or water measuring methods being used or to be used to implement 

subdivision (a) of this Article of this Contract and identifying the agricultural turnouts and the Other 

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

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

identifying the locations at which such devices and/or methods are not yet being used including a 

time schedule for implementation at such locations. The Contracting Officer shall advise the 

Contractor in writing within sixty (60) days as to the adequacy of, and necessary modifications, if 

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

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

Contracting Officer notifies the Contractor that the measuring devices or methods are inadequate, the 

parties shall within sixty (60) days following the Contracting Officer‘s response, negotiate in good 

faith the earliest practicable date by which the Contractor shall modify said measuring devices and/or 
Contract No. 14-06-200-4020E 

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measuring methods as required by the Contracting Officer to ensure compliance with subdivision (a) 

of this Article of this Contract. 

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

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

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

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

in writing by April 30 of each Year of the annual volume of Irrigation Water and Other Water 

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

 (e) Omitted. 

385 RATES, METHOD OF PAYMENT FOR WATER,

386 AND ACCELERATED REPAYMENT OF FACILITIES 

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 7. (a) The Contractor’s cost obligations for all Delivered Water shall be determined 

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

Secretary’s then-existing ratesetting policy for municipal and industrial water, consistent with the 

SJRRSA, and such ratesetting policies shall be amended, modified, or superseded only through a 

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

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

(1) The Contractor shall pay the United States as provided for in this 

Article of this Contract for the Delivered Water at Rates and Charges determined in accordance with 

policies for Irrigation Water and municipal and industrial water. The Contractor’s Rates shall be 

established to recover its estimated reimbursable costs included in the O&M Component of the Rate 

and amounts established to recover other charges and deficits, other than the construction costs. The 
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Rates for O&M costs and Charges shall be adjusted, as appropriate, in accordance with the provisions 

of the SJRRSA. 

 (2) Omitted. 

 (A) Omitted. 

 (B) Project construction costs or other capitalized costs attributable 

to capital additions to the Project incurred after the effective date of this Contract or that are not 

reflected in the schedules referenced in Exhibits “C-1” and “C-2” and properly assignable to the 

Contractor, shall be repaid as prescribed by the SJRRSA without interest except as required by law. 

Consistent with Federal Reclamation law, interest shall continue to accrue on the municipal and 

industrial portion of unpaid Project construction costs or other capitalized cost assigned to the 

Contractor until such costs are paid. Increases or decreases in Project construction costs or other 

capitalized costs assigned to the Contractor caused solely by annual adjustment of Project 

construction costs or other capitalized costs assigned to each CVP contractor by the Secretary shall 

not be considered in determining the amounts to be paid pursuant to this subdivision (a)(2)(B), but 

will be considered under subdivision (b) of this Article. A separate repayment agreement shall be 

established by the Contractor and the Contracting Officer to accomplish repayment of all additional 

Project construction costs or other capitalized costs assigned to the Contractor within the timeframe 

prescribed by the SJRRSA subject to the following: 

(1) If the collective annual Project construction costs or 

other capitalized costs that are incurred after the effective date of this Contract and properly 

assignable to the contractors are less than $5,000,000, then the portion of such costs properly 
Contract No. 14-06-200-4020E 

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assignable to the Contractor shall be repaid in not more than five (5) years after notification of the 

allocation. This amount is the result of a collective annual allocation of Project construction costs to 

the contractors exercising contract conversions; Provided, That the reference to the amount of 

$5,000,000 shall not be a precedent in any other context. 

421 

422 

423 

424 

425 

426 

427 

(2) If the collective annual Project construction costs or 

other capitalized costs that are incurred after the effective date of this Contract and properly 

assignable to the contractors are $5,000,000 or greater, then the portion of such costs properly 

assignable to the Contractor shall be repaid as provided by applicable Federal Reclamation law. This 

amount is the result of a collective annual allocation of Project construction costs to the contractors 

exercising contract conversions; Provided, That the reference to the amount of $5,000,000 shall not 

be a precedent in any other context. 

428 

429 

430 

431 

432 

433 

434 

435 

436 

437 

438 

439 

 (b) Consistent with Section 10010(b) of the SJRRSA, following a final cost 

allocation by the Secretary upon completion of the construction of the Central Valley Project, the 

amounts paid by the Contractor shall be subject to adjustment to reflect the effect of any reallocation 

of Project construction costs or other capitalized costs assigned to the Contractor that may have 

occurred between the determination of Contractor’s Existing Capital Obligation and the final cost 

allocation. In the event that the final cost allocation, as determined by the Secretary, indicates that 

the costs properly assignable to the Contractor, as determined by the Contracting Officer, are greater 

than the Existing Capital Obligation and other amounts of Project construction costs or other 

capitalized costs paid by the Contractor, then the Contractor shall be obligated to pay the remaining 

allocated costs. The term of such additional repayment contract shall be no less than one (1) year and 
Contract No. 14-06-200-4020E 

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440 

441 

442 

443 

444 

445 

446 

447 

448 

449 

450 

451 

452 

453 

454 

455 

456 

457 

458 

459 

460 

no more than ten (10) years, however, mutually agreeable provisions regarding the rate of repayment 

of such amount may be developed by the parties. In the event that the final cost allocation, as 

determined by the Secretary, indicates that the costs properly assignable to the Contractor, as 

determined by the Contracting Officer, are less than the Existing Capital Obligation and other 

amounts of Project construction costs or other capitalized costs paid by the Contractor, then the 

Contracting Officer shall credit such overpayment as an offset against any outstanding or future 

obligation of the Contractor, consistent with the SJRRSA. This Contract shall be implemented in a 

manner consistent with Section 10010(f) of the SJRRSA. 

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

Contractor an estimate of the Charges for Project Water that will be applied to the period October 1, 

of the current Calendar Year, through September 30, of the following Calendar Year, and the basis 

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

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

Officer shall notify the Contractor in writing of the Charges to be in effect during the period October 

1 of the current Calendar Year, through September 30 of the following Calendar Year, and such 

notification shall revise Exhibit “B”. Charges shall be subject to reduction consistent with the 

SJRRSA based upon the average annual delivery amount agreed to by the Contracting Officer and the 

Contractor. 

 (1) For the years 2020 through 2039 inclusive, outstanding or future 

obligations of the Contractor shall be reduced consistent with Section 10010(d)(2) of the SJRRSA. 

The amount of such reduction in outstanding or future obligations of the Contractor after October 1, 
Contract No. 14-06-200-4020E 

 23

461 

462 

463 

464 

465 

466 

467 

468 

469 

470 

471 

472 

473 

474 

475 

476 

477 

478 

479 

480 

2010 has been computed by the Contracting Officer, and as computed, such amount is set forth in 

Exhibit “D”. 

 (d) Prior to October 1 of each Calendar Year, the Contracting Officer shall make 

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

computations and cost allocations upon which those Rates are based. The Contractor shall be 

allowed not less than two (2) months to review and comment on such computations and cost 

allocations. By December 31 of each Calendar Year, the Contracting Officer shall provide the 

Contractor with the final Rates to be in effect for the upcoming Year, and such notification shall 

revise Exhibit “B”. The O&M component of the Rate may be reduced as provided in the SJRRSA. 

 (e) Before March 1 and again before July 1 of each Year, the Contractor shall pay 

to the United States, at the Rates and Charges provided in subdivision (a) of this Article of this 

Contract, for one-half (1/2) of the Delivered Water (i.e. 12,000 acre-feet) regardless of the quantity of 

Irrigation Water and Other Water actually made available to the Contractor during the Year. 

 (f) Omitted. 

 (g) Omitted. 

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

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

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

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

allocated and applied in accordance with Federal Reclamation law and the associated rules or 
Contract No. 14-06-200-4020E 

 24

481 

482 

483 

484 

485 

486 

487 

488 

489 

490 

491 

492 

493 

494 

495 

496 

497 

498 

499 

500 

regulations, the then-existing Project Ratesetting policies for municipal and industrial water or 

Irrigation Water, and consistent with the SJRRSA. 

 (j) The Contracting Officer shall keep its accounts, pertaining to the 

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

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

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

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

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

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

relating to accountings, reports, or information. 

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

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

policies, and procedures used for establishing Rates, Charges, and/or for making and allocating 

payments, other than those set forth in this Article of this Contract, may be in the mutual best interest 

of the parties, it is expressly agreed that the parties may enter into agreements to modify the 

mechanisms, policies, and procedures for any of those purposes while this Contract is in effect 

without amending this Contract. 

 (l) (1) Omitted. 

 (2) Omitted. 

 (3) Omitted. 
Contract No. 14-06-200-4020E 

 25

501 

502 

503 

504 

505 

506 

507 

508 

509 

510 

511 

512 

513 

514 

 (m) Rates under the respective ratesetting policies will be established to recover 

only reimbursable O&M (including any deficits) costs of the Project, as those terms are used in the 

then-existing Project ratesetting policies, and consistent with the SJRRSA, and interest, where 

appropriate, except in instances where a minimum Rate is applicable in accordance with the relevant 

Project ratesetting policy. Changes of significance in practices which implement the Contracting 

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

Contractor an opportunity to discuss the nature, need, and impact of the proposed change. 

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

the Rates for Project Water transferred by the Contractor shall be the Contractor’s Rates adjusted 

upward or downward to reflect the changed costs of delivery (if any) incurred by the Contracting 

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

accordance with the then-existing Central Valley Project Ratesetting Policy. 

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

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

515 NON-INTEREST BEARING OPERATION AND MAINTENANCE DEFICITS

516 

517 

518 

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

Contract, the Contractor has no non-interest bearing operation and maintenance deficits and therefore 

shall have no further liability. 

519 RECOVERED WATER ACCOUNT

520 

521 

 9. Omitted. 
Contract No. 14-06-200-4020E 

 26

522 SALES, TRANSFERS, AND EXCHANGES OF WATER

523 

524 

525 

526 

527 

528 

529 

530 

531 

532 

533 

534 

535 

536 

537 

538 

539 

540 

541 

542 

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

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

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

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

Contract may take place without the prior written approval of the Contracting Officer. No such 

Project Water sales, transfers, or exchanges shall be approved, where approval is required, absent 

compliance with appropriate environmental documentation including but not limited to the National 

Environmental Policy Act and the Endangered Species Act. Such environmental documentation must 

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

including environmental justice, of the proposed Project Water sales, transfers and exchanges on both 

the transferor/exchanger and transferee/exchange recipient. 

(b) Omitted. 

(c) Omitted. 

 (d) Omitted. 

(e) Omitted. 

(f) Omitted. 

(1) Omitted. 

(2) Omitted. 

 (3) Omitted. 

 (4) Omitted. 
Contract No. 14-06-200-4020E 

 27

543 

544 

545 

546 

547 

548 

549 

 (g) Notwithstanding any Additional Capital Obligation that may later be 

established, in the case of a sale or transfer of Irrigation Water to another contractor which is 

otherwise subject to the acreage limitations, reporting, and Full Cost pricing provisions of the 

Reclamation Reform Act of 1982, as amended, hereinafter referred to as the RRA, such sold or 

transferred Irrigation Water shall not be subject to such RRA provisions, however, in the case of a 

sale or transfer of Irrigation Water to the Contractor from another contractor which is subject to RRA 

provisions, such RRA provisions shall apply to delivery of such water.

550 APPLICATION OF PAYMENTS AND ADJUSTMENTS

551 

552 

553 

554 

555 

556 

557 

558 

559 

560 

561 

562 

563 

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

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

the Contractor arising out of this Contract then due and payable. Overpayments of more than One 

Thousand Dollars ($1,000) shall be refunded at the Contractor’s request. In lieu of a refund, any 

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

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

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

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

overpayments shall be made within thirty (30) days of the Contracting Officer obtaining direction as 

to how to credit or refund such overpayment in response to the notice to the Contractor that it has 

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

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

Contractor pursuant to Article 26 of this Contract shall be adjusted to reflect the actual costs when the 
Contract No. 14-06-200-4020E 

 28

564 

565 

566 

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

refunded to the Contractor. If the actual costs exceed the Contractor's advances, the Contractor will 

be billed for the additional costs pursuant to Article 26 of this Contract. 

567 TEMPORARY REDUCTIONS—RETURN FLOWS

568 

569 

570 

571 

572 

573 

574 

575 

576 

577 

 12. (a) The Contracting Officer shall make all reasonable efforts to optimize delivery 

of the Contract Total subject to: (i) the authorized purposes and priorities of the Project; (ii) the 

requirements of Federal law and the Settlement; and (iii) the obligations of the United States under 

existing contracts, or renewals thereof, providing for water deliveries from the Project. 

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

Project Water delivered to the Contractor, pursuant to this Contract, as herein provided for the 

purposes of investigation, inspection, maintenance, repair, or replacement of any of the Project 

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

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

discontinuance or reduction, except in case of emergency, in which case no notice need be given; 

Provided, That the United States shall use its best efforts to avoid any discontinuance or reduction in 

such service. Upon resumption of service after such reduction or discontinuance, and if requested by 

the Contractor, the United States will, if possible, deliver the quantity of Project Water which would 

have been delivered hereunder in the absence of such discontinuance or reduction. 

578 

579 

580 

581 

582 

583 

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

derived from Project Water delivered to the Contractor, pursuant to this Contract, which escapes or is 

584 discharged beyond the Contractor's Service Area; Provided, That this shall not be construed as 
Contract No. 14-06-200-4020E 

 29

585 

586 

587 

588 

589 

590 

claiming for the United States any right as seepage or return flow to water being used pursuant to this 

Contract for surface irrigation or underground storage either being put to reasonable and beneficial 

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

claiming by, through, or under the Contractor. For purposes of this subdivision, groundwater 

recharge, groundwater banking and all similar groundwater activities will be deemed to be 

underground storage. 

591 CONSTRAINTS ON THE AVAILABILITY OF WATER

592 

593 

594 

595 

596 

 13. If there is a reduction in total water supply because of errors in physical operations of 

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

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

of Article 19 of this Contract, no liability shall accrue against the United States or any of its officers, 

agents, or employees for any damage, direct or indirect, arising therefrom. 

597 UNAVOIDABLE GROUNDWATER PERCOLATION

598 14. Omitted. 

599 ACREAGE LIMITATION

600 

601 

602 

603 

604 

605 

 15. (a) The Contractor has paid the Repayment Obligation, and notwithstanding any 

Additional Capital Obligation that may later be established, the provisions of section 213(a) and (b) 

of the RRA shall apply to lands in the Contractor’s Service Area, with the effect that acreage 

limitations, reporting, and Full Cost pricing provisions of the RRA shall no longer apply to lands in 

the Contractor’s Service Area with respect to Water Delivered pursuant to this Contract. 

Reclamation will conduct a final water district review for the purpose of determining compliance 
Contract No. 14-06-200-4020E 

 30

606 

607 

608 

609 

610 

611 

612 

613 

614 

615 

616 

with the acreage limitations, reporting, and Full Cost pricing provisions of the RRA from the date of 

the last water district review until the date when payment to Reclamation of the Repayment 

Obligation was completed. 

 (b) Project Water now owned or hereafter acquired by the Contractor through a 

separate contract, other than this Contract, that is subject to Federal Reclamation law, may be 

delivered to lands within the Contractor’s Service Area. Notwithstanding any Additional Capital 

Obligation that may later be established, Project Water delivered under this Contract may be mixed 

with Project Water delivered pursuant to a contract with the United States, other than this Contract, to 

which acreage limitations, reporting, and the Full Cost pricing provisions of Federal Reclamation law 

apply without causing the application of the acreage limitations, reporting, and the Full Cost pricing 

provisions of Federal Reclamation law to the Project Water delivered pursuant to this Contract; 

Provided, The terms and conditions in such other contract shall continue to apply, and if such terms 

and conditions so require, the lands to receive Project Water under such other contract shall be 

properly designated by the Contractor and such Project Water is to be delivered in accordance with 

the RRA including any applicable acreage limitations, reporting, and the Full Cost pricing provisions.

617 

618 

619 

620 

621 RULES, REGULATIONS, AND DETERMINATIONS

622 

623 

624 

625 

626 

627 

628 

16. (a) The parties agree that the delivery of water or the use of Federal facilities 

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

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

(b) The terms of this Contract are subject to the Settlement and the SJRRSA. 

Nothing in this Contract shall be interpreted to limit or interfere with the full implementation of the 

Settlement and the SJRRSA. 
Contract No. 14-06-200-4020E 

 31

629 PROTECTION OF WATER AND AIR QUALITY

630 

631 

17. (a) Project facilities used to make available and deliver water to the Contractor 

shall be operated and maintained in the most practical manner to maintain the quality of the water at 

the highest level possible as determined by the Contracting Officer: Provided, That the United States 

does not warrant the quality of the water delivered to the Contractor and is under no obligation to 

furnish or construct water treatment facilities to maintain or improve the quality of water delivered to 

the Contractor. 

632 

633 

634 

635 

636 

637 

638 

639 

640 

641 

642 

643 

644 

 (b) The Contractor shall comply with all applicable water and air pollution laws 

and regulations of the United States and the State of California; and shall obtain all required permits 

or licenses from the appropriate Federal, State, or local authorities necessary for the delivery of water 

by the Contractor; and shall be responsible for compliance with all Federal, State, and local water 

quality standards applicable to surface and subsurface drainage and/or discharges generated through 

the use of Federal or Contractor facilities or project water provided by the Contractor within the 

Contractor’s Project Water Service Area. 

 

 (c) This article shall not affect or alter any legal obligations of the Secretary to 

provide drainage or other discharge services. 

645 WATER ACQUIRED BY THE CONTRACTOR

646 OTHER THAN FROM THE UNITED STATES

647 

648 

649 

650 

651 

652 

653 

654 

655 

656 

 18. (a) Omitted.

 (b) Notwithstanding any Additional Capital Obligation that may later be 

established, water or water rights now owned or hereafter acquired by the Contractor other than from 

the United States pursuant to this Contract and Irrigation Water furnished pursuant to the terms of 

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

Contractor without the payment of fees to the United States and without application of Federal 

Reclamation law to Project Water delivered pursuant to this Contract or to lands which receive 

Project Water delivered to Contractor pursuant to this Contract.

 (c) Water or water rights now owned or hereafter acquired by the Contractor, other 

than from the United States or adverse to the Project or its contractors (i.e., non-project water), may 
Contract No. 14-06-200-4020E 

 32

657 

658 

659 

660 

661 

662 

663 

664 

665 

666 

667 

668 

669 

670 

671 

672 

673 

674 

675 

676 

677 

be stored, conveyed and/or diverted through Project facilities, other than Hidden Unit facilities, 

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

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

necessary, consistent with the following provisions: 

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

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

States an appropriate rate as determined by the Contracting Officer. In addition, if electrical power is 

required to pump non-project water, the Contractor shall be responsible for obtaining the necessary 

power and paying the necessary charges therefor. 

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

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

determined by the Contracting Officer; (ii) reduce the quantity or quality of water available to other 

Project Contractors; (iii) interfere with the delivery of contractual water entitlements to any other 

Project Contractors; (iv) interfere with the physical maintenance of the Project facilities; or (v) result 

in the United States incurring any liability or unreimbursed costs or expenses thereby. 

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

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

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

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

property, direct or indirect, resulting from Contractor’s diversion or extraction of non-project water 

from any source. 
Contract No. 14-06-200-4020E 

 33

678 

679 

680 

681 

682 

683 

684 

685 

686 

687 

688 

689 

690 

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

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

management plan for the area from which it was extracted. 

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

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

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

non-project water prior to any such remaining capacity being made available to non-project 

contractors. 

 (d) Non-project water may be stored, conveyed and/or diverted through Hidden 

Unit facilities, subject to the prior completion of appropriate environmental documentation and 

approval of the Contracting Officer without execution of a separate contract, consistent with 

subdivisions (c)(1) through (c)(5) of this Article and any other condition determined to be appropriate 

by the Contracting Officer. 

691 OPINIONS AND DETERMINATIONS

692 

693 

694 

695 

696 

697 

698 

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

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

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

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

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

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

provided in a timely manner. Nothing in this Article of this Contract is intended to or shall affect or 
Contract No. 14-06-200-4020E 

 34

699 

700 

701 

702 

703 

704 

705 

alter the standard of judicial review applicable under Federal law to any opinion or determination 

implementing a specific provision of Federal law embodied in statute or regulation. 

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

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

United States and the State of California, and the rules and regulations promulgated by the Secretary. 

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

practicable. 

706 COORDINATION AND COOPERATION

707 

708 

709 

710 

711 

712 

713 

714 

715 

716 

717 

718 

719 

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

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

affected Project Contractors, in order to improve the operation and management of the Project. The 

communication, coordination, and cooperation regarding operations and management shall include, 

but not limited to, any action which will or may materially affect the quantity or quality of Project 

Water supply, the allocation of Project Water supply, and Project financial matters including, but not 

limited to, budget issues. The communication, coordination, and cooperation provided for hereunder 

shall extend to all provisions of this Contract. Each party shall retain exclusive decision making 

authority for all actions, opinions, and determinations to be made by the respective party. 

 (b) It is the intent of the Secretary to improve water supply reliability. To carry 

out this intent: 

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

the development of integrated resource management plans for the Contractor. Further, the 
Contract No. 14-06-200-4020E 

 35

720 

721 

722 

723 

724 

725 

726 

727 

728 

729 

730 

731 

732 

733 

734 

735 

736 

737 

Contracting Officer will, as appropriate, seek authorizations for implementation of partnerships to 

improve water supply, water quality, and reliability. 

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

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

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

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

California to seek improved water resource management. 

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

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

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

hold division level meetings to discuss Project operations, division level water management 

activities, and other issues as appropriate. 

 (c) Without limiting the contractual obligations of the Contracting Officer 

hereunder, nothing in this Contract shall be construed to limit or constrain the Contracting Officer’s 

ability to communicate, coordinate, and cooperate with the Contractor or other interested 

stakeholders or to make decisions in a timely fashion as needed to protect health, safety, physical 

integrity of structures or facilities, or the Contracting Officer’s ability to comply with applicable 

laws. 

738 CHARGES FOR DELINQUENT PAYMENTS

739 

740 

741 

742 

743 

 21. (a) The Contractor shall be subject to interest, administrative and penalty charges 

on delinquent installments or payments. When a payment is not received by the due date, the 

Contractor shall pay an interest charge for each day the payment is delinquent beyond the due date. 

When a payment becomes sixty (60) days delinquent, the Contractor shall pay an administrative 

charge to cover additional costs of billing and processing the delinquent payment. When a payment 
Contract No. 14-06-200-4020E 

 36

744 

745 

746 

747 

748 

749 

750 

751 

752 

753 

754 

755 

is delinquent ninety (90) days or more, the Contractor shall pay an additional penalty charge of six 

(6%) percent per year for each day the payment is delinquent beyond the due date. Further, the 

Contractor shall pay any fees incurred for debt collection services associated with a delinquent 

payment. 

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

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

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

Project Act of 1939 (Public Law 76-260). The interest charge rate shall be determined as of the due 

date and remain fixed for the duration of the delinquent period. 

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

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

accrued interest, and finally to the overdue payment. 

756 EQUAL EMPLOYMENT OPPORTUNITY

757 

758 

759 

760 

761 

762 

763 

764 

765 

766 

767 

768 

769 

770 

771 

772 

773 

774 

775 

776 

777 

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

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

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

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

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

action shall include, but not be limited to the following: employment, upgrading, demotion, or 

transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of 

compensation; and selection for training, including apprenticeship. The Contractor agrees to post in 

conspicuous places, available to employees and applicants for employment, notices to be provided by 

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

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

or on behalf of the Contractor, state that all qualified applicants will receive consideration for 

employment without regard to race, color, religion, sex, disability, or national origin. 

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

which it has a collective bargaining agreement or other contract or understanding, a notice, to be 

provided by the Contracting Officer, advising the labor union or workers’ representative of the 

Contractor’s commitments under Section 202 of Executive Order 11246 of September 24, 1965, and 

shall post copies of the notice in conspicuous places available to employees and applicants for 

employment. 

(d) The Contractor will comply with all provisions of Executive Order No. 11246 of 

September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. 
Contract No. 14-06-200-4020E 

 37

778 

779 

780 

781 

782 

783 

784 

785 

786 

787 

788 

789 

790 

791 

792 

793 

794 

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

Order 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of 

Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the 

Contracting Agency and the Secretary of Labor for purposes of investigation to ascertain compliance 

with such rules, regulations, and orders. 

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

of this contract or with any of such rules, regulations, or orders, this contract may be canceled, 

terminated or suspended in whole or in part and the Contractor may be declared ineligible for further 

Government contracts in accordance with procedures authorized in Executive Order 11246 of 

September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in 

Executive Order 11246 of September 24, 1965 or by rule, regulation, or order of the Secretary of 

Labor, or as otherwise provided by law. 

(g) The Contractor will include the provisions of paragraphs (1) through (7) in every 

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

Labor issued pursuant to Section 204 of Executive Order 11246 of September 24, 1965, so that such 

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

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

means of enforcing such provisions, including sanctions for noncompliance: Provided, however, that 

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

or vendor as a result of such direction, the Contractor may request the United States to enter into such 

litigation to protect the interests of the United States. 

795 

796 

797 

798 

799 GENERAL OBLIGATION--BENEFITS CONDITIONED UPON PAYMENT

800 

801 

802 

803 

804 

805 

806 

807 

808 

809 

810 

811 

812 

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

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

may be distributed among the Contractor's water users and notwithstanding the default of individual 

water users in their obligations to the Contractor. 

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

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

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

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

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

payment of water rates levied or established by the Contractor. 

 (c) With respect to subdivision (b) of this Article of this Contract, the Contractor 

shall have no obligation to require advance payment for water rates which it levies. 
Contract No. 14-06-200-4020E 

 38

813 COMPLIANCE WITH CIVIL RIGHTS LAWS AND REGULATIONS

814 

815 

816 

817 

818 

819 

820 

821 

822 

823 

824 

825 

826 

827 

828 

829 

830 

831 

 24. (a) The Contractor shall comply with Title VI of the Civil Rights Act of 1964 (42 

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

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

well as with their respective implementing regulations and guidelines imposed by the U.S. 

Department of the Interior and/or Bureau of Reclamation. 

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

of race, color, national origin, handicap, or age, be excluded from participation in, be denied the 

benefits of, or be otherwise subjected to discrimination under any program or activity receiving 

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

agrees to immediately take any measures necessary to implement this obligation, including permitting 

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

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

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

assistance extended after the date hereof to the Contractor by the Bureau of Reclamation, including 

installment payments after such date on account of arrangements for Federal financial assistance 

which were approved before such date. The Contractor recognizes and agrees that such Federal 

assistance will be extended in reliance on the representations and agreements made in this Article, 

and that the United States reserves the right to seek judicial enforcement thereof. 

832 PRIVACY ACT COMPLIANCE

833 25. Omitted. 

 

834 CONTRACTOR TO PAY CERTAIN MISCELLANEOUS COSTS

835 

836 

837 

838 

839 

840 

 26. In addition to all other payments to be made by the Contractor pursuant to this 

Contract, the Contractor shall pay to the United States, within sixty (60) days after receipt of a bill 

and detailed statement submitted by the Contracting Officer to the Contractor for such specific items 

of direct cost incurred by the United States for work requested by the Contractor associated with this 

Contract plus indirect costs in accordance with applicable Bureau of Reclamation policies and 

procedures. All such amounts referred to in this Article of this Contract shall not exceed the amount 
Contract No. 14-06-200-4020E 

 39

841 

842 

agreed to in writing in advance by the Contractor. This Article of this Contract shall not apply to 

costs for routine contract administration. 

843 WATER CONSERVATION

844 

845 

846 

847 

848 

849 

850 

851 

852 

853 

854 

855 

856 

857 

858 

859 

860 

 27. (a) Prior to the delivery of water provided from or conveyed through Federally 

constructed or Federally financed facilities pursuant to this Contract, the Contractor shall be 

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

conservation plan that has been determined by the Contracting Officer to meet the conservation and 

efficiency criteria for evaluating water conservation plans established under Federal law. The water 

conservation and efficiency program shall contain definite water conservation objectives, appropriate 

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

Continued Project Water delivery pursuant to this Contract shall be contingent upon the Contractor’s 

continued implementation of such water conservation program. In the event the Contractor's water 

conservation plan or any revised water conservation plan completed pursuant to subdivision (d) of 

this Article of this Contract have not yet been determined by the Contracting Officer to meet such 

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

Contractor, water deliveries shall be made under this Contract so long as the Contractor diligently 

works with the Contracting Officer to obtain such determination at the earliest practicable date, and 

thereafter the Contractor immediately begins implementing its water conservation and efficiency 

program in accordance with the time schedules therein. 

 (b) Omitted. 
Contract No. 14-06-200-4020E 

 40

861 

862 

863 

864 

865 

866 

867 

868 

869 

870 

871 

 (c) The Contractor shall submit to the Contracting Officer a report on the status of 

its implementation of the water conservation plan on the reporting dates specified in the then-existing 

conservation and efficiency criteria established under Federal law. 

 (d) At five (5) -year intervals, the Contractor shall revise its water conservation 

plan to reflect the then-existing conservation and efficiency criteria for evaluating water conservation 

plans established under Federal law and submit such revised water management plan to the 

Contracting Officer for review and evaluation. The Contracting Officer will then determine if the 

water conservation plan meets Reclamation’s then-existing conservation and efficiency criteria for 

evaluating water conservation plans established under Federal law. 

 (e) If the Contractor is engaged in direct groundwater recharge, such activity shall 

be described in the Contractor’s water conservation plan. 

872 EXISTING OR ACQUIRED WATER OR WATER RIGHTS

873 

874 

875 

876 

877 

878 

879 

 28. Except as specifically provided in Article 18 of this Contract, the provisions of this 

Contract shall not be applicable to or affect non-project water or water rights now owned or hereafter 

acquired by the Contractor or any user of such water within the Contractor's Service Area, including, 

without limitation, Prior-Rights Water. Any such water shall not be considered Project Water under 

this Contract. In addition, this Contract shall not be construed as limiting or curtailing any rights 

which the Contractor or any water user within the Contractor's Service Area acquires or has available 

under any other contract pursuant to Federal Reclamation law. 

880 OPERATION AND MAINTENANCE BY OPERATING NON-FEDERAL ENTITY

881 29. Omitted. 
Contract No. 14-06-200-4020E 

 41

882 CONTINGENT ON APPROPRIATION OR ALLOTMENT OF FUNDS

883 

884 

885 

886 

887 

 30. The expenditure or advance of any money or the performance of any obligation of the 

United States under this Contract shall be contingent upon appropriation or allotment of funds. 

Absence of appropriation or allotment of funds shall not relieve the Contractor from any obligations 

under this Contract. No liability shall accrue to the United States in case funds are not appropriated 

or allotted. 

888 BOOKS, RECORDS, AND REPORTS

889 

890 

891 

892 

893 

894 

895 

896 

897 

898 

899 

900 

901 

902 

903 

 31. (a) The Contractor shall establish and maintain accounts and other books and 

records pertaining to administration of the terms and conditions of this Contract, including: the 

Contractor's financial transactions, water supply data, and Project land and right-of-way agreements; 

the water users' land-use (crop census), land ownership, land-leasing and water use data; and other 

matters that the Contracting Officer may require. Reports thereon shall be furnished to the 

Contracting Officer in such form and on such date or dates as the Contracting Officer may require. 

Subject to applicable Federal laws and regulations, each party to this Contract shall have the right 

during office hours to examine and make copies of the other party's books and records relating to 

matters covered by this Contract. 

 (b) Notwithstanding the provisions of subdivision (a) of this Article of this 

Contract, no books, records, or other information shall be requested from the Contractor by the 

Contracting Officer unless such books, records, or information are reasonably related to the 

administration or performance of this Contract. Any such request shall allow the Contractor a 

reasonable period of time within which to provide the requested books, records, or information. 

 (c) Omitted. 

904 ASSIGNMENT LIMITED--SUCCESSORS AND ASSIGNS OBLIGATED

905 

906 

907 

908 

909 

 32. (a) The provisions of this Contract shall apply to and bind the successors and 

assigns of the parties hereto, but no assignment or transfer of this Contract or any right or interest 

therein shall be valid until approved in writing by the Contracting Officer. 

(b) The assignment of any right or interest in this Contract by either party shall not 

interfere with the rights or obligations of the other party to this Contract absent the written 
Contract No. 14-06-200-4020E 

 42

910 

911 

912 

concurrence of said other party. 

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

of any proposed assignment. 

913 SEVERABILITY

914 

915 

916 

917 

918 

919 

920 

921 

922 

923 

924 

925 

926 

927 

928 

 33. In the event that a person or entity who is neither (i) a party to a Project contract, nor 

(ii) a person or entity that receives Project Water from a party to a Project contract, nor (iii) an 

association or other form of organization whose primary function is to represent parties to Project 

contracts, brings an action in a court of competent jurisdiction challenging the legality or 

enforceability of a provision included in this Contract and said person, entity, association, or 

organization obtains a final court decision holding that such provision is legally invalid or 

unenforceable and the Contractor has not intervened in that lawsuit in support of the plaintiff(s), the 

parties to this Contract shall use their best efforts to (i) within thirty (30) days of the date of such final 

court decision identify by mutual agreement the provisions in this Contract which must be revised 

and (ii) within three (3) months thereafter promptly agree on the appropriate revision(s). The time 

periods specified above may be extended by mutual agreement of the parties. Pending the 

completion of the actions designated above, to the extent it can do so without violating any applicable 

provisions of law, the United States shall continue to make the quantities of Project Water specified 

in this Contract available to the Contractor pursuant to the provisions of this Contract which were not 

found to be legally invalid or unenforceable in the final court decision. 

929 RESOLUTION OF DISPUTES

930 34. Should any dispute arise concerning any provisions of this Contract, or the parties’ 
Contract No. 14-06-200-4020E 

 43

931 

932 

933 

rights and obligations thereunder, the parties shall meet and confer in an attempt to resolve the 

dispute. Prior to the Contractor commencing any legal action, or the Contracting Officer referring 

any matter to Department of Justice, the party shall provide to the other party thirty (30) days written 

notice of the intent to take such action; Provided, That such notice shall not be required where a delay 

in commencing an action would prejudice the interests of the party that intends to file suit. During 

the thirty (30) day notice period, the Contractor and the Contracting Officer shall meet and confer in 

an attempt to resolve the dispute. Except as specifically provided, nothing herein is intended to 

waive or abridge any right or remedy that the Contractor or the United States may have. 

934 

935 

936 

937 

938 

939 OFFICIALS NOT TO BENEFIT

940 

941 

942 

 35. No Member of or Delegate to Congress, Resident Commissioner, or official of the 

Contractor shall benefit from this Contract other than as a water user or landowner in the same 

manner as other water users or landowners. 

943 CHANGES IN CONTRACTOR’S SERVICE AREA

944 

945 

946 

947 

948 

949 

950 

951 

952 

953 

 36. (a) While this Contract is in effect, no change may be made in the Contractor's 

Service Area or boundaries, by inclusion or exclusion of lands, dissolution, consolidation, merger, or 

otherwise, except upon the Contracting Officer's written consent. 

 (b) Within thirty (30) days of receipt of a request for such a change, the 

Contracting Officer will notify the Contractor of any additional information required by the 

Contracting Officer for processing said request, and both parties will meet to establish a mutually 

agreeable schedule for timely completion of the process. Such process will analyze whether the 

proposed change is likely to: (i) result in the use of Project Water contrary to the terms of this 

Contract; (ii) impair the ability of the Contractor to pay for Project Water furnished under this 

Contract or to pay for any Federally-constructed facilities for which the Contractor is responsible; 
Contract No. 14-06-200-4020E 

 44

954 

955 

956 

957 

and (iii) have an impact on any Project Water rights applications, permits, or licenses. In addition, 

the Contracting Officer shall comply with the National Environmental Policy Act and the Endangered 

Species Act. The Contractor will be responsible for all costs incurred by the Contracting Officer in 

this process, and such costs will be paid in accordance with Article 26 of this Contract. 

958 FEDERAL LAWS

959 

960 

 37. By entering into this Contract, the Contractor does not waive its rights to contest the 

validity or application in connection with the performance of the terms and conditions of this 

Contract of any Federal law or regulation; Provided, That the Contractor agrees to comply with the 

terms and conditions of this Contract unless and until relief from application of such Federal law or 

regulation to the implementing provision of the Contract is granted by a court of competent 

jurisdiction. 

961 

962 

963 

964 

965 EMERGENCY RESERVE FUND

966 38. Omitted. 

967 MEDIUM FOR TRANSMITTING PAYMENT

968 

969 

970 

971 

972 

973 

974 

975 

39. (a) All payments from the Contractor to the United States under this contract 

shall be by the medium requested by the United States on or before the date payment is due. The 

required method of payment may include checks, wire transfers, or other types of payment specified 

by the United States. 

 (b) Upon execution of the contract, the Contractor shall furnish the Contracting 

Officer with the Contractor’s taxpayer’s identification number (TIN). The purpose for requiring the 

Contractor’s TIN is for collecting and reporting any delinquent amounts arising out of the 

Contractor’s relationship with the United States. 

976 NOTICES

977 

978 

979 

 40. Any notice, demand, or request authorized or required by this Contract shall be 

deemed to have been given, on behalf of the Contractor, when mailed, postage prepaid, or delivered 

to the Area Manager, South-Central California Area Office, 1243 “N” Street, Fresno, California 
Contract No. 14-06-200-4020E 

 45

980 

981 

982 

983 

93721, and on behalf of the United States, when mailed, postage prepaid, or delivered to the Board of 

Directors of Madera Irrigation District, 12152 Road 28 1⁄4, Madera, California 93637. The 

designation of the addressee or the address may be changed by notice given in the same manner as 

provided in this Article of this Contract for other notices. 

984 CONFIRMATION OF CONTRACT

985 

986 

987 

988 

989 

990 

 41. The Contractor, after the execution of this Contract, shall promptly provide to the 

Contracting Officer a decree of a court of competent jurisdiction of the State of California, 

confirming the execution of this Contract. The Contractor shall furnish the United States a certified 

copy of the final decree, the validation proceedings, and all pertinent supporting records of the court 

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

binding on the Contractor. 

991 CONTRACT DRAFTING CONSIDERATIONS

992 

993 

994 

995 

996 

997 

998 

 42. Articles 1 through 8, Articles 10 through 15, subdivision (b) of Article 16, Articles 18 

through 20, subdivision (c) of Article 23, Articles 26 through 28, subdivision (b) of Article 31, 

subdivisions (b) and (c) of Article 32, Articles 33 through 34, subdivision (b) of Article 36, and 

Article 37 of this Contract have been drafted, negotiated, and reviewed by the parties hereto, each of 

whom is sophisticated in the matters to which this Contract pertains, and no one party shall be 

considered to have drafted the stated Articles. 
Contract No. 14-06-200-4020E 

 46

999 

1000 

 IN WITNESS WHEREOF, the parties hereto have executed this Contract as of the day and 

year first above written.