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89-653 PS 2004

H.R. 885 AND H.R. 1753

LEGISLATIVE HEARING

BEFORE THE

SUBCOMMITTEE ON WATER AND POWER

OF THE

COMMITTEE ON RESOURCES 

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED EIGHTH CONGRESS

FIRST SESSION

Thursday, October 2, 2003

Serial No. 108-65

Printed for the use of the Committee on Resources

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/house 

or 

Committee address: http://resourcescommittee.house.gov 

(II)

COMMITTEE ON RESOURCES 

RICHARD W. POMBO, California, Chairman 

NICK J. RAHALL II, West Virginia, Ranking Democrat Member

Don Young, Alaska 

W.J. ‘‘Billy’’ Tauzin, Louisiana 

Jim Saxton, New Jersey 

Elton Gallegly, California 

John J. Duncan, Jr., Tennessee 

Wayne T. Gilchrest, Maryland 

Ken Calvert, California 

Scott McInnis, Colorado 

Barbara Cubin, Wyoming 

George Radanovich, California 

Walter B. Jones, Jr., North Carolina 

Chris Cannon, Utah 

John E. Peterson, Pennsylvania 

Jim Gibbons, Nevada, 

Vice Chairman 

Mark E. Souder, Indiana 

Greg Walden, Oregon 

Thomas G. Tancredo, Colorado 

J.D. Hayworth, Arizona 

Tom Osborne, Nebraska 

Jeff Flake, Arizona 

Dennis R. Rehberg, Montana 

Rick Renzi, Arizona 

Tom Cole, Oklahoma 

Stevan Pearce, New Mexico 

Rob Bishop, Utah 

Devin Nunes, California 

Randy Neugebauer, Texas 

Dale E. Kildee, Michigan 

Eni F.H. Faleomavaega, American Samoa 

Neil Abercrombie, Hawaii 

Solomon P. Ortiz, Texas 

Frank Pallone, Jr., New Jersey 

Calvin M. Dooley, California 

Donna M. Christensen, Virgin Islands 

Ron Kind, Wisconsin 

Jay Inslee, Washington 

Grace F. Napolitano, California 

Tom Udall, New Mexico 

Mark Udall, Colorado 

Anı ́bal Acevedo-Vila ́, Puerto Rico 

Brad Carson, Oklahoma 

Rau ́l M. Grijalva, Arizona 

Dennis A. Cardoza, California 

Madeleine Z. Bordallo, Guam 

George Miller, California 

Edward J. Markey, Massachusetts 

Rube ́n Hinojosa, Texas 

Ciro D. Rodriguez, Texas 

Joe Baca, California 

Betty McCollum, Minnesota

Steven J. Ding, Chief of Staff 

Lisa Pittman, Chief Counsel 

James H. Zoia, Democrat Staff Director 

Jeffrey P. Petrich, Democrat Chief Counsel 

SUBCOMMITTEE ON WATER AND POWER 

KEN CALVERT, California, Chairman 

GRACE F. NAPOLITANO, California, Ranking Democrat Member

George Radanovich, California 

Greg Walden, Oregon 

Thomas G. Tancredo, Colorado 

J.D. Hayworth, Arizona 

Tom Osborne, Nebraska 

Rick Renzi, Arizona 

Stevan Pearce, New Mexico 

Devin Nunes, California 

Richard W. Pombo, California, ex officio 

Calvin M. Dooley, California 

Jay Inslee, Washington 

Rau ́l M. Grijalva, Arizona 

Dennis A. Cardoza, California 

George Miller, California 

Ciro D. Rodriguez, Texas 

Joe Baca, California 

Nick J. Rahall II, West Virginia, ex officio 

(III)

C O N T E N T S 

Page

Hearing held on Thursday, October 2, 2003 .......................................................... 1

Statement of Members: 

Calvert, Hon. Ken, a Representative in Congress from the State of 

California ....................................................................................................... 1

Prepared statement of ............................................................................... 2

Grijalva, Hon. Raul M., a Representative in Congress from the State 

of Arizona ...................................................................................................... 14

Hayworth, Hon. J.D., a Representative in Congress from the State of 

Arizona ........................................................................................................... 4

Prepared statement of ............................................................................... 5

Kyl, Hon. Jon, a U.S. Senator in Congress from the State of Arizona ........ 6

Prepared statement on H.R. 885 ............................................................. 8

Napolitano, Hon. Grace F., a Representative in Congress from the State 

of California ................................................................................................... 3

Prepared statement of ............................................................................... 3

Nethercutt, Hon. George, Jr., a Representative in Congress from the 

State of Washington ..................................................................................... 9

Prepared statement on H.R. 1753 ........................................................... 11

Pearce, Hon. Stevan, a Representative in Congress from the State of 

New Mexico ................................................................................................... 13

Prepared statement of ............................................................................... 13

Renzi, Hon. Rick, a Representative in Congress from the State of Arizona 12

Prepared statement of ............................................................................... 12

Statement of Witnesses: 

Guenther, Herbert R., Director, Arizona Department of Water Resources, 

Oral statement on H.R. 885 ........................................................................ 68

Response to questions submitted for the record ..................................... 76

Supplemental statement submitted for the record ................................. 124

Hickok, Steven, Deputy Administrator, Bonneville Power Administration 21

Prepared statement on H.R. 1753 ........................................................... 23

Response to questions submitted for the record ..................................... 26

Juan-Saunders, Vivian, Chairwoman, Tohono O’odham Nation .................. 58

Prepared statement on H.R. 885 ............................................................. 60

Kitcheyan, Kathleen W., Tribal Chairwoman, San Carlos Apache Tribe, 

Oral statement on H.R. 885 ........................................................................ 66

Lopez, Estevan R., Director, New Mexico Interstate Stream Commission .. 78

Prepared statement on H.R. 885 ............................................................. 79

Martin, Aurene, Acting Assistant Secretary for Indian Affairs, U.S. 

Department of the Interior, Oral statement on H.R. 885 ......................... 21

Napolitano, Hon. Janet, Governor, State of Arizona, Prepared statement 

of ..................................................................................................................... 69 

Narcia, Hon. Richard, Governor, Gila River Indian Reservation ................. 51

Prepared statement on H.R. 885 ............................................................. 53

Response to questions submitted for the record ..................................... 57

Pollak, Stanley, Water Rights Counsel, Navajo Nation, Oral statement 

on H.R. 885 ................................................................................................... 82

Raley, Bennett W., Assistant Secretary for Water and Science, U.S. 

Department of the Interior ........................................................................... 14

Prepared statement on H.R. 885 ............................................................. 15

Response to questions submitted for the record ..................................... 20

Shirley, Joe, Jr., President, Navajo Nation, Prepared statement on 

H.R. 885 ........................................................................................................ 84

Seyler, Warren, Chairman, Spokane Tribe of Indians .................................. 33

Page

IV

Statement of Witnesses—Continued

Seyler, Warren, Chairman, Spokane Tribe of Indians —Continued

Prepared statement on H.R. 1753 ........................................................... 35

Response to questions submitted for the record ..................................... 38

Additional materials supplied: 

Arizona Cities of Chandler, Glendale, Goodyear, Mesa, Peoria, and 

Scottsdale, Statement submitted for the record in support of H.R. 885 . 99

Burdette, Vivian, Chairwoman, Tonto Apache Tribe, Statement submitted 

for the record in support of H.R. 885 ......................................................... 123

Fines, L. Anthony, Attorney for Gila Valley Irrigation District and David 

A. Brown, Attorney for Franklin Irrigation District, Statement submitted for the record ..................................................................................... 101

Fullmer, Jamie, Chairman, Yavapai-Apache Nation, Statement submitted 

for the record in support of H.R. 885 ......................................................... 123

Gila River Indian Community, Supplemental testimony submitted for 

the record ....................................................................................................... 101

Hawker, Hon. Keno, Mayor, City of Mesa, Arizona, Statement submitted 

for the record ................................................................................................. 107

Mason, Douglas, General Manager, San Carlos Irrigation and Drainage 

District, Coolidge, Arizona, Statement submitted for the record in 

support of H.R. 885 ...................................................................................... 108

Payson, Town of, Arizona, Statement submitted for the record by the 

Mayor and Common Council in support of H.R. 885 ................................ 109

Renner, George, President, Board of Directors, Central Arizona Water 

Conservation District, Statement submitted for the record ...................... 109

Rimsza, Hon. Skip, Mayor, City of Phoenix, Arizona, Statement 

submitted for the record in support of H.R. 885 ....................................... 112

Spokane Tribe of Indians: A Showing of the United States’ Need to 

Fairly and Honorably Settle the Tribes Claims for Grand Coulee—

A Narrative with Attachments, submitted for the record on H.R. 1753 . 123

Sullivan, John F., Associate General Manager, Water Group, Salt River 

Valley Water Users Association and Salt River Project Agricultural 

Improvement and Power District, Statement submitted for the record 

in support of H.R. 885 ................................................................................. 114

Talley, Hon. Van, Mayor, City of Safford, Arizona, Statement submitted 

for the record in support of H.R. 885 ......................................................... 122

(1)

LEGISLATIVE HEARING ON H.R. 885, TO PROVIDE FOR ADJUSTMENTS TO THE CENTRAL 

ARIZONA PROJECT IN ARIZONA, TO 

AUTHORIZE THE GILA RIVER INDIAN COMMUNITY WATER RIGHTS SETTLEMENT, TO 

REAUTHORIZE AND AMEND THE SOUTHERN 

ARIZONA WATER RIGHTS SETTLEMENT ACT 

OF 1982, AND FOR OTHER PURPOSES; AND 

H.R. 1753, TO PROVIDE FOR EQUITABLE 

COMPENSATION OF THE SPOKANE TRIBE 

OF INDIANS OF THE SPOKANE RESERVATION IN SETTLEMENT OF CLAIMS OF THE 

TRIBE CONCERNING THE CONTRIBUTION 

OF THE TRIBE TO THE PRODUCTION OF 

HYDROPOWER BY THE GRAND COULEE 

DAM, AND FOR OTHER PURPOSES. 

Thursday, October 2, 2003

U.S. House of Representatives 

Subcommittee on Water and Power 

Committee on Resources 

Washington, DC 

The Subcommittee met, pursuant to notice, at 10:02 a.m., in 

Room 1324, Longworth House Office Building, Hon. Ken Calvert 

[Chairman of the Subcommittee] presiding. 

Present: Representatives Calvert, Hayworth, Renzi, Pearce, 

Napolitano and Grijalva. 

STATEMENT OF HON. KEN CALVERT, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. CALVERT. The legislative hearing by the Subcommittee on 

Water and Power will come to order. 

The Subcommittee today is meeting to hear testimony on 

H.R. 885, to provide for adjustments to the Central Arizona Project 

in Arizona to authorize the Gila River Indian Community water 

rights settlement, to reauthorize and amend the Southern Arizona 

Water Rights Settlement Act of 1982, and for other purposes; and 

2

H.R. 1753, to provide for an equitable compensation of the Spokane Tribe of Indians of the Spokane Reservation in the settlement 

of claims of the tribe concerning the contribution of the tribe to the 

production of hydropower by the Grand Coulee Dam, and for other 

purposes. 

Mr. CALVERT. Today’s hearing is another step in our efforts to examine the potential value of other water and power resources 

throughout the West. Both bills before the Subcommittee today 

have direct impacts on Native American communities and their 

communities, and their neighbors. 

The Arizona delegation, particularly Senator Kyl, who will be 

here shortly, and my distinguished colleague, J.D. Hayworth, have 

worked hard to find consensus-based water solutions in their State. 

H.R. 885 and its Senate companion bill reflect those efforts to date. 

The bills rightly attempt to resolve costly litigation and give the 

people of Arizona a road map of water certainty through a whole 

host of water supply and uses. As one who has worked to bring 

parties together to resolve a similar situation involving the quantification settlement agreement in Southern California with our 

friends in the Upper and Lower Basin, I strongly support the concepts of long-term water certainty and reducing litigation. 

Although I realize that some issues remain on H.R. 885, I want 

to commend the Arizona delegation and the administration for 

their leadership in attempting to resolve this very complex situation. 

I would also like to commend my Washington State colleague, 

George Nethercutt, for rising in strong defense of his constituents 

and trying to bring more accountability to how our government operates. I know that he has worked hard for many years on trying 

to right the wrongs of the past as it relates to the Spokane Tribe. 

Everyone agrees that the tribe has been seriously impacted by the 

construction of the Grand Coulee Dam. However, disagreement exists over the bets method to compensate the tribe. I realize the 

tribe has run into a substantial statute of limitation problem with 

their claim, but that shouldn’t stop the tribe and the Bonneville 

Power Administration from working constructively on a final solution. 

[The prepared statement of Mr. Calvert follows:]

Statement of The Honorable Ken Calvert, Chairman,

Subcommittee on Water and Power, on H.R. 885 and H.R. 1753

Today’s hearing is another step in our effort to examine the potential value of our 

water and power resources throughout the west. Both bills before the Subcommittee 

today have direct impacts on their respective native American communities and on 

their neighbors. 

The Arizona delegation, particularly Sen. Kyl and my distinguished colleague, 

J.D. Hayworth, have worked hard to bring about consensus-based water solutions 

for their state. H.R. 885 and its Senate companion bill reflect that progress to date. 

The bills rightly attempt to resolve costly litigation and give the people of Arizona 

a roadmap of water certainty through a whole host of water supplies and uses. 

As one who has worked to bring parties together to resolve a similar situation involving the March 11, 2004, Quantification Settlement Agreement in southern California, I strongly support these concepts. 

Although I realize that some issues remain on H.R. 885, I want to commend the 

Arizona delegation and the Administration for their leadership in attempting to resolve this very complex situation. 

I would also like to commend my Washington State colleague, George Nethercutt, 

for rising in strong defense of his constituents and trying to bring more 

3

accountability to how our government operates. I know that he has worked hard for 

many years on trying to right the wrongs of the past as it relates to the Spokane 

Tribe. 

Everyone agrees that the Tribe has been seriously impacted by the construction 

of the Grand Coulee Dam, however disagreement exists over the best method to 

compensate the Tribe. I realize that the Tribe has run into a substantial statute of 

limitations problem with their claim, but that shouldn’t stop the Tribe and the Bonneville Power Administration from working constructively on a final solution. 

Since I have to leave mid-way through the hearing, I am going to hand the gavel 

to my able friend and colleague, J.D. Hayworth at the appropriate time. In the 

meantime, I welcome the witnesses and look forward to resolution on these bills. 

I also ask that members limit their questions to the Administration to the issues 

before us today. Thank you 

Mr. CALVERT. Since I must leave midway through the hearing, 

I am going to hand the gavel over to my able friend and colleague, 

J.D. Hayworth, at the appropriate time. In the meantime, I will 

welcome the witnesses and ask all parties to find resolutions on 

these bills. 

I also ask that members limit their questions to the issues today 

before us, and I would thank you. 

I now recognize my friend and recognize Ms. Napolitano and the 

Ranking Democrat member for any statements she may have. 

STATEMENT OF HON. GRACE NAPOLITANO, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mrs. NAPOLITANO. Thank you, Mr. Chairman. That really was a 

low blow. 

[Laughter.] 

Mrs. NAPOLITANO. I am teasing. Thank you for the opportunity 

to be here today, Mr. Chair. The two water bills before us today 

affecting Native Americans have had a long and complex history, 

as we have heard, and upon reading it, I am aghast. I am amazed 

at how long it has been to have this before us, and I am sure my 

colleagues are as distressed as I am and hope that this neglect, this 

shunning of our obligation to our Native Americans will be righted, 

or at the least the beginning of finding the solutions to helping 

those people that have suffered for so long without some equality 

in these areas. 

I congratulate my colleagues for their efforts and trust that we 

will be having some solutions as we move forward. Thank you so 

very much, Mr. Chair. I look forward to the hearing. 

[The prepared statement of Mrs. Napolitano follows:]

Statement of The Honorable Grace Napolitano, a Representative in 

Congress from the State of California 

Thank you, Chairman Calvert, for holding this important hearing today. 

H.R. 885 would provide adjustments to the Central Arizona Project, authorize a 

water rights settlement for the Gila River tribe and amend the Southern Arizona 

Water Rights Settlement Act. 

H.R. 1753 would provide equitable compensation of the Spokane Tribe of Indians 

of the Spokane Reservation. 

Both bills have a long and complex history that dates back prior to my time in 

Congress. I look forward to hearing from our witnesses, and especially thank those 

that traveled to Washington to be here today. 

Mr. CALVERT. I thank the gentlelady. 

Mr. Hayworth? 

4

STATEMENT OF HON. J.D. HAYWORTH, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF ARIZONA 

Mr. HAYWORTH. Mr. Chairman, thank you very much, and I 

would like to begin by thanking Chairman Pombo and Chairman 

Calvert for scheduling this, also my good friend and colleague from 

the First District, Rick Renzi, who is the Vice Chairman and will 

have a hand in the hearing today, and I see my friend, Mr. 

Grijalva, so we have good bipartisan representation from the State 

of Arizona; and we will no doubt be joined by our friend from the 

new Sixth District, Congressman Flake, who also serves on this 

Subcommittee. 

Let me pause at this juncture, Mr. Chairman, to personally 

thank the witnesses for traveling so far to be here today to testify. 

In particular, I know that in addition to the tribal chairpeople who 

are here to testify, a number of my friends who serve on the tribal 

councils as well as tribal administrators and many other Arizonans 

join us today in the audience. 

Because of time constraints, we will have only one witness representing the State of Arizona, but I am informed that you have 

secured formal approval of the settlement agreement from most of 

the cities, towns, irrigation districts, and water purveyors in 

Arizona that are incorporated in the current settlement framework. 

We are also joined today by our friends from New Mexico. It is 

my understanding that Arizona and New Mexico interests have 

been able to reach an agreement that will resolve some of the 

claims that are currently in dispute between water users in our 

two States. I am hopeful this successful effort will soon translate 

into a successful resolution on another Arizona-New Mexico issue 

that has apparently been lingering since 1968. 

And finally, I am pleased to acknowledge the hard work and 

leadership of my colleague from the U.S. Senate, Senator Jon Kyl. 

Senator Kyl, I believe you to be the right man at the right time 

to move this along and get this done. 

At the center of the legislation we are here today to consider is 

an effort to do justice to all Indian tribes in Arizona. By any measure, Indian tribes, especially those in Arizona, have given much 

more to the United States than they have received in return. Although Arizona includes more reservations and reservation land 

than any other State, we should not lose sight of the fact that all 

of the remaining land was in some way ceded by an Arizona Indian 

tribe. Of course, the contributions made by Native Americans and 

throughout Indian country continue on today, including involvement in our State’s economy, and as the State of Arizona makes 

clear in its testimony, through dedication and service in our nation’s armed forces. 

In my estimation, this legislation represents a new era in 

Arizona and Federal relations with Indian tribes. First, this is an 

agreement that originated in Indian country. Second, it is not a 

handout. It includes bargained-for exchanges between all of the 

parties to the settlement. No one got everything they wanted, and 

in some cases, some parties had to settle for less than they believe 

they deserved. But the town of Autumn Nation and the Gila River 

Indian Community have taken the stand that, on balance, this 

5

represents a significant step forward for their government and 

their people. 

Every Indian tribe that receives Central Arizona Project water 

will immediately receive a benefit from this legislation because it 

provides decades of relief from certain charges that apply to their 

CAP water. In addition, those Indian tribes with existing settlements will have access to a new funding source to pay for the components of their settlement agreements. This same funding source 

will be available to settle any remaining tribal water rights claims 

in Arizona. 

While this legislation aids Arizona Indian tribes, it also provides 

benefits to the overwhelming majority of Arizona’s citizens. First, 

by resolving Arizona’s dispute over CAP repayment and over the 

division of CAP water, Arizona can effectively manage its scarce 

water resources. For decades, Arizona has made groundwater management one of its highest priorities, and this legislation builds 

upon this effort. Water management is nearly impossible without 

certainty of supply and priority. Through the negotiations affirmed 

by this legislation, we can have that certainty without waiting 

years or even decades for court rulings. 

Mr. Chairman, colleagues, ladies and gentlemen, I am hopeful 

that today’s testimony will focus on how we can resolve any remaining issues and get this important legislation done as quickly 

as possible. 

Again, thank you, Mr. Chairman. I yield back. 

[The prepared statement of Mr. Hayworth follows:]

Statement of The Honorable J.D. Hayworth, a Representative in Congress 

from the State of Arizona 

I would like to begin by thanking Chairman Pombo and the Chairman of this Subcommittee, Mr. Calvert and the Vice Chairman, my friend from Arizona, Rick Renzi, 

for scheduling this hearing today. I would also like to personally thank the witnesses for traveling so far to be here today to testify. In particular, I know that in 

addition to the tribal chairpeople who are here to testify, a number of my friends 

who serve on the tribal councils and as tribal administrators, as well as many other 

Arizonans also join us today in the audience. 

Because of time-constraints we will only have one witness representing the State 

of Arizona, but I am informed that you have secured formal approval of the settlement agreement from most of the cities, towns, irrigation districts, and water purveyors in Arizona that are incorporated in the settlement framework. 

We are also joined today by our friends from New Mexico. It is my understanding 

that Arizona and New Mexico interests have been able to reach an agreement that 

will resolve some of the claims that are currently in dispute between water users 

in our two states. I am hopeful that this successful effort will soon translate into 

a successful resolution on another Arizona-New Mexico issue that has apparently 

been lingering since 1968. 

Finally, I would like to acknowledge the hard work and leadership of my colleague 

from the United States Senate, Senator Jon Kyl. Senator Kyl is the right man at 

the right time to get this done. 

At the center of the legislation that we are here today to consider is an effort to 

do justice to all Indian tribes in Arizona. By any measure, Indian tribes, especially 

in Arizona, have given much more to the United States than they have received in 

return. Although Arizona includes more reservations and reservation land than any 

other State, we should not lose sight of the fact that all of the remaining land was 

in some way ceded by an Arizona Indian tribe. Of course, the contributions made 

by Indians and Indian country continue on through today including involvement in 

the State’s economy and, as the State of Arizona makes clear in its testimony, 

through dedication and service in our Nation’s armed forces. 

In my estimation, this legislation represents a new era in Arizona and federal relations with Indian tribes. First, this is an agreement that originated in Indian 

country. Second, it is not a hand-out. It includes bargained-for exchanges between 

6

all of the parties to the settlement. No one got everything they wanted, and, in some 

cases, they had to settle for less than they believe they deserve. But the Tohono 

O’odham Nation and the Gila River Indian Community have taken the stand that, 

on balance, this represents a significant step forward for their government and their 

people. 

Every Indian tribe that receives Central Arizona Project water will immediately 

receive a benefit from this legislation because it provides decades of relief from certain charges that apply to their CAP water. In addition, those Indian tribes with 

existing settlements will have access to a new funding source to pay for the components of their settlement agreements. This same funding source will be available to 

settle any remaining tribal water rights claims in Arizona. 

While this legislation aids Arizona Indian tribes, it also provides benefits to the 

overwhelming majority of Arizona citizens. First, by resolving Arizona’s dispute over 

CAP repayment and over the division of CAP water, Arizona can manage its scarce 

water resources. For decades, Arizona has made groundwater management one of 

its highest priorities. This legislation builds upon that effort. 

Water management is nearly impossible without certainty of supply and priority. 

Through the negotiations affirmed by this legislation, we can have that certainty 

without waiting years or even decades for court rulings. 

I am hopeful that today’s testimony will focus on how we can resolve any remaining issues and get this important legislation done as quickly as possible. 

Mr. CALVERT. I thank the gentleman. 

If there are any other additional opening statements, I would ask 

that we would put them off until after our first panel gives their 

testimony to allow them to return to their duties. 

With that, I would like to recognize the first panel, our friend 

and former colleague here in the House, Senator Jon Kyl, United 

States Senator, State of Arizona, who will testify on H.R. 885. 

Senator? 

STATEMENT OF HON. JON KYL, A UNITED STATES SENATOR 

FROM THE STATE OF ARIZONA 

Senator KYL. Thank you very much, Mr. Chairman. I thank Representative Nethercutt for allowing me to go first here. Thank you, 

Mr. Chairman. I thank Representative Hayworth for a fine statement, for his cosponsorship of the bill, and both Representatives 

Grijalva and Renzi for their assistance in getting this hearing 

scheduled. We appreciate it very much. 

The water users of Arizona have waited a long time for this day, 

and I just hope you can appreciate the significance that all of the 

people behind you feel, the fact that you are holding this hearing. 

That is very much why I appreciate it. It is really the product, this 

legislation, of about 14 years of negotiation and litigation and then 

negotiation again. 

Virtually every major water user and provider in Central Arizona 

has devoted itself to the passage of this bill. In fact, H.R. 885 

would codify the largest water claims settlement in the history of 

Arizona. The three titles in the bill represent the tremendous efforts of literally hundreds of people in Arizona, as well as Washington, D.C., over this period of 14 years. Looking ahead, this bill 

could ultimately be nearly as important to Arizona’s future as was 

the authorization of the Central Arizona Project. 

Since Arizona began receiving CAP water from the Colorado 

River, litigation has divided water users over how the CAP water 

should be allocated and exactly how much Arizona was required to 

repay the Federal Government. Recall that, I think wisely, other 

States required of Arizona a payback of a portion of the CAP if the 

7

Federal Government was going to up-front the costs. There has 

now been a settlement between the U.S. Government and the State 

of Arizona as to how much that repayment should be. So the bill, 

among other things, codifies that settlement and it also resolves 

once and for all the allocation of all of the remaining CAP water, 

as I said. 

The final allocation provides necessary stability for State water 

authorities to plan for Arizona’s future water needs, and in addition, approximately 200,000 acre feet of CAP water will be made 

available under this settlement to settle various Indian water 

claims in the State. 

The bill would also authorize the use of the Lower Colorado 

River Basin Development Fund, which is funded solely from revenues paid by Arizona entities, to construct irrigation works necessary for the tribes with Congressionally approved water settlements to use their CAP water. 

Mr. Chairman, Title II of the bill settles the water rights claims 

of the Gila River Indian Community, allocating nearly 100,000 acre 

feet of CAP water to the community and providing funds to stabilize the costs of delivering CAP water and to construct the facilities necessary to allow the community to fully utilize the water 

that it has been allocated. 

Title III provides for long-needed amendments to the 1982 Southern Arizona Water Settlement Act for the Tohono O’odham Nation, 

and that has never been fully implemented. 

The bill will allow Arizona cities to plan for the future, as I said, 

knowing how much water they can count on. The Indian tribes will 

finally get wet water, not just the paper water rights that they 

have had in the past, and projects to use that water. In addition, 

mining companies, farmers, irrigation delivery districts, and others 

can continue to receive water without the fear that they will be 

stopped by litigation. 

There are some minor issues that remain, as Representative 

Hayworth said, but we have every confidence that those issues can 

be resolved before we mark up the legislation, and I made that 

commitment in the hearing that we had in the Senate just a couple 

of days ago. 

In particular, the States of Arizona and New Mexico have been 

negotiating the best way to address New Mexico’s rights under the 

1986 Boulder Canyon Act to exchange 18,000 acre feet of CAP 

water on the Gila River. They are meeting regularly and report 

that they are making progress in those negotiations. 

In addition, I hope that negotiations with the San Carlos Apache 

Tribe will move forward so that their claims can be resolved by the 

legislation. We have made it clear by leaving a title open in the legislation that if they would like to negotiate their claims, there is 

a place in the bill for those claims to be resolved and, if not, that 

is a decision that they have to make. But in any event, that opportunity is available. 

In summary, the bill is vital to the citizens of Arizona. It will 

provide certainty needed to move forward with water use decisions. 

Furthermore, the United States can avoid litigating water rights 

and damage claims and satisfy its trust responsibilities to the 

tribes. The parties have worked many years to reach consensus 

8

rather than litigate, and I believe the bill represents the best opportunity to achieve a fair result for everyone. 

Mr. Chairman, might I make just one final comment. I thought 

the hearing that was held in the Senate did something very good. 

The record is full of all of the good things that this legislation will 

do. Representative Hayworth and I just barely touched on what 

this means to the people in Arizona. But we went right back to 

business, rolled up our sleeves in the previous hearing, by focusing 

really on the remaining concerns, the things that have to be done. 

That is what we want the people of this Committee to know, not 

just all of the good things, but the few things that we remain working on, and especially Bennett Raley from the Department of Interior will identify things the Department is working on so you will 

know exactly what is left to do before we can conclude this settlement. So I count that as good news, not something that we should 

be concerned about. 

I am very appreciative of all of the people behind me who have 

worked so hard to make this settlement a reality and I thank you 

again for giving them the opportunity to be here and to see that 

we can move this legislation forward. 

[The prepared statement of Mr. Kyl follows:]

Statement of The Honorable Jon Kyl, a U.S. Senator

from the State of Arizona 

Chairman Calvert, and members of the Subcommittee, I would first like to thank 

you for holding this hearing and allowing me to testify. My special thanks also go 

to my colleague, Rep. Hayworth, for sponsoring this important legislation and shepherding it through the Congressional process. The water users and providers of 

Arizona have waited a long time for this day. The bill before your committee, the 

Arizona Water Settlements Act (H.R. 885), is the product of fourteen years of negotiation, litigation, and more negotiation. Virtually every major water user and provider in central Arizona has devoted itself to the passage of this bill. In fact, 

H.R. 885 would codify the largest water claims settlement in the history of Arizona. 

The three titles in this bill represent the tremendous efforts of literally hundreds 

of people in Arizona and here in Washington over a period of fourteen years. Looking ahead, this bill could ultimately be nearly as important to Arizona’s future as 

was the authorization of the Central Arizona Project (CAP) itself. 

Since Arizona began receiving CAP water from the Colorado River, litigation has 

divided water users over how the CAP water should be allocated and exactly how 

much Arizona was required to repay the federal government. This bill will, among 

other things, codify the settlement reached between the United States and the Central Arizona Water Conservation District over the state’s repayment obligation for 

costs incurred by the United States in constructing the Central Arizona Project. It 

will also resolve, once and for all, the allocation of all remaining CAP water. This 

final allocation will provide the stability necessary for state water authorities to 

plan for Arizona’s future water needs. In addition, approximately 200,000 acre-feet 

of CAP water will be made available to settle various Indian water claims in the 

state. The bill would also authorize the use of the Lower Colorado River Basin Development Fund, which is funded solely from revenues paid by Arizona entities, to 

construct irrigation works necessary for tribes with congressionally approved water 

settlements to use CAP water. 

Mr. Chairman, Title II of this bill settles the water rights claims of the Gila River 

Indian Community. It allocates nearly 100,000 acre-feet of CAP water to the Community, and provides funds to subsidize the costs of delivering CAP water and to 

construct the facilities necessary to allow the Community to fully utilize the water 

allocated to it in this settlement. Title III provides for long-needed amendments to 

the 1982 Southern Arizona Water Settlement Act for the Tohono O’odham Nation, 

which has never been fully implemented. 

This bill will allow Arizona cities to plan for the future, knowing how much water 

they can count on. The Indian tribes will finally get ‘‘wet’’ water (as opposed to the 

paper claims to water they have now) and projects to use the water. In addition, 

9

mining companies, farmers, and irrigation delivery districts can continue to receive 

water without the fear that they will be stopped by Indian litigation. 

While some minor issues remain, we have every confidence that these issues will 

be resolved before we mark-up the bill. In particular, the states of Arizona and New 

Mexico have been negotiating the best way to address New Mexico’s right under the 

1968 Boulder Canyon Project Act (authorizing the CAP) to exchange 18,000 acrefeet of CAP water on the Gila River. The states are meeting regularly and report 

that they are making progress. In addition, we hope that negotiations with the San 

Carlos Apache Tribe will move forward so that all claims can be resolved by this 

bill. 

In summary, this bill is vital to the citizens of Arizona and will provide the certainty needed to move forward with water use decisions. Furthermore, the United 

States can avoid litigating water rights and damage claims and satisfy its trust responsibilities to the Tribes. The parties have worked many years to reach consensus 

rather than litigate, and I believe this bill represents the best opportunity to achieve 

a fair result for all the people of Arizona. 

Mr. CALVERT. Thank you, Senator, for your testimony. I know 

you have to get back a couple hundred yards away here, and so we 

appreciate your coming today and look forward to working with you 

on this legislation. 

Next, The Honorable George Nethercutt, U.S. House of 

Representatives. The gentleman is recognized. 

STATEMENT OF HON. GEORGE R. NETHERCUTT, JR., A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF 

WASHINGTON 

Mr. NETHERCUTT. Thank you, Mr. Chairman, and thanks to the 

Ranking Member and members of the Subcommittee for holding 

this hearing and giving me the opportunity to provide testimony in 

support of H.R. 1753. It was introduced jointly with me and Congressman Norm Dicks of my State of Washington, and we urge that 

the Subcommittee take action with respect to this legislation. 

It would provide a settlement to the Spokane Tribe of Indians for 

losses suffered as a result of the construction of the Grand Coulee 

Dam in my State. I don’t know if any members of the Subcommittee have had a chance to see this dam. It is the largest concrete dam in the world. It is the largest producer of hydroelectricity 

in the United States. It is the third largest producer of electricity 

in the world. So it is a huge structure. It is a mile across and it 

is a site to behold. 

The importance of mentioning that project is that it had a serious and detrimental impact on tribes that surround the Grand 

Coulee Dam area. The Spokane Tribe, the Colville Confederated 

Tribes were deeply impacted by this construction that provides 

cost-based hydroelectric power to the citizens of the Pacific Northwest and it had an impact on the fisheries, resources, and the traditional heritage of these tribes. 

It is a complicated issue that surrounds the history of the Grand 

Coulee Dam and its impact on the tribes, the Colville Tribe and the 

Spokane Tribe. This legislation would provide a settlement to the 

Spokane Tribe, which has been lacking in a settlement with the 

U.S. Government for the taking of the lands and the fishing rights 

and the other consequences of the dam over a period of years since 

1941. 

Similar legislation was created and enacted in 1994 to compensate the Colville Tribe, with the difference being that the 

10

Colville Tribes maintained the legal claim against the USA dating 

back to 1951. The claim held by the Colville Tribes was a land 

claim that the tribe was able to amend in 1976 to cover damages 

arising from the construction and operation of the Grand Coulee. 

While the Spokane Tribe had filed similar land claims, the tribe 

had entered into settlement negotiations in 1967, approximately 9 

years prior to any indication that the United States might attempt 

to limit or eliminate its obligations to the tribes regarding the 

Grand Coulee Dam. So as a consequence, the Spokane Tribe did 

not have a pending Indian Claims Commission claim to amend in 

1976 as did the Colville Confederated Tribes. 

So this legislation, the legislation which enacted the settlement 

for the Colville Tribes provided for a cash lump-sum payment and 

annual payments in the tens of millions to the tribe, representing 

the ongoing proceeds from the sale of hydropower, monitored, administered by the Bonneville Power Administration, which is the 

power marketing agency in our region. 

At that time, the House Resources Committee noted that the 

Spokane Tribe has a moral claim and requests that the Department of Interior and the Department of Justice work with the Spokane Tribe to develop a means to address the Spokane’s claim. In 

1997, the BPA, Bonneville Power Administration, entered into negotiations with the tribe. There were some meetings. No settlement 

was reached. 

The tribe wants 39.4 percent, the same percentage as the Colville 

Tribe, the Spokane Tribe that is the subject of this legislation. We 

had negotiations a year ago. I moderated those. We thought we 

were pretty close to a settlement, about 29.3 percent as a compromise. That broke down, didn’t occur. The latest offer we see 

from the Bonneville Power Administration through the Department 

of Energy is 19.2 percent one-time annual payment and then 19.2 

percent structured catch-up payments thereafter. 

We think that is inadequate. I believe it is inadequate. The tribe 

believes it is inadequate. It is not fair. 

This is a matter of equity and fairness, Mr. Chairman, members 

of the Subcommittee. We are expecting that this legislation will 

spur negotiations, we will have a chance to sit down further with 

Bonneville Power Administration and the tribe. I am fearful that 

there won’t be any further negotiations unless this legislation is enacted. This is a matter of fairness and equity to the Spokane Tribe. 

They have proceeded in good faith from day one, back 30 and 40 

years ago, 50 years ago, and now they are on the short end of this 

negotiation stick. We believe it is fair that they receive this fair 

consideration by enactment of this legislation so that they can be 

equitably treated as the Department of Justice and the government 

and this Committee and others have said they are entitled to. 

So I am happy to be here to testify in support of this bill and 

urge your favorable consideration. 

Mr. CALVERT. I thank the gentleman. So you believe as this process moves forward that you potentially could find some middle 

ground on this issue if the folks from Bonneville negotiate in good 

faith? 

Mr. NETHERCUTT. Yes, sir, I do. I think we are between $20 and 

$90 million apart. We can reach a settlement if we have a chance 

11

to get some pressure added to both sides to sit down, negotiate in 

good faith, and get this resolved. But the offer on the one end is 

way too low and the Spokane Tribe is willing to come off its higher 

offer, the same fair offer that the Colville Tribes got, the 39.4 percent. 

So there is some middle ground here that can be reached, in my 

judgment. We thought we had it reached. It broke down. It is time 

to get back to the table and really seriously, in good faith, negotiate 

and get this off everybody’s table. 

Mr. CALVERT. I thank the gentleman. 

Any additional questions for Mr. Nethercutt? 

[No response.] 

Mr. CALVERT. Seeing none, we thank our colleague for coming 

today and we appreciate your testimony. 

Mr. NETHERCUTT. Thanks for having me. 

[The prepared statement of Mr. Nethercutt follows:]

Statement of The Honorable George R. Nethercutt, Jr., a Representative in 

Congress from the State of Washington 

Mr. Chairman and Members of the Committee, thank you for holding this hearing 

today and for the opportunity to present testimony today in support of H.R. 1753. 

This legislation would provide a settlement to the Spokane Tribe of Indians for 

losses suffered as a result of construction of the Grand Coulee Dam. 

Similar settlement legislation was enacted in 1994 to compensate the neighboring 

Confederated Colville Tribes with the difference being that the Colville Tribes maintained a legal claim against the United States dating back to 1951. The claim held 

by the Colville Tribes was a land claim that the Colville Tribes were able to amend 

in 1976 to cover damages arising from the construction and operation of Grand Coulee Dam. While the Spokane Tribe had filed similar land claims, the Tribe had entered into settlement on those claims in 1967, approximately nine years prior to any 

indication that the U.S. might attempt to limit or eliminate its obligations to the 

Tribes regarding Grand Coulee Dam. As a consequence, the Spokane Tribe did not 

have a pending Indian Claims Commission claim to amend in 1976 as did the 

Colville Tribes. 

The legislation which enacted a settlement to the Colville Tribes provided for a 

$53 million lump sum payment for past damages payable by the U.S. Treasury’s 

Judgment Fund and roughly $15 million annually from the ongoing proceeds from 

the sale of hydropower by the Bonneville Power Administration. At that time, the 

House Resources Committee noted ‘‘that the Spokane Tribe has a moral claim and 

requests that the Department of the Interior and the Department of Justice work 

with the Spokane Tribe to develop a means to address the Spokane’s claim.’’

In 1997, BPA entered into negotiations with the Spokane Tribe and several meetings occurred without fruitful progress. I then introduced legislation in 1999 to provide a settlement to the Spokane Tribe directly proportional to the settlement afforded the Colville Tribes based upon the percentage of lands appropriated from the 

tribe for the Grand Coulee Project, or approximately 39.4 percent of the past and 

future compensation awarded the Colville Tribes. 

Negotiations resumed and at the last meeting held in Spokane, on January 14, 

2002, which I moderated, the Tribe presented what it believed to be a ‘‘middle 

ground’’ settlement offer equaling 29.3 percent of the Colville settlement and a one 

time ‘‘catch up’’ payment of $29,234,000 that would cover back payments from Fiscal 

Year 1995 (the time when the Colville settlement was enacted) through 2002. The 

Tribe agreed to defer the receipt of the ‘‘catch up’’ payments in the first years following the settlement to ease passage of the legislation through Congress. In addition, the Tribe remained open to discussing alternative payment structure arrangements that would ease the impact on BPA ratepayers. The Administrator of BPA 

stated at this meeting that he felt a middle ground had been reached and he would 

‘‘run the numbers’’ and respond to the Tribe within two weeks. We all left that 

meeting, Mr. Chairman, thinking that a settlement had been reached. 

Four months later, on May 15, 2002, the Administrator of BPA finally responded 

to the Tribe’s last offer, with a one-time promise of annual payments of 19.2 percent 

of the Colville settlement and a 19.2 percent structured ‘‘catch up’’ payment covering 

12

FY 1995 through FY 2002. The difference between the two proposals was estimated 

at the time to be between $20 million and $90 million. 

Unfortunately, I believe we have now reached a point where negotiations between 

BPA and the Tribe will proceed no further without additional direction from Congress. Therefore, I request that you approve this legislation so that the Federal Government may keep the word of our Nation to the Spokane Tribe. 

Mr. CALVERT. I would now like to—excuse me. Are there any additional opening statements? Mr. Renzi? 

STATEMENT OF HON. RICK RENZI, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF ARIZONA 

Mr. RENZI. Thank you, Chairman Calvert and members of the 

Committee. I want to take this opportunity to provide brief remarks on H.R. 885, the Arizona Water Settlement Act. 

I would like to begin by welcoming all of our speakers today, specifically those speakers from the First District of Arizona, especially San Carlos Apache Chairwoman Kathy Kitcheyan and members of the Tribal Council, as well as Navajo Nation President Joe 

Shirley. I want to thank you all for traveling to Washington, D.C., 

for being here, my friends from the Apache Nation. Both the White 

Mountain Apache Nation and the Avapaya Apache and the Tonto 

Apache have provided written testimony, and I appreciate your 

participation in this process. 

I know this legislation has taken years to draft and negotiate, 

has resulted in parts of it that remain complex. I recognize that a 

hearing on this Arizona Water Settlements Act is an important 

first step in the legislative process. And while all parties are aware 

that we still may address some issues, as Senator Kyl has discussed, I am hopeful that these final issues can be worked out and 

that the settlement can occur specifically to benefit all parties involved. 

I want to thank you for the opportunity to open with these remarks. I look forward to hearing the testimony. 

[The prepared statement of Mr. Renzi follows:]

Statement of The Honorable Rick Renzi, a Representative in Congress from 

the State of Arizona 

Chairman Calvert and members of the committee, thank you for the opportunity 

to provide brief remarks on H.R. 885, the Arizona Water Settlements Act. 

I would like to welcome all of our speakers today, specifically those speakers from 

the First District of Arizona, San Carlos Apache Chairwoman Kathy Kitcheyan and 

Navajo Nation President Joe Shirley. Thank you for traveling to Washington, D.C., 

to discuss your interest in this legislation. In addition, written testimony has been 

submitted by several other tribes in my district, the White Mountain Apache, 

Yavapai Apache and Tonto Apache. I appreciate the participation by all of these 

tribes. 

This legislation has taken years to draft and negotiate and, as a result, is extremely complex. I recognize that a hearing on the Arizona Water Settlements Act 

is an important first step in the legislative process. While all parties are aware that 

issues need to be addressed in the Arizona Water Settlements Act, I am hopeful 

that these final issues can be worked out. 

Thank you for the opportunity to provide opening remarks and I look forward to 

listening to the testimony today. 

Mr. CALVERT. I thank the gentleman. 

Any additional opening statements? Mr. Pearce? 

13

STATEMENT OF HON. STEVAN PEARCE, A REPRESENTATIVE 

IN CONGRESS FROM THE STATE OF NEW MEXICO 

Mr. PEARCE. Thank you, Mr. Chairman. Again, I appreciate the 

opportunity to speak on this bill and I appreciate you holding the 

hearings on H.R. 885. I welcome those who have worked hard to 

reach a tentative agreement to bring this bill before you. 

I especially want to welcome Estevan Lopez, the Chairman of the 

New Mexico Interstate Stream Commission, who is going to testify 

today. 

This is a very important bill that settles some difficult issues in 

Arizona and New Mexico that have divided friends and neighbors 

for quite some time. It seems that in the West, as you know, Mr. 

Chairman, water may be the most contentious issue facing us all. 

Reaching agreement seems to be taking decades, as evidenced by 

the authorizing legislation originally passed in 1968, and we are 

now ready to move forward with settlement soon. I understand the 

issue of diversions in the Riordan Valley in New Mexico are settled. 

The issue of further development of the Gila River Basin water in 

New Mexico remains unsettled. 

Thirty-five years ago, as part of the 1968 Colorado River Basin 

Project Act, the New Mexico Unit of the Central Arizona Project 

was authorized, conceived to provide the future water supply in 

Southwestern New Mexico. Before this legislation is enacted, we 

must ensure the promises made to New Mexico in 1968 is fulfilled. 

Negotiations are still ongoing to settle outstanding issues and are 

progressing. We are committed to working with Senator Kyl and 

Representative Hayworth to bring this settlement to conclusion 

and to support the settlement once New Mexico’s concerns are resolved. 

Thank you, Mr. Chairman, for the opportunity to speak to this 

issue. 

[The prepared statement of Mr. Pearce follows:]

Statement of The Honorable Stevan Pearce, a Representative in Congress 

from the State of New Mexico 

Thank you Mr. Chairman for holding this hearing on H.R. 885, and I welcome 

those who have worked hard to reach a tentative agreement in order to bring this 

bill before you. 

This is a very important bill that settles some very difficult water issues in 

Arizona and New Mexico that have divided friends and neighbors for quite some 

time. It seems that in the West, as you know Mr. Chairman, water may be the most 

contentious issue. Reaching agreements seem to take decades, as evidenced of the 

authorizing legislation originally passing in 1968, and we are now ready to move 

forward with the settlements soon. 

I understand the issue of diversions in the Virden Valley in New Mexico is settled. 

The issue of further development of Gila River Basin water in New Mexico remains. 

Thirty-five years ago, as part of the 1968 Colorado River Basin Project Act, the New 

Mexico Unit of the Central Arizona Project was authorized—conceived to provide 

the future water supply in Southwestern New Mexico. Before this legislation is enacted, we MUST assure the promise made to New Mexico in 1968 is fulfilled. 

Negotiations are still ongoing to settle outstanding issues, and are progressing. I 

am committed to working with Senator Kyl and Representative Hayworth to bring 

this settlement to conclusion, and to support this settlement once New Mexico’s concerns are resolved. 

Thank you Mr. Chairman. I yield back the balance of my time. 

Mr. CALVERT. I thank the gentleman from New Mexico. 

The gentleman from Arizona, Mr. Grijalva. 

14

STATEMENT OF HON. RAUL GRIJALVA, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF ARIZONA 

Mr. GRIJALVA. Thank you, Mr. Chairman. I, too, want to acknowledge the fine work that Senator Kyl and my colleague, Representative Hayworth, have done on this H.R. 885. It is very important to the State of Arizona, very important to the nations that 

are represented here, Tohono O’odham Nation, the Gila River 

Indian Nation and Community, and both of their—Chairwoman 

Vivian Saunders is here and I want to welcome and thank her for 

coming and giving testimony to this Committee. Governor Narcia 

is also here and I want to thank him for his effort on this legislation. 

There are unresolved issues, but the momentum and the work 

that both the community and all the interests in the State of 

Arizona have done to this point have brought us to this hearing, 

and I want to acknowledge the hard work and the efforts that they 

put forth. I look forward to a resolution and I look forward to this 

hearing continuing the momentum to reach a final settlement, to 

reach a markup, and to give some stability and security both to the 

Nation and to the State of Arizona in terms of water use. 

Thank you, Mr. Chairman. 

Mr. CALVERT. I thank the gentleman. 

I would now like to recognize the administration, our next panel 

of witnesses. Testifying on H.R. 885 is Mr. Bennett Raley, Assistant Secretary of Water and Science, Department of Interior, and 

Assistant Secretary Raley is accompanied by Ms. Aurene Martin, 

Acting Assistant Secretary for Indian Affairs. 

Testifying on H.R. 1753 is Mr. Steven Hickok, Deputy Administrator of the Bonneville Power Administration. 

I would now like to recognize Mr. Bennett Raley to testify for 5 

minutes on H.R. 885. The gentleman is recognized. 

STATEMENT OF BENNETT W. RALEY, ASSISTANT SECRETARY 

FOR WATER AND SCIENCE, DEPARTMENT OF THE INTERIOR, 

ACCOMPANIED BY AURENE MARTIN, ACTING ASSISTANT 

SECRETARY FOR INDIAN AFFAIRS 

Mr. RALEY. Thank you, Mr. Chairman, Congresswoman 

Napolitano, Mr. Hayworth, and other members of the Committee. 

We are pleased today to testify on H.R. 885 for the simple reason 

that the issues addressed in this legislation and the parallel legislation on the Senate side are among the highest priorities for the 

Department of the Interior. This suite of issues spans the entire 

scope of the State of Arizona. It addresses, or will address, we 

hope, issues important to the State of New Mexico, and it is time 

to bring to closure the untold years of effort that have gone into 

this work and brought everyone this far. 

We have submitted written testimony, Mr. Chairman, which contains detailed comments on the legislation, but what I would like 

to do at this time is to observe that from the Department’s standpoint, we are within striking distance of success, and one never 

knows when a window of opportunity is presented like it is here. 

If the parties don’t take that opportunity to close the final gap, the 

window may never open again, or it may be decades down the road. 

15

The window is open. We are within striking distance, and we 

pledge on behalf of the Department our utmost efforts to work with 

this Committee and Mr. Kyl in the Senate to bring this to closure, 

because it is good for the State of Arizona. We trust it will be good 

for the State of New Mexico. And it will be a key part of providing 

certainty for resource users in those States. 

We would observe that there are three areas that need particular 

attention. First of all, the funding mechanism that is in H.R. 885 

is innovative but does not follow the normal appropriations process. 

The administration is currently studying that funding mechanism 

to determine if it is an appropriate way to provide the certainty for 

funding that is required under the settlement stipulation and other 

aspects of this compromise. 

Second, as this Committee well knows, the Department, the Secretary of Interior, has trust responsibility to Native American 

tribes which extend to all tribes, and in particular we would encourage the parties to redouble their efforts to address issues relating to the San Carlos Apache Tribe so that all of the in-basin 

issues in Central Arizona can be resolved and we don’t end up leaving an important part unresolved and potentially a source of concern in the near future. 

Third, the Department deeply desires that the States of Arizona 

and New Mexico find common ground so that both may move forward and attain the goals of the 1968 Act. We are comfortable that 

the delegations of these two States that we treasure will be able 

to do that and we will lend our efforts if that is helpful, or if it is 

helpful for us to stay back and stay out of the way, we will do that, 

as well. 

With that, Mr. Chairman, I would direct any other questions to 

the written testimony and would like to allow Assistant Secretary 

Martin to make any comments that she has. Thank you. 

[The prepared statement of Mr. Raley follows:]

Statement of Bennett W. Raley, Assistant Secretary for Water and Science, 

U.S. Department of the Interior 

Good morning Mr. Chairman and members of the Committee. I am Bennett W. 

Raley, Assistant Secretary for Water and Science at the Department of the Interior. 

I am accompanied by Aurene Martin, Acting Assistant Secretary for Indian Affairs. 

I appreciate the opportunity to appear before this Committee to discuss H.R. 885, 

a bill to authorize the Arizona Water Rights Settlement Act of 2003. 

H.R. 885 is the single most far-reaching piece of federal legislation regarding 

water use within Arizona since Congress authorized the Central Arizona Project 

thirty-five years ago. H.R. 885 is an impressive and complex bill, designed to provide a comprehensive resolution of critical water use issues facing the State of 

Arizona, and Arizona Indian tribes today. This legislation provides certainty regarding the use of water in Arizona in a number of ways: It provides water to settle 

outstanding water rights claims of certain Arizona tribes; provides financing of infrastructure so that all tribes can put CAP water to use; and it provides water for 

future water rights settlements. It also provides water necessary to accommodate 

the explosive population growth in the cities of central Arizona; it provides certainty 

for farmers who currently utilize imported water supplies from the Colorado River; 

and it also provides a mechanism to secure water to protect against future droughts. 

These arrangements, necessary to all users of Colorado River water in Arizona are 

accomplished utilizing local tax revenues to accomplish the financing of all undertakings under the global settlement embodied in the legislation. 

The Administration supports the core concepts of the settlements that are 

achieved through H.R. 885 and the overarching goal of resolving many important 

water challenges facing the State of Arizona, with the caveats discussed below. We 

believe that the comprehensive approach that is embodied in H.R. 885 is the right 

16

way to resolve these longstanding disputes regarding the use of the CAP and this 

portion of Arizona’s allocation to the Colorado River. 

Before providing detailed comments on particular provisions of the bill, some of 

which will require addressing outstanding concerns, it is necessary to review the 

overall structure and goals of H.R. 885. As we move forward, this Administration 

remains committed to working with the Committee, Congressman Hayworth, Senator Kyl, and the settlement parties to reach mutually agreeable solutions to all remaining issues. The resolution of these outstanding issues is an extremely high priority for the Department of the Interior. 

Background 

Even in the days before statehood, Arizona’s leaders saw the need to bring Colorado River water to the interior portions of the State. During the 1940’s and ‘‘50’s 

California developed facilities allowing the utilization of more than its apportionment from the Colorado River and quickly began full use of its share of the river, 

and more. During that same time, Arizona began developing its own plans for utilization of its 2.8 maf apportionment. However, California effectively prevented 

Arizona from implementing its plans, arguing that development and use of water 

from Colorado River tributaries within Arizona counted against its apportionment 

and limited significant additional development and diversion from the mainstream 

by Arizona. 

Unable to reach resolution on this issue, in 1952 Arizona brought an original action in the U.S. Supreme Court, asking the Court to clarify and support Arizona’s 

apportionment from the Colorado. After 12 years of fact finding by a Special Master 

and arguments by the two states, the Supreme Court issued a decision in 1963 affirming Arizona’s 2.8 maf apportionment. 

Despite Arizona’s victory in the Supreme Court, California was still able to extract a final concession from Arizona. In exchange for California’s support of Congressional authorization in 1968 for the Central Arizona Project (CAP), Arizona was 

forced to allow its CAP water to have a subservient priority to California water use 

during times of shortage on the Colorado River system. This was a significant concession since CAP water use represents more than half of Arizona’s Lower Basin 

apportionment—approximately 1.5 maf of its 2.8 maf. The CAP brings this critical 

supply from the Colorado River through Phoenix to Tucson, Arizona, via a primary 

canal of more than 330 miles. 

After decades of fighting to get the CAP authorized and constructed, in the early 

1990’s Arizona faced financial and water supply disputes over how the Project—and 

the State’s allocation from the Colorado River—would be utilized. 

For most of the 1990’s uncertainty existed for Arizona: uncertainty over who 

would receive water from the CAP, and uncertainty over the costs of the project and 

who would repay those costs. Perhaps most importantly to the State, uncertainty 

existed over the ability of the State to store water and protect against the eventual 

shortages on the Colorado—which have a unique impact on Arizona water users due 

to the junior status imposed by Congress in 1968. 

The uncertainty also involved complex and contentious litigation filed in 1995 between the federal government and the Central Arizona Water Conservation District, 

the political entity which operates the CAP and repays the local costs of the project. 

After years of litigation over the CAP, extensive negotiations were conducted to resolve the complicated CAP issues so that the needs of all project beneficiaries would 

be adequately addressed. 

During these discussions it became clear that financial repayment and other operational issues could not be resolved until there was a firm agreement on the amount 

of CAP water that would be allocated to federal uses, i.e., allocations to Indian 

tribes in Arizona. When these discussions were initiated, 32% of the CAP water was 

allocated for Federal uses, 56% for Non-Federal uses and 12% was un-contracted. 

Both the United States and the State of Arizona were interested in dedicating uncontracted water to allow settlement of outstanding Indian water rights claims and 

to meet emerging needs for municipal purposes. The amount of water needed for 

future Indian water rights settlements within Arizona turned in large part on consideration of the large pending claim of the Gila River Indian Community (Community) in the on-going general stream adjudication of the Gila River system. The Gila 

River Indian Reservation encompasses approximately 372,000 acres south of, and 

adjacent to, Phoenix, Arizona. 

The claim filed by the United States on behalf of the Community in the Gila River 

adjudication was for 1.5 million AFA. This represents the largest single Indian 

claim in Arizona—and one of the largest Indian claims in the West. If this claim 

were successful, the amount of water available to central Arizona cities, towns, 

17

utilities, industrial and commercial users, and major agricultural interests would be 

greatly reduced. 

Consequently, ongoing negotiations of that claim were put on a parallel track with 

the CAP litigation negotiations, with the understanding that tandem resolution of 

the issues would be necessary. The underlying premise of the settlement that 

emerged—including the framework of this legislation—is to achieve a comprehensive resolution of all outstanding CAP issues. This, in turn, will allow sustainable 

operation of the CAP in a manner that provides benefits and equitable treatment 

to all intended project beneficiaries. The alternative, piecemeal and sequential resolution of all of the outstanding disputes on the CAP, would be doomed to fail. 

The linkage embodied in this legislation integrates U.S. obligations under Federal 

statutes and the trust relationship with Indian tribes. As with the initial authorization of the CAP in 1968, we are presented with a unique opportunity to provide a 

final settlement of many of the complex Federal, State, Local, Tribal and private 

water issues in the State. 

In May of 2000, the Department and CAWCD reached agreement on a stipulated 

settlement of the CAP litigation. This stipulation serves as a blueprint for a comprehensive resolution of the suite of CAP issues I have identified above. The stipulation requires that a number of conditions must occur before it is effective or final. 

Under the stipulation, these conditions must occur before December 2012 or the 

stipulation will terminate. 

The CAWCD v. U.S. settlement stipulation is contingent on Congressional enactment of a Gila River Indian Community Settlement; Amendment of the Southern 

Arizona Indian Water Rights Settlement (SAWRSA); and the identification of a firm 

funding mechanism for the CAP, GRIC and SAWRSA settlements. 

Settlement Stipulation & H.R. 885: The Arizona Water Rights Settlement Act of 

2003

H.R. 885 approves three separate and significant settlements: the settlement stipulation reached in the CAWCD v. U.S. litigation (addressing CAP operational and 

repayment issues), the Gila River settlement (addressing water rights claims of the 

Gila River Indian Community), and the SAWRSA settlement (addressing water 

rights claims of the Tohono O’odham Nation). 

The basic structure of the stipulation developed in 2000 is preserved in H.R. 885, 

subject to certain conditions. The main components of the settlement contained in 

H.R. 885 are to provide: (1) additional water to resolve tribal claims; (2) certainty 

regarding allocation of available water supply; (3) additional water supplies for 

Arizona’s growing cities; (4) financial and operational certainty for CAWCD (operator and repayment entity of CAP); (5) affordable water for non-Indian agriculture; 

(6) appropriate repayment of CAP costs; (7) structures and programs to bank water 

for Arizona’s future; and (8) a firm funding mechanism to provide affordable water 

to tribes, while developing the infrastructure necessary to allow all of Arizona’s 

tribes to fully utilize their CAP supplies. 

The structure of H.R. 885 represents Arizona’s extensive efforts to resolve these 

contentious issues. The bill is strongly supported by the relevant Arizona State 

Agencies, Members of Congress with Arizona constituencies, the Gila River Community, the Tohono O’odham tribe, and a wide array of Arizona interests. In light of 

the diverse parties, competing interests and longstanding controversies involved, 

H.R. 885, if amended to address certain issues, represents the best prospect to restructure the CAP in a context that reconciles the Public, Tribal and Private 

interests—including statutory obligations of the United States. 

I will summarize each of the three titles contained in H.R. 885 and comment on 

some of the provisions of each that are of concern to the Administration. 

Title I—Central Arizona Project Settlement 

The critical components of the CAP stipulated settlement are set forth in Title I 

of H.R. 885. They include: (1) a final allocation of CAP water supplies so that 47% 

of Project water is dedicated to Arizona Indian tribes and 53% is dedicated to 

Arizona cities, industrial users and agriculture; (2) setting aside a final additional 

allocation pool of 197,500 acre-feet for use in facilitating the GRIC settlement and 

future Arizona Indian water rights settlements; (3) a final allocation of 65,647 AFA 

of remaining high priority (M&I) water to Arizona cities and towns; (4) relief from 

debt incurred under section 9(d) of the 1939 Reclamation Projects Act by agricultural water uses, which allows these users to relinquish their long-term CAP water 

contracts so that the water can be used for the Indian water rights settlements and 

future municipal use; and (5) allowing the Colorado River Lower Basin Development 

Fund (LBDF), the Treasury fund where CAP repayment funds are deposited, to be 

18

used for the costs of Indian water rights settlements, completing tribal water delivery systems and reducing the cost of CAP water for tribes to affordable levels. 

H.R. 885’s utilization of the Colorado River Lower Development Fund is intended 

to meet the terms of the stipulation by providing for, among other things, subsidizing fixed OM&R costs for Indian tribes, including OM&R costs for the Gila 

River Indian Community, rehabilitation of the San Carlos Irrigation Project (SCIP), 

construction of Indian Distribution Systems, and funds for future Indian water settlements. 

The financing mechanism assumed in H.R. 885 is complex, and operates outside 

of the normal annual appropriations process. Given this, the Administration is currently reviewing the funding provision to determine whether it is an appropriate 

way to satisfy the contingencies of the settlement. There may be other funding 

mechanisms that meet the firm funding requirement of the settlement. We look forward to working with the Committee on this issue. 

Title II—Gila River Indian Community Water Rights Settlement 

Title II of H.R. 885 is the Gila River Indian Community Settlement. This settlement would resolve all of the Community’s water rights claims in the general 

stream adjudication of the Gila River system, litigation that covers much of the 

water supply of central Arizona. This litigation has been the subject of negotiation 

and settlement talks for more than 13 years. 

The major components of the settlement are: (1) confirmation of existing, and 

dedication of additional, water supplies for the Community in satisfaction of its 

water rights claims; (2) use of existing facilities to deliver the additional water supplies; (3) funding for on-Reservation agricultural development; and (4) protection of 

the Reservation groundwater supplies. 

While the United States supports a settlement of the Gila River Community’s 

water claims, and believes the majority of the provisions of the Settlement Act in 

this title are consistent with that objective, we do have concerns, detailed below, 

that we want to work on with the Committee, Congressman Hayworth, Senator Kyl 

and the various parties to promptly resolve. 

A. Inclusion of a Settlement with the San Carlos Apache Tribe 

In resolving the water rights claims of the Gila River Indian Community, we must 

remain mindful not to place the United States in a position of having conflicting 

obligations to two Indian tribes. The Gila River Indian Community and the San 

Carlos Apache Tribe have reservations and existing decreed water rights in the 

same watershed. In litigation underlying the settlement, the United States has argued in favor of both the Gila River Indian Community’s and the San Carlos 

Apache’s water rights under the 1935 Globe Equity Decree. That Federal Consent 

Decree addresses the water rights of those tribes, as well as the rights of most nonIndian water users, in the mainstem of the Gila River above the confluence of the 

Gila and Salt rivers. The GRIC settlement will alter operations under the Gila Decree. These changes have the potential to impact the rights of the San Carlos 

Apache Tribe. 

We believe that additional efforts to resolve the concerns of the San Carlos 

Apache Tribe should be taken, and Interior has engaged in a serious effort to do 

that. The Department has taken a number of steps in this regard and is prepared 

to do more. Interior officials have met with the San Carlos Tribal leaders on numerous occasions, and our sincere hope is that we can reach resolution on a wide array 

of issues so that agreement on the San Carlos Apache Tribe’s water rights can be 

added to this legislation as it proceeds. We look forward to working with the Committee and the Tribes on this matter. 

B. Waivers of the United States Enforcement Authorities 

H.R. 885, as introduced, also includes significant waivers of the United States’ 

ability to enforce environmental statutes relating to water quality in the Gila River 

basin The settling parties seek to limit their exposure to environmental liability. 

However, the Administration believes the waivers, as currently drafted, may provide 

undue immunity from environmental liability and shift costs for cleanup to the Federal government. This could restrict the ability for the federal government to clean 

up the most contaminated waste sites in the Gila River Basin. For example, the legislation waives claims by the United States against both parties to the settlement 

as well as non-parties. As drafted, this legislation can also be interpreted to provide 

a waiver for future claims under certain environmental statutes, including those 

under the Superfund authority. This could restrict the ability for the federal government to cleanup the most serious hazardous waste sites in the Gila River Basin. 

These water quality waivers were not included in prior water rights settlements affecting Indian Tribes and are not necessary in this legislation. 

19

Following the introduction of H.R. 885, the Department of Justice entered into 

discussions with the settlement parties regarding the waivers. These discussions 

continue to progress. The Administration is committed to continuing these discussions to find a solution to these significant issues, as this legislation must maintain 

the Federal government’s ability to protect human health and environment. 

C. Overly Broad Waiver of the United States Sovereign Immunity 

The Administration also is concerned, as we believe that H.R. 885 contains an 

overly-broad waiver of United States sovereign immunity. We believe that this provision is unnecessary, as sovereign immunity waivers in the McCarran Amendment 

allow a suit against the United States to administer its adjudicated water rights. 

Further, if such a waiver is retained, it should be narrowly drafted. The Administration also has some concern about the scope of certain waivers under Section 312 of 

the bill. 

D. Impacts of the Intended Water Exchanges 

H.R. 885 authorizes several water exchanges between the Community and various parties in the State, including the Phelps Dodge Corporation, ASARCO and 

several municipalities in the Upper Gila River watershed. While we support the 

mechanism of water exchanges, we want to work with the committee to ensure that 

the current language adequately takes into account the water rights of the San Carlos Apache Tribe, parties affected in the State of New Mexico (under the Colorado 

River Basin Project Act), listed species and critical habitat under the Endangered 

Species Act (ESA), and rights to divert water in relation to the Globe Equity Decree. 

Previous analyses indicate that appurtenant structures and dams involved in this 

agreement could lead to more extensive and frequent Gila River drying, which, in 

turn, could lead to potential ESA conflicts. 

E. Fifth Amendment Takings Concern 

Title II places the ownership of all settlement water in the hands of Gila River 

Indian Community, notwithstanding the fact that the Gila Decree (the 1935 Globe 

Equity Decree) framed its award under that Decree ‘‘for the reclamation and irrigation of the irrigable Indian allotments on said reservation.’’ We would like to refine 

the language of the bill to reduce the likelihood that an individual allottee may assert a ‘‘takings’’ claim based on the settlement. Both Interior and Justice are committed to working with the settlement parties and the proponents of H.R. 885 to 

reduce any risk of a Fifth Amendment taking and to assure that the rights of individual Indian allottees are protected. 

F. Costs Associated 

Federal contributions to the proposed settlement within this Title include the fulfillment of existing statutory and programmatic responsibilities and the assumption 

of new obligations designed to put GRIC in a position to utilize the water resources 

confirmed or granted in the settlement. There are also numerous costs contained 

within this title, which the United States does not believe are reasonably related 

to the costs avoided and benefits received, and we look forward to working with the 

Committee, Congressman Hayworth and Senator Kyl prior to further consideration 

of this legislation to ensure the costs contained in the legislation are appropriate. 

For example, given the correlative benefits, we support the rehabilitation and 

completion of the Indian portion of the San Carlos Irrigation Project (SCIP)—an irrigation project that was initiated in the 1930’s but never completed and which has 

fallen into significant disrepair. However, we believe that the language of H.R. 885, 

requiring the Secretary to provide for the ‘‘rehabilitation, operation, maintenance 

and replacement’’ of the San Carlos Irrigation Project, needs to be refined. Our view 

is that both the cost control and indexing mechanisms for these expenditures need 

to be revisited. 

Similarly, when looking at the government’s cost of addressing subsidence damages on the reservation, we recognize the settlement requires the United States to 

repair past and future subsidence damage. We believe that federal liability for such 

damages should be limited. 

Additionally, in some instances we believe that existing costs have been shifted 

from State parties to the United States, and those costs may be more appropriately 

addressed by other existing Federal programs. We believe disbursements from the 

Lower Basin Fund should be limited to those costs which have a direct relationship 

to the core concepts of the settlements addressed in H.R. 885. 

We also believe that a closer look should be given to some of the costs included 

in the provisions of Title II, dealing with the Upper Gila River. One example is the 

costs identified to line San Carlos Irrigation and Drainage District (the non-Indian 

component of SCIP) canals so that water can be conserved. The Administration 

20

supports this concept but believes a greater share of the conserved water should be 

provided to the United States for possible use in settling the San Carlos Apache 

Tribe’s water rights claims in the Gila River. 

Title III—Amendments to the Southern Arizona Water Rights Settlement Act 

(SAWRSA) 

The Southern Arizona Water Rights Settlement Act, known as ‘‘SAWRSA,’’ 

Pub. L. 97-293, was enacted in 1982 to resolve Indian water rights claims arising 

within the San Xavier and Shuk Toak Districts of the Tohono O’odham Nation. 

SAWRSA did not settle all outstanding Tohono O’odham water rights claims. Claims 

for the Sif Oidak District and other Reservation lands remain to be settled. 

As originally enacted, SAWRSA allocated 37,000 AFA of CAP water to the San 

Xavier and Shuk Toak Districts of the Nation, together with another 28,200 AFA 

of water to be delivered from any source by the United States to the Districts. All 

of the water is to be delivered without cost to the Nation. The original settlement 

also requires the United States to rehabilitate and extend an historic allottee farming operation and design and construct irrigation facilities sufficient to put remaining settlement water to use. 

Construction of all irrigation facilities and the full implementation of SAWRSA 

has not occurred, principally because of a disagreement over proper allocation of settlement benefits between the Nation and allottees within the San Xavier District. 

Because of this disagreement, the allottees have refused to join in the dismissal of 

United States v. City of Tucson, CIV. 75-39 TUC-WDB (D. Ariz.), the litigation 

which lead to the enactment of the settlement. SAWRSA requires the United States, 

the Nation and the allottees to dismiss the litigation as a condition of full effectiveness of the settlement. 

For over ten years, the Department of the Interior, the City of Tucson and other 

state parties have been engaged in discussions with the Nation and the allottees in 

an attempt to agree on amendments that would resolve disputed issues. The Nation 

and the allottees have now agreed on how settlement water resources and funds 

should be distributed. The agreements between the Nation and the allottees are contained in Title III of H.R. 885. Essentially, the Nation and the allottees have agreed 

upon allocation of water resources, construction of new irrigation facilities and sharing of settlement funds. 

In general, the Administration supports these agreements and we look forward to 

working with the Committee to clarify or refine a few items we remain concerned 

about. Chief among these is the so-called ‘‘net proceeds’’ issue that revolves around 

the United States’ ability to make the Cooperative Fund a self-sustaining fund and 

potential federal liability if it is not self-sustaining or is underfunded. 

Conclusion 

It is important to emphasize that the Administration fundamentally supports this 

important settlement effort if it is amended to address concerns discussed above, 

and we look forward to working with the Committee to revise specific provisions of 

the legislation so that we can support the bill without reservation. 

The Administration lauds the tremendous efforts dedicated by all parties to find 

a workable solution to this complex set of issues and supports the core settlement 

concepts and framework as set forth in H.R. 885. We recognize that this legislation 

will resolve long-standing and critical water challenges facing the State of Arizona. 

We look forward to working with the Committee, Congressman Hayworth, Senator 

Kyl, and the settlement parties to craft legislation that accomplishes these goals in 

a manner that comports with Federal financial policy and legal considerations. 

This concludes my testimony. I would be pleased to answer any questions that 

the members of the Committee may have. 

[Mr. Raley’s response to questions submitted for the record 

follows:]

Response to questions submitted for the record by Bennett W. Raley, 

Assistant Secretary for Water and Science, U.S. Department of the Interior 

Question: 

It is my understanding that numerous Indian water rights settlements (including 

the following Fort McDowell, P.L. 101-628 (1990) § 410(a) and San Carlos Apache, 

P.L. i02-575 (1992) § 3709(a)) include a provision that ensures that environmental 

impact of the components of the settlement agreement and legislation are subject 

to environmental review subsequent to execution by the Secretary. Can you assure 

21

the Committee that this provision is now routinely included in Indian Water rights 

settlements, including the Arizona Water Settlements Act? 

Answer: 

As noted by the Committee, it is common for Indian water rights settlement legislation to include provisions that address environmental compliance regarding actions during the implementation phase of settlements. The Department has consistently carried out all necessary environmental compliance documentation for such 

implementation actions and will continue to do so. The specific provisions of individual Indian Water rights settlements in this regard are the result of negotiations 

among the Tribe, the Department, and other relevant stakeholders. In addition, 

these negotiations often include the participation of potential Congressional sponsors and Congressional staff. While common, it is difficult for the Department to assure the Committee that similar language will be included in all proposed Indian 

Water rights settlements. As an example, it is appropriate to note that the two cited 

settlements include distinct provisions regarding environmental compliance. Compare Ft. McDowell Indian Community Water Rights Settlement Act of 1990, 

Pub. L. 101–628, §§ 410(a)-(d) (1990) with San Carlos Apache Tribe Water Rights 

Settlement Act of 1992, Pub. L. 102-575, §§ 3709(a)-(d) (1992). 

With respect to efforts pursuant to the proposed Arizona Water Settlements Act, 

the Department began work in 1999 on an Environmental Impact Statement on the 

allocation of CAP water supply and long-term CAP contract execution. In June of 

2000, the Department published a Draft EIS on this effort. Appropriations restrictions prevented further work on this EIS subsequent to the publication of the Draft 

EIS. At this time, however, such restrictions have lapsed and the Department is 

now preparing to reinitiate the EIS process to allow the contracting actions identified as part of the settlement alternative to move forward in advance of the finalized 

legislation. 

Mr. CALVERT. Assistant Secretary, you are recognized. 

STATEMENT OF AURENE MARTIN, ACTING ASSISTANT 

SECRETARY FOR INDIAN AFFAIRS 

Ms. MARTIN. Good morning, sir. I would only echo what Mr. 

Raley has already stated. We are supportive of the core concepts 

contained in H.R. 885 because they resolve longstanding significant issues for both the Tohono O’odham and the Gila River Indian 

Community and we believe that they provide sufficient flexibility 

for resolving other disputes in the State of Arizona. 

We do have some outstanding issues which we do need to resolve, including the concerns of the San Carlos Apache, resolution 

of some individual issues, and immunity and environmental liability issues. But we are very optimistic about our ability to resolve 

those issues and look forward to working with the different parties. 

Thank you. 

Mr. CALVERT. Thank you. 

I would now like to recognize Mr. Steven Hickok to testify on 

H.R. 1753. 

STATEMENT OF STEVEN G. HICKOK, DEPUTY 

ADMINISTRATOR, BONNEVILLE POWER ADMINISTRATION 

Mr. HICKOK. Thank you, Mr. Chairman and members of the Subcommittee. With your permission, I will submit my written testimony for the record. 

Mr. CALVERT. Without objection, so ordered. 

Mr. HICKOK. I am Steve Hickok, Deputy Administrator of Bonneville. The administration, while it is unable to support H.R. 1753 

as it is currently drafted, we are definitely in interest of reaching 

a fair and final settlement of these issues with the Spokanes. I 

22

think in my 5 minutes, I would best serve the Subcommittee by 

focusing on the two issues that have stood in the way of our reaching a settlement with the Spokanes over the past half-dozen years 

or so and highlight an issue that may be in front of us if and when 

we go forward. 

First, the method we used in arriving at compensation for the 

Colville Tribes, if applied to the Spokane Tribe situation, would result in payments to the Spokanes that would be about 19 percent 

of the amounts that are currently being provided to the Colvilles, 

not the 39 percent that is currently in the legislation, and the reason is that the method that we used, one of three that we evaluated when we were negotiating with the Colvilles and that had 

been proposed for use in other situations like this or actually used 

in the past, the method we used divided the value of the land differently between what is under the reservoir and what is under the 

dam, and it literally provides half the value of the project to the 

relatively few acres under the dam and the other half to the relatively large number of acres under the reservoir. 

The Colvilles had acreage under the dam and the Spokanes do 

not, and that is very simply the reason why, if you just do a fraction of the acreage involved under the reservoirs, which is the proposal of the bill, you get 39, whereas the method we used in the 

Colville settlement produces about half that amount. 

The second big issue is that while the Colvilles had made a claim 

and brought suit against the government for past damages in the 

window provided under the Indian Claims Act, and the Spokanes 

had not, we have been willing to establish a sharing of Grand Coulee power revenues on a going-forward basis, but we haven’t been 

willing to resurrect the past damages issue, leaving that closed, basically, after 1951. 

Now, having summarized those positions on the two big issues, 

I should hasten to say that both parties have explored departures 

from their positions on these issues. Congressman Nethercutt mentioned, for example, that the Spokanes, while holding to their past 

damages position, had at one point proposed splitting the difference 

with us between 1939 at 29 percent on the value question. And 

Bonneville, while holding to the 19 percent position, had at one 

point in these discussions proposed back-casting 10 years back and 

structuring a settlement that would provide payments to the Spokanes beginning as if they had begun exactly at the moment that 

we had settled with the Colvilles. It would pick up the years roughly since 1994 to the present date. 

Neither of those concessions by the two parties, though, resulted 

in a package that either one could support, and in the end, we are 

back where we started from. 

The third issue, look forward, and one that is probably more significant now than pre-2001, is the rates issue on Bonneville’s ratepayers. Back in 2001, Bonneville instituted a 45 percent rate increase and that increased the power component of people’s bills by 

50 percent, from 22 mils a kilowatt hour to 32. And just to put that 

in perspective, while 1,000 kilowatt hour residents would see the 

wholesale power component of their bill go up $10 a month, from 

$20 to $30, the 100,000 megawatt hour a month aluminum smelter 

23

would see their monthly power bill go up from $2 million to 

$3 million a year, and that happened in 2001. 

We proposed another rate increase to go into effect in October of 

this year of another 15 percent, and as your colleagues from the 

Northwest can attest, there has been a firestorm about whether or 

not the Northwest economy can stand that, and we took $381 million out of Bonneville’s cost structure for the next 3 years in order 

to bring that increase down from 15 percent to 2 percent, and that 

is what we put into place yesterday. 

So what would a settlement mean in terms of the cost to the 

ratepayers of a Colville-type settlement? Well, if you used the 

H.R. 1753 and it would result in about a $5 million a year additional cost to Bonneville, that is a sixth of a mil per kilowatt hour, 

so that 1,000 kilowatt hour house would pay an extra 17 cents a 

month. It sounds pretty reasonable. And the 100,000 megawatt 

hour a month smelter would pay another $17,000 a month in their 

power bill, and I think that pretty well frames the issue. 

Thank you, Mr. Chairman. 

Mr. CALVERT. I thank the gentleman. 

[The prepared statement of Mr. Hickok follows:]

Statement of Steven G. Hickok, Deputy Administrator,

Bonneville Power Administration 

Mr. Chairman, my name is Steven G. Hickok. I am the Deputy Administrator of 

the Bonneville Power Administration (Bonneville). It is my pleasure to appear before the House Resources Committee, Subcommittee on Water and Power. Bonneville appreciates the opportunity to comment on H.R. 1753, the Spokane Tribe of 

Indians of the Spokane Reservation Grand Coulee Dam Equitable Compensation 

Settlement Act. 

My testimony today will focus on the discussions Bonneville has had with the Spokane Tribe and the proposal the prior Administration made to the Spokane Tribe 

in response to its request for compensation related to the construction of Grand 

Coulee Dam. I will also compare that proposal to what would result for the Spokane 

Tribe if H.R. 1753 were enacted. Finally, I will address the present Administration’s 

concerns with the proposed legislation. Although the Administration is committed 

to appropriate compensation for the Spokane Tribe, it is unable to support the legislation. 

First, let me set out the factual background that gave rise to the Spokane Tribe’s 

request for compensation, which affects our view of the current situation. 

Factual Background 

This matter arose out of representations made by Federal officials to the Spokane 

Tribe and the Confederated Tribes of the Colville Reservation when Grand Coulee 

Dam was under construction in the 1930s. Approximately 2,500 acres of land within 

the Spokane Reservation and 6,900 acres of land within the Colville Reservation 

were taken for use in the Grand Coulee Project. Originally, the State of Washington 

planned to develop a hydroelectric project at Grand Coulee. An agency of the state 

obtained a preliminary permit under the Federal Power Act to develop the site. Had 

the state built the project, a license issued under the Federal Power Act would have 

provided the Spokane Tribe and the Colville Tribes compensation for use of their 

lands in the Grand Coulee Project. In 1933, however, Congress authorized Federal 

construction of Grand Coulee Dam as part of the Columbia Basin Project, to be developed and administered by the U.S. Bureau of Reclamation. Federal projects are 

not subject to licensing under the Federal Power Act. 

That same year, Secretary of the Interior Harold Ickes approved two letters from 

the Department of the Interior—one to the Supervising Engineer of the Grand Coulee Project and one to the Commissioner of Reclamation—indicating that, because 

Spokane and Colville Tribal land would be taken for the project, each of the Tribes 

should receive a share of the revenue from the sale of power produced by the dam. 

The following year, the Assistant Director of Irrigation wrote the Commissioner of 

Indian Affairs, proposing that the Tribes be paid an appropriate percentage of the 

‘‘profits’’ of the project based on the amount of Reservation land beneath the dam 

24

and the reservoir. He proposed that half of the value of the project be ascribed to 

the dam and half to the reservoir, and that the Spokane Tribe participate in proportion to the Reservation’s contact with the reservoir only, as the Spokane Tribe had 

no land under the dam. 

The Government did not act on this proposal, nor did it determine what might 

be an appropriate share of revenues for either Tribe. In 1946 Congress passed the 

Indian Claims Commission Act (ICC), creating a five-year window in which Indian 

tribes could sue the United States for past harms. The Colville Tribes brought suit 

under the Act for a share of the power revenues of Grand Coulee Dam. Although 

the Spokane Tribe brought suit against the Government under the Act for other 

claims, it did not bring a suit for a share of Grand Coulee’s revenues prior to settling its ICC claim. 

Settlement With the Colville Tribes 

Bonneville has marketed the power from Grand Coulee Dam since the dam began 

operations in 1942. Therefore, although Bonneville was not a named party to the 

Colville Tribes litigation, Bonneville understood that the power function—among the 

other, multiple functions of Grand Coulee—and its users (the Bonneville ratepayers) 

would likely be expected to bear a share of any judgment in the case. Together with 

the Department of Justice, Bonneville entered into discussions with the Colville 

Tribes to settle the Colville’s lawsuit. The parties reached agreement in 1993, and 

legislation was passed in 1994 approving the settlement and directing payment of 

the settlement amounts to the Colville Tribes. 

The settlement value was based largely on a formula that had been used to compensate the Flathead Indian Tribe when the Tribe’s land was taken by a private 

entity for the development of Kerr Dam. It also included a litigation risk premium 

in recognition of the financial risk to the Government in proceeding to trial if the 

case did not settle. The settlement payments included two elements. First, the 

Colville Tribes in total were paid a lump sum of $53 million from the Judgment 

Fund (a fund available to pay certain court judgments against the United States, 

and any Justice Department settlements of litigation) to compensate them for use 

of their land from 1942, when Grand Coulee began operations, to the time of settlement. Bonneville was not obligated to reimburse the Judgment Fund for any of this 

amount. 

Second, Bonneville agreed to make annual payments to the Colville Tribes going 

forward. These payments represent a share of the revenue from the sale of the 

power from the dam. The first payment was for $15.25 million for Fiscal Year 1995. 

Subsequent payments have been governed by a formula based on the annual value 

of power produced by Grand Coulee. Under the 1994 legislation enacting the settlement and a subsequent 1996 amendment, Bonneville receives an annual credit for 

its repayment to the Treasury that covers a portion of Bonneville’s payment to the 

Colville Tribes. The credit was $15.86 million in Fiscal Year 1997, and increased 

annually until Fiscal Year 2001, when it was $18.55 million. Since Fiscal 

Year 2001 the credit has been fixed at $4.6 million, and Bonneville will receive an 

annual credit of $4.6 million as long as it continues making payments to the Colville 

Tribes. Therefore, the percentage of the Bonneville payment that the credit covers 

is changing through time. These credits, together with the amount paid by the Judgment Fund, achieve the contribution of the U.S. taxpayers to the settlement—30 

percent of the settlement’s value. Bonneville’s ratepayers are contributing 70 percent of the value of approximately $570 million. 

Discussions With The Spokane Tribe 

On August 4, 1994, the Senate Indian Affairs Committee and the Senate Energy 

and Natural Resources Committee held a joint hearing on S. 2259, a bill that endorsed the settlement agreement with the Colville Tribes. A representative of the 

Spokane Tribe testified at the hearing, seeking an amendment to the bill to address 

the Spokane Tribe’s claims of damage from the project. 

During full Senate consideration of the bill, which took place during the prior Administration, Senators Daniel Inouye, Bill Bradley, John McCain and Patty Murray 

engaged in a colloquy urging the Department of the Interior and other relevant Federal agencies to enter into negotiations with the Spokane Tribe to conclude a fair 

and equitable settlement of the Tribe’s claims. On August 5, 1994, Interior Solicitor 

John Leshy wrote Senator Bill Bradley, indicating that the Department of the Interior was reviewing information submitted by the Spokane Tribe and would continue 

its examination. Subsequently, representatives of the Department of the Interior 

and the Spokane Tribe met on a number of occasions to discuss the Spokane Tribe’s 

claims. 

25

Bonneville then entered into discussions with the Spokane Tribe. In 1998 Bonneville representatives traveled to the Spokane Reservation to explain the formula 

used in the Colville Tribal settlement and how it might be applied to the Spokane 

Tribe’s compensation request. In doing this, Bonneville recognized the Spokane 

Tribe’s current and future contributions to the value of the project (from the continuing use of former Reservation lands), but, because of the absence of a claim and 

the lack of access to the Judgment Fund, indicated that it would not address any 

past contributions. 

Since 1998 Bonneville and the Spokane Tribe have met a number of times to discuss appropriate compensation. Unfortunately, the two have been unable to reach 

agreement. In the end the Spokane Tribe was not satisfied with the going-forward 

payments that resulted when the formula used to compensate the Colville Tribes 

was applied, and was unhappy with the Administration’s resistance to paying past 

damages. 

On May 2, 2000, Bonneville Administrator Judi Johansen reiterated the prior Administration’s position on compensation in a letter to Senator Murray. In the letter, 

Ms. Johansen underscored that the then Administration did not support payments 

for any past periods, but was prepared to discuss again the possibility of prospective 

annual payments of a share of Grand Coulee power revenues, based on the methodology employed in the Colville Tribes’ settlement. She added that it would also be 

reasonable to discount these payments because, unlike the Colville Tribes, the Spokane Tribe had no legal claim. Finally, she stated that it was the Administration’s 

position that, consistent with the cost-sharing arrangement between ratepayers and 

taxpayers adopted in the Colville Tribes legislation, 70 percent of the value of any 

compensation to the Tribe should come from Bonneville ratepayers and 30 percent 

from U.S. taxpayers. 

If enacted, H.R. 1753 would compensate the Spokane Tribe at a level that appears to be substantially in excess of the amount that the prior Administration considered in previous negotiations. The bill would establish in the Treasury an interest-bearing account called the Spokane Tribe of Indians Settlement Fund Account. 

Section 5(b)(1) of the bill would require the Secretary of the Treasury to deposit into 

this account an amount equal to 39.4 percent of the lump sum paid to the Colville 

Tribes, adjusted for inflation, to compensate the Spokane Tribe for use of its land 

from June 29, 1940, to November 2, 1994. 

The bill also would require the Administrator of the Bonneville Power Administration to make two series of payments. First, Section 5(b)(2) would require the Bonneville Administrator to deposit into the account each year for six years an amount 

equal to 7.88 percent of the total annual payments made to the Colville Tribes from 

1996 (when the first annual payment was made to the Colville Tribes) through the 

end of the fiscal year during which H.R. 1753 is enacted, adjusted for inflation. Second, Section 5(c) of the bill would require the Bonneville Administrator to pay the 

Spokane Tribe on an annual basis, an amount equal to 39.4 percent of each annual 

payment that Bonneville is making to the Colville Tribes in fiscal years after the 

date of enactment of the Act. 

Section 7 of the bill would require the Bonneville Administrator to deduct from 

interest payable each fiscal year to the Secretary of the Treasury, a percentage of 

each annual payment made to the Spokane Tribe for the preceding fiscal year. The 

percentage deducted would be calculated and adjusted to ensure that the Bonneville 

Power Administration receives a deduction comparable to the deduction it receives 

for payments made to the Colville Tribes under the Confederated Tribes of the 

Colville Reservation Grand Coulee Dam Settlement Act. 

Finally, Section 9 of the bill would authorize an appropriation of such sums as 

are necessary to carry out the Act. 

In contrast to the payments that would be provided the Spokane Tribe under 

H.R. 1753’s provisions, Bonneville’s estimate of going-forward payments to the Spokane Tribe—based on the methodology employed in the Colville Tribes settlement 

and taking into account the difference between the amount of acreage taken from 

the Colville Reservation and the amount taken from the Spokane Reservation—is 

about 19 percent of those provided to the Colville Tribes. During most of our discussions with the Spokane Tribe we have also assumed that this number should be discounted to reflect the lack of any claim filed under the ICC. 

More Discussions With the Spokane Tribe 

During the Bush Administration and Administrator Steve Wright’s tenure, Bonneville continued discussions with the Spokane Tribe. Bonneville advanced a number 

of it own proposals to the Spokane Tribe that were outside the framework approved 

by the prior Administration in the hope that these proposals could bring prompt resolution of this issue. None of these proposals were embraced by the Spokane Tribe 

26

as acceptable for settlement, and so Bonneville has not pursued approval of them 

in the present Administration. None of these proposals remain on the table. We advanced them in a spirit of reaching closure promptly. Bonneville did not advance 

them as proposals the Spokane Tribe could accept as a starting point and then build 

on to pursue additional compensation. Without agreement by all the Federal and 

non-Federal parties, the Administration is without a proposal for an appropriate settlement. The Administration is willing to resume working with the tribe to reach 

a fair settlement. At the appropriate time, the Administration would want to discuss 

the potential funding mechanisms. 

Conclusion 

Mr. Chairman, in closing I want to reiterate that the Bush Administration is supportive of reaching a fair and final settlement with the Spokane Tribe. I stand ready 

to answer any questions you may have. 

[Mr. Hickok’s response to questions submitted for the record 

follows:]

Response to questions submitted for the record by Steven Hickok, Deputy 

Administrator, Bonneville Power Administration, from Congressman Ken 

Calvert on H.R. 1753

Failed Negotiations 

Q1. Why have negotiations between Bonneville and the Tribe failed? 

A1. I believe there are three reasons that negotiations have not resulted in an 

agreement. First, Bonneville believes that any agreement with the Spokane Tribe 

should be based on the methodology employed in the Colville Tribes settlement. This 

methodology provides a principled basis for compensating the Spokane Tribe. The 

Tribe has not accepted the applicability of the Colville methodology. 

Second, the lump sum that the Government paid to the Colville Tribes for past 

use of their lands was paid out of the Judgment Fund, in settlement of the Colvilles’ 

lawsuit. Because the Spokane Tribe does not have a legal claim, the Judgment Fund 

is unavailable to pay the Spokane Tribe for past use of its land, and Bonneville has 

not been willing to make up any such amounts. Bonneville was not responsible for 

any part of the lump sum that was paid to the Colville Tribes, and it has been adamant in its refusal to assume this obligation with regard to the Spokane Tribe. 

Third, the Spokane Tribe may view Bonneville’s proposals as starting points from 

which the Tribe can build its pursuit of a larger compensation through legislation. 

H.R. 1753 appears to reflect this kind of strategy, as it adopts the Tribe’s original 

position in negotiations from more than five years ago. 

Middle Ground 

Q2. Do you believe there is middle ground on this issue? 

A2. H.R. 1753 represents the Spokane Tribe’s original position in this negotiation, 

which is poles apart from BPA’s. We will not find middle ground between these two 

positions if the Spokane Tribe believes it can expect to get H.R. 1753 passed in its 

current form. 

Through the history of these negotiations, both parties have amended their positions at different points in the negotiations in search of ‘‘middle ground’’ that might 

support a fair solution. We will continue to try to find a compromise. BPA is committed to appropriate sharing of Grand Coulee revenues with the Spokane Tribe. 

We also will likely need the implementation assistance of Congress if and when we 

reach an agreement. 

No Back Payments without Pending Claim 

Q3. How has the Spokane Tribe’s statute of limitations problems impacted the financial aspect of negotiations? Would this legislation set a 

precedent by which a back payment is given to a tribe that did not have 

a pending claim? 

A3. As I testified, Bonneville has assumed that, because the Spokane Tribe has 

no legal claim, payments to the Tribe should be discounted. At one point Bonneville 

did advance an offer of annual payments with no discount. This offer was outside 

of the framework approved by the prior Administration, and was advanced in hope 

of bringing prompt resolution to this matter. It failed to do so. 

In addition, because the Spokane Tribe does not have a legal claim, the Judgment 

Fund is unavailable to pay on any settlement. Therefore, the taxpayers’ portion of 

any settlement payments to the Spokane Tribe would have to be provided through 

27

other means. As I stated above, Bonneville has not been willing to assume any financial obligation for its ratepayers that it did not assume in the Colville Tribes 

settlement. 

The question of possible precedent-setting potential of this legislation is best directed to the Justice Department. It is Bonneville’s view that the Government compensated the Colville Tribes because a specific promise was made to the Tribes to 

pay them a share of the revenues of Grand Coulee Dam. The same promise was 

made to the Spokane Tribe. 

Rate Impacts of the Legislation 

Q4. How would you build this bill’s costs into the BPA’s rates? Has BPA 

heard from the customers on what this rate impact would have on them? 

A4. Under the bill as presently drafted, Bonneville would make an initial payment 

of approximately $20 million and annual payments of about $20 million per year 

for the following 4 or 5 years. At that time the annual payment would decrease to 

approximately $6-8 million (in today’s dollars), and would be adjusted each year to 

reflect actual power sales from Grand Coulee Dam. Bonneville would build these 

payments into its rates as a power cost. The Fiscal Year 2004 payment would increase our wholesale priority firm rate by about one-half of one mill per kilowatthour (kwh). This would increase electricity bills by about 50 cents per month for 

an average-sized home (1,000 kwh per month) and about $50,000 per month for an 

aluminum smelter (100,000 megawatt hours per month). While we have not discussed a potential Spokane settlement with our customers, customers have been 

quite clear that we need to take all actions possible to reduce the upward pressures 

on our rates. 

Appropriate Time for Negotiations 

Q5. Mr. Hickok, you mention that BPA would enter into new negotiations 

at an ‘‘appropriate time.’’ When is an appropriate time? 

A5. We are prepared to meet with the Spokane Tribe to renew these negotiations 

at any convenient time. 

Mr. CALVERT. Mr. Raley, as you know, Secretary Norton has 

made wise water management a focus of her tenure. Do you believe 

that this settlement regarding H.R. 885 is consistent with the Secretary’s 2025 water initiative? 

Mr. RALEY. Yes, sir, in all respects. From the cooperative approach to its identification of canal lining and efficiency gains, this 

is one of the models that 2025 is based on. 

Mr. CALVERT. The Arizona bill also has a unique and complex 

funding mechanism, as you mentioned in your testimony. Can you 

explain how that funding works now and how it would be changed 

under the bill? 

Mr. RALEY. Mr. Chairman, at the present time, revenues from 

Arizona sources go into the Lower Basin Fund, which is not used 

or identified for anything in particular. This mechanism would create, in essence, a revolving fund where those revenues would be 

pledged as a permanent source of funding for the expenditures necessary to implement this legislation. That funding mechanism is 

what is being reviewed at the present time by the administration. 

A decision has not been made as to whether it is appropriate. I can 

say, though, that from the Department of Interior’s standpoint, we 

are not aware of an alternative mechanism that provides the certainty that is required by the stipulation. We are open to finding 

whatever works. 

Mr. CALVERT. How long do you think that will take? 

Mr. RALEY. Mr. Chairman, I believe that the administration will 

need to be responsive to this Committee and this body’s needs as 

you move this legislation forward, and that will help us reach closure on that issue. 

28

Mr. CALVERT. I thank the gentleman. 

Mrs. Napolitano? 

Mrs. NAPOLITANO. There are many questions that I would like to 

have. I still would love to hear more of the testimony from the witnesses before I ask the questions. Will you be around, Mr. Raley? 

Mr. RALEY. Unfortunately, I have to leave, but we will certainly 

respond to written questions, or, Congresswoman, if you would like, 

I can try to schedule a time to come back up and meet with you 

and your staff this week or next week. I do want to talk about a 

certain study that you and I discussed on numerous occasions and 

would be happy to come up——

Mrs. NAPOLITANO. I was going to ask about that, but I was precluded. 

Mr. RALEY. Well, I appreciate the Chairman keeping us focused, 

but we need to talk about that, as well, so I am sorry I can’t stay. 

Mrs. NAPOLITANO. Would you like a copy of it? 

Mr. RALEY. Pardon? 

Mrs. NAPOLITANO. Would you like a copy of it? 

Mr. RALEY. Well, actually, I directed that it be sent out to the 

people that paid for it so they could review the draft, so I hope we 

have the same copy. 

Mrs. NAPOLITANO. I trust. There is one question before you leave, 

then, and I will be in trust with you later, Mr. Chair, and I will 

share information with you for the record. How would the bill affect the repayment of the Central Arizona Project costs and the 

money that has been spent on non-Indian irrigation water distribution systems? 

Mr. RALEY. As the Congresswoman is aware, there are aspects 

of the legislation that address 90 repayment. We believe that those 

aspects of the legislation are entirely appropriate, given that the allocation of water for the Central Arizona Project under this legislation is far different from what was originally intended under the 

Central Arizona Project. Simply put, it makes no sense to us, nor 

do we consider it to be fair, to have the prior 90 repayment structure continue even though the water is being allocated and used for 

other purposes. 

Mrs. NAPOLITANO. That is very, very interesting to not have an 

idea of how that is going to happen. 

The question then for Mr. Hickok would be, how soon can we expect BPA to get together with the tribe to resolve these outstanding 

issues and attempt to come to a settlement? 

Mr. HICKOK. We would be prepared to start it at any time. There 

aren’t any preconditions. And I think——

Mrs. NAPOLITANO. Are you scheduled now to continue meeting 

with them, I guess is my question. 

Mr. HICKOK. We are not at the present time. 

Mrs. NAPOLITANO. How soon would you be willing to meet with 

them? 

Mr. HICKOK. We are ready at any time. 

Mrs. NAPOLITANO. Thank you. Mr. Chair, I don’t have questions 

right now. 

Mr. CALVERT. I thank the gentlelady. 

Mr. Hayworth? 

Mr. HAYWORTH. Thank you, Mr. Chairman. 

29

Assistant Secretary Raley, I touched on it in my opening statement, as did Vice Chairman Renzi and Senator Kyl, about the 

whole notion of inclusion of the San Carlos Tribe. If the bill is 

moved in its current form, in your opinion, is there sufficient flexibility to accommodate a settlement of the San Carlos Tribe? 

Mr. RALEY. Yes, sir. 

Mr. HAYWORTH. The absence in this bill of a settlement with the 

San Carlos Apache Tribe is a concern for us as well because of the 

many reasons you have articulated in the written testimony and as 

we have touched on earlier today. As Senator Kyl mentioned, and 

I think it bears repeating, we have a placeholder for water rights 

settlement for the San Carlos Apache Tribe. It is our understanding the negotiation toward a settlement are underway and 

the political and geographic position of the tribe is important toward final solutions toward water rights settlements on the Gila 

River. 

From your perspective, can you delineate the efforts that are underway to move this toward resolution? 

Mr. RALEY. Well, the Secretary’s team has had numerous meetings with the interested parties and will continue to meet with 

them. It will be at increasing frequency and intensity because of 

the need to resolve these issues as this legislation proceeds. There 

were meetings in March and there is fairly constant communication. We are ready, willing, and able to engage at any time and 

commit to do so. 

Mr. HAYWORTH. My friend, the Ranking Member, touched on the 

notion of funding as we look at H.R. 885, and on the record, Assistant Secretary Raley, do you agree with us that this bill needs a 

firm funding source to work? 

Mr. RALEY. The stipulation entered for settlement of the litigation requires that there be a firm funding source, first. Second, 

from an equitable standpoint, the point that has been made in the 

past by the Gila River Indian Community is that paper water, or 

water that they can’t use, is of ultimately no value to them. A 

foundational aspect to this settlement has been that it would provide the Gila River Community with actual ability to use the water 

they are accepting under this settlement. So from both a technical 

as well as an equitable standpoint, we recognize that if this concept 

is moved forward, there has to be a stable funding source. 

Mr. HAYWORTH. As we look toward that stable funding source, in 

your opinion, will the fund be exhausted by the requirements of 

H.R. 885 prior to other tribes reaching water rights settlements, 

and if not, what part of the Lower Basin Development Fund would 

or could be available for use by other tribes, such as the White 

Mountain Apache, for future water development? 

Mr. RALEY. As the Committee knows, the revenues into the fund 

are roughly $40 to $50 million a year. The actual outflow from the 

fund would be dependent upon the implementation of the construction schedule, so we cannot predict with precision exactly what the 

cash-flow would look like. We are comfortable that this bill could 

be implemented under that sort of a cash-flow arrangement. 

We can’t tell at this point what the total cost would be because 

of some of the open-ended aspects of the legislation, such funds as 

required, et cetera, et cetera. But we are comfortable that this apVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00033 Fmt 6633 Sfmt 6602 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
30

proach, whether it is focused on this funding mechanism, if that 

were to be the will of Congress, or from a water standpoint, is fully 

consistent with the Secretary’s trust responsibility to all of the 

tribes that are affected by this legislation. 

Mr. HAYWORTH. I see my time is almost up. Just one question 

I think can be answered fairly quickly. If the administration did 

not settle these cases, what would the potential damages be to the 

Federal Government? 

Mr. RALEY. The risk of litigation is very, very significant and it 

is very clear to the administration that settlement is in the best 

interests of the United States taxpayers, the United States citizens, 

and that litigation should be the last resort. 

Mr. HAYWORTH. I thank you, Mr. Secretary, and thank you, Mr. 

Chairman. 

Mr. CALVERT. I thank the gentleman. 

Mr. Pearce? 

Mr. PEARCE. Mr. Chairman, Assistant Secretary Raley, the 

18,000 square feet that were made available to New Mexico by the 

1968 bill. I am a little unfamiliar with it. Was that in the form of 

water moving down the stream or in the form of water that would 

potentially be stored? What form was that in? 

Mr. RALEY. Well, there is a need for an exchange agreement to 

be worked out between the States and with Interior and we are 

committed to moving forward and working out that sort of exchange agreement. I believe originally that the contemplation was 

that there would be a dam constructed in New Mexico that would 

be used. That dam may not be the best—that particular site may 

not be the most feasible or most appropriate way, and the Department will be working with New Mexico to identify any structures 

that would be necessary as well as institutional arrangements for 

New Mexico to gain the benefits that were intended under the 1968 

Act. 

Mr. PEARCE. Mr. Raley, if the dam would not be the best possible 

solution, what potential solutions would you see and what recognition is there that every year that we don’t have the 18,000 acre feet 

available is a loss of income, a loss of jobs, a loss of earning potential to people in that region? 

Mr. RALEY. I think it would be premature for us to identify what 

would be the preferred course, which is why I can only commit to 

New Mexico that the Bureau of Reclamation and the other agencies 

within the Department of the Interior will work with New Mexico 

and, of necessity, with the other Colorado River Basin States to effectuate New Mexico’s ability to gain the benefits of the 1968 Act. 

We are not prepared today to identify exactly how that should be 

implemented on the ground. 

Mr. PEARCE. And, Mr. Raley, I don’t think that there are provisions in this bill describing how that longstanding obligation since 

1968 even will be resolved at this point. Do you foresee that that 

would be an addition to this bill? Would it be a supplemental bill? 

Would it—how do we move that forward? It has been one of the 

ongoing concerns of the Western side of our State. 

Mr. RALEY. And legitimately so. We would leave to this body and 

the Senate exactly the form, whether it is an addition to this bill 

or a separate bill. We are, as I indicated, very hopeful and desirous 

31

of the Arizona and New Mexico delegations reaching an accommodation on this issue so that the needs of both States can be met. 

Mr. PEARCE. Thank you, Mr. Chairman. My last question would 

be that there is an outstanding need to settle an agreement between the Navajo Nation and New Mexico to provide water for 

Window Rock, and again, I wonder if there is any provision that 

you know of that is moving forward to create a conclusion to those 

needs? 

Mr. RALEY. I am aware that within the Department, we have 

had a number of discussions on how to provide—to make that happen from an institutional or legal framework arrangement, and I 

know that is considerable interest and a focus within the New Mexico delegation, yourself and Senator Domenici and others to provide 

legislation that will give us direction on how to meet those needs. 

Mr. CALVERT. I thank the gentleman. 

Mr. Hickok, in your opinion, why have the negotiations between 

the Bonneville Power Administration and the tribe failed? 

Mr. HICKOK. Mr. Chairman, it is probably because the Spokanes 

are encouraged to believe that whatever we might arrive at out 

there might simply be the starting point to do better back here. For 

example, H.R. 1753 adopts their negotiating position, the position 

they took at the beginning, which is poles apart from ours. So if 

they are encouraged to believe that they can actually obtain that, 

it probably wouldn’t be worth anybody’s time to continue negotiations. 

But if, on the other hand, they were encouraged and we were encouraged to go out and find a fair and equitable settlement, recognizing that we should bring it back to you for its approval and to 

effect it, put it into effect, that would be a different dynamic. 

Mr. CALVERT. Well, in your opinion, do you believe that you can 

find that middle ground? I asked that same question to Mr. 

Nethercutt. Do you have any encouragement at all for that? 

Mr. HICKOK. I think we can. Yes, we can. 

Mr. CALVERT. Mrs. Napolitano asked a question about when will 

these new negotiations begin, and you said any time, or whenever 

that is appropriate. Does everybody agree to that, both sides? I 

mean, are you willing to sit down immediately rather than we have 

to go through this legislative process? 

Mr. HICKOK. We haven’t discussed recently sitting down once 

again and moving—trying to move forward from positions we have 

taken in the past. I think the focus, frankly, has been to see whether this could be legislated to a resolution that they haven’t been 

able to accomplish in negotiations. 

Mr. CALVERT. Well, I would certainly encourage you to find that 

appropriate time and try to work this out. Obviously, we are very 

interested in possibly moving some legislation if, in fact, you are 

not able to negotiate this, and I think that is possibly consistent 

with this Committee. So I am hopeful that that can occur. We 

would much rather see negotiated settlements rather than legislated settlements. It is a much better solution to the problem. 

With that, I am going to ask Mr. Hayworth to take over. I apologize to the Committee and I will recognize Mrs. Napolitano for additional questions. 

32

Mrs. NAPOLITANO. Just one last question that I had and it had 

to do with the treaty with Mexico that you were referring to, Mr. 

Raley. 

Mr. RALEY. I am sorry, could you repeat that? I didn’t hear. 

Mrs. NAPOLITANO. The treaty, the treaty with Mexico over water 

release. Are we in compliance in releasing that water? 

Mr. RALEY. Yes, we are. 

Mrs. NAPOLITANO. You are? Is this the same treaty that covers 

all the rivers that go into Mexico, or is it a separate treaty from 

the Colorado and the Rio Grande? 

Mr. RALEY. No. Both the Rio Grande and the Colorado are covered by, or addressed in, the 1944 treaty. 

Mrs. NAPOLITANO. Forty-four, so it is prior to 1968. 

Mr. RALEY. Well, the treaty addresses both Rio Grande and the 

Colorado. The 1968, to my recollection, does not address issues in 

the Rio Grande. 

Mrs. NAPOLITANO. OK. 

Mr. RALEY. I hope—did I misunderstand your question? 

Mrs. NAPOLITANO. No, no, you are right. I just wanted to clarify 

that. There is an issue of water shortages along the Rio Grande 

and I was wondering whether this is part of the same treaty. 

Mr. Hickok, I wanted to continue just a little bit further on the 

sitting at the table with Bonneville and whether or not you see 

that as being a peaceable solution at this point. Can you sit down 

with the group, with the tribe, and look at it from the perspective 

of moving forward and finding a solution, as the Chairman had indicated, without the benefit of legislative process? 

Mr. HICKOK. I think that is the preferable way to go. I think that 

is what we would like to do. The negotiations we concluded with 

the Colvilles were not a piece of cake, but we were both smiling 

when we shook hands at the end of that. We reached a settlement 

that we believe was good for the government and good for the tribe, 

and we are prepared to do that with the Spokanes. 

Mrs. NAPOLITANO. When was the last time you met with Bonneville, the tribes on this issue? 

Mr. HICKOK. It was probably under the auspices of Congressman 

Nethercutt, who convened a meeting in January—January of last 

year. 

Mrs. NAPOLITANO. So about a year and a half ago? 

Mr. HICKOK. Yes. 

Mrs. NAPOLITANO. And any attempts been made to renegotiate or 

sit down at the table since? 

Mr. HICKOK. Not since. 

Mrs. NAPOLITANO. Not since. Well, I look forward to talking to 

the tribes and finding out if they have the same willingness to sit 

at the table. 

Mr. HICKOK. Thank you. 

Mrs. NAPOLITANO. Thank you. Thank you, Mr. Chair. 

Mr. HAYWORTH. [Presiding.] And we thank the Ranking Member 

as well as this panel of witnesses. Thank you very much for your 

time and your testimony. 

Mr. HAYWORTH. And with that, I would like to recognize and call 

forward the third and final panel of witnesses who join us today 

in this hearing on these two bills. 

33

The Subcommittee will welcome first Mr. Warren Seyler, Chairman of the Spokane Tribe of Indians; Governor Richard Narcia, 

who is Governor of the Gila River Indian Community; Ms. Vivian 

Juan-Saunders, who is the Chairwoman of the Tohono O’odham 

Nation; Mr. Joe Shirley is President of the Navajo Nation, and we 

understand that President Shirley, who was with us here yesterday, was unable to attend. Using the Chairman’s prerogative, I understand that Legal Counsel for the Nation is here and the Subcommittee will make an exception to the rule and allow Legal 

Counsel for the Navajo Nation to offer testimony in the place of 

President Shirley Stanley Pollack, we understand will provide that 

testimony. 

Also here joining us today to testify on H.R. 885 is Ms. Kathy 

Kitcheyan, who is the Tribal Chairwoman of the San Carlos 

Apache Tribe. We also welcome Mr. Herb Guenther, the Director 

of the Arizona Department of Water Resources, and Mr. Estevan 

R. Lopez, Director of the New Mexico Interstate Stream Commission. 

We appreciate all the witnesses coming for this third panel this 

morning, and as we take care of all the logistics and make sure 

that literally all our witnesses have a place at the table and access 

to the microphones, again, we welcome you. Many of you have traveled great distances to be here today to discuss these two pieces of 

legislation. 

And so now, as I believe name plates and microphones are in 

place, let us first recognize Chairman Seyler of the Spokane Tribe 

of Indians. Welcome, Mr. Chairman, and we would appreciate your 

testimony. 

STATEMENT OF WARREN SEYLER, CHAIRMAN,

SPOKANE TRIBE OF INDIANS 

Mr. SEYLER. Thank you, Mr. Chairman and members of the Subcommittee on Water and Power, for the opportunity to testify on 

H.R. 1753. Accompanying me today is Howard Funke, our attorney, and Dr. Charles Pace, our economist. Also joining us is my 

Vice Chairman, Greg Abrahamson, and Tribal Council member 

Dave Wynecoop. 

I am here today on behalf of the Spokane Tribe to ask for your 

help as representatives of the United States of America. I ask that 

you act on behalf of the United States to finally treat the Spokane 

Tribe fairly and honorably for the injury to our tribe and reservation caused by the Grand Coulee Project. My testimony today summarizes the critical need for this important legislation. We are also 

providing briefing books for the record and a video, if you allow 

them on the record, please. 

Mr. HAYWORTH. Without objection, those will be submitted for 

the record. 

Mr. SEYLER. The Spokane Tribe is an honorable tribe, a strong 

tribe, the tribe historically that has been a trusting tribe. We are 

good to our word and strong for this nation. Grand Coulee’s waters 

flooded the lands of two sister Indian reservations that held great 

economic, cultural, and spiritual significance. Ours is one of those 

reservations. 

34

Let me briefly say why I say sister reservations. The two reservations lie directly across from each other on the Columbia and 

Spokane Rivers. We have brothers and sisters that live on both reservations. We have brothers and sisters that are enrolled in both 

reservations. One sister may be Spokane, the other brother may be 

Colville. We have families that are joined. But yet this issue divides us. It is unfair. 

Our life, culture, economy, and religion centered around the rivers. We were a river people. We were a fishing people. We depended heavily on the rivers and historic salmon runs that were 

brought to us. We are known by neighboring tribes as salmon eaters. The Spokane River, which was named after our people, was 

and is the center of our universe. We call it the ‘‘Path of Life.’’ 

President Rutherford B. Hayes in 1881 recognized this importance 

and significance of the rivers to the Spokane Tribe and expressly 

included the entire adjacent river beds of the Spokane and Columbia Rivers within our reservation. But the Spokane and Columbia 

Rivers now are beneath the backwaters of the Grand Coulee Dam. 

If I move forward, if I may, address the three issues that BPA 

listed were troublesome for them. First, they indicated that the 

method used in reaching settlement with the Colville Tribe. I don’t 

think this was completely accurate. In speaking with the Colville 

Tribe and economists, and speaking with my good friend, Eddie 

Palmenteer, who was the Chairman of the Colville Tribe at that 

time, and I verified this just 2 or 3 days ago at a funeral of our 

former Chairman, he had said there were formulas, but that is not 

what the agreement was reached on. 

He said they cut a money deal and cut it down the middle. Later, 

we feel that Bonneville went out, went back after this deal was cut, 

and then created a formula and made it work, so much so, that 

there was a litigation premium of 13 percent that was added. Why 

not 10 percent? Why not 15 percent? There was 13 so their formula 

could then work. 

He also mentioned the ICCA Act of 1951. Understand that in the 

1950s, our tribe was very remote. We were 100 miles away from 

the BIA office. All the communication was done in the form of letters. Yes, we didn’t have a claim, but until 5 months before the 

1951 deadline, we did not even have a formal government. Our constitution was still being worked on. We didn’t have any method, 

really, to put our claims forward. 

Our attorneys were not even hired until a few months before the 

end of the 1951 deadline. It was held up back here in D.C. in the 

Department of Interior in the Solicitor’s Office. Back then, they had 

to approve who could be our attorneys. They held on to that approval until it was almost too late. We did get a land claim, but 

back then, we did not know we could file a claim on Coulee Dam. 

The Colvilles did not know they could file on Coulee Dam. Their 

claim did not come until, I believe it was in the 1970s, and they 

amended their claim. 

And there were other issues that happened in 1967 when we did 

finally file our claim, issues that were held and were not given to 

the tribe. This, you can see in the report. 

Also, they spoke about the rate issues, the 45 percent rate increase. The Spokane Tribe did not cause this rate increase. We still 

35

receive nothing. All we do is give and give and give to this great 

nation. This is a great nation. We give our land. The government 

uses our land every year to create such a vast opportunity for this 

country to survive and to thrive. That dam in the 1940s helped win 

World War II. All we ask is to be paid to offer something for our 

contribution to helping do that. 

Mr. HAYWORTH. Mr. Seyler, I wanted to intervene right now because, first of all, I just want to thank you for your testimony. We 

need to—and if I failed to mentioned this at the outset, forgive 

me—we are trying to get the brief comments in within a 5-minute 

parameter. If there is one final point you would like to make here, 

that would be great. And again, I will remind all assembled that 

your entire written testimony has been submitted for the record 

and we will take that into account. So let me respectfully ask you 

if you have one statement in summary. 

Mr. SEYLER. Ninety seconds? 

Mr. HAYWORTH. That would be fine, sir. 

Mr. SEYLER. Back home, in my travels over these last 13 years, 

many times they ask what the people back home really feel. They 

feel we want to resolve this issue. They look back at the words that 

were spoken, and Acting Solicitor Ashton Brenner stated, ‘‘The government overlooked the prohibition against the guardian seizing 

the property of its own ward’’—the tribe is that ward—‘‘and then 

profiting from that seizure.’’

One other statement from Chief Justice Blackman. ‘‘Great nations, like great men, should honor their word.’’ This is what we 

are asking today, is that for the 70 years of promises and honor 

that this country, that we live up to that today. Thank you. 

Mr. HAYWORTH. And we thank you, Mr. Seyler, for your 

statements. 

[The prepared statement of Mr. Seyler follows:]

Statement of Warren Seyler, Chairman, Spokane Tribe of Indians 

Thank you Mr. Chairman and members of the Subcommittee on Water and Power 

for the opportunity to testify on H.R. 1753. Accompanying me are Howard Funke, 

our attorney, and Dr. Charles Pace, our economist, who are available for questions 

and may have a few comments. 

I am here today on behalf of the Spokane Tribe to ask for your help as representatives of the United States of America. I ask that you act on behalf of the United 

States to finally treat the Spokane Tribe fairly and honorably for the injury to our 

Tribe and Reservation caused by the Grand Coulee Project. My testimony today 

summarizes the critical need for this important legislation. We are also providing 

briefing books for the record which give greater detail on our issues. 

Grand Coulee’s waters flooded the lands of two sister Indian reservations that 

held great economic, cultural and spiritual significance. Ours is one of those reservations. 

Our life, culture, economy and religion centered around the rivers. We were river 

people. We were fishing people. We depended heavily on the rivers and the historic 

salmon runs they brought to us. We were known by our neighboring tribes as the 

Salmon Eaters. The Spokane River—which was named after our people—was and 

is the center of our world. We called it the ‘‘Path of Life.’’ President Rutherford B. 

Hayes in 1881 recognized the importance and significance of the rivers by expressly 

including the entire adjacent riverbeds of the Spokane and Columbia Rivers within 

our Reservation. But the Spokane and Columbia Rivers are now beneath Grand 

Coulee’s waters. Today our best lands and fishing sites lie at the bottom of Lake 

Roosevelt. 

The other Reservation flooded by Grand Coulee’s waters is that of the Colville 

Confederated Tribes. The waters that rose behind Grand Coulee Dam brought similar fates to both our Reservations. Our burial sites—the places our ancestors were 

36

laid to rest—were lost to the rising waters. The river banks, which provided us 

plants for foods and medicines were forever flooded. The homes, gardens, farms and 

ranches our people had worked hard to build on our Reservation are now under 

water. The free-flowing Columbia River and our ‘‘Path of Life’’ are now slack water 

behind Grand Coulee. The Dam also destroyed our salmon runs, which from time 

immemorial had given us life and identity. While the Colville lost most of their 

runs, salmon still were able to reach the Colville Reservation up to the Grand Coulee Dam. But upstream, at our Reservation, the salmon were entirely lost. 

For decades, the Colville and Spokane Tribes shared similar histories and dialogue in connection with the Grand Coulee issue, and were subjected to the identical 

misconduct by the United States Government. When the project first began, it was 

to be a state project, governed by the Federal Power Act which required annual 

compensation to impacted Indian tribes. Later, after the Project was federalized and 

no longer fell under the Federal Power Act, Government officials continued to recognize that the Tribes should be compensated. When construction on Grand Coulee 

began, the Commissioner of Indian Affairs recommended, in writing, that both 

Tribes receive annual payments for the dam’s operations. The Secretary of the Interior and other high-level federal officials knew the Tribes should receive compensation. But it never happened. Both Tribes were equally deceived. 

In 1941, our Tribes renewed their efforts, taking the extraordinary step of sending 

a joint delegation cross-country to meet in Washington, D.C., with the Commissioner 

of Indian Affairs on Grand Coulee. The meeting was held on December 10—three 

days after Pearl Harbor was bombed. The Commissioner and his staff explained 

that the war had become the nation’s priority, and that Congress could not be expected during such times to address the Tribe’s needs. But they committed to do 

what they could to help, and our leaders returned home trusting that things would 

be made right once the war was over—the same war we sent our young to fight. 

These were times when our people were almost completely dependent on the Bureau of Indian Affairs for protecting our Reservation and resources. Our great white 

father was BIA. We were allowed to do nothing without the BIA. We were not experienced in the ways of American law, politics and business. At that time, we were 

among the most isolated of tribes in the nation. We were beginning to farm and 

ranch, but our subsistence ways—depending on the Rivers’ salmon—was most 

prominent. At that time, we also had no constitutionally formed government. And 

even though the Bureau of Indian Affairs’ nearest agency was 100 miles away on 

the Colville Reservation, we relied on BIA officials for managing details like recording the minutes of Tribal meetings. So when the Commissioner of Indian Affairs 

told our people he would do all he could to help, it carried great weight. Being a 

trusting people, we took the government representatives’ word. 

Soon after the War’s end, in 1946, Congress enacted the Indian Claims Commission Act. The ICCA allowed Indian tribes to bring historic legal claims against the 

United States government. Several obstacles unique to our Tribe made the task of 

filing our ICCA claims unusually difficult. First, although the Act required the Commission and BIA to notify all tribes of claims that should be filed, we received no 

such notice. We learned of the ICCA from neighboring tribes only months before the 

1951 filing deadline. Second, our leadership acted to retain a lawyer once they 

learned of the ICCA. But the Commissioner of Indian Affairs withheld his approval 

for several months, costing our Tribe much critical time. Also, our Constitutional 

government was first formed only 60 days before the 1951 deadline for filing. Eventually, the Spokanes filed a standard ICCA claim much like the claim filed by the 

Colville Tribes. No mention of Grand Coulee was made in either since the ICCA was 

understood to apply to historic claims rather than claims where wrongful conduct 

was ongoing. 

In 1972, the Secretary of the Interior established a Task Force to address the Spokane and Colville Tribes’ Grand Coulee issues, and later, in 1976, the Senate Appropriations Committee renewed the hope of both Tribes by directing the Secretaries 

of the Interior and the Army to ‘‘open discussions with the Tribes to determine 

what, if any, interest the Tribes have in such production of power and to explore 

ways in which the Tribes might benefit from any interest so determined.’’ During 

the next several years, numerous meetings were held. Both the Colvilles and the 

Spokanes participated in earnest, fully believing that the Government would satisfy 

Congress’ directive. When the Task Force’s report came out, however, it was nothing 

more than a legal position: the United States has legal defenses and, therefore, 

there is no requirement to compensate the Tribes. After several years of work, the 

Report, which is included in our briefing materials, failed to consider the Tribal interests involved in the process. And it completely ignored Congress’ mandate that 

benefits associated with those interests be explored. We had trusted that Congress 

would help by addressing our claim side by side with the Colvilles. 

37

As I said earlier, Grand Coulee’s impacts on the Spokane and Colville Tribes was 

virtually identical, as were the Tribes’ histories of dealing with the United States. 

While the Colvilles may have lost more land, the Spokane lost our salmon fisheries 

entirely. And both Tribes have survived decades of lost hope and broken promises. 

There is a simple historical fact that separates the Colville and Spokane Tribes. 

It is that fact that led ultimately to the Colville Tribe’s settlement of its claims—

a settlement under which the Colvilles received $53 million in back damages, and 

annual payments in perpetuity that since 1994 have been $15-20 million each year. 

We believe it is unprecedented for one tribe to receive compensation from the 

United States while a similar tribe receives nothing. 

In the mid-1960s, the Spokane Tribe—a trusting tribe that has always come to 

the aid of the U.S.—entered a cooperative relationship with the United States government, and in 1967 the Tribe settled its Indian Claims Commission case. The 

Colvilles did not. Instead, the Colvilles persisted with their legal battles through the 

1960s, and beyond the days of the Task Force. The Colvilles hadn’t raised Grand 

Coulee claims in their original ICCA case any better than had the Spokanes. But 

their decades-long resistance to settlement enabled them to benefit from a mid1970s Indian Claims Commission case. In 1975, the Commission ruled for the first 

time ever that it had jurisdiction over cases where the wrongful conduct continued 

beyond the ICCA’s 1951 statutory deadline. 

Armed with that new decision, the Colvilles by 1976 had sought and obtained permission to amend their ICCA claim to include for the first time their Grand Coulee 

case. Our Tribe, having come to terms with the United States in the 1960s, had no 

case left to amend. In spite of that, both tribes continued to negotiate and meet with 

the United States. 

In 1978, the Indian Claims Commission ruled that the United States’ conduct in 

building Grand Coulee Dam was unfair and dishonorable and, therefore, awarded 

the Colville Tribes over $3 million for fisheries losses. In 1992, the Federal Circuit 

Court of Appeals ruled that the Colvilles’ claim for power values, based on the same 

standard, was not barred. With that leverage, the Colvilles secured a settlement 

which, in 1994 the Congress approved in Public Law Number 103-436. 

Nine years ago, in the context of the Colvilles’ settlement, I came here and testified to Congress on my Tribe’s behalf. I asked Congress to include our settlement 

with the Colvilles, or to waive the ICCA statute of limitations so we might be able 

to present our case. But rather than providing our requested relief, Congress again 

directed the United States to negotiate with us a fair settlement. 

Since then, I have participated in virtually all discussions held between our Tribe 

and three BPA administrators representing the United States. During the past nine 

years, we have been forced to confront countless tactics that ran directly counter to 

the Congress’ direction and intent that our Grand Coulee claims be negotiated in 

good faith and on the merits. As Senator Patty Murray stated: 

‘‘The fair and honorable dealings standard established in the Indian Claims 

Commission Act should clearly apply to the United States’ conduct and relationship with both the Colville and Spokane Tribes.’’

For the first several years we met nothing but delay and the assertion of technical 

legal defenses. Members of Congress who had been made aware of these failings, 

admonished the United States, stating in clear terms that the negotiations must be 

on the merits of our claim without consideration of legal defenses, and that by definition, negotiations must involve flexibility. We were advised that an offer was 

being developed, but that it had to go through several levels of federal approval. We 

were concerned that there would be little room for negotiation. As we awaited the 

offer, we continuously sought and obtained assurances from BPA and others that 

once presented, there would be sufficient flexibility for negotiations. But when the 

offer finally came five years later, it was presented as an ultimatum—‘‘Take it or 

leave it.’’

The offer fell far short of what we felt represented a fair settlement. Since 1992, 

we had sought a settlement that was proportionate to the Colvilles’ based on lands 

used by the Project. So again we regrouped, and enlisted the assistance of Congressman Nethercutt to moderate a negotiation session with BPA. At the end of that session, both sides had made concessions, as occur during good faith negotiations. BPA 

committed to examining ways to make the agreement in principle work, and promised to get back to us in a couple of weeks. Then came more delay. After more than 

a year of waiting for BPA to follow through, we were stunned when BPA backed 

altogether away from the agreement in principle. Since then, we have tried numerous approaches on numerous occasions to make the agreement work—and each time 

BPA has rejected our efforts. 

After nine years of fruitless negotiations, nine years of broken promises and 

delays, I am back here today requesting that this injustice not go unanswered. That 

38

the United States Government recognize our contributions and sacrifices. To compensate one of the two Tribes devastated by Grand Coulee, and not the other has 

only compounded the injustice to our people and prolonged this conflict. We believe 

it would be unprecedented for Congress to only provide relief to one tribe—and not 

the other—when both are so similarly impacted. 

In closing, Mr. Chairman, and honorable members of the Committee, I ask you 

to listen with your hearts. We have no place to turn. We have no place to go. We 

ask for our day of justice. We have waited for this day for over sixty years. 

OCTOBER 20, 2003

Honorable Ken Calvert, Chairman 

Subcommittee on Water and Power 

U.S. House of Representatives 

Committee on Resources 

Washington, D.C., 20515

Dear Chairman Calvert:

Thank you for the opportunity to appear before the House Subcommittee on 

Water and Power’s October 2, 2003 legislative hearings on H.R. 1753. The hearing 

was very important to the Spokane Tribe of Indians in our longstanding and continuing efforts to secure a fair and honorable settlement for tribal lands which were 

confiscated by the United States for purposes of the Grand Coulee Project. 

In your letter of October 6, 2003, you indicated that the Majority Members of the 

Committee had five additional questions as follows: 

1. Why have negotiations between Bonneville and the Tribe failed? 

2. Do you believe there is middle ground on this issue? 

3. Since Indian settlements are a national interest, are you opposed to having the 

U.S. Treasury fund all of the Spokane settlement? 

4. The primary difference over the Colville and Spokane situation is the statute 

of limitations issue. Grand Coulee construction impacted your reservation before 1967, the year the Tribe settled on its original land claim. Why didn’t the 

Tribe amend its original land claim to account for the Grand Coulee impacts? 

5. Would this legislation set a precedent by which a back payment is given to a 

tribe that did not have a pending claim? 

Please find attached my response to the above questions. Once again, thank you 

for holding hearings on H.R. 1753.

SINCERELY,

WARREN SEYLER, CHAIRMAN

SPOKANE TRIBE OF INDIANS

P.O. BOX 100

WELLPINIT, WA 99040

Attachment 

Responses of Warren Seyler, Chairman, Spokane Tribe of Indians, to questions submitted for the record from Ken Calvert, Chairman, House 

Resources Subcommittee on Water and Power, regarding Spokane Settlement Bill, H.R. 1753—Submitted October 21, 2003

Question No. 1: Why have negotiations between Bonneville and the Tribe 

failed? 

Response: There are three main reasons why negotiations between Bonneville and 

the Tribe have failed to produce a fair and honorable settlement. First, the Administration and BPA, despite repeated congressional directives, have consistently delayed and stalled progress. By doing so, BPA has deferred across two successive rate 

cases, without interest, on paying any compensation to the Tribe. 

Second, during negotiations, BPA also insisted that any compensation package for 

the Spokane Tribe be based on a nonsensical formula that was never used as a basis 

for the Colville settlement and greatly disadvantages the Spokane Tribe. 

Third, while delaying negotiations and devaluing the losses suffered by the Spokane Tribe, BPA was simultaneously distributing enormous additional benefits to 

aluminum companies and the other entities in the Pacific Northwest, far in excess 

39

of the historic benefits which it has provided. This extreme increase in benefits was 

deliberately pursued in spite of the western energy crises and has led to unprecedented impacts on BPA’s rates. 

In 1994, while considering the Colville settlement, Congress directed the Administration to reach a fair and honorable settlement with Spokane. However, despite repeated letters from Congressman George Nethercutt, Senator John McCain and others urging the Departments of Justice and Interior to enter into negotiations with 

the Spokane Tribe and reach a fair and honorable settlement, the Administration 

stalled on its obligation and no negotiations occurred for four years, from 1994 

through 1998. 

Finally, in August of 1998, BPA began ‘‘discussions’’ with the Spokane Tribe but, 

even then, indicated that it had no authority to negotiate. In those discussions, BPA 

presented to the Spokane Tribe a formula which it proposed be used to value the 

lands which the United Stated seized from the Spokane Tribe for the Grand Coulee 

Project, claiming that this formula was the basis for the Colville settlement. 

This formula was an improper and arbitrary application of an unrelated single 

FERC case, completely unlike Grand Coulee, and was totally unsuitable for valuing 

Spokane (or Colville) lands taken for the project and, more importantly, did not 

serve as a basis for the Colville Settlement. BPA, even though it lacked authority 

to negotiate, also demanded substantial additional concessions from the Spokane 

Tribe. For example, BPA insisted that any compensation paid the Spokane Tribe 

must not include payments for the fact that Grand Coulee exterminated the fish 

runs in the upper Columbia River and Spokane River which the Spokane people had 

depended upon since time immemorial. 

As late as 1999, BPA still lacked authority to negotiate with the Spokane Tribe. 

As a result, Congressman George Nethercutt and Senator Patty Murray introduced 

Spokane settlement legislation. Those proposed settlement bills were based on 

straight-forward ‘‘proportional’’ settlement whereby the Spokane would receive 

39.4% of the payments which the United States made to Colville. This proportion 

was based on the ratio of lands taken from the Spokane to lands taken from the 

Colville Tribe. 

By March of 2000, BPA still had no authority to negotiate with the Spokane Tribe 

but made an ‘‘unofficial’’ proposal, again based on the ‘‘formula’’ BPA claimed it used 

in the Colville settlement. This proposal, which provided annual payments of just 

19.2% of annual payments to Colville, contained numerous, significant mathematical 

errors and faulty analysis. It applied a ‘‘profitability method’’ to a non-profit organization. It viewed the Grand Coulee Project as a sort of ‘‘joint venture’’ between the 

United States and project developer and the Spokane Tribe as landowner. And, most 

importantly, it weighted a handful of acres in the project which the Spokane Tribe 

did not own at 2200 times the value of lands which the Spokane Tribe did own. 

By May 2000, near the end of the 106th Congress, BPA had received authority 

to negotiate. The late release of authority to negotiate, the insistence on use of an 

unjust formula, the erroneous math and analysis provided by BPA to the Tribe delayed not only a fair negotiated settlement as directed by Congress but foreclosed 

meaningful consideration of the Spokane settlement bills by Congress. 

In June 2001, the Spokane Tribe sought to revive negotiations with BPA by offering, at BPA’s request, a range of creative approaches to settlement. These included 

a mix of less revenue in exchange for a block of power, upgrading of distribution/

transmission facilities, assigning the Bureau of Reclamation (which operates the 

Grand Coulee Project) partial payment responsibility. The Spokane Tribe also indicated its willingness to structure payments for back damages over time to minimize 

any impacts on BPA’s ratepayers. 

In July of 2001, BPA flatly rejected the Spokane Tribe’s proposal and, in response, 

withdrew its previous offer of a one-time back payment. In doing so, BPA cut the 

value of its prior best offer by approximately $17 million. Thus, by August 2001, 

negotiations were at an impasse. 

In September of 2001, the Spokane Tribe returned to Congress and requested settlement legislation be introduced. In response, Congressman George Nethercutt suggested that the Spokane Tribe make a final effort to negotiate and agreed to conduct 

and facilitate a negotiation session between the Tribe and BPA. Due to events which 

occurred in mid September, that session did not occur until January of 2002. 

In January of 2002, Congressman Nethercutt facilitated a negotiations which arrived at a ‘‘middle ground’’ settlement scenario which provided compensation for 

back payments and annual payments of 29.4%, i.e., halfway between BPA’s 19.2% 

and the Spokane Tribe’s 39.4%. In those sessions, Steve Wright, BPA administrator, 

stated the middle ground settlement scenario should work for BPA but that he 

needed 10 days to 2 weeks to ‘‘run the numbers’’ and determine how best to structure the back payment over time. 

40

By the first week in April of 2002, nearly three months after the session facilitated by Congressman Nethercutt, the Spokane Tribe had still heard no response 

form BPA. Out of total frustration, the Spokane returned to Washington, D.C., to 

request settlement legislation from Congress. 

In May of 2002, four months after the January 2002 negotiating session and while 

in Washington, D.C., meeting with members of Congress, the Spokane Tribe finally 

received a reply from BPA regarding the ‘‘middle ground’’ settlement scenario. 

BPA’s delayed response merely put the back pay back on the table. BPA did not 

budge from its long-standing insistence that annual payments to the Spokane Tribe 

not exceed 19.2% of payments to Colville. BPA’s letter also warned the Tribe to 

promptly accept this offer or back pay would again be taken off the table. 

As a result, the leadership of the Spokane Tribe concluded that further negotiations with BPA were unlikely to yield any kind of fair or honorable settlement. 

Rather, BPA merely used the January 14, 2002 facilitated negotiations to successfully stall reintroduction of settlement legislation and prevent timely congressional 

hearings. 

In May, 2002, Congressman Nethercutt and Senator Patty Murray, for the second 

time, reintroduced Spokane settlement bill based on a 39.4% proportional settlement 

with the Colville. In July of 2002, staff for the Senate Committee staff of the Indian 

Affairs, Energy and staff acting on behalf of members of the Washington delegation 

suggested the Spokane Tribe attempt further negotiations with BPA, this time facilitated by and through the staff of the committees and requested the Tribe resubmit an expanded version of the creative areas/options for settlement to the Committee to serve as a basis for further settlement discussions. 

At the time, BPA expressed renewed optimism and clarity stating that BPA staff 

would take a ‘‘first cut’’ at costing out the Tribe’s proposal and indicating that they 

would respond to Committee staff by August 1, 2002. August came and went with 

no reply by BPA. In fact, BPA did not respond until six weeks later and even then, 

in an email, merely stated that the Spokane Tribe’s proposal ‘‘simply increases costs 

to BPA’’ and ‘‘we have many obligations and requests for spending on worthy efforts.’’

Thus, the Spokane Tribe renewed its request for congressional hearings in October 2002. However, congressional elections were hotly contested and no hearings 

were scheduled. Finally, in 2003, Congressman Nethercutt introduced a settlement 

bill in the House of Representatives and Senator Maria Cantwell introduced a settlement bill in the Senate. Hearings were held on October 2, 2003. At those hearings, BPA testified before the House Water and Power Subcommittee taking the position that the Tribe would be forced to accept its 19.2% offer if only Congress would 

stop encouraging the Tribe to expect more. 

Question No. 2: Do you believe there is a middle ground on this issue? 

Response: In a meeting hosted by Congressman Nethercutt in January 2002, the 

Spokane Tribe offered a ‘‘middle ground’’ proposal to BPA of 29.3% of the Colville 

Settlement. The 29.3% is the midpoint between BPA’s position of 19.2% and the 

Spokane Tribe’s position of 39.4%. BPA ultimately ignored the Tribe’s proposal. 

Essentially, the Spokane Tribe had always bargained for 39.4% of the compensation package received by Colville. This proportion was based upon the ratio of the 

respective lands taken from the two tribes. However, BPA, applying its profitabilityKerr Dam methodology, was unwilling to offer more than 19.2% of annual payments 

made to Colville. And BPA’s last offer contained no ‘‘back pay’’ comparable to the 

$53 million one-time payment to Colville. 

With Representative Nethercutt’s assistance and guidance, the parties arrived on 

January 14, 2002 at a ‘‘middle ground’’ settlement scenario which (it was thought) 

could work for all parties. Following the January 14, 2002 meeting, the Tribe prepared a preliminary analysis of impacts of an annual payment—based on 29.3% of 

Colville—on BPA’s Power Business Line’s expenses and found they would be negligible. The increase in the average monthly electric bill of a typical household in 

the Pacific Northwest would be less that 12 cents, i.e., less than one-half of one percent of the rate increases BPA put in effect as of October, 2001 for the FY 2002-

2006 rate case. 

Near the end of the January 14, 2002 negotiations, Steve Wright, BPA Administrator and CEO, stated that the middle ground compromise, as outlined, should 

work for BPA but that he would need ‘‘ten days to two weeks’’ for BPA staff to ‘‘run 

the numbers’’ and determine how best to structure the back payment over time. The 

Tribe reiterated its willingness to partition the back payment into several separate 

payments in order to distribute the impact of the settlement over time, and its willingness to join with BPA in analyzing the impact on BPA ratepayers of various apVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00044 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
41

proaches for making the one-time payment. The BPA, however, virtually ignored the 

Tribe following the meeting. 

Seventy-six (76) days later the Spokane Tribe had still not heard back from the 

Administrator. Two weeks had drawn out to nearly three months with no response 

on BPA’s part. During that time, representatives of BPA had repeatedly indicated 

that their response was imminent. On April 3, 2002, the Chairman of the Spokane 

Tribe, Alfred Peone, contacted Representative Nethercutt, thanking him for his efforts and respectfully requesting that the settlement legislation be reintroduced and 

hearings scheduled regarding the Spokane Tribe’s claims against the United States 

for damages associated with the Grand Coulee Project. 

The Spokane Tribe’s assessment was that further negotiations with BPA were unlikely to bear fruit and that reintroduction of settlement legislation and scheduling 

of congressional hearings was the best approach to resolving the Spokane Tribe’s 

claims for damages and providing a fair settlement with the Spokane Tribe. 

‘‘At this point, we have lost faith in the value of further negotiations with 

Bonneville.... BPA throughout its dealings with the Spokane Tribe on this 

matter has...grossly undervalue[d] the contribution of Spokane lands seized 

by the United States for project purposes.... [T]his devaluation has taken 

many forms.... BPA has insisted on applying a profit-based methodology to 

a federal power marketing administration that earns no profits. BPA has 

insisted on using the lowest possible estimate of actual Spokane lands 

taken. It has insisted on imposing an arbitrary, capricious and wholly unwarranted litigation penalty in perpetuity on the Tribe to further reduce 

payments. Representatives of BPA have steadfastly refused to consider 

making a one-time back payment to Spokane comparable to the $53 million 

which the Colville received in 1995, thereby undermining any semblance of 

a ‘‘proportional’’ settlement.

* * *

They requested that we develop but then refused to even discuss a creative approach to settlement, offered and then rescinded a proposal to provide the Tribe with a few years ‘catch up’ payment, and since January 14th 

failed to keep their promise as to when we could expect a response on strategies to structure a scenario for making payments over time.’’

Letter from Chairman Peone to Rep. Nethercutt, dated April 3, 2002. 

In response to being totally ignored the Tribe again returned to Congress to request a legislated settlement. While meeting with members of Congress the Tribe 

received a belated written response from BPA in a letter from Steve Wright to 

Chairman Peone, dated May 15 2002—some seventeen weeks following the negotiation session. The Tribe left the January 14, 2002 session with the feeling an agreement had been reached subject to BPA ‘‘running the numbers.’’ BPA had a different 

perspective. While apologizing for his ‘‘lengthy delay’’ in responding to the Tribe, 

Wright stated: 

‘‘I want to reiterate that while I expressed appreciation for your willingness 

to move from your earlier position, I did not in any way signify an agreement with your position. Our conversation was wide ranging and left many 

issues to be considered. Given that the current Administration has not been 

briefed on the issues we discussed, let alone any proposed settlement, I 

could in no way commit to any specific outcome.’’

Letter from Steve Wright to Alfred Peone, May 15, 2002. 

Stating his continued support ‘‘for an agreement based on the Colville Settlement’’ 

the Administrator renewed the offer to the Tribe ‘‘of 19.2% of the total compensation 

paid the Colvilles.’’ In effect this offer merely placed back into consideration the 

back pay of roughly $17 million that was taken out of the offer on July 31, 2001 

by BPA. The letter warned the Tribe that ‘‘Lacking prompt resolution, I will again 

withdraw the provision for payment for Fiscal Years 1995 through 2002.’’ The only 

conclusion the Tribe could reach was that BPA used the January 14 negotiations 

to stall reintroduction of settlement legislation and hearings in Congress. BPA was 

ultimately successful. 

Question No. 3: Since Indian settlements are a national interest, are you 

opposed to having the U.S. Treasury fund all of the Spokane settlement? 

Response: No, so long as the payments are forthcoming, mandatory and certain. 

Indeed, the nation has realized enormous benefit from the use of Spokane lands to 

generate hydropower at Grand Coulee and so has the Pacific Northwest Region. 

While the Tribe does not care where the revenues come from to fund a fair and honorable settlement, the Tribe believes it would be simple to follow the Colville payVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00045 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
42

ment structure which in effect splits the costs of settlement between Bonneville and 

the U.S. Treasury. 

The United States General Accounting Office (GAO) suggests splitting the costs 

between Treasury and Bonneville may be the preferred approach. The GAO provided testimony on October 2, 2003, to the Committee on Indian Affairs, U.S. Senate 

on the Spokane Settlement Bill, S. 1438, for the express purpose of addressing: 

1. impact of a settlement on Bonneville if the costs were split between Bonneville 

and the Treasury; and 

2. possible allocation of these costs between Bonneville and the Treasury. 

GAO, Testimony Before the Committee on Indian Affairs, U.S. Senate (October 2, 

2003). (Attachment 1). Speaking to the issue of the allocation of payment 

responsibility among both the Treasury and Bonneville, GAO states: 

A reasonable case can be made for having Bonneville and the U.S. Treasury allocate any costs for the Spokane tribe’s claims along the lines agreed 

to for the Colville tribes. Any settlement would attempt to re-institute a 

commitment the federal government made to the tribes in the 1930s. Under 

the Federal Water Power Act of 1920, licenses for the development of privately owned hydropower projects should include a ‘‘reasonable annual 

charge’’ for the use of Indian lands. Originally, the Grand Coulee site was 

licensed, and the Spokane tribe expected to receive annual payments for its 

lands used for the project. However, the license was cancelled when the federal government took over the project (federalized the project). Since the 

federal government is not subject to the Federal Water Power Act, it was 

not required to make annual payments to the tribes. Nevertheless, the federal government made a commitment in the 1930s to make annual payments to the Colville and Spokane tribes as if the project had remained a 

nonfederal project. However, the federal government did not follow through 

on this commitment after the project was completed and started generating 

revenues from electricity sales in the 1940s. In pursuing this matter, the 

tribes weathered various administrations and changes in the federal government’s Indian policy. In the 1950s and 1960s, the federal government 

actively sought to terminate its relationship with a number of tribes, including the Spokane tribe. 

In the early 1970s, when it became clear that the federal government 

was not going to make these payments, the Colville tribes were able to 

amend their claim with the Indian Claims Commission to pursue this matter. After agreeing to the overall legitimacy of the Colville tribes’ claims, 

the Congress ultimately approved a settlement that primarily required Bonneville to provide annual payments for water power values. This settlement 

was a compromise to split the costs between Bonneville and the U.S. Treasury. Bonneville is primarily paying the recurring annual payments, and the 

U.S. Treasury’s Judgment Fund provided the one-time lump sum payment 

in settlement of the past annual payments—$53 million. The Spokane tribe, 

however, had already settled its claim years earlier and therefore could not 

file an amended claim with the commission. Nevertheless, since Bonneville 

collects the annual revenues for the electricity generated by the dam, it 

could be argued that Bonneville should make annual payments to the Spokane tribe out of those revenues, as it does for the Colville tribes; the U.S. 

Treasury would then pay a lump sum to settle any claims for past years. 

The current House settlement proposal, H.R. 1753, and previous House and 

Senate settlement proposals introduced in the 106th and 107th Congresses 

directed the settlement costs to be split between Bonneville and the U.S. 

Treasury. 

It could also be argued that the U.S. Treasury should pay the Spokane 

tribe’s claim, as it does for most claim settlements against the federal government. S. 1438 provides for the settlement of the tribe’s claim from the 

U.S. Treasury. However, we do not believe a compelling case can be made 

to have the nation’s taxpayers fully absorb an additional cost of doing business associated with Bonneville’s production of power in one region of the 

country. 

In summary, the Tribe is not opposed to the U.S. Treasury funding all of the 

Spokane payments. However, the Tribe believes it would be simple and equitable 

to split the costs between the Treasury and BPA along the lines of the Colville 

settlement. 

[NOTE: Attachment 1—‘‘Spokane Tribe’s Additional Compensation Claim for the 

Grand Coulee Dam’’—a statement submitted for the record by Robert A. Robinson, 

43

Managing Director, Natural Resources and Environment, U.S. General Accounting 

Office, can be found at the end of this response to questions.] 

Question No. 4: The primary difference over the Colville and the Spokane 

situations is the statute of limitations issue. Grand Coulee construction 

impacted your reservation before 1967, the year the Tribe settled on its 

original land claim. Why didn’t the Tribe amend its original land claim 

to account for the Grand Coulee impacts? 

Response: The Spokane Tribe of Indians did not amend its original petition to include Grand Coulee claims before the 1967 settlement for several reasons, including 

the failure of its trustee—the BIA—to advise the Tribe of its claims as required by 

statute, the continuous representation by its trustee that the Tribe’s claims would 

be fairly and honorably addressed, and a 1975 development in ICCA case law that 

for the first time recognized the legal viability of ongoing claims that had not fully 

accrued before the ICCA statutory deadline. 

In 1946, Congress enacted the Indian Claims Commission Act. Act of August 13, 

1946 (60 Stat. 1049). Pursuant to that Act, there was a five year statute of limitations to file claims before the Commission which expired August 13, 1951. The ICC 

Act imposed a duty on the Bureau of Indian Affairs to apprize the various tribes 

of the provisions of the Act and the need to file claims before the Commission. 25 

U.S.C. § 70l (repealed). Unfortunately, the BIA agency responsible for the Spokane 

Tribe was located 100 miles away on the Colville Indian Reservation. According to 

a 1981 memorandum to the Chairman of the Senate Appropriations Committee: 

‘‘There is no record of the Claims Commission or the Indian Bureau notifying or dealing with the Spokane Tribe in any way regarding its right to 

file claims before the Indian Claims Commission. During the Calvin Coolidge administration a bill had passed through Congress permitting it and 

the neighboring Kalispel Tribe to file claims for their ceded aboriginal 

lands, but that bill was vetoed by the president. That potential claim for 

the cession of its land was the only Claim that the Tribe had knowledge 

that it had. 

At about the time of the approval of its tribal government in June 1951 

the tribal leaders heard from their neighboring Kalispels and Coeur 

d’Alenes of their having filed claims for the cession of their aboriginal 

lands. They hastened back to Washington, D.C., and belatedly employed the 

same claims attorneys these tribes had. These just-hired attorneys had no 

time to investigate other claims and filed only one claim, that for the cession of their approximately 3.5 million acres of aboriginal land.’’

See Memorandum of January 12, 1981 with Final Report, Colville/Spokane Task 

Force (September 1980). (Attachment 5 to Spokane Tribe of Indians’ Written Materials submitted October 2, 2003). While the BIA was well aware of the potential 

claims of the Spokane Tribe to a portion of the hydropower revenues generated by 

Grand Coulee, there is no evidence that the BIA ever advised the Tribe of such 

claims. Thus, the Tribe had no way of knowing that its Grand Coulee claims should, 

or could, have been brought under the ICCA. 

Although the Indian Claims Commission statute of limitations expired in August 

1951, neither the Colville Confederated Tribes nor the Spokane Tribe knew then or 

for many years thereafter were aware that there would be a need to even file claims 

related to the use of their tribal land and water resources for the construction and 

operation of the Grand Coulee Dam for power production and reclamation. Instead, 

they were led by their federal trustee to believe that the United States would address their claims. Beginning in the 1930s and through the 1970s, the historical and 

legal record is replete with high level agency correspondence, Solicitor’s Opinions, 

inter-agency proposals/memoranda, Congressional findings and directives and ongoing negotiations with the affected Tribes to come to agreements upon the share 

of revenue generated by Grand Coulee which should go to the Tribes for the use 

of their respective resources. 

The Tribes had every reason to believe that its trustee, the United States, was, 

although belatedly, going to act in good faith to provide fair and honorable compensation to the Tribes for the United States’ proportionate use of their Tribal resources for revenue generated by the Grand Coulee Dam. Thus, while the Spokane 

Tribe in 1967 settled the ICCA claims, the expectation of fair treatment for Grand 

Coulee’s impacts continued. Ironically, the Spokane Tribe’s willingness to resolve its 

differences with the United States would later be used as justification for the United 

States’ refusal to deal fairly and honorably with the Tribe. 

In addition to these points, no case law under the ICCA supported claims that 

had not fully accrued before 1951. Claims for wrongful conduct that began before 

1951 and continued beyond that date were not recognized as legally viable until 

44

nearly a decade after the Spokane Tribe’s settlement. The Colvilles, who had not 

settled their ICCA claim, continued their litigation against the United States. In 

1975, the Indian Claims Commission ruled for the first time ever on a jurisdictional 

question, left open since 1956, that controlled the Colvilles’ Grand Coulee claim. The 

Commission held that it had jurisdiction over ongoing claims as long as they were 

part of a continuing wrong which began before the ICCA’s enactment and continued 

thereafter. Navajo Tribe v. United States, 36 Ind. Cl. Comm. 433, 434-35 (1975). 

With this major legal question answered, the Colvilles sought, and in 1976 obtained, 

permission from the Commission to amend their complaint to include for the first 

time their Grand Coulee claims. With new life breathed into their claims, the 

Colvilles pursued litigation to the Federal Circuit Court of Appeals, which held that 

the ICCA’s ‘‘fair and honorable dealings’’ standard may serve to defeat the United 

States’ ‘‘navigational servitude’’ defense. Colville Confederated Tribes v. United 

States, 964 F.2d 1102 (Fed. Cir. 1992). In light of this ruling, the United States in 

earnest renewed negotiations with the Colvilles to resolve that Tribe’s Grand Coulee-related claims. Unfortunately because the Spokane Tribe in 1967 had acted in 

cooperation with the United States to settle its ICCA case, it lacked the legal leverage to force meaningful negotiations. 

Numerous historical occurrences factored into the different legal postures held 

under the ICCA by the Colville and Spokane Tribes. Key among them was the Spokane Tribe’s inability to amend its original petition to include Grand Coulee-related 

claims. The Spokane Tribe was not advised by its federal trustee, as required by 

statute, of its potential ICCA claims related to Grand Coulee. The Tribe was misled 

by continuing representations by its federal trustee that the United States would 

fairly and honorably address its Grand Coulee claims. And, finally, no ICCA case 

recognized the Commission’s jurisdiction over such ongoing claims until 1975, eight 

years after the Spokane Tribe’s claims were settled. 

Question No. 5: Would this legislation set a precedent by which a back 

payment is given to a tribe that did not have a pending claim? 

Response: A complete answer to this question requires a four-part response. 

First: The Spokane Indian Tribe’s claim is so factually and legally unique that 

any precedential value of the legislation would be extremely limited. 

Based on the Tribe’s survey, there were only two other tribal governments who 

may have moral claims against the United States for lands inundated by federal 

dams in the Columbia Basin, but for the ICCA’s statute of limitations. The 

Dworshak Dam on the North Fork of the Clearwater River barely touches upon the 

northern boundary of the Nez Perce Reservation, inundating a tiny portion of reservation lands. The American Falls Dam on the Snake River is located below the 

Fort Hall Indian Reservation. The reservoir behind the dam inundates a small portion of the Fort Hall Reservation, where the Snake River forms the northwestern 

boundary of the Fort Hall Reservation. 

A third—the only other Indian Reservation in the United States that may have 

suffered similar devastation—is the Fort Berthold Reservation, which was flooded 

by a federal dam on the Missouri River. Unlike the Spokane, the Fort Berthold 

Tribes’ culture was not centered around fishing. Moreover, Congress has already 

provided additional compensation to the Fort Berthold Tribes, over and above the 

substantial compensation these Tribes received when their lands were inundated, 

because of the especially egregious impacts. See Public Law 102-575. 

None of these Reservations are impacted to the degree the Grand Coulee devastated the Spokane Reservation. The western (Columbia River) and southern (Spokane River) borders of the Spokane Reservation are flooded by the Grand Coulee 

Project. The Grand Coulee Project devastated the Spokane Reservation, and the 

Tribe’s culture, far worse than any other Indian Reservation was impacted by federal hydro-electric development in the United States, except perhaps the Colville 

Reservation. 

These comparisons go to the heart of the uniqueness of the Spokane claims. No 

other Northwest Indian reservations were devastated by a federal hydro-electric 

project as severely as the Colville and the Spokane. It is unique in that one inundated Tribe was compensated and the other is not, yet the impacts are identical. 

It is unique in that express, written commitments were made by the Secretary of 

the Interior to compensate the Tribes for Grand Coulee impacts, but these promises 

were not kept. The sheer size of the Grand Coulee Project (the largest electricity 

producer in the United States and the largest concrete dam in the world), combined 

with the absolute economic, social, cultural, and religious reliance of the Spokane 

Tribe on fishing and the Spokane and Columbia Rivers, makes its claims unique. 

The precedential value is, therefore, virtually non-existent. 

45

Second: The Spokane Tribe’s claim for the loss of its salmon runs may have created a precedent, and for that reason the Tribe agreed not to include it in this legislation. 

Early in the negotiations that followed enactment of the Colville Tribe’s settlement bill, the Spokane Tribe explained to the various involved federal agencies that 

it intended to pursue damages for the loss of its historic salmon runs. The Spokane 

Tribe, once totally dependent on the salmon, had lost these runs entirely to Grand 

Coulee. The Colville Tribes, which did not entirely lose access to the runs, were compensated for their losses through the ICCA. 

When the first drafts of the Spokane Tribe’s settlement bill were being discussed 

with potential Congressional sponsors, the Tribe was asked to remove provisions for 

compensation related to fish losses because they might establish a precedent. The 

remainder would be left in place because it was not viewed as precedent-setting. 

The Tribe agreed to the request. 

Third: The legislation will not create a new precedent for similar claims, since 

there already exists ample legislative precedent for Congressional resolution of tribal claims against the United States notwithstanding technical defenses the United 

States could raise. 

P.L. 103-436. The 1994 Colville Tribes Settlement Act is the most important 

precedent. The Colville and the Spokane are neighboring tribes situated across the 

Columbia River from one another. In 1994, Congress provided the Colville Tribes 

$53 million back damages and an initial annual payment of $15,250,000. Subsequent annual payments will be made to Colville as long as the Grand Coulee Dam 

generates hydroelectric power. The Spokane Tribe, suffering virtually identical in 

nature impacts, have received no such compensation from Congress. 

P.L. 107-331. In 2002, the 107th Congress enacted the Yankton Sioux Tribe and 

Santee Sioux Tribe Equitable Compensation Act which provided a $28 million trust 

fund as compensation to both Tribes for the taking of Reservation lands for the construction of the Fort Randall and Gavins Point Dams on the Missouri River system 

under the Pick-Sloan Project. 

P.L. 106-511. In 2000, Congress enacted the Cheyenne River Sioux Equitable 

Compensation Act which provided a $290 million trust fund as additional compensation to the Tribe for the taking of tribal lands for the Oahe Dam as part of the PickSloan Project on the Missouri River. 

P.L. 105-132. In 1997, in the first session of the 105th Congress, legislation was 

enacted to provide $35 million of additional compensation to the Lower Brule Sioux 

Tribe of South Dakota for the takings of its lands for the Pick-Sloan Project. 

P.L. 104-223. In 1996, the 104th Congress enacted legislation to provide compensation of $27.5 million to the Crow Creek Sioux Tribe in South Dakota for infrastructure that was inundated by flood waters from two dams on the Missouri River. 

The ‘‘taking’’ legislation for the Pick-Sloan Project authorized under a 1944 Act of 

Congress provided for construction of alternative structures which were either not 

constructed or were constructed in a shoddy way. The method of compensation was 

premised on computation of revenues from the Western Area Power Administration 

(WAPA)—the same process used to fund the Three Affiliated Tribes and Standing 

Rock Sioux compensation bill (below). 

P.L. 102-575. In 1992, Congress enacted the ‘‘Three Affiliated Tribes and Standing Rock Sioux Tribe Equitable Compensation Program Act,’’ which provided compensation to both tribes for the taking of reservation lands for the construction of 

Garrison Dam and Reservoir and the Oahe Dam and Reservoir. Like Grand Coulee 

Project, these Missouri River dams were built without consultation and equitable 

compensation to the two impacted tribes, yet enormous benefits accrued to the 

United States and its designated beneficiaries. 

The $12 million in compensation each tribe had received for the taking of its 

lands at the time was found to be totally inadequate in light of the devastating and 

inordinate share of the impact borne by these two tribes. Congress appropriated an 

additional $149.2 million for the Three Affiliated Tribes and $90.6 million to the 

Standing Rock Sioux Tribe, which provides an annual revenue stream for both 

tribes based on the interest earned. (See Title 35 of Public Law 102-575 and Senate 

Report No. 102-267.) 

P.L. 96-338. Restored lands to the Tule River Indian Tribe despite fact Tribe did 

not bring a claim for these lands under the ICCA. 

P.L. 96-401. Authorizing the Secretary of the Interior to cancel and renegotiate 

coal leases involving Northern Cheyenne lands in light of an apparent violation of 

the Federal Government’s fiduciary duty to the tribe and because the present ‘‘impasse can only lead to expensive and lengthy litigation.’’ House Report No. 96-1370, 

at 3. 

46

1See also, footnote 12, GAO, Testimony Before the Committee on Indian Affairs, U.S. Senate 

(October 2, 2003) (listing various additional public laws similar to those above). 

P.L. 95-280. The Zuni Act directed the Secretary of the Interior to purchase and 

hold certain lands in trust for the Zuni Indian Tribe of New Mexico. Not withstanding statutes of limitations, the Act also conferred jurisdiction upon the Court 

of Claims to hear and determine the Zuni’s aboriginal lands claim. Congress recognized that ‘‘[u]nfortunately, the Zuni Indian tribal leadership failed to comprehend 

the absolute necessity of filing a claim during the statutory five-year period ending 

in 1951.’’ Congress took note of the fact that the Zuni lacked sufficient legal representation and that the federal government had failed to meet its obligation to provide notice and explanation to the Zuni of their right to file a claim against the 

United States. 

Each of these enactments represent occasions when Congress provided compensatory or other direct relief to Indian tribes for past wrongs despite the absence of 

pending claims. As a consequence, the legislation will not stand as significant additional precedent. 

Fourth: Pre-existing precedent also can be found, to a degree, in the various Congressional Bills of Reference or jurisdictional statutes, which allow Indian tribes to 

proceed with legal claims despite the running of statutes of limitations. 

P.L. 104-198. Conferred jurisdiction on the United Court of Federal Claims with 

respect to land claims of the Pueblo of Isleta. 

P.L. 95-280. The Zuni Act directed the Secretary of the Interior to purchase and 

hold certain lands in trust for the Zuni Indian Tribe of New Mexico. Notwithstanding statutes of limitations, the Act also conferred jurisdiction upon the Court 

of Claims to hear and determine the Zuni’s aboriginal lands claim. Congress recognized that ‘‘[u]nfortunately, the Zuni Indian tribal leadership failed to comprehend 

the absolute necessity of filing a claim during the statutory five-year period ending 

in 1951.’’ Congress took note of the fact that the Zuni lacked sufficient legal representation and that the federal government had failed to meet its obligation to provide notice and explanation to the Zuni of their right to file a claim against the 

United States. 

P.L. 95-247. Notwithstanding certain statutes of limitations, Congress conferred 

jurisdiction on the Indian Claims Commission to consider the merits of the Wichita 

Indian Tribe’s claim against the United States for the taking of lands. 

P.L. 95-243. This Act authorized the U.S. Court of Claims to review, without regard to the technical defenses of res judicata or collateral estoppel, the Sioux Tribe’s 

claims for compensation for the taking of the Black Hills. Thus Congress overrode 

the Court of Claims dismissal of the Sioux’s claim, which had been dismissed on 

the grounds of res judicata. 

P.L. 96-251. Waived the statute of limitations of the ICCA to permit the Cow 

Creek Band of Umpqua Indians to file a claim against the United States for treaty 

violations. Congress stated that its enactment of this legislation ‘‘will assure the 

Cow Creek Ban their right to due process and a fair day in court.’’ Senate Report 

No. 96-397 at 2. 

P.L. 96-404. Allowed a land claim suit by the Three Affiliated Tribes to proceed 

in the U.S. Court of Claims notwithstanding statutes of limitations, lapse in time, 

res judicata, collateral estoppel, or any other provisions of law. 

P.L. 96-405. Authorized the U.S. Court of Claims to hear claims by the Blackfeet 

and Gros Ventre Tribes for land takings notwithstanding Court of Claims earlier 

dismissal of these tribes’ suit on the grounds of res judicata. 

P.L. 96-434. Same relief as in P.L. 96-405 afforded to the Assiniboine Tribe. 

Thus, this legislation is not precedentially unique since Congress often has provided mechanisms that enable Indian tribes to seek compensation for past wrongs. 1

The enactment of legislation to allow the Spokane Tribe to litigate its claims, like 

those listed above, is a potentially available alternative that was considered and rejected by the Tribe and by one of the bill’s primary sponsors. Such actions almost 

unanimously result in the expenditure by both sides of vast sums on lawyers and 

expert witnesses, take years to resolve, are exceedingly contentious, and rarely are 

resolved in a manner satisfactory to all parties. As experienced lawyers often say, 

a bad settlement is always better than a good judgment. 

47

1Pub. L. No. 76-690, 54 Stat. 703 (1940), an act for the acquisition of Indian lands for the 

Grand Coulee Dam and Reservoir, and for other purposes, granted the United States title to 

Indian lands the Secretary of the Interior designated as necessary for the Grand Coulee Dam 

project and authorized the Secretary to determine the appropriate amount to be paid to the 

tribes for lands so designated. 2Pub. L. No. 103-436, 108 Stat. 4577 (1994). 

3The legislative settlement proposals introduced in the 106th Congress were S. 1525 and 

H.R. 2664. In the 107th Congress, the proposals were S. 2567 and H.R. 4859. The proposals 

pending in the 108th Congress are S. 1438 and H.R. 1753. Under S. 1438 the settlement costs 

would all be paid out of the U.S. Treasury, while under H.R. 1753, the settlement costs would 

be split between Bonneville and the Treasury. 4 U.S. General Accounting Office, Bonneville Power Administration: Long-Term Fiscal Challenges, GAO-03-918R (Washington, D.C.: July 1, 2003). 

ATTACHMENT 1

Testimony before the Committee on Indian Affairs, U.S. Senate, Statement 

submitted for the record by Robert A. Robinson, Managing Director, 

Natural Resources and Environment, U.S. General Accounting Office 

Mr. Chairman and Members of the Committee: 

We are pleased to have the opportunity to comment on the Spokane tribe’s additional compensation claim for the Grand Coulee Dam and the proposed legislative 

settlement, S. 1438. As you know, the Grand Coulee Dam was constructed on the 

Columbia River in northeastern Washington State from 1933 to 1942. When finished, the 550-foot high dam was the largest concrete dam in the world. It is still 

the largest hydroelectric facility in the United States. The Franklin D. Roosevelt 

Reservoir, which was created behind the dam, extends over 130 miles up the Columbia River and about 30 miles east along the Spokane River. The reservoir covers 

land on the Colville Reservation along the Columbia River and land on the adjacent 

Spokane Reservation along both the Columbia and Spokane rivers. Under a 1940 

act, the federal government paid $63,000 and $4,700 to the Colville and Spokane 

tribes, respectively, for the land used for the dam and reservoir. 1

Subsequently, the Colville tribes pursued additional claims for their lost fisheries 

and for ‘‘water power values’’ (i.e., a share of the hydropower revenues generated 

by the dam from the use of their lands) before the Indian Claims Commission. The 

Colville tribes’ fisheries claim was settled in 1978 for about $3.3 million. Under a 

1994 Act—the Confederated tribes of the Colville Reservation Grand Coulee Dam 

Settlement Act (P.L. 103-436, Nov. 2, 1994)—the Colville tribes were awarded a 

lump sum payment of $53 million for lost hydropower revenues and, beginning in 

1996, annual payments that have ranged between $14 million and $21 million for 

their water power values claim. 2 The lump sum payment was made from the U.S. 

Treasury, and the cost of the annual payments is shared between the Bonneville 

Power Administration (Bonneville), which markets the power generated at the dam, 

and Treasury. 

The Spokane tribe is currently pursuing similar claims. S. 1438, introduced in 

July 2003, is a proposed legislative settlement for the Spokane tribe’s claims. While 

settlement proposals introduced in the 106th and 107th Congresses directed the settlement costs to be split between Bonneville and the U.S. Treasury, S. 1438 provides that the settlement be paid entirely out of the U.S. Treasury. 3 In this context, 

you asked us to address the (1) impact of a settlement on Bonneville if the costs 

were split between Bonneville and the U.S. Treasury; and (2) possible allocation of 

settlement costs between Bonneville and the U.S. Treasury. To meet these objectives, we relied on information developed for a preliminary GAO report to the Subcommittee on Energy and Water Development, House Committee on Appropriations; 4 interviewed officials at Bonneville and representatives of the Spokane tribe; 

and reviewed numerous documents on the Colville and Spokane tribes’ claims for 

additional compensation. Our work for the Appropriations Subcommittee on Bonneville’s financial condition is continuing. We plan to issue our final report in June 

2004. Also, as you know, we are continuing our review of Bonneville’s obligations 

for tribal fish and wildlife programs for this Committee. See appendix I for a more 

detailed description of how we estimated the impact of a settlement on Bonneville. 

We performed our work in September 2003, according to generally accepted government auditing standards. We provided a draft of this statement to Bonneville for 

comment but did not receive a response in time to include in this statement. 

In summary, we found the following: 

• A settlement with the Spokane tribe along the lines provided to the Colville 

tribes would likely necessitate a small increase in Bonneville’s rates for power. 

While the rate increase would amount to less than 20 cents per month per 

48

5Pub. L. No. 79-726, § 2, 60 Stat. 1049, 1050 (1946). 

household, it comes at a time when Bonneville’s customers have already absorbed rate increases, including those announced on October 1, 2003, of over 40 

percent and when the region’s economy is experiencing difficulties. However, 

the bulk of Bonneville’s obligations in any settlement similar to the Colville settlement will occur in the future, when the conditions causing Bonneville’s current financial difficulties will probably have abated. Therefore, Bonneville’s current financial difficulties should not unduly influence current discussions about 

how to compensate the Spokane tribe. 

• A reasonable case can be made to settle the Spokane tribe’s case along the lines 

of the Colville settlement—a one-time payment from the U.S. Treasury for past 

lost payments for water power values and annual payments primarily from 

Bonneville. Bonneville continues to earn revenues from the Spokane Reservation lands used to generate hydropower. However, unlike the Colville tribes, the 

Spokane tribe does not benefit from these revenues. The Spokane tribe does not 

benefit because it missed its filing opportunity before the Indian Claims Commission. At that time it was pursuing other avenues to win payments for the 

value of its land for hydropower. These efforts would ultimately fail. Without 

congressional action, it seems unlikely that a settlement for the Spokane tribe 

will occur. 

Background 

The Colville and Spokane Indian reservations were established in 1872 and 1877, 

respectively, on land that was later included in the State of Washington. The 

Colville Reservation, of approximately 1.4 million acres, was created on July 2, 

1872, through an executive order issued by President Grant. The Spokane Reservation, of approximately 155,000 acres, was created by an agreement between agents 

of the federal government and certain Spokane chiefs on August 18, 1877. President 

Hayes’ executive order of January 18, 1881, confirmed the 1877 agreement. In 2001, 

the Colville and Spokane tribes had enrolled populations of 8,842 and 2,305, respectively. 

The Indian Claim Commission was created on August 13, 1946, to adjudicate 

Indian claims, including ‘‘claims based upon fair and honorable dealings that are 

not recognized by any existing rule of law or equity.’’ 5 Under section 12 of the Act 

that created the Commission, all claims had to be filed within 5 years. Ultimately 

370 petitions, which were eventually separated into 617 dockets, were filed with the 

Commission. The great majority of the claims were land claims. Settlements awards 

were paid out of the U.S. Treasury. 

The Colville tribes filed a number of claims with the Indian Claims Commission 

within the 5-year window—on July 31, August 1, and August 8, 1951. Their fisheries claim and water power values claim became part of Indian Claims Commission 

Docket No. 181, which was originally filed on July 31, 1951. The original petition 

for Docket No. 181 included broad language seeking damages for unlawful trespass 

on reservation lands and for compensation or other benefits from the use of the 

tribes’ land and other property. The tribes’ original petition did not specifically mention the Grand Coulee Dam. In 1956, Docket No. 181 was divided into four separate 

claims. The tribes’ fisheries claim became part of Docket No. 181-C. In November 

1976, over 25 years after the original filing of Docket No. 181, the Indian Claims 

Commission allowed the Colville tribes to file an amended petition seeking just and 

equitable compensation for the water power values of certain riverbed and upstream 

lands that had been taken by the United States as part of the Grand Coulee Dam 

development. This amended water power value claim was designated as Docket No. 

181-D, and it was settled in 1994 by Public Law 103-436. 

The Spokane tribe filed one claim with the Indian Claims Commission, Docket No. 

331, on August 10, 1951, just days before the August 13, 1951, deadline. The claim 

sought additional compensation for land ceded to the United States by an agreement 

of March 18, 1887. Furthermore, the Spokane tribe asserted a general accounting 

claim. These two claims were separated into Docket No. 331 for the land claim and 

Docket No. 331-A for the accounting claim. Both claims were jointly settled in 1967 

for $6.7 million. That is, the Spokane tribe settled all of its claims before the Indian 

Claims Commission almost 10 years before the Colville tribes were allowed to 

amend their claim to include a water power values claim. In doing so, the Spokane 

tribe missed its opportunity to make a legal claim with the Indian Claims Commission for its water power values as well as its fisheries. At that time, the Spokane 

tribe, as well as the Colville tribes, were pursuing other avenues for compensation 

of water power values. 

49

6Pub. L. No. 75-329, § 2, 50 Stat. 731, 732 (1937). 

7Pub. L. No. 96-501, § 2, 94 Stat. 2697 (1980). 

8The payments are to be made in perpetuity, but Bonneville gave us an annual estimate for 

the next five years that conforms to its 5-year rate case planning horizon. While Bonneville will 

make these payments to the Colville tribes, it will receive interest credits in the amount of $4.6 

million per year from the U.S. Treasury—also in perpetuity—effectively reducing its payments 

by about 27 percent. 9This estimate also assumes that Bonneville pays the entire $7 million per year. If Bonneville 

receives interest credits from Treasury for part of the amount, the impact would be proportionally smaller. 

The Bonneville Power Administration was formed in 1937 to market electric 

power produced by the Bonneville Dam. 6 Bonneville’s marketing responsibilities 

have expanded since then to include power from 31 federally owned hydroelectric 

projects, including the Grand Coulee Dam. Under the Pacific Northwest Electric 

Power Planning and Conservation Act of 1980 (Northwest Power Act), Bonneville 

is responsible for providing the Pacific Northwest with an adequate, efficient, economical, and reliable power supply. 7 Bonneville currently provides about 45 percent 

of all electric power consumed in Idaho, Montana, Oregon, and Washington and 

owns about 75 percent of the region’s transmission lines. 

Bonneville Would Have to Recover Settlement Costs from Ratepayers, but Magnitude 

of Rate Increase Would Be Small 

A settlement requiring Bonneville to pay the Spokane tribe would add to its costs 

of operation, and it therefore would probably pass these costs to Bonneville’s customers in the form of higher rates for power. Bonneville is a self-financing agency, 

which means that it must cover its costs through the revenue generated by selling 

power and transmission services. Bonneville typically sets its rates for 5-year periods in order to generate enough revenue to cover the costs of operating the federal 

power system and to make its debt payments. 

Assuming that the settlement with the Spokane tribe is similar in nature to the 

settlement with the Colville tribe in 1994, the impact on Bonneville’s rates would 

be small. Under the settlement with the Colville tribe, Bonneville has made annual 

payments since 1996 that have ranged from about $14 million to $21 million. Currently, Bonneville estimates that it will pay about $17 million per year over the next 

5 years. 8 In its negotiations with Bonneville, the Spokane tribe has asked for about 

40 percent of the Colville tribe’s settlement, which would amount to about $7 million annually from Bonneville. Bonneville uses a rule of thumb to determine rate 

increases: between $40 million and $50 million in additional annual costs will lead 

to a rate increase of 1/10th of a cent per kilowatt hour (kWh). Using this rule, we 

estimate that a settlement with Spokane that is equivalent to 40 percent of the 

Colville settlement would lead to an increase in rates of less than 20 cents per 

month per household for a typical household relying solely on power from Bonneville, or a 0.5 percent increase in rates over current levels. 9

Although the magnitude of the rate increase necessary to fund a settlement with 

the Spokane tribe would be small, it comes at a time when Bonneville’s customers 

have recently faced large rate increases. From 2000 through early 2003, Bonneville 

experienced a substantial deterioration in its financial condition because of rising 

costs and lower-than-projected revenues. As a result, Bonneville’s cash reserves of 

$811 million at the end of Fiscal Year 2000 had fallen to $188 million by the end 

of Fiscal Year 2002. To cope with its financial difficulties, Bonneville raised its 

power rates for 2002 by more than 40 percent over 2001 levels. On October 1, 2003, 

Bonneville raised its rates a further 2.2 percent. Despite Bonneville’s current financial difficulties, Bonneville predicts the conditions that led to the financial 

problems—namely, consecutive years of low water conditions, extreme market price 

volatility, and long-term contracts Bonneville signed to buy power from other suppliers at a high cost, which are due to expire in 2006—will abate. Therefore, because 

the bulk of Bonneville’s obligations in any settlement similar to the Colville settlement will occur in the future, Bonneville’s current financial difficulties should not 

unduly influence current discussions about how to compensate the Spokane tribe. 

A Reasonable Case Can Be Made for Adopting the Colville Model in Allocating Any 

Costs Associated with a Settlement for the Spokane Tribe 

A reasonable case can be made for having Bonneville and the U.S. Treasury allocate any costs for the Spokane tribe’s claims along the lines agreed to for the 

Colville tribes. Any settlement would attempt to re-institute a commitment the federal government made to the tribes in the 1930s. Under the Federal Water Power 

Act of 1920, licenses for the development of privately owned hydropower projects 

50

10Pub. L. No. 66-280, § 10(e), 41 Stat. 1063, 1069 (1920). 11The Judgment Fund is a permanent indefinite appropriation available to pay certain settlements and judgments against the federal government. 12See, e.g., Pub. L. No. 95-280, § 2, 92 Stat. 244 (1978), Pub. L. No. 96-251, 94 Stat. 372 

(1980), Pub. L. No. 96-404, 94 Stat. 1711 (1980), or Pub. L. No. 104-198, 110 Stat. 2418 

(1996). 

should include a ‘‘reasonable annual charge’’ for the use of Indian lands. 10 Originally, the Grand Coulee site was licensed, and the Spokane tribe expected to receive 

annual payments for its lands used for the project. However, the license was cancelled when the federal government took over the project (federalized the project). 

Since the federal government is not subject to the Federal Water Power Act, it was 

not required to make annual payments to the tribes. Nevertheless, the federal government made a commitment in the 1930s to make annual payments to the Colville 

and Spokane tribes as if the project had remained a nonfederal project. However, 

the federal government did not follow through on this commitment after the project 

was completed and started generating revenues from electricity sales in the 1940s. 

In pursuing this matter, the tribes weathered various administrations and changes 

in the federal government’s Indian policy. In the 1950s and 1960s, the federal government actively sought to terminate its relationship with a number of tribes, including the Spokane tribe. 

In the early 1970s, when it became clear that the federal government was not 

going to make these payments, the Colville tribes were able to amend their claim 

with the Indian Claims Commission to pursue this matter. After agreeing to the 

overall legitimacy of the Colville tribes’ claims, the Congress ultimately approved a 

settlement that primarily required Bonneville to provide annual payments for water 

power values. This settlement was a compromise to split the costs between Bonneville and the U.S. Treasury. Bonneville is primarily paying the recurring annual 

payments, and the U.S. Treasury’s Judgment Fund provided the one-time lump sum 

payment in settlement of the past annual payments—$53 million. 11 The Spokane 

tribe, however, had already settled its claim years earlier and therefore could not 

file an amended claim with the commission. Nevertheless, since Bonneville collects 

the annual revenues for the electricity generated by the dam, it could be argued 

that Bonneville should make annual payments to the Spokane tribe out of those revenues, as it does for the Colville tribes; the U.S. Treasury would then pay a lump 

sum to settle any claims for past years. The current House settlement proposal, 

H.R. 1753, and previous House and Senate settlement proposals introduced in the 

106th and 107th Congresses directed the settlement costs to be split between Bonneville and the U.S. Treasury. 

It could also be argued that the U.S. Treasury should pay the Spokane tribe’s 

claim, as it does for most claim settlements against the federal government. S. 1438 

provides for the settlement of the tribe’s claim from the U.S. Treasury. However, 

we do not believe a compelling case can be made to have the nation’s taxpayers fully 

absorb an additional cost of doing business associated with Bonneville’s production 

of power in one region of the country. 

Conclusion 

In conclusion, since the Spokane tribe missed its opportunity to file claims with 

the Indian Claims Commission for its fisheries and water power values, it is unlikely that the tribe’s claims and any associated settlement or final resolution will 

move forward in any meaningful way without some form of congressional intervention. If the Congress is satisfied with the merits of the tribe’s claims, settlement legislation, such as the current House and Senate bills, could be used as a method to 

resolve the tribe’s claims. A reasonable case can be made for adopting the model 

established in the Colville settlement to allocate the settlement costs between Bonneville and the U.S. Treasury. Another option would be to enact legislation providing for some form of dispute resolution, such as mediation or binding arbitration. 

If the Congress has any doubts about the merits of the claim, it could enact legislation to allow the tribe to file its claim in the U.S. Federal Court of Claims. 12 The 

merits of the claims could then be decided in court. Such an action was discussed 

in 1994 when the Colville settlement was reached. 

Contacts and Acknowledgments 

For further information, please contact Robert A. Robinson on (202) 512-3841. Individuals making key contributions to this testimony included Jill Berman, Brad 

Dobbins, Samantha Gross, Jason Holliday, Jeffery Malcolm, Frank Rusco, Rebecca 

Sandulli, and Carol Herrnstadt Shulman.Appendix I 

51

13From Fiscal Year 2000 onward, Bonneville receives a $4.6 million interest credit on its 

Treasury debt payment to offset some of the cost of the Colville settlement. Therefore, 

Bonneville’s share of the Colville payments total $12.4 million net of the credit. This calculation 

conservatively assumes that Bonneville will be responsible for the entire Spokane payment. 

Methodology for Estimating the Impact of a Settlement on the Bonneville Power 

Administration 

Because a settlement has not yet been negotiated, we used the terms of the 

Colville settlement to estimate the potential effect of the Spokane settlement on 

electricity rates in the Pacific Northwest. Assumptions used in this calculation are 

designed to provide a conservative (high-end) estimate of the impact of the settlement on Bonneville’s ratepayers. For planning purposes, Bonneville estimates that 

payments to the Colville tribes total $17 million annually. 13 The Spokane tribe is 

requesting as much as 40 percent of the Colville settlement, or approximately $7 

million annually. To estimate the impact of increasing costs on power rates, Bonneville uses a rule of thumb that $40 million to $50 million in increased costs over 

a year necessitate a rate increase of approximately $0.001 per kilowatt-hour (kWh). 

Using this rule of thumb, a $7 million per year cost increase would raise Bonneville’s wholesale power rates by approximately $0.00016 per kWh. 

According to the Oregon Department of Energy, the average household in Oregon 

uses approximately 1,000 kWh of electricity per month. An average household in 

Washington uses 1,170 kWh of electricity per month, according to the Washington 

Utilities and Transportation Commission. Using the approximate rate increase calculated above, the electricity bills for average households in Oregon and Washington 

would increase approximately 16 cents and 19 cents, respectively. These calculations 

assume that the household receives all its electricity from Bonneville and that its 

retail utility passes through the wholesale rate increase. The impact on the region 

as a whole would be smaller because Bonneville provides only about 45 percent of 

the region’s power. Our calculations also assume that Bonneville would not be permitted to deduct any portion of its payment to the Spokane tribe from its debt payment to the U.S. Treasury. Public Law 103-436 enables Bonneville to deduct a portion of its annual payment to the Colville tribes as an interest credit on its Treasury 

debt payments. If a similar provision were included for any payments for the Spokane tribe, the impact on ratepayers would be reduced. 

Mr. HAYWORTH. Now, as we consider H.R. 885, it is my privilege 

again to recognize Governor Narcia for his testimony on H.R. 885. 

Governor Narcia? 

STATEMENT OF RICHARD NARCIA, GOVERNOR, GILA RIVER 

INDIAN RESERVATION, ACCOMPANIED BY RODNEY B. LEWIS, 

GENERAL COUNSEL, GILA RIVER INDIAN COMMUNITY 

Mr. NARCIA. Thank you, Mr. Chair. Chairman Calvert, Vice 

Chairman Renzi, and members of the Subcommittee on Water and 

Power, I am Richard Narcia, Governor of the Gila River Indian 

Community, and I appreciate this opportunity to share with you 

the Community’s strong support for the Arizona Water Settlement 

Act. I also take this opportunity to thank you, Representative 

Hayworth, for your hard work and leadership in sponsoring this 

important legislation. I also thank you, Senator Kyl, for his steadfast support of the Community and for his commitment, support, 

and dedication to our settlement. 

This settlement is a monumental achievement for our Community and enjoys the unanimous support of our council, nine of 

whom are here with me today and are listed in my written testimony. 

The Gila River Indian Community was formerly established by 

executive order in 1859. The community is comprised of the Akimel 

O’odham, or the Pima, and the Pee Posh, or the Maricopa, people. 

We are the largest Indian community in the metropolitan Phoenix 

52

area. Our reservation encompasses nearly 600 square miles with 

an enrolled membership of over 19,000. 

Our history in the Phoenix Valley dates back thousands of years. 

Some of the most ancient agricultural irrigation systems in the 

world were built by our ancestors and can be found throughout the 

metropolitan Phoenix area. Agriculture was a mainstay of our community until very recent times. We are the Akimel O’odham, the 

river people, and as I have stated, we have resided in the Gila 

River Valley of Central Arizona for centuries. We are the direct ancestors of the Hohokum, who farmed the Gila River Valley since 

300 A.D., developing hundreds of miles of irrigation canals for 

crops such as corn, squash, lima beans, tobacco, and cotton. 

Together, the Akimel O’odham and the Pee Posh thrived on what 

the Gila River provided—food, water for irrigation, a way of life for 

our people. The river was our source of life and the center of our 

economic and social environment. It provided for all the community’s needs, and as a result, the river people were among the most 

prosperous and self-sufficient communities, Indian and non-Indian, 

in the entire Phoenix Valley. As settlers moved to the Phoenix Valley, the Community adapted to and assisted the new settlers by 

providing food and protection. Members of our Community formed 

components of the first Arizona Territorial Guard. 

This changed in the late 19th century. The settlements were established upstream from our tribal lands, including farmers, industry, and other landowners who began to divert water from the Gila 

River. As the turn of the century approached, the steady flow of the 

Gila River across our tribal lands diminished. 

Today, the Gila River does not flow. It is now a dry river bed 

winding through our lands. The loss of the Gila River has resulted 

in great poverty for many members of our Community and has led 

to changes in our diet that has resulted in the highest per capita 

incidence of diabetes of any community in the world. 

In 1989, our Community and the U.S. Government initiated 

water settlement negotiations to address the great uncertainty and 

about the allocation and dependability of water supplies to our reservation and to more than three million residents and businesses 

of Maricopa, Pinal, Pima, Yavapai, Graham, and Gila Counties in 

Central Arizona. Nearly 14 years later, we have reached a comprehensive settlement of our Community’s water rights claims and 

the allocation and priority of water supplies among the major 

water users in Central Arizona. 

The benefits of this settlement for our Community are many. 

Most importantly, it will guarantee a dependable water supply to 

our lands. In total, we will receive an annual entitlement of 

653,500 acre feet of water, most of which will come from the Central Arizona Project, which delivers approximately 1.5 million acre 

feet of Colorado River water annually to Central Arizona. While 

this is only a fraction of the amount that we are legally entitled 

to, it does provide our Community with a new source of water to 

replace some of the Gila River water that we have lost. 

The settlement agreement will also ensure construction and 

maintenance of the distribution system that would be needed to 

allow delivery of the water to the reservation. Together, the settlement water and the distribution system will enable our Community 

53

members to farm tribal and allotted lands as well as provide them 

an opportunity to escape poverty and participate more meaningfully in the economy of the region. While there is little chance that 

we can recapture the prosperity of our ancestors, a settlement 

agreement will enable more tribal members to participate in our 

ancestors’ way of life. 

As a result of this settlement, the Community will also achieve 

a separate piece with non-Indian parties throughout Arizona. We 

are convinced that this is the right path for the Community at this 

time. There is no question that our presence may be missed by 

other tribes who are involved in ongoing litigation. However, the 

Community has deliberated on this at length and has made its 

choice. This is not to say that this was an easy choice. To achieve 

agreement, we, like all the other parties, have had to make compromises. Some were harder than others, but each was carefully 

considered and approved by our council. 

The settlement agreement encompassed in the Arizona Water 

Settlement Act is the top priority of the Gila River Indian Community. We have expended enormous amounts of time and resources 

to reach this agreement with nearly every major water user in 

Central Arizona. While our Community and each party to this 

agreement will make sacrifices to fulfill this settlement, we will do 

so in exchange for dependable supplies of renewable water and a 

more certain economic future. 

I again want to express my appreciation for the opportunity to 

come before you this morning. In conclusion and for the record, our 

settlement negotiations have been extremely transparent. Anyone 

or any entity who had an issue or concern with the settlement had 

a place at the negotiating table if, and if they wanted to participate. We are very hopeful that the Subcommittee will favorably 

consider this legislation and that it will be enacted in this Congress. Thank you. 

Mr. HAYWORTH. Thank you, Governor Narcia. 

[The prepared statement of Mr. Narcia follows:]

Statement of The Honorable Richard P. Narcia, Governor,

Gila River Indian Community 

Thank you Chairman Calvert and Vice Chairman Renzi, and members of the Subcommittee on Water and Power. I am Richard Narcia, Governor of the Gila River 

Indian Community. I appreciate this opportunity to share with you the Community’s 

strong support for the Arizona Water Settlements Act (H.R. 885). I would also like 

to take this opportunity to particularly thank you, Representative Hayworth, for 

your hard work and leadership in sponsoring this important legislation. I would also 

like to thank Senator Kyl for his steadfast support of the Community and for his 

commitment and dedication to our settlement. 

This settlement is a monumental achievement for our Community and enjoys the 

unanimous support of our Council, ten of whom are here with me today. For the 

record, I would like to acknowledge each of them: Wally Jones, Eugene Blackwater, 

Jennifer Allison-Ray, Bernell Allison, Sr., Cecil Lewis, Gordon Santos, Gerald 

Sunna, Christopher Soke, Sr., Jonathan Thomas and Harry Cruye. Finally, I would 

also like to recognize and thank the members of the Community Water Negotiation 

Team for their hard work in making this a reality, including Council members who 

are also members of the Team—Harry Cruye, Jonathan Thomas, Chris Soke, Dana 

Norris, the former Director of the Office of Water Rights, Cecil Antone, the current 

Director of the Office of Water Rights, Rod Lewis, the General Counsel for the Community, Ardell Ruiz, Harlan Bohnee and Lee Thompson. 

54

Introduction 

By way of introduction, the Gila River Indian Community was formally established by Executive Order in 1859. The Community is comprised of the Akimel 

O’odham (Pima) and the Pee Posh (Maricopa) people. We are the largest Indian 

Community in the Phoenix metropolitan area, with a Reservation encompassing 

nearly 600 square miles and with an enrolled population of over 19,000. We have 

a long history in the Phoenix Valley, dating back thousands of years. Some of the 

most ancient agricultural irrigation systems in the world were built by our ancestors 

and can be found throughout the Phoenix metropolitan area. Agriculture was the 

mainstay of our Community until very recent times. 

The Arizona Water Settlements Act will help reestablish our Community’s access 

to renewable sources of water as compensation for the Gila River water taken from 

the Tribe beginning over a century ago. The return of dependable sources of water 

will enable more members of our Community to participate in our agricultural heritage and enjoy a better way of life. 

The Arizona Water Settlements Act encompasses the largest Indian water claims 

settlement in U.S. history. This agreement has been negotiated over the last fourteen years by nearly all major water users in central Arizona, including representatives of our Community, state, local and other tribal governments, farming and industry. The agreement establishes and prioritizes the allocation of water among 

these parties. It concludes longstanding litigation that has been expensive and disruptive to our Community and to others in central Arizona, preventing us from 

planning future growth and impeding steps to achieve economic stability and political harmony in the region. 

The Arizona Water Settlements Act also provides a mechanism for funding future 

Indian water rights settlements in Arizona and the construction of new water distributions systems for Indian tribes in the Phoenix Valley, as required under existing water settlement agreements. Thus, it provides major benefits for other Arizona 

tribes, both those that have already settled their water claims and are awaiting the 

construction of their water systems, as well as those that are seeking to settle their 

claims at some point in the future. 

Our History 

To fully appreciate the importance of the Arizona Water Settlements Act to our 

Community and its future, I would like to briefly review our history and the central 

role of water to our culture and economic prosperity. 

We are the Akimel O’odham, the People of the River. We have resided in the Gila 

River Valley of central Arizona for centuries. The direct ancestors of the Akimel 

O’odham, the Ancient Hohokum, farmed in the Gila River Valley since at least 300 

A.D., developing hundreds of miles of irrigation canals to supply water for crops 

such as maize, squash, lima beans, tobacco and cotton. 

Together, the Akimel O’odham and Pee Posh thrived on what the Gila River 

provided—a plentiful source of food for tribal members, water for irrigation and a 

way of life for all the Tribes’ people. The River was our breadbasket and the center 

of our economic and social life. It provided for all the Community’s needs, and, as 

a result, the People of the River were among the most prosperous, self-sufficient 

communities, Indian and non-Indian, in the entire Phoenix Valley. 

As settlers moved to the Phoenix Valley, our Community adapted to and assisted 

the new settlers by providing food and protection. Members of the Community 

formed a component of the first Arizona Territorial Guard. 

This all changed in late 19th century. New settlements were established upstream 

from our Tribal lands, including farmers, industry and other landowners, who began 

to divert water from the Gila River. As the turn-of-the-century approached, the 

steady flow of the Gila River across our tribal lands diminished, and with this dependable water source went our vast farmlands and our ability to sustain all Members of our Community. 

Today, the Gila River does not flow through our Tribal lands. It is now a dry river 

bed winding through the desert. The loss of the Gila River has resulted in great 

poverty to many Members of our Community, and has led to changes in our diet 

that have resulted in the highest per capita incidence of diabetes of any community 

in the world. Background to Arizona Water Settlements Act 

Our struggle to regain the Gila River began in the early part of the last century. 

In 1924, Congress authorized construction of the Coolidge Dam as the primary feature of a new irrigation project—called the San Carlos Irrigation Project—that 

would provide irrigation for our Reservation. The 1924 Act was intended to address 

our loss of Gila River water and, in so doing, fulfill the trust obligation of the United 

States to our Community. 

55

The 1924 Act was also to create a non-Indian component to this irrigation project. 

Unfortunately, although the 1924 Act provided that our component of this project 

was to be built before the non-Indian portion, our portion was never completed, and 

what was built was never adequately engineered or maintained. Thus, although the 

San Carlos Irrigation Project was intended to create an irrigation project for 50,000 

of the irrigable acres on our Reservation, it never served more than 30,000 acres 

and today serves just over 15,000 acres. 

In 1925, citing the 1924 Act, the United States sued water users upstream of our 

Community in order to reestablish existing rights of the Community in the Gila 

River. Unfortunately, the U.S. government, in all candor, did not do a very good job 

in making its case on our behalf, which resulted in greater frustration and increased 

federal liability to our Community. Our frustration was fed by the fact that when 

the Community sought to intervene itself in this litigation, the United States actually opposed our intervention. As a result, we were prevented then from actually 

participating in litigation that would set the framework for our struggle to protect 

our water rights up to the present day. 

Ten years later, in 1935, this litigation ended in a settlement and consent 

decree—called the 1935 Globe Equity Decree—which recognized the Community’s 

rights to 300,000 acre-feet of Gila River water each year. This was far less water 

than our people had access to for centuries prior to the settlement. Moreover, to this 

day, we have yet to receive much more than 100,000 acre-feet annually of the 

amount decreed in 1935. Thus, not only did the Community not receive recognition 

of all its water rights in 1935, it has not even received from the Gila River that 

to which the Globe Equity Court decreed it was entitled. 

As a result, our Community has been forced to continue its struggle to vindicate 

its claims to water through litigation. First, in 1982, we began an effort in federal 

district court to enforce the 1935 Decree against upstream Gila River diverters. Second, we filed the single largest claim for water rights in the Gila River Adjudication, 

a separate State court proceeding begun in the mid-1970s to determine and establish the priority of water rights in the Gila River system and its tributaries. In this 

State court adjudication, we are claiming approximately 1.2 million acre-feet of 

water annually from these water systems and seeking judicial recognition that our 

water rights supercede those of all other non-Indian users. 

Absent the comprehensive water settlement contained in the Arizona Water Settlements Act, we will have no choice but to continue to pursue our water rights 

through this litigation. We will also have to explore more actively any action we 

might have against the federal government for its failure to adequately protect and 

develop our water resources as required by its trust responsibility to the Community 

and its statutory obligations under the 1924 Act. 

The Settlement Agreement and Arizona Water Settlements Act 

In 1989, our Community and the United States Government initiated water settlement negotiations to address the great uncertainty about the allocation and dependability of water supplies to our Reservation and to the more than three million 

residents and businesses of Maricopa, Pinal, Pima, Graham and Gila Counties in 

central Arizona. Nearly 14 years later, we have reached a comprehensive settlement 

of our Community’s water rights claims and the allocation and priority of water supplies among the major water users in central Arizona. 

Our settlement is in many ways unique: 

• One, it is the largest settlement of Indian water rights in U.S. history, at least 

to this date; 

• Two, it involves thirty-five separate parties, both Indian and non-Indian, most 

of which have required separate negotiations and agreements to resolve the specific issues raised between them and the Community. It is a very large bundle 

of compromises, each of which was thrashed out with the full consideration of 

its implications and importance in the overall deal. Its very size precludes the 

possibility of it being perfect, but the Community recognizes that it would be 

unrealistic to expect perfection in a settlement of this size and scope. I can assure the Subcommittee that in each instance in which the Community has compromised, it has done so with due deliberation by both the Water Negotiation 

Team and, when necessary, the prior approval of the Council; 

• Three, our settlement is part of a more comprehensive settlement of repayment 

issues between the United States and the Central Arizona Water Conservation 

District. This settlement establishes a unique framework for resolving funding 

and water supply issues not just for our settlement and that of the Tohono 

O’odham Nation, but also Indian water rights settlements already negotiated 

and approved in the past, and those to come in the future. This settlement component is critical to our settlement and without it, the settlement will not work; 

56

• Four, although most Indian water settlements affect only a single State, ours 

includes water users in New Mexico as well. A number of the parties with 

whom we are settling are located in the State of New Mexico in the Virden Valley. Moreover, we have worked closely with the State of New Mexico to ensure 

our settlement does not adversely affect the exchange rights that the State of 

New Mexico obtained in the 1968 Colorado River Basin Project Act. We are now 

actively exploring with the State of New Mexico, along with all the other affected parties in the State of Arizona, means of potentially implementing these 

exchange rights. If other New Mexico concerns or interests are raised, we will, 

of course, do what we can to help to address them; 

• Fifth, given the complexity of interests addressed in our settlement, and the 

very large number of parties involved, as well as our geographic location in 

close proximity to major metropolitan areas in the Phoenix area, the Community has been obliged to serve as the primary coordinator of all such negotiations and to work out issues between parties as well as our own. This has been 

a major undertaking on the part of the Community, but one that we believe is 

well worth the effort. As we approach Congress for consideration of this major 

piece of legislation, we can safely say that every essential issue that can be resolved in the context of one individual Tribe’s settlement has been resolved; and 

• Sixth, the Community has actively sought out the views of other parties potentially affected by this settlement, particularly other tribes, in an effort to explain our settlement and alleviate any concerns that we can. I have personally 

reached out to all other tribal leaders in the State in this regard. I cannot guarantee that we completely agreed with their concerns, but I know that we have 

made a fair and reasonable effort to do so. My own experience with other Indian 

water settlements in Arizona that were considered without any consultation or 

consideration of other tribes’ concerns is a major motivation for me in this regard. 

The benefits of this settlement for our Community are many. Most importantly, 

it will guarantee a dependable supply of water to our lands. In total, we will have 

an annual entitlement of 653,500 acre-feet of water under the agreement. Most of 

this will come from the Central Arizona Project, which delivers approximately 1.5 

million acre-feet of Colorado River water each year to central Arizona. While this 

amount is only a fraction of the water to which we are legally entitled, it does provide our Community with new water sources to replace some of the Gila River water 

we have lost—our Community has a strong desire for actually deliverable water 

rather than rights to water that is not enforced. 

The settlement agreement also will ensure construction and maintenance of the 

distribution systems that will be needed to allow delivery of water to the Reservation. Together, the settlement water and distribution infrastructure will enable 

more of our Community Members to farm Tribal lands and Allotted lands, as well 

as provide them an opportunity to escape poverty and to participate more meaningfully in the economy of the region. While there is little chance that we can recapture 

the past prosperity of our ancestors, the settlement agreement will enable more 

Tribal members to participate in our ancestors’ way of life. 

I would note that all funds that the Community is to receive as part of this settlement are being used solely for the development of a viable water delivery system 

for our farmers. One portion of the funds that the Community will receive from this 

settlement is to be used to rehabilitate and finally build out the long-awaited San 

Carlos Irrigation Project on our Reservation. Although authorized in 1924 and intended by Congress to be built prior to any non-Indian portions of that project, it 

never was completed and what was built has fallen into substantial disrepair. 

The Community has agreed to use most of the funds it receives for that worthwhile end. The remaining balance is intended to assist the Community in making 

the CAP water it receives in lieu of its rights to the natural waters of the Gila River 

affordable for its Members and Allottees. The Community has committed to supplement the funds it receives from the settlement for this purpose. 

As a result of this settlement, the Community will also achieve a separate peace 

with non-Indian parties throughout Arizona. The Community has struggled for this 

peace for many years, many times working hand in hand with other Arizona Indian 

Tribes, such as the San Carlos Apache Tribe. We are convinced that this is the right 

path for the Community at this time. There is no question that our presence may 

be missed by other tribes who are still involved in ongoing litigation. However, the 

Community has deliberated on this at length and made its choice. 

This is not to say that our choice was easy. To achieve agreement, we, like all 

other parties to this settlement, have had to make many compromises along the 

way. Some were harder than others, but each was carefully considered and apVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00060 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
57

proved by our Council. We view the package as developed as one that is worthy of 

all our support. 

The Arizona Water Settlements Act contains numerous benefits for Arizona. It 

will eliminate uncertainty among Indian communities, state and local government 

leaders, industry, farmers and other citizens, concerning future water use in central 

Arizona. This will enable long-term water planning to proceed for all concerned. The 

Act will help settle drawn-out and costly litigation of water rights and damage 

claims, enabling all parties to the settlement to refocus on future economic planning 

and growth. 

The Act also will help ensure that existing water use in central Arizona and upstream of our Reservation on the Gila River will not be disrupted or displaced by 

our claims. Through lease and exchange agreements with the surrounding cities, the 

settlement provides for unique new opportunities for the Community and the surrounding municipalities to cooperate in their water use and planning. Finally, the 

Arizona Water Settlements Act, more than any federal government action since this 

water dispute began over a hundred years ago, will help satisfy the United States’ 

trust responsibility to our Community and other Indian tribes. It will ensure dependable renewable water supplies and delivery to Tribal lands, as partial compensation for water taken from the Community, its Members and Allottees for over 

a century. 

Conclusion 

The settlement agreement encompassed in the Arizona Water Settlements Act is 

the top priority of the Gila River Indian Community. We have expended enormous 

amounts of time and resources to reach this agreement with nearly every major 

water user in central Arizona. While our Community, and each party to this agreement, will make sacrifices to consecrate this settlement, we will do so in exchange 

for dependable supplies of renewable water and a more certain economic future. For 

our Community, this settlement offers an opportunity for more of our Tribal members to partake in the rich agricultural heritage of our ancestors, the Akimel 

O’odham and Pee Posh. 

I again want to express my appreciation for the opportunity to appear before the 

Subcommittee today to share our views on this historic legislation. We are very 

hopeful that the Subcommittee will favorably consider this legislation and that it 

will be enacted during this Congress so that our people—and so many other stakeholders in Central Arizona—may finally begin to realize the benefits that will flow 

from this long overdue water settlement. 

Thank you. 

[Response to questions submitted for the record by Governor 

Narcia follows:]

GILA RIVER INDIAN COMMUNITY, EXECUTIVE

OFFICE OF THE GOVERNOR & LIEUTENANT GOVERNOR, 

October 31, 2003. 

Hon. KEN CALVERT, 

Chairperson, Water and Power Subcommittee of the House Committee on Resources, 

Longworth House Office Building, Washington, DC. 

DEAR CHAIRMAN CALVERT: Thank you for the opportunity to answer the followup question you submitted after the Water and Power Subcommittee’s October 2, 

2003, hearing on H.R. 885, Arizona Water Settlements Act. The answer to the question you submitted is attached. 

Your interest and participating in the consideration of this important legislation 

is greatly appreciated by the members of the Gila River Indian Community (Community). 

Please contact me if the Community can be of any assistance in the Committee’s 

deliberations on H.R. 885. 

Best Regards, 

RICHARD P. NARCIA, 

Governor 

Enclosure.

* * *

Question. Unlike other Indian Water rights settlements, which frequently 

require the federal government to fund an open-ended development trust 

fund, all of the funds made available to the Community under H.R. 885 go 

58

exclusively to fund water development and use on the Gila River Indian 

Reservation. Does this demonstrate the Community’s commitment to fully 

utilizing its water supply? 

Answer. All of the federal money that goes to the Community under H.R. 885 will 

go only to provide water for the Community’s lands, the means to use this water, 

or help with paying the cost of CAP water. While we would certainly not be opposed 

to federal resources for other tribal projects, we realize that the size of our water 

rights claims and the resources needed to fulfill the promises made to the Community in the 19th and 20th centuries already requires a substantial commitment of 

federal resources. For that reason, we recognize that certain components, like a development fund, would not be included in our settlement. 

The members of the Community are the descendants of the people who farmed 

in the valley for thousands of years. We view our Settlement as a way of preserving 

this fundamental part of our heritage. 

RICHARD P. NARCIA

Mr. HAYWORTH. Now, it is my honor to recognize Chairwoman 

Joan-Saunders to testify on H.R. 885. Welcome. 

STATEMENT OF VIVIAN JUAN-SAUNDERS, CHAIRWOMAN,

TOHONO O’ODHAM NATION 

Ms. JUAN-SAUNDERS. Thank you. Good morning. I would like to 

thank Chairman Calvert and members of the Committee for scheduling this very historic day. 

My name is Vivian Juan-Saunders. I am the Chairwoman of the 

Tohono O’odham Nation. The Tohono O’odham Nation is located in 

Southern Arizona. We have a land base of 2.8 million acres and an 

enrolled membership of 28,000. I would like to thank you for the 

opportunity to speak on the Arizona Water Settlement Act of 2003, 

which is a very critical issue for our people. 

I would like to first express my appreciation to you, Representative Hayworth, for cosponsoring the introduction of the Settlement 

Act with Senator Kyl and recognize the other members of the 

Arizona Congressional delegation for your support, Mr. Renzi, Mr. 

Grijalva. 

I would like to first of all recognize the extraordinary efforts of 

the negotiating team in reaching a consensus on the issues which 

enable the introduction of the amendments to the Nation’s 1982 

water settlement. The negotiating team included representatives of 

the Tohono O’odham Nation, our legislative counsel, the San Xavier District, the Schuk Toak District, the San Xavier allottees, the 

San Xavier Cooperative Farm, the State of Arizona, the city of Tucson, Asarco Incorporated, which is a copper mine, and Farmers Investment Company. 

I would like to focus on the benefits which would be realized by 

water users in the Tucson Management Area as a result of the enactment and implementation of this Settlement Act, with particular emphasis on the amendments. 

One, what has historically been widespread uncertainty regarding the rights of water users in the Tucson Management Area will 

be transformed into certainty regarding these rights. 

Two, receipt of several significant benefits under the Southern 

Arizona Water Settlement Act was conditioned on final dismissal 

of the underlying water litigation, United States v. Tucson, including the annual delivery of 28,200 acre feet of water within the San 

Xavier and Eastern Schuk Toak Districts of the Nation, and collecVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00062 Fmt 6633 Sfmt 6602 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
59

tion of damages by the Tohono O’odham Nation for failure of the 

United States to deliver water to the districts. 

In addition, the agreement by the Tohono O’odham Nation to 

waive and release past and future water claims and past injuries 

to water rights only takes effect on final dismissal of the United 

States v. Tucson. By agreement among the parties to the amendments, this lawsuit will be dismissed with prejudice. Under the 

amendments, the waiver and release of claims also extends to future injuries to water rights. 

The parties’ commitment to dismiss the lawsuit was predicated 

on resolving longstanding differences of opinion between the 

Tohono O’odham Nation, the San Xavier District, and the San Xavier allottees regarding the division of water and financial benefits 

under the Southern Arizona Water Rights Settlement Act, and in 

our testimony, we have outlined how these disputes have been resolved. 

Four, a reliable source of funding is critical to the timely implementation of the amendments. The interest on the cooperative fund 

established under the Southern Arizona Water Rights Settlement 

Act is inadequate to fund the cost required to fulfill the obligations 

of the United States imposed by the Southern Arizona Water 

Rights Settlement Act and the amendments. 

I would like to focus on the amendments and related settlement 

agreement. First of all, the city of Tucson has agreed to pay for the 

repair of sinkhole damage in the San Xavier District on allotted 

lands and lands held in trust for our Tohono O’odham Nation. Tucson has further agreed that the Tohono O’odham Nation’s claims 

for subsidence damages in the San Xavier and Eastern Schuk Toak 

Districts are preserved and will be processed pursuant to the procedures outlined in the agreement. 

Asarco, the copper mine, has agreed to accept Central Arizona 

Project water for processing ore at the Mission Mine and reduce 

groundwater withdrawals by an acre foot for each foot of CAP 

water delivered. The intended effect of this exchange is to stabilize 

or elevate the groundwater table in the San Xavier District. Subject to receiving adequate security to assure repayment, the Tohono 

O’odham Nation has agreed to provide a loan to Asarco Mine to 

construct the CAP delivery system to the mine. 

Farmers Investment Company has agreed to various limitations 

on its groundwater withdrawals affecting the San Xavier District. 

The agreement will be recorded in the official records of Pima 

County to assure the limitations bind successors in interest. 

And finally, certain provisions of Title I of the Settlement Act are 

essential to implementation of the amendments. 

I would like to conclude by highlighting the new Federal obligations under the amendments. First of all, Sections 311(c)(1) and (2) 

authorizes the Secretary to expend sums not to exceed $215,000 for 

the San Xavier District and $175,000 for the Eastern Schuk Toak 

District for groundwater monitoring programs. 

Second, Section 311(f) authorizes the Secretary to conduct a feasibility study of the land exchange between the allottees and 

Asarco Mine at a cost not to exceed $250,000. 

I would like to conclude by sharing that it has been 28 years 

since the first lawsuit was filed to clarify water claims. That was 

60

in 1975. It has been 21 years, 1982, since the Southern Arizona 

Water Rights Settlement Act was passed here in Congress. We believe that the passage of these amendments will not only benefit 

the Tohono O’odham Nation, but benefit all water users in Southern Arizona. We strongly urge you to support the passage of these 

amendments and we, as a nation, will continue to support any efforts in compromise on issues that are still outstanding regarding 

water rights settlements for other tribes. 

We thank you for the opportunity to testify. 

Mr. HAYWORTH. And Chairwoman Juan-Saunders, we thank you 

for your testimony. 

[The prepared statement of Ms. Juan-Saunders follows:]

Statement of Vivian Juan-Saunders, Chairwoman,

Tohono O’odham Nation 

I. INTRODUCTION 

Chairman Calvert and members of the Committee. I am Vivian Juan-Saunders, 

Chairwoman of the Tohono O’odham Nation. The Nation’s Reservation is located in 

southern Arizona, has a land base of 2.8 million acres, and is the second largest 

Indian reservation in the United States. 

On behalf of the 28,000 members of the Nation, I thank you for the opportunity 

to speak on the Arizona Water Settlements Act of 2003 which is an issue of critical 

importance to our people. I would like to first express my appreciation to Representative Hayworth who co-sponsored introduction of the Settlements Act with Senator 

Kyl, as well as other members of the Arizona delegation who have expressed their 

support. 

I would also like to recognize the extraordinary efforts of the negotiating team in 

reaching a consensus on the issues which enabled the introduction of Amendments 

to the Nation’s 1982 water settlement. The negotiating team included representatives of the Nation, the Nation’s Legislative Council, the San Xavier District, the 

Schuk Toak District, the San Xavier allottees, the San Xavier Cooperative Farm, the 

State of Arizona, the City of Tucson, Asarco Incorporated and Farmers Investment 

Company. Officials in the Interior Department also actively participated in the negotiations. 

The written testimony filed with this Subcommittee includes a detailed summary 

of the Southern Arizona Water Rights Settlement Act of 1982 (‘‘SAWRSA’’); the 

Southern Arizona Water Rights Settlement Amendments Act of 2003 (the ‘‘Amendments’’); and cost and appropriation items related to the Amendments. 

I would like to focus on the benefits which would be realized by water users in 

the Tucson Management Area (‘‘TMA’’) as a result of the enactment and implementation of the Settlements Act, with particular emphasis on the Amendments. 

1. What has historically been wide-spread uncertainty regarding the rights of 

water users in the TMA would be transformed into certainty regarding these rights. 

2. Receipt of several significant benefits under SAWRSA was conditioned on final 

dismissal of the underlying water litigation (United States v. Tucson), including the 

annual delivery of 28,200 acre-feet of water within the San Xavier and eastern 

Schuk Toak Districts of the Nation; and collection of damages by the Nation for failure of the United States to deliver water to the Districts. (Under the Amendments, 

the damage remedy would also apply to a failure of the United States to complete 

the rehabilitation and extension of the Cooperative Farm within stated deadlines.) 

In addition, the agreement by the Nation to waive and release past and future 

water claims, and past injuries to water rights, only takes effect on final dismissal 

of United States v. Tucson. By agreement among the parties to the Amendments 

this lawsuit will be dismissed with prejudice. Under the Amendments, the waiver 

and release of claims also extends to future injuries to water rights. 

3. The parties’ commitment to dismiss the lawsuit was predicated on resolving 

long-standing differences of opinion between the Nation, the San Xavier District and 

the San Xavier allottees regarding the division of water and financial benefits under 

SAWRSA. These disputes have been settled as follows: 

(a) The Amendments provide an apportionment of water between the 

Nation, and the San Xavier District and San Xavier allottees. 

(b) The Amendments provide the San Xavier District with the option to 

cash out the construction costs of a new farm authorized for construction 

61

under SAWRSA. If that option is exercised, the District and the allottees 

will be entitled to use the funds for a variety of purposes. 

(c) The Nation has agreed to make a substantial financial contribution 

to subjugate lands within the proposed extension of the allottees’ Cooperative Farm, provide working capital for the Cooperative Farm and to remediate contaminated groundwater within the San Xavier District. The 

amount of this contribution significantly exceeds the appropriations required by the Amendments. 

4. A reliable source of funding is critical to the timely implementation of the 

Amendments. The interest on the Cooperative Fund established under SAWRSA is 

inadequate to fund the costs required to fulfill the obligations of the United States 

imposed by SAWRSA and the Amendments. This shortfall is addressed in the 

Amendments. 

(a) The Amendments provide for a significant adjustment in the principal amount of the Fund. 

(b) The Amendments also provide for the deposit in the Fund of all proceeds of sale of recharge credits received by the United States in a managed 

recharge project in the Santa Cruz River, using a portion of the 28,200 acre 

feet of effluent water deliverable by Tucson under SAWRSA. 

(c) The Amendments authorize the use of the Lower Colorado River 

Basin Development Fund to pay identified costs of implementing the settlement. 

5. Under the Amendments and related Settlement Agreement: (a) Tucson has agreed to provide $300,000 to repair sinkhole damage in 

the San Xavier District on allotted lands and lands held in trust for the Nation. Tucson has further agreed that the Nation’s claims for subsidence 

damages in the San Xavier and eastern Schuk Toak Districts are preserved, 

and will be processed pursuant to the procedures outlined in the agreement; 

(b) Asarco has agreed to accept Central Arizona Project (CAP) water for 

processing ore at the Mission Mine and reduce groundwater withdrawals by 

an acre foot for each acre foot of CAP water delivered. The intended effect 

of this exchange is to stabilize or elevate the groundwater table in the San 

Xavier District. Subject to receiving adequate security to assure repayment, 

the Nation has agreed to provide a loan to Asarco of up to $800,000 to construct the CAP delivery system to the Mine; and 

(c) Farmers Investment Company has agreed to various limitations on 

its groundwater withdrawals affecting the San Xavier District. The agreement will be recorded in the official records of Pima County to assure the 

limitations bind successors in interest. 

6. Finally, certain provisions of Title I of the Settlements Act are essential to implementation of the Amendments: 

(a) SAWRSA did not identify the source for the 28,200 acre feet of 

water. Title I identifies CAP agricultural priority water as the source of 

water to satisfy the annual delivery of the 28,200 acre feet identified in 

SAWRSA; 

(b) Title I obligates the United States to firm the 28,200 acre-feet of 

CAP agricultural priority water to a municipal and industrial delivery priority, with financial or in-kind assistance provided by the State of Arizona; 

and 

(c) Title I provides that unallocated CAP water and dedicated funding 

will be available for future Indian water settlements. These features of the 

Settlements Act are of particular importance to the Nation in order to facilitate the settlement of the Nation’s remaining water claims in the Sif Oidak 

District and portions of adjoining Districts which are within the boundaries 

of the Pinal Active Management Area. 

II. SOUTHERN ARIZONA WATER RIGHTS SETTLEMENT ACT OF 1982

A. Overview of Settlement 

In 1975 the Papago Tribe (now the Tohono O’odham Nation), the United States 

and two individual Indian allottees, as representatives of a class of Indian trust allotment landowners in the San Xavier District, sued the City of Tucson and other 

water users in the Upper Santa Cruz Basin, claiming damages and seeking to enjoin 

pumping of groundwater (United States v. Tucson). There was concern that the litigation would cast a cloud over the future of the Tucson area. Local entities engaged 

in extensive negotiations with the United States and the lawyers for the Indian parties and finally reached a settlement in 1982. In October 1982, Congress passed the 

Southern Arizona Water Rights Settlement Act of 1982, 96 Stat. 1274 (‘‘SAWRSA’’), 

which embodied the settlement. 

62

1The Tohono O’odham Nation is the national government and consists of Districts organized 

as political subdivisions of the Nation. The San Xavier and Schuk Toak Districts are two of the 

11 Districts of the Nation. The San Xavier District and the eastern portion of the Schuk Toak 

District are within the Upper Santa Cruz Basin and are part of the SAWRSA settlement. 

The terms of the settlement called for the Nation to receive, without charge, farm 

improvements, 66,000 acre feet of water annually, the right to pump 10,000 acre 

feet of groundwater annually within the San Xavier District and a $15 million trust 

fund. (Of the 66,000 acre feet, 37,800 acre feet is the Nation’s contracted Central 

Arizona Project (CAP) water for the San Xavier District and the eastern Schuk Toak 

District. 1 An additional 28,200 acre feet of the water was to be acquired by the 

Secretary and delivered after United States v. Tucson was dismissed.) The City was 

required to transfer 28,200 acre feet of effluent water to the United States and, with 

the State and other local entities, to contribute a total of $5.25 million to a Cooperative Fund. Interest on the Cooperative Fund was available to the United States for 

payment of the ongoing costs of implementing the settlement. The San Xavier 

allottees’ water rights were to be satisfied out of water provided to the Nation in 

the settlement. 

The City, State and local interests timely performed all of their obligations under 

the settlement and the Nation agreed to dismiss the case. The San Xavier allottee 

landowners objected to certain aspects of SAWRSA and opposed dismissal of the litigation. 

In 1993, allottees filed a class action lawsuit (Alvarez v. Tucson) in which they 

sought to enjoin groundwater pumping by the City and others, and asserted more 

than $200 million damages. Individual San Xavier allottees also filed a lawsuit in 

1993 against the United States (Adams v. United States) which asserted breaches 

of trust related to the allottees’ land and water resources, and sought declaratory 

and injunctive relief. Dispositive motions in these lawsuits are pending before the 

Court. Rulings on the motions have been suspended to allow the SAWRSA parties 

to negotiate amendments which would resolve the outstanding issues among the 

parties. 

For many years, the Nation, the San Xavier District, the Schuk Toak District, the 

allottees, the City of Tucson, the State of Arizona, Asarco Incorporated and Farmers 

Investment Co. negotiated amendments to SAWRSA that would allow full implementation of the settlement, provide important clarification in the allocation of existing benefits, and provide more flexible water use by the parties. 

B. Specific Benefits and Obligations of Parties 

The following is a summary of the substantive provisions of SAWRSA, as amended by the Southern Arizona Water Rights Technical Amendments Act of 1992 (106 

Stat. 3256). 

Nation’s Benefits: 

1. The United States is required to annually deliver 37,800 acre feet of CAP water 

without the Nation having to pay any OM&R or capital charges. 

a. 27,000 acre feet for San Xavier District 

b. 10,800 acre feet for eastern Schuk Toak District 

2. The United States is required to improve and extend the allottees’ Cooperative 

Farm in San Xavier and to construct irrigation works for a new farm in San Xavier 

to take the CAP water. 

3. The United States is required to annually deliver an additional 28,200 acre feet 

of water suitable for agriculture, after the pending water claims litigation is finally 

dismissed: 

a. 23,000 acre feet to San Xavier District; and 

b. 5,200 acre feet to eastern Schuk Toak District. 

4. If the United States fails to deliver any of the 66,000 acre feet in any year after 

October 1992, it must pay the Nation damages equal to the value of the undelivered 

quantity of water (the deadline was extended to June 30, 1993 by the Technical 

Amendments enacted in 1992). 

5. The United States established a $15,000,000 Trust Fund which is managed by 

the Nation, the interest from which can be used to develop land and water resources 

within the Nation. 

Nation’s Obligations: 

1. The Nation agreed to file a stipulation for dismissal of United States v. Tucson, 

and to file in court the allottee class representatives’ petition to dismiss. 

2. The Nation agreed to waive and release all past claims of water rights or injuries to water rights, and to waive and release all future claims of water rights. This 

waiver and release encompasses past and future claims of federal reserved water 

63

rights in the San Xavier District and the eastern Schuk Toak District. The waiver 

and release does not take effect until United States v. Tucson is finally dismissed. 

3. The Nation agreed to limit pumping of groundwater: 

a. To 10,000 acre feet per year in the San Xavier District; and 

b. To the 1981 pumping amount in the eastern Schuk Toak District. 

4. The Nation agreed to comply with the water management plan established by 

the Secretary of the Interior. 

City’s Obligations: 

1. The City agreed to make 28,200 acre feet of effluent available to the Secretary. 

2. The City contributed $1,500,000 to a Cooperative Fund, the interest from which 

is for ‘‘carrying out the obligations of the Secretary’’ under provisions of the settlement. 

Other Obligations: 

1. Other contributors to the Cooperative Fund were: 

State of Arizona—$2,750,000

Anamax, Cyprus-Pima, AS&R (‘‘Asarco’’), Duval & Farmers Investment Co. 

(‘‘FICO’’)—$1,000,000

United States—$5,250,000

2. If United States v. Tucson was not dismissed by October 1985, the Cooperative 

Fund was to be terminated and the contributed funds returned to the contributors 

(this provision was deleted by the Technical Amendments in 1992). 

3. The United States is not obligated to annually deliver the 28,200 acre feet of 

water to the Nation until United States v. Tucson is finally dismissed. 

4. The United States is not obligated to pay the Nation damages for failure to annually deliver any of the 66,000 acre feet of water until United States v Tucson is 

finally dismissed. 

5. The Nation can only use its settlement water within the Tucson Management 

Area (TMA). 

6. The Nation can sell or lease settlement water, but only within the TMA. 

III. SOUTHERN ARIZONA WATER RIGHTS SETTLEMENT AMENDMENTS 

ACT OF 2003

The Southern Arizona Water Rights Settlement Amendments Act of 2003 (the 

‘‘Amendments’’) appears as Title III in the Arizona Water Settlements Act of 2003 

(the ‘‘Settlements Act’’). Subject to the satisfaction of all conditions to the effective 

date of the Amendments (Section 302), the Amendments will clarify, restate, supplement and modify the provisions of SAWRSA in the following respects: 

1. The Secretary would be obligated to annually deliver 28,000 acre feet of water 

from the federal share of CAP water. The Secretary and the State are required to 

cooperate in a program to firm this CAP water to municipal and industrial delivery 

priority pursuant to the obligations in Section 105 of Title I to the Settlements Act; 

2. The Secretary would be required to rehabilitate and extend the allottees’ existing Cooperative Farm by a date certain, or pay specified penalties. The Farm would 

be extended to 2,300 acres. Rehabilitation of the Cooperative Farm would include 

bank stabilization on the Santa Cruz River and repair of sinkholes; 

3. Pursuant to an agreement between the Nation, the San Xavier District and the 

allottees, the Nation would make a substantial financial contribution for subjugation 

of lands within the proposed extension to the Cooperative Farm, working capital for 

the Cooperative Farm and a fund to remediate contaminated groundwater within 

the District; 

4. The San Xavier District would receive the option of taking cash instead of construction of a new farm; 

5. Penalties payable by the United States for failure to timely perform its obligations with regard to the Cooperative Farm and its extension would be payable to 

the Cooperative Farm Association; 

6. The San Xavier District and the allottees would be entitled to annually receive 

up to 35,000 acre feet of the settlement water for beneficial use, subject to compliance with the Nation’s water code; 

7. SAWRSA does not provide for specific releases of claims for future injuries to 

water rights. The release of claims for future injuries to water rights would be required by the Amendments so long as groundwater withdrawals outside the San Xavier District are in compliance with State law and with the related Settlement 

Agreement; 

8. The waiver and release of water rights by the Nation and the allottees, other 

than the rights established in SAWRSA, would be confirmed, clarified and made 

more explicit. One of the conditions to the effective date of the Amendments would 

64

be final dismissal of the litigation. As to any allottees who opt out of a class, their 

water rights, if any, would be barred; 

9. Lands acquired by the Nation outside the boundaries of the Nation’s Reservation which the Nation seeks to have taken into trust by the United States will not 

include federal reserved rights to surface water or groundwater; 

10. SAWRSA now limits the Nation to pumping no more than 10,000 acre feet 

of groundwater per year within the San Xavier District, with no provisions for underground storage and recovery. The Amendments would create a deferred pumping 

storage account, with an initial credit to recognize a portion of the groundwater allowance that has not been pumped since 1983. Withdrawals from the deferred 

pumping storage account could not exceed 10,000 acre feet in any year or 50,000 

acre-feet over any ten-year period. The Amendments would also allow direct underground storage and recovery of surface water, in a manner similar to that provided 

for under current State law. Comparable provisions are made for pumping groundwater within the eastern Schuk Toak District. The Nation could also pump additional groundwater during CAP shortage periods and interruption in CAP deliveries; 

11. SAWRSA now requires that all of the Nation’s water be used within the 

boundaries of the Tucson Management Area (TMA). The Amendments would allow 

the Nation to lease its water outside the TMA, after giving a right of first refusal 

to users within the TMA. It would also allow the Nation to use a portion of its settlement water within the Nation’s Reservation outside of the TMA; 

12. A new comprehensive Settlement Agreement among the Nation, the allottee 

classes, the United States, the State of Arizona, the City of Tucson, Asarco and 

FICO would be approved by the Amendments; and 

13. Separate agreements would be entered into among the Nation, United States, 

allottees and Tucson; the Nation, San Xavier District, allottees, the United States 

and Asarco; and the Nation, San Xavier District, allottees, United States and FICO. 

These agreements would be confirmed and approved by the Amendments. 

a. The Tucson Agreement provides: 

(i) For the payment by the City of Tucson of $300,000 to the San Xavier 

District to establish a sinkhole remediation fund to be used to maintain and repair 

any future sinkholes after the United States has completed its sinkhole repair 

project; and 

(ii) For the release by the United States and the allottees of past, present and 

future claims for damages from sinkholes or subsidence; release by the United 

States and the Nation of past, present and future claims for damages from 

sinkholes; and an administrative process for review by the City of any claim of the 

Nation for damages from subsidence before any court action is filed on such claim. 

b. The Asarco Agreement provides: 

(i) Up to 10,000 acre feet of the 35,000 acre foot allocation of CAP water for 

use in San Xavier will be delivered annually to Asarco for mining purposes in 

exchange for an equivalent reduction in groundwater pumping pursuant to a water 

agreement with the Nation; 

(ii) Asarco will have an option to renew the existing on-Reservation well site 

lease with the Nation for an additional 25 year term; 

(iii) Subject to adequate security to assure repayment, the Nation agrees to 

loan Asarco up to $800,000 for construction of a CAP delivery system repayable over 

a period not to exceed 14 years; 

(iv) Pursuant to A.R.S. § 45-841.01, the Nation is qualified to earn marketable 

storage credits which have an assigned value under the Asarco Agreement and are 

used to repay the Asarco loan and thereafter apportioned between the Nation and 

the San Xavier District; 

(v) With the exception of discharges of toxic or hazardous substances to 

groundwater, certain claims for groundwater contamination by Asarco are settled by 

Asarco payments of water lease delivery charges into a settlement fund, with Asarco 

making additional direct payment from its funds to the extent of any shortfall in 

the scheduled payment amount; and 

(vi) Waivers and releases of all past and future claims by the Nation, San 

Xavier District, allottees, United States and Asarco related to withdrawal of 

groundwater by the parties within the TMA.

65

c. The FICO Agreement provides: 

(i) Limitation of 850 acre feet annual withdrawal of groundwater by FICO 

within two miles of the exterior boundaries of the San Xavier District; 

(ii) Limitation of 36,000 acre feet annual withdrawal of groundwater by FICO 

from all FICO lands; 

(iii) Prohibition on FICO from selling groundwater credits to third parties for 

withdrawal within three miles of the exterior boundaries of the Tohono O’odham 

Nation; 

(iv) Except as otherwise provided in (i), (ii) and (iii) above, waivers and 

releases of all past and future claims by the Nation, allottees, United States and 

FICO related to withdrawal of groundwater by the parties within the TMA; 

(v) FICO shall record the Agreement in the official records of Pima County 

upon the effective date of the Amendments; and 

(vi) Terms of the Agreement are binding on heirs, devisees, executors, assigns 

and successors of the parties. 

IV. FUNDING COSTS UNDER AMENDMENTS 

The following is a summary of the various provisions in the Amendments that authorize use of the Lower Colorado River Basin Development Fund. The summary 

first discusses federal obligations in the Amendments that arise from obligations in 

SAWRSA and second new federal financial obligations under Amendments. 

A. FEDERAL OBLIGATIONS ARISING FROM SAWRSA 

Section 304(c)(3)(B): Authorizes the Secretary of the Interior to pay to the San Xavier District the sum of $18,300,000 in lieu of, and in full satisfaction of, the obligation of the Secretary to construct a ‘‘new farm’’ in the San Xavier District including 

design and construction activities relating to additional canals, laterals, farm 

ditches, and irrigation works for the efficient distribution of water described in section 303(a)(1)(A) of SAWRSA. Use of the funds is regulated pursuant to section 

304(f). 

History of the Expenditure. Section 303(a)(1)(B) of SAWRSA directs the Secretary, 

acting through the Bureau of Reclamation, to improve and extend the irrigation system, including the design and construction of additional canals, laterals, farm 

ditches and irrigation works, necessary for the efficient annual distribution for agricultural purposes of 27,000 acre feet of water referred to in 303(a)(1)(A) of SAWRSA. 

Section 304(c)(3)(B) of the Amendments gives the San Xavier District the option to 

cash out the construction benefit of a new farm and thereby use the portion of the 

27,000 acre feet annual distribution not required for the existing or extended Cooperative Farm for other purposes. Identification and retention of this amount in the 

Lower Colorado River Basin Development Fund is a condition to the Amendments 

becoming effective pursuant to Section 302. 

Sections 308(d)(2)(A)(i) and (ii): Authorizes the Secretary to enter into a contract 

with the San Xavier District and to pay a sum not to exceed $891,200 for the development of a water management plan for the San Xavier District and authorizes the 

Secretary to enter into a contract with the Nation and to pay a sum not to exceed 

$237,200 for the development of a water management plan for the eastern Schuk 

Toak District. 

History of the Expenditure. Section 303(a)(3) of SAWRSA directs the Secretary, 

acting through the Bureau of Reclamation, to establish water management plans for 

the San Xavier District and the eastern Schuk Toak District, that have the same 

effect as those plans developed under State law. Identification and retention of this 

amount in the Lower Colorado River Basin Development Fund is a condition to the 

Amendments becoming effective pursuant to section 302. 

Section 310(a)(2)(A)(ii): Establishes that the Cooperative Fund may be increased 

in principal by an amount not to exceed $32,000,000 based on a determination by 

the Secretary that the additional funds are necessary to carry out the Amendments 

and after providing notice to Congress. 

History of the Expenditure. Section 313(b)(3)(B) of SAWRSA provided for an additional sum up to $16,000,000 which the Secretary determined to be necessary to 

meet the Secretary’s obligations, after providing notice to Congress. SAWRSA provides that the $16,000,000 shall be adjusted pursuant to Section 312(b)(2). Section 

313(b)(2) states that the adjustment represents the additional interest that would 

have been earned by the Cooperative Fund had the monies been contributed initially. The Technical Amendments to SAWRSA enacted in 1992 inadvertently 

dropped the reference to the means for calculating the adjustment. Thus, the requirement to adjust the $16,000,00 existed between 1982 and 1992. 

Section 317(a)(1): Authorizes an expenditure of $3,500,000 (adjusted for fluctuations in construction costs) to construct features of the irrigation systems described 

66

in Sections 304(c)(1) through (4) that are not authorized to be constructed under any 

other provision of law. 

History of the Expenditure. Section 303(a)(4) of SAWRSA authorizes the appro- priation of up to $3,500,000, adjusted for fluctuations in construction costs. Section 317(a)(5): Authorizes an expenditure of $4,000,000 to carry out Section 

311(d). 

History of Expenditure. Section 303(b)(1) of SAWRSA authorized the Secretary to 

carry out a study to determine the available and suitability of water resources within the Sells Reservation. Identification and retention of this amount in the Lower 

Colorado River Basin Development Fund is a condition to the Amendments becoming effective pursuant to Section 302. 

B. NEW FEDERAL OBLIGATIONS OF AMENDMENTS 

Sections 311(c)(1) and (2): Authorizes the Secretary to expend sums not to exceed $215,000 for the San Xavier District and $175,000 for the eastern Schuk Toak District for groundwater monitoring programs. 

History of the Expenditure. The tribal parties and the federal team reached agreement on this new obligation prior to the introduction of S. 3231, the Arizona Water 

Settlements Act of 2000. Identification and retention of this amount in the Lower 

Colorado River Basin Development Fund is a condition to the Amendments becoming effective pursuant to Section 302. 

Section 311(f): Authorizes the Secretary to conduct a feasibility study of a land exchange between the allottees and Asarco at a cost not to exceed $250,000. 

History of the Expenditures. This is a new obligation. The introduction of S. 2992, 

the Arizona Water Settlements Act of 2002, included a land exchange study with 

Asarco but did not provide a specific dollar amount for the study. The Amendments 

have included a sum not to exceed $250,000. Identification and retention of this 

amount in the Lower Colorado River Basin Development Fund is a condition to the 

Amendments becoming effective pursuant to Section 302. 

Mr. HAYWORTH. Let me yield at this juncture to my colleague 

from Arizona because he, in exercising his Congressional 

prerogative, would like to introduce the next witness. 

Mr. RENZI. Thank you, Chairman. I want to take a minute to 

share with my friends here today a little history and welcome 

Chairwoman Kathy Kitcheyan from the San Carlos Apache Tribe. 

I apologize for not having a better seat at the table for you. You 

certainly deserve better. 

Chairwoman Kathy Kitcheyan is a former teacher and educator 

and longtime advocate on health and children’s issues both nationally as well as in Arizona. Chairwoman Kitcheyan was the first 

woman elected to the Chair position of her tribe in a long history 

of great leaders of the Apache Nation. 

I want to thank you for coming here today. I know that you have 

had some concerns and we all listen with interest. Welcome. 

Mr. CALVERT. Thank you, Mr. Chairman. 

Ms. KITCHEYAN. I guess that means it is my turn. 

Mr. HAYWORTH. Yes, ma’am, Madam Chairwoman. It is your 

turn to testify. Welcome. 

STATEMENT OF KATHY W. KITCHEYAN, TRIBAL CHAIRWOMAN, 

SAN CARLOS APACHE TRIBE, ACCOMPANIED BY JOE 

SPARKS, SPECIAL COUNSEL, SAN CARLOS APACHE TRIBE 

Ms. KITCHEYAN. Thank you very much. I feel like I need to say 

this because the day before and today, I feel like I am a woman 

with very few friends in Washington, D.C., so I want to point out 

something in this room. That man over there, Morris Udall, was 

a true friend of Apache people, him and his brother Stewart. I interned for him in the 1970s under the National Indian Youth 

Council, and I hope I have a friend here today. 

67

Having said that, I would like to say good morning. J.D. 

Hayworth, from the Great State of Arizona and Congresswoman 

Napolitano, and sir, I don’t know your name, I am sorry—Steve 

Lanich, OK. Good morning, sir. Kyle Weaver. And, of course, our 

Congressman, Rick Renzi. Thank you for that introduction. 

You have my written testimony, so I am not going to read it verbatim. You guys all have a master’s or doctor’s degree and I am 

sure you can read that on your own. 

Anyway, today, I am here alone with two of my council members, 

Mary Moses and Karen Kee, and also our attorney, Joe Sparks. 

Our reservation was first established with a treaty in 1852, and in 

the beginning, our reservation was over two million acres. But due 

to the greed of ranchers and farmers and unscrupulous politicians, 

it was reduced five times. Why? Because they discovered copper, 

silver, gold, and water. Had that not been done, our unemployment 

rate today would not be 76 percent. It was about money then, and 

today, I personally feel that it is about money, too. 

I, along with many other friends and relatives, were raised on 

the banks of the Gila River. It flowed well in those days. It was 

our playground and also sustained our crops. Many of our people 

had their own gardens. With the eventual growth of the mining industry, expansion of the ranching and farming community upstream, the flow of the Gila River slowed down tremendously. According to the Globe Equity Decree of 1935, the San Carlos 

Apaches are supposed to get 6,000 acre foot of water to irrigate 

1,000 acres. But today, we barely get enough water to irrigate 400 

acres. Imagine that. There have been occasions when the water 

commissioner calls to tell us to turn off our river pumps while 

Upper Valley users have their pumps running 24 hours a day. 

Under this proposed legislation for CAP water, we will most like- ly pay $74 per acre foot, while non-Indians pay anywhere from $26 

to $28 per acre foot. This is such a disparity. I say it is a severe 

injustice and discriminating. 

The other issue, Coolidge Dam, named after one of our Presidents, Calvin Coolidge, synonymous with San Carlos Lake. This 

Act will certainly result in its destruction. Imagine that. It would 

be a national disgrace because it is named after one of our Presidents. 

It will also choke off a large majority of the natural surface flow 

from the Gila River and encourage the discharge of sewer water 

into the river by upstream communities. 

If Coolidge Dam dies also, millions of birds and fish will, too, including species listed under the Endangered Species Act, the 

Southwestern willow, the flycatcher, the razor back sucker, and the 

bald eagle. This is why our tribe has tried for decades to get a minimum pool established in the lake of at least 75,000 acre foot, and 

I believe J.D. Hayworth was instrumental a few years back in helping us with that. We can store our CAP water here, but only if we 

can pay that $74 per acre foot for the CAP water. 

In our treaty with the U.S. Government, they have agreed to uphold its trust responsibility in the protection of land, natural resources, and water. We, as Apaches, have also pledged to be loyal 

and law abiding in all areas. We have lived up to our end of the 

bargain, even though we were not made citizens until 1924, even 

68

though we did not have the voting franchise until 1948. We have 

been loyal to the government. All we are asking for in this settlement is equity and fairness. It is not a window of opportunity for 

us. There is no benefits for us as the bill is written and we would 

like equal funding for the San Carlos Apaches. 

In our culture, water is very sacred, and this may be difficult for 

some of you to understand, but it is the lifeline of our existence, 

along with our language, our culture, and our spirituality. Therefore, it is not about fame. It is not about money. And it is not about 

power. 

Thus, we should not be taken lightly. Just because we are a 

small tribe with no political clout and just because we are a tribe 

with limited financial resources and can’t contribute for someone’s 

reelection, that does not mean we should get the scraps. We are a 

proud and honorable people and will continue to talk in good faith 

to anyone that will listen to us. And we certainly appreciate the efforts of Mr. Renzi and anyone that will help us. 

Thank you very much, Mr. Hayworth. 

Mr. HAYWORTH. And Chairwoman Kitcheyan, we thank you very 

much for your testimony. 

Representing the State of Arizona, Mr. Herb Guenther is here, 

and we would appreciate your testimony, sir. 

STATEMENT OF HERBERT R. GUENTHER, DIRECTOR,

ARIZONA DEPARTMENT OF WATER RESOURCES 

Mr. GUENTHER. Thank you, Mr. Chairman, members. I am here 

on behalf of Governor Janet Napolitano, who sends her regards and 

her testimony will be introduced into the record. 

I am not going to speak to the comments, as you can all read the 

comments as far as our participation within the bill. The State of 

Arizona strongly supports the bill as it stands today and will continue to work on those aspects of the bill that need some finishing 

touches, as well as those which are currently in negotiation, such 

as Title IV. 

This effort has taken, at least a couple of the titles, over 30 years 

to bring to closure. There are a lot of people who have a good portion of their lifetime invested in this settlement. It is an extremely 

complex settlement, as you can imagine, involving well over twothirds of the water users in the State of Arizona. So just by its nature, it is extremely delicate. It is a house of cards with each card 

maintaining a certain—sharing the burden of the rest. 

The main issues here that give us comfort is primarily the stipulated settlement of longstanding litigation. All three titles that are 

active have brought to closure extended litigation, and hopefully, 

those will go a long way to giving people a longer predictability, 

more predictability about their water supply, and therefore, more 

reliability and the realism that, in fact, they can plan for their future accordingly. 

Again, Mr. Chairman, members, we support the legislation in its 

entirety and we pledge our continuing participation in trying to resolve those outstanding issues and bringing those to successful closure, as well. I stand ready to answer any questions. 

Mr. HAYWORTH. Mr. Guenther, thank you very much. 

[The prepared statement of Governor Napolitano follows:]

69

Statement of The Honorable Janet Napolitano, Governor,

State of Arizona 

Chairman Calvert, and Members of the Subcommittee: 

Good morning, and thank you for the opportunity to present the views of the 

State of Arizona on H.R. 885, the Arizona Water Settlements Act of 2003. 

It is now time for Congress to confirm the agreements reached after many years 

of intense negotiations and compromise. With passage of H.R. 885, and implementation of the settlements, Arizona will embark on a new age of water resource planning, usage and cooperation. 

The legislation encompasses multiple Titles to resolve many longstanding water 

disputes in Arizona. Additionally, it provides benefits to New Mexico. Each Title addresses a particular settlement agreement, and provides the congressional authorization and funding needed to implement the settlement. Many times in the past, 

Congress has been faced with enacting legislation to authorize settlements that 

have not been finalized. I am pleased to inform the Committee members that the 

three settlement agreements to be ‘‘authorized, ratified, and confirmed’’ by Act of 

Congress have been executed by the State of Arizona, the tribes, and nearly all of 

the non-Indian parties, except the Secretary of the Interior. The Secretary requires 

congressional authorization prior to signing the settlements. There is no question 

that the parties intend to settle the issues, and, in fact, many of the parties are 

carrying out their government functions as if the settlements were already final. 

This legislation is vitally important to the future of Arizona, in economic terms, 

in meeting water management goals, and in furthering our relations with our tribal 

citizens. H.R. 885 will provide the mechanisms to resolve two major tribal water 

settlements immediately, and will provide the United States and non-Indian parties 

additional tools to resolve water rights claims of other Arizona tribes. It establishes 

a means for acquiring water and funding for future tribal water rights settlements. 

Let me provide some highlights of each Title and why each is so important to all 

the people of Arizona. 

Title I: Central Arizona Project Settlement 

Since statehood in 1912, Arizonans have dreamed of bringing Colorado River 

water to the cities and farms of central Arizona. It was the great Senator Carl Hayden’s dream. The recently deceased John Rhodes, former House minority leader, 

claimed passage of legislation to authorize the Central Arizona Project (CAP) as his 

greatest achievement in his 30 years in Congress. The CAP authorization became 

a reality in 1968 and by 1985 the CAP was delivering Colorado River water to farms 

and communities, as a replacement for groundwater. It continues to be our lifeblood, 

allowing many Arizonans to weather the drought conditions of eight of the last nine 

years. We continue to enhance the use of CAP, and this legislation furthers the 

State’s water management goals utilizing the CAP. 

Title I is consistent with, and in furtherance of, the intent of the stipulated settlement approved by the U.S. District Court of the litigation between the United 

States and the Central Arizona Water Conservation District (CAWCD) over the 

amount of repayment for the CAP. This Title also resolves other non-contract issues 

between the United States and the non-Indian CAP water users. Further, Title I 

provides the means to acquire the water supplies and funding necessary for the settlements in the other Titles of H.R. 885, and for future tribal water settlements. 

Final division of the Colorado River water for the CAP between the state users 

and the federal users is important to the State. With this legislation, approximately 

47% of the CAP will be dedicated for use by Arizona Indian tribes. The rest has 

been, or will be, allocated among the many Arizona non-Indian municipal, industrial 

and agricultural users. As part of Title I, 65,647 acre-feet of CAP high priority 

rights will be reallocated to Arizona cities, towns and water companies for municipal 

and industrial use. This reallocation has been pending for years after an extensive 

public process by the Arizona Department of Water Resources. 

To acquire water for tribal water settlements, Title I provides a mechanism for 

agricultural interests to relinquish their CAP subcontracts in return for debt relief 

from Section 9(d) of the Reclamation Project Act of 1939 totaling $158 million 

(shared by the federal government and state interests). Additionally, Title I provides 

for waivers of water rights claims by certain Indian tribes, and regulatory relief 

from the Reclamation Reform Act (RRA). It is important to the State that the water 

for tribal settlements, over and above that contributed by the parties, be acquired 

water from willing rightholders and not water taken by the federal government. 

Early tribal settlements were based on this concept, but in the 1990s the Secretary 

and Congress allocated water for settlements despite concerns raised by the State. 

70

We hope that the provisions of Title I can be a precedent for settlements throughout 

the country. 

The 1982 Reclamation Reform Act (RRA) has prevented the State from making 

full use of the CAP, which was designed to replace existing groundwater use for agriculture. Some lands are not eligible to receive CAP water due to RRA and are instead still irrigated with groundwater. Additionally, the administrative costs of implementing RRA in Arizona outweigh any perceived benefits to the government. The 

relinquishing districts would then be able to purchase CAP water over the next 30 

years from year-to-year agriculture pools at an affordable price. RRA relief for the 

agricultural districts within the CAP service area, as provided in Title I, furthers 

implementation of the Arizona Groundwater Code, and our effort to preserve our depleted groundwater supply for future generations. 

The water acquired pursuant to the CAP agricultural subcontract relinquishments 

will be used in the water budgets for the Gila River Indian Community settlement 

in Title II, for the Tohono O’odham Nation settlement amendments in Title III, and 

provide the Secretary of the Interior with additional water for future Arizona tribal 

water settlements, for a total of 197,500 acre-feet of water. Up to an additional 

96,295 acre-feet will be provided for the State to hold in trust for a period of time 

and then reallocate to municipal and industrial water users in Arizona. 

Title I also authorizes an agreement between Arizona and the Secretary to share 

in the ‘‘firming’’ of 60,648 acre-feet of the tribal CAP water to make it a more reliable water source for tribes to use for municipal and industrial purposes. Firming 

is the process of storing water underground today to be used when the dedicated 

surface water supply is lacking due to shortages. The State is obligated to firm 

15,000 acre-feet for the Gila River Indian Community Water Rights Settlement, and 

another 8,724 acre-feet for future Arizona Indian tribal settlements. Through the 

Arizona Water Banking Authority we have begun a process to identify the best ways 

to meet this obligation, and to examine whether additional state law authorizations 

are needed, as well as funding options. 

Arizona has been concerned in the past about proposals to market water out-ofstate, in derogation of the Law of the River, the Indian non-intercourse acts, and 

other applicable laws. The Law of the River includes several U.S. Supreme Court 

decisions, two multi-state compacts, and numerous acts of Congress concerning the 

use of the Colorado River. We believe that uses of the Colorado River must be consistent with this body of law. 

Title I clearly prohibits the direct or indirect marketing of CAP outside the boundaries of the State of Arizona. However, it would not impact the existing interstate 

banking agreements with California and Nevada through the Arizona Water Banking Authority. Nor would it affect any exchange necessary for the New Mexico Unit 

of the CAP as authorized in 1968. The State has been negotiating with the State 

of New Mexico over proposed changes to confirm that New Mexico can develop the 

CAP New Mexico Unit as envisioned in the 1968 Act. 

Funding of tribal water settlements has been a problem in the past. Tribes are 

asked to give up potential large paper water rights in return for a reasonable water 

budget and the ability to make use of the water. Use of water involves development 

funds for on-reservation projects. As you know, the appropriations process is difficult and may continue to be so in the future. 

Title I outlines the intended uses for the Lower Colorado River Basin Fund (Fund) 

over the next 40 years. The Fund consists of payments by the non-Indian CAP 

water users and power revenues of the CAP. These sources will continue to flow into 

the Fund until the CAP is fully repaid. Under Title I, the revenues in the Fund are 

redirected to be used to reduce the cost of delivery of water to tribal water users, 

to finance current and future tribal water settlements and to finance CAP distribution systems on tribal lands. It is important to note that this funding is for the longrange water and economic development needs of Indian tribes. 

Other issues resolved in Title I include clarifying that CAP contracts, whether 

tribal or non-Indian, are for permanent service within the meaning of the Boulder 

Canyon Project Act and for a term of service of 100 years. It also resolves the longstanding dispute between the Secretary and CAWCD about how shortages will be 

shared by users of the CAP. 

The provisions of Title I have been memorialized in the Arizona Water Settlement 

Agreement (Agreement), among the CAWCD, the Director of the Arizona Department of Water Resources, and the Secretary of the Interior. CAWCD and the Director signed the Agreement last year, but the Secretary will need to complete the National Environmental Policy Act process before signing. Finishing the Agreement 

will further the stipulated settlement of the repayment litigation in U.S. District 

Court, which could not be completed without passage of H.R.885. 

71

Title II: Gila River Indian Community Water Rights Settlement 

Coronado visited the Pima Indians of what is now central Arizona in 1540. There 

the conquistador bought grains from lush tribal fields along the Gila River. The current Gila River Indian Community (Community), made up of two tribes, the Pima 

and the Maricopa, are the descendents of those Indians visited so long ago by Spanish explorers and missionaries. These tribes assisted the U.S. Cavalry in the Indian 

wars, sold grain to American settlers, and its members have volunteered to serve 

in many overseas conflicts. One such member was Ira Hayes who helped raise the 

United States Flag over Iwo Jima. 

With a history of farming they have fought in the courts for decades for their 

water rights. Over the last two decades negotiations have been held. In the last year 

we finally succeeded in reaching a settlement. Title II would authorize the Secretary 

to sign the Gila River Indian Community Water Rights Settlement and provide the 

ways and means needed to make it a reality. 

The State participated in this settlement in many roles, that of facilitator, water 

rights holder, and protector of state policies and interests. Additionally, the State 

attempted to make the settlement acceptable for small water users unable to represent themselves in the negotiations. After enactment of the congressional settlement legislation, Arizona must address and enact changes to Arizona law consistent 

with the settlement to bind all citizens to the settlement, now and in the future. 

A State does not commit lightly to changing its laws, but in this case it will not 

only address issues presented by the settlement, but also serve the water management goals of the State. To this end the Arizona Department of Water Resources, 

the Arizona Game and Fish Commission and the Arizona State Land Department 

represented the State in negotiations. I will outline the State’s policy considerations. 

A major goal of any Indian water rights settlement is finality. Title II confirms 

an overall final water budget for the Gila River Indian Community and provides 

strict accounting of that budget, funding to allow utilization of the water, and broad 

waivers of claims by the Community and the United States as trustee to pending 

and future court claims to water rights. 

In the General Stream Adjudication of the Gila River and its sources, the Community and the United States claim between 1.5 million and 2 million acre-feet of 

water from all sources. The Gila River bisects the Community, which has proven 

uses of Gila River and groundwater since before recorded history. It is not a matter 

of whether the Community is entitled to water; it is a question of how much. 

In the settlement, the Community has agreed to an overall water budget of 

653,500 acre-feet annually, calculated on a rolling average over 10 years. The 

sources of the water are Gila River water, Salt/Verde River water, groundwater, exchanged reclaimed water, and Central Arizona Project (CAP) water. Well over onehalf of the proposed water budget is currently under the legal control of the Community. It has a CAP contract for 173,100 acre-feet, a time-immemorial right to over 

200,000 acre-feet Gila River water under the Globe Equity decree (125,000 acre-feet 

of reliable water in the tribal water budget), 5,900 acre-feet of Salt/Verde River 

water under the Haggard Decree, and the sovereign right to pump their own 

groundwater outside of State regulation. Part of this settlement is recognition of 

rights already held and used by the Community, with methods to improve those existing uses. Attached to my statement is an outline of the Community settlement 

water budget. 

The primary source of additional water for the Community’s water budget is CAP, 

with some contributed Salt/Verde River water and exchanged reclaimed water. 

Some parties contribute CAP water, but the largest block is from the CAP subcontract relinquishment pool established under Title I, approximately 102,000 acrefeet of lower priority water used for agriculture. The final piece to the water budget 

came from creative thinking by the Phoenix area cities. The cities of Mesa and 

Chandler will exchange highly treated reclaimed water with the Community for 

Community CAP water on a 5 to 4 ratio. This creative thinking solves several water 

management issues and benefits Indians and non-Indians. In fact, the two cities 

have already entered into the agreements necessary to make the exchange, beginning the construction process prior to enactment of this legislation. The Community 

and the United States are prohibited from seeking water above the proposed water 

budget. 

In exchange for this water budget and funding to make use of the budget, the 

Community and the United States are granting broad waivers to all the citizens of 

Arizona of past, present, and future court actions on water rights, subject to some 

retention of rights to enforce the benefits of the settlement. Arizona insisted that 

this be a final settlement of the Community’s claims to water. 

A benefit to settlements is to make partners out of combatants. An example of 

this, to be confirmed in the settlement, is the relationship between the Gila River 

72

Indian Community and the San Carlos Irrigation and Drainage District (SCIDD). 

SCIDD and the Community share in the San Carlos Indian Irrigation Project run 

by the Bureau of Indian Affairs. Sharing water of a project operated by an underfunded federal agency has strained the relationship. Through the settlement, 

SCIDD and the Community will enter into a new relationship, dividing the project 

features and taking over responsibility for operating their own systems. The settlement also provides funding to rehabilitate the existing unlined system to make better use of limited water supplies. SCIDD and the Community now share common 

goals and work together as a team. This is but one example of how this settlement 

is making neighbors out of antagonists. 

I will, at this point, list the parties to separate agreements (settlement, exchange, 

lease, or otherwise) that are part of the overall Community settlement confirmed 

by H.R. 885. The parties are: • The Salt River Project; • Phelps Dodge Corporation; • The irrigation districts and many towns and cities in the Upper Gila River 

Valley and the San Pedro River, including New Mexico rightholders; • Arlington Canal Company and the Buckeye Irrigation Company; • Maricopa-Stanfield Irrigation and Drainage District; • Central Arizona Irrigation and Drainage District; • San Carlos Irrigation and Drainage District; • The Cities of Mesa and Chandler; • Arizona Game and Fish Commission; and • Phoenix area cities with leasing arrangements. 

Some of these separate agreements further the water management goals of the 

State. For example, the ability of various cities to lease high-priority CAP water 

from the Community for 100 years is important in meeting Assured Water Supply 

requirements under state law for new subdivisions. The reclaimed water exchange 

agreements between the cities and the Community provide the Community with a 

reliable source of water for agriculture, and assist the cities in making full reuse 

of treated effluent. 

The Upper Gila Valley settlements provide many benefits. Not only do the settlements end long-standing contentious litigation before the Globe Equity Court, between the large irrigation districts and the Community, but also provide a basis for 

future settlements. The irrigation districts have agreed to permanently reduce irrigation acreage for the benefit of the Community, and if there were a future settlement with the San Carlos Apaches, the districts would permanently reduce additional irrigation acreage. The irrigation districts have also agreed to a cap on combined diversions and groundwater pumping; real reductions in water use, to the 

benefit of the river’s health, the Community, and the San Carlos Apache Tribe. 

In past Indian settlements, States have been asked to make financial contributions to settlements. In previous Arizona Indian tribal water settlements, the State 

has provided an appropriation to the tribal development fund. The State’s contribution to the Community settlement is structured differently. First, the State believes 

that the CAP water that is being relinquished is a state contribution. It was originally part of the non-Indian allocations of the CAP. We have agreed to this division 

of water in Title I and urge its use for the Community’s settlement. The financial 

aspect for the State in this settlement may be large as time goes by, but it does 

not include any contribution to the Community development. Instead the State has 

agreed to firm up to 15,000 acre-feet of low-priority CAP water. Title I outlines this 

commitment but leaves the details to a future agreement with the Secretary about 

firming of tribal supplies Through the Arizona Water Banking Authority we are in 

the process of analyzing how this will be accomplished. It may involve millions of 

dollars to bank an amount necessary to firm the water to municipal and industrial 

delivery priority. 

One of the separate agreements involves protection of groundwater in the areas 

south of the Gila River Indian Reservation. By changes to state law, the State will 

limit the use of groundwater in specific areas adjacent to the reservation to help 

protect tribal groundwater. To further ensure that the restrictions benefit the aquifer for the Community, the State will authorize and supply a water replenishment 

bank. The settlement outlines the goals of the replenishment bank but leaves implementation up to the Arizona Legislature. By enacting state legislation we will bind 

all future water users in that protected area to the settlement. This replenishment 

bank may involve millions of dollars. 

Water uses in other areas within the Gila watershed are also of concern to the 

Community, including groundwater users along the San Pedro River and the Upper 

Gila River. The water budget makes assumptions about the present flow of the Gila 

and San Pedro rivers. The State has proposed that present uses on those streams 

73

should be allowed to continue and the Community has agreed. The settlement proposes a ‘‘safe harbor’’ provision for these current uses that the Community, SCIDD 

and the United States would not challenge. To limit future uses, the State has 

agreed to propose changes in state law that prohibit the construction of new dams 

and the development of new irrigation uses within the San Pedro River and the 

Upper Gila River basins. When enacted the State assumes an ongoing enforcement 

responsibility. At this time we do not have an estimate of this future financial commitment. 

To summarize: The State contributions involve several changes in state law to accomplish the goals of the settlement; obligate the State to ongoing enforcement provisions, and necessitate large underground water storage expenditures for firming 

of tribal water and for the replenishment bank. 

This settlement encompasses many good things for many entities within Arizona. 

I have touched only on those of particular importance as State policy considerations. 

However, I must comment on one more provision. In Title II, and in Title III, the 

legislation outlines procedures for the Gila River Indian Community and the Tohono 

O’odham Nation to have lands placed into trust. 

It is important to remember that 28 percent of Arizona’s total land base consists 

of various Indian Reservations, with much more land held in trust for benefit of 

tribes or individual Indians, or in fee by tribes. We are proud of our tribal governments and have improved our ability to work with them on a government-to-government basis, especially on health, education and gaming issues. However, there are 

many consequences to state and local non-Indian authorities when lands are added 

to reservations, or taken into trust. For many years the State has taken the position 

that only Congress has the authority to make new reservations or additions to existing reservations, pursuant to congressional directives found in 25 U.S.C. 211. Some 

tribes and the Secretary of the Interior disagree with our legal analysis. To circumvent future litigation on this issue we, along with other Arizona interests including the congressional delegation, have urged that the settling tribes agree to a 

clarification of this issue concerning their reservations. 

Title II confirms that new additions to the reservation, or the placing of lands into 

trust status for the benefit of the Community, will only be accomplished by specific 

acts of Congress. Congress enacted the Zuni Indian Tribe Water Settlement Act earlier this year with similar provisions. We strongly support retention of this provision 

in Title II, as well as in Title III. 

In summary, the Gila River Indian Community Tribal Water Settlement provides 

many benefits to all Arizonans, and the State has committed itself to changes in 

state law and future use of resources to effect the benefit of the settlement for the 

Community. 

Title III: Amendments to the Southern Arizona Water Rights Settlement Act of 1982

In 1982, Congress enacted the Southern Arizona Water Rights Settlement Act 

(SAWRSA) to resolve the tribal claims against non-Indian water users in the Upper 

Santa Cruz Basin by the Tohono O’odham Nation (Nation), then known as the 

Papago Tribe, pending in the case U.S. v. Tucson. The 1982 SAWRSA called for a 

water budget of 66,000 acre-feet of delivered water, a 10,000 acre-feet limit on 

groundwater pumping by the Nation, a $15 million development trust fund, and a 

cooperative fund to pay for the delivery of surface water. 

Portions of the settlement have been completed, including the construction of a 

major portion of the distribution system to use the Nation’s original CAP allocation. 

The Nation, the State, and the local entities have performed their required tasks 

under the 1982 Act. This included state entities’ financial contributions of $5.25 million, Tucson’s contribution of 28,200 acre-feet of effluent and tribal waivers of claims 

to water rights. 

However, issues about the distribution of the tribal benefits arose before final dismissal of U.S. v. Tucson. At the same time, questions were raised about the source 

of a portion of the tribal water budget, and opposition formed to the building of a 

new farm on unbroken desert lands. Title III of H.R. 885 would amend the 1982 

Act to address these issues, provide a better method for dismissal of the pending 

lawsuits, and modernize the authorized uses of water by the Nation to be more consistent with those allowed under state law. It also confirms the settlement agreement among the Nation, the State of Arizona, Asarco, an international mining company, and Farmers Investments Companies (FICO). I recently signed the settlement 

agreement, as have all parties except the Secretary of the Interior, who is awaiting 

congressional authorization. 

To begin the more recent negotiations with all parties to the settlement, an agreement was reached between the Nation and the Indian allottees, whose allotment 

lands are within the basin, about the use of the settlement benefits. It is a tribute 

74

to the tribal parties that they have worked out internal differences, and now are 

ready to finish the settlement. The State acted as a party to the final settlement 

and facilitated the negotiations. 

Title III clarifies all the issues that delayed implementation. First, it identifies 

the source of the additional settlement water. The Nation has an original CAP allocation of 37,800 acre-feet, but SAWRSA provided for an additional 28,200 acre-feet 

of unidentified settlement water. Under Title I of H.R. 885, CAP agricultural water 

is made available to the Secretary for Indian water settlements, and it is from this 

pool of relinquished contracts that the Nation will receive its full settlement budget. 

Title I directs that the Secretary will have the responsibility to firm the 28,200 acrefeet of settlement water. The State offered up to $3 million in appropriations or 

services to assist the Secretary in that obligation. It should be noted that the State 

had already appropriated a contribution to the Cooperative Fund, as required under 

the 1982 Act, and this $3 million is an additional contribution. 

The settlement better defines the nature of the 10,000 acre-foot limit on pumping 

rights. The 1982 congressional directive on the limitation of pumping did not address whether this is a ‘‘reserved’’ pumping right or the equivalency of a state-based 

grandfathered pumping right in an active management area. In return for clarifying 

that this is not a reserved right the State has agreed to seek state law changes to 

allow additional protection to the Nation’s groundwater resource from the effects of 

new wells around the reservation. Under this legislative change, the State adds to 

its water management responsibilities in the Tucson Active Management Area. 

Each of the major parties, the City of Tucson, Asarco, and FICO, have entered 

separate agreements with the Nation and the allottees to further protect the 

groundwater resource of the reservation. This includes a creative solution by Asarco 

to substitute tribal CAP water for Asarco’s industrial groundwater use through a 

storage arrangement. 

Waivers and releases under the 1982 Act only provided for past and present 

claims to water rights and injuries to water rights, while the Title III amendments 

include future claims to water rights and injuries to water rights with some defined 

exceptions to enable the parties to enforce the settlement provisions. 

In 1982, it was envisioned that the Bureau of Reclamation would construct or rehabilitate three different farm units for the Nation. Under Title III, a procedure is 

outlined to substitute a $18.3 million development fund for one farm that would 

have been built on unspoiled desert lands. The $18.3 million is a present value substitute for a project already authorized as part of a settlement and committed to 

construction. Of the remaining commitment, one farm is already completed, and the 

last farm rehabilitation and expansion project has begun, both using CAP funding. 

A procedure for dismissing the pending lawsuits is agreed upon in the settlement 

agreement, and confirmed by Title III. It provides for class action consolidation and 

dismissal of Indian allottee claims based on the receipt of settlement benefits. There 

are over 3,000 individual Indian allottees with land interests in the basin. The State 

finds that this procedure gives greater certainty, binding not just the present litigants but also their successors. 

In summary, Title III provides better tools for dismissal of pending lawsuits, a 

confirmed supply of settlement water for the Nation, protection of tribal groundwater, creative uses of CAP water, and legal certainty over issues not addressed in 

1982, such as the nature of the groundwater pumping right. 

Title IV: San Carlos Apache Tribal Water Settlement 

Unfortunately, at this time we do not have a San Carlos Apache tribal water settlement. Congress approved a San Carlos Apache Tribe water settlement of their 

claims to the Salt River watershed portion of the reservation in 1992. Since that 

time, several discussions have been about resolving the tribe’s claims to the Gila 

River watershed portion of the reservation. These issues are also being addressed 

in the General Stream Adjudication of the Gila River and its source. 

The State stands ready to assist in the negotiation of the San Carlos Apache tribal claims to the Gila River when the Tribe and the United States reach an understanding of the parameters of such a settlement. It is possible that a settlement will 

be reached before passage of H.R. 885. However, the State does not believe that the 

rest of legislation should be delayed if Title IV cannot be completed. 

Provisions have been made in Title II to maintain the rights of the San Carlos 

Apache Tribe against the settling parties. The San Carlos Apache Tribe expressed 

concerns to the State that the legislation and the settlement agreement for the Gila 

River Indian Community hinder use of their current water rights. They cite primarily the exchange provisions in the Community’s settlement, and the legislative 

changes proposed by the State of New Mexico, both in Title II. Under the Globe Equity decree of 1935 the Apaches were awarded a water right with an 1846 priority 

75

date to irrigate 1,000 acres along the Gila River. The State fully supports maintaining the ability to use this right, and, in fact, would support proposals to enhance 

the ability of the Apaches to make use of the 1846 right. 

The State is optimistic that the Apache claims to the Gila will be resolved in the 

not too distant future, either by settlement or in Adjudication Court, but urges the 

Committee to move forward on H.R. 885, with or without a new Apache settlement. 

Summary and Conclusion 

Before closing I would note that there are concerns that have been raised by nonparties to the settlements. Most notably the Navajo Nation, in its endeavor to quantify its water rights, has offered comments. Their primary concern is that the Navajo Nation claims have not been considered in this legislation. The State of Arizona 

is currently negotiating with the Navajo Nation about its claims to the mainstream 

Colorado River. It is our hope that a portion of the water acquired pursuant to the 

relinquishments authorized in Title I will be available for settling their claims. 

Title I provides the final division of the Colorado River waters to be delivered 

through the CAP, clarifies contractual relationships with the United States, authorizes a shortage-sharing approach, and furthers the intent of the stipulated settlement between Central Arizona Water Conservation District and the United States 

on repayment of construction costs of the CAP. Presently unallocated CAP water is 

finally allocated or reallocated pursuant to public processes completed many years 

ago. Finally, Title I provides a mechanism for relinquishment of agricultural priority 

water to be used for Indian water settlements, both present and future, along with 

a funding mechanism for those settlements and for the delivery of CAP water to 

Indian customers. The funding mechanisms proposed through the Lower Colorado 

River Basin Fund may be unique, but they are worthy of congressional approval. 

These benefits accrue primarily to Arizona Indian tribes and their future economic 

development. 

Title II confirms the water rights settlement of the Gila River Indian Community, 

ending long-standing judicial and cultural conflicts concerning millions of acre-feet 

of water. It provides the Community with a clear final water budget and the resources to utilize that water in return for complete waivers and releases of water 

rights claims and injuries to water rights. Many of the settlement’s features enhance the ability to conserve groundwater in central Arizona, including the leasing 

of tribal CAP supplies to non-Indian users in Arizona. Title II resolves potential 

legal disputes over how non-tribal lands gain trust or reservation status by confirming that it is properly Congress’ role to determine if and how reservations are 

changed. The State has committed to pursue changes in state law and to expend 

millions of dollars to assure the Community more reliable water supplies and to preserve groundwater on and around the reservation. 

Title III provides means to finalize a settlement long overdue for the Tohono 

O’odham Nation and the people of southern Arizona. It modernizes the 1982 settlement, providing water use flexibility, especially of CAP water. In seeking additional 

protections of tribal groundwater, the settlement complements existing state water 

management goals. The effort in amending the settlement gave tribal, local, state, 

and federal government representatives an opportunity to better understand each 

other and to become partners instead of combatants. 

We have worked long and hard to negotiate the three settlements represented by 

the respective Titles, and the State of Arizona strongly recommends that the Committee support H.R. 885, the Arizona Water Settlements Act of 2003. 

76

[Mr. Guenther’s response to questions submitted for the record 

follows:]

Response to questions submitted for the record by Herbert R. Guenther, 

Director, Arizona Department of Water Resources 

Congressman Hayworth’s Question to the State of Arizona 

It is my understanding that any party that holds a water right under the 

Globe Equity 59 Decree (G.E. 59 Decree) may engage in a transfer of that 


89653.002
77

right which involves a change in the point of diversion or manner or purpose of the use of such water. It is also my understanding that the authorization for such transfers is contained in Article XI of the Decree, which 

also requires that such transfers occur ‘‘without injury’’ to the rights of 

other parties that hold water rights recognized by the Decree. 

Can you confirm that all water exchanges and transfers that involve 

G.E. 59 Decree water rights contemplated or authorized by the Arizona 

Water Rights Settlements Act will be subject to approval by the Globe Equity Court applying the standard contained in Article XI of the G.E. 59 Decree? 

Answers 

Concerning Congressman Hayworth’s understanding of Article XI of the Globe Equity 59 Decree and its application to transfers and exchanges we offer the following 

comments: 

In an order dated September 23, 1993, rules were adopted by the Decree Court 

on sever and transfers or change of use of decreed rights, but did not address shortterm or long-term exchanges. However, the Court has reviewed exchange proposals 

in the past couple of years due to the on-going drought. 

In April of 2003 the Court approved an exchange of Central Arizona Project water 

for water retained in San Carlos reservoir. Here the San Carlos Apache Tribe had 

CAP water delivered to the San Carlos Indian Irrigation Project (SCIP) entities (San 

Carlos Irrigation and Drainage District and Gila River Indian Community) in exchange for retention of SCIP rights in the reservoir. The parties presented the Court 

with a stipulation. 

To meet emergency water needs the Town of Kearny executed an exchange agreement with the Gila River Indian Community (GRIC) and the San Carlos Irrigation 

and Drainage District (SCIDD) for 2001–2002. Decree parties protested the exchange because it did not go through the 1993 rules. The Gi1a River Water Commissioner did not think the rule applied to a short-term exchange. After a briefing and 

a hearing the Judge decided on June 6, 2003, to allow the 2001–2002 exchange because there was no harm to other users, but did not grant it as a long-term exchange. After noting that the Kearny exchange was not a precedent, the Judge 

urged all parties to come to the Court with stipulated agreements for proposed exchanges. The Judge did not decide whether exchanges were authorized or consistent 

with Article XI of the Decree because that issue had not been briefed. However, in 

our opinion the Judge has clearly indicated that exchanges involving parties to the 

Decree such as GRIC and SCIDD should come before the Decree Court for approval 

under a no harm to other rightholders standard. 

Concerning the specific question about the Arizona Water Settlements Act and its 

requirement of Globe Equity 59 Decree Court approval of transfers and exchanges 

we offer the following comments: 

We believe the legislation does (pursuant to agreement of the parties) require the 

approval of the Globe Equity 59 Decree Court for many provisions. Exchanges and 

transfers are specifically part of the Arizona Water Settlements Act. Provisions of 

the Upper Valley Defendants (UVD) Settlement Agreement, Exhibit 26.2 relates to 

transfers; and the Phelps Dodge Agreement, Exhibit 10.1, relates to exchanges. Both 

of those agreements contain specific provisions for Globe Equity 59 Decree Court jurisdiction and approvals. See paragraphs 5.2, 11, 12.1, and 13.3 of the UVD Settlement Agreement, and paragraph 6.1 of the Phelps Dodge Agreement. Should an 

Asarco Agreement be reached, it is anticipated that it would also contain provisions 

about the Globe Equity 59 Decree Court, including any exchanges pursuant to CAP 

leases. 

Related but not currently contained in the legislation are the amendments to be 

offered by the New Mexico congressional delegation. Under the 1968 Central 

Arizona Project Act (43 U.S.C. 1521 et seq) a New Mexico Unit of the CAP was authorized (§ 1524(f)). Gila River exchanges were specifically authorized and subject to 

a standard of ‘‘without injury or cost to the holders’’ of Globe Equity Decree rights 

to the Gila River. While approval of the exchange is not required under the 1968 

Act, the Decree Court would probably be the forum for determination of any injury 

claims by rightholders. We believe the New Mexico amendments may be drafted to 

require Globe Equity 59 Decree Court approval of the proposed exchange agreement. 

Mr. CALVERT. At this point, the Chair would recognize our friend 

from New Mexico, Mr. Lopez, to offer his testimony on H.R. 885. 

78

STATEMENT OF ESTEVAN R. LOPEZ, DIRECTOR,

NEW MEXICO INTERSTATE STREAM COMMISSION 

Mr. LOPEZ. Good morning, Mr. Chairman and Subcommittee 

members. My name is Estevan Lopez. I am the Director of the New 

Mexico Interstate Stream Commission. I appreciate very much the 

opportunity to appear before you today and provide comments on 

behalf of the State of New Mexico regarding the Arizona Water 

Settlement Act, H.R. 885. With your permission, I will submit my 

written testimony for the record. 

This legislation will resolve longstanding water issues among 

Indian tribes and water users in New Mexico and Arizona. It is of 

great importance to the State of Arizona and will bring numerous 

benefits to water users in communities in the Gila River Basin. I 

want to commend you, Representative Hayworth, and Senator Kyl 

and other members of the Arizona delegation for such comprehensive and important legislation. 

In addition to the benefits to Indian tribes and water users in 

Arizona, this bill could benefit Western New Mexico, which shares 

the Gila River with Arizona. Both Title I of the bill, the Central 

Arizona Project Settlement Act, and Title II, the Gila River Indian 

Community Water Rights Settlement Act, bear directly on use of 

water within the Gila River Basin in New Mexico. 

During the last year, we have worked with representatives of the 

State of Arizona, Indian tribes, and water users to craft language 

that will address New Mexico’s needs. We have made substantial 

progress, and if New Mexico’s interests can be protected, we will 

be able to stand fully behind the bill. 

New Mexico has two discrete areas of interest. First, in the 

Upper Valley Defendant, or UVD, agreement, approved in Title II 

of the bill, we want to ensure that New Mexico farmers in the 

Virden Valley are fairly treated. Second, the authorization for the 

New Mexico unit under Section 304 of the 1968 Act authorizing the 

Central Arizona Project must be fully protected in advance. I will 

discuss these two matters in turn. 

Last year, my office and the New Mexico Office of the State Engineer participated in negotiating provisions of the UVD Agreement. 

The core agreement calls for the UVDs to reduce current irrigation 

by 3,000 acres in exchange for the ability to pump groundwater up 

to six acre feet per acre, regardless of priority. The result in New 

Mexico is that water rights associated with up to 240 acres, or approximately 8 percent of the current irrigated acres in the Virden 

Valley, would be extinguished. The State of New Mexico believes 

the UVD settlement in H.R. 885 is a fair and reasonable compromise that will protect all parties and provide a more secure and 

dependable water supply. We support implementing the UVD settlement. 

Our second concern is to carry out the authorization for the New 

Mexico unit of the Central Arizona Project, or CAP, as provided in 

the 1968 Act. The 1964 U.S. Supreme Court decree in Arizona v. 

California limited the State of New Mexico to present and past 

uses of water with no water for future uses. The 1968 Act authorized an apportionment to New Mexico as part of the cap. The intent of the 1968 Act is to provide for future uses of water in New 

Mexico from the Gila River Basin above those specified in Arizona 

79

v. California. The 1968 Act directs the Secretary of Interior to provide New Mexico with additional water through an exchange by 

which the Secretary would contract with water users in New Mexico for water from the Gila River Basin in amounts that will permit 

consumptive use of water not to exceed an annual average of 

18,000 acre feet, including reservoir evaporation, over and above 

the consumptive uses provided in Article IV of the decree of 

Arizona v. California. To complete the exchange, the 1968 Act also 

directs the Secretary to deliver CAP water to users in Arizona in 

sufficient quantities to replace in full any diminution of their Gila 

River water supplies that results from the additional consumptive 

use of Gila River water in New Mexico. Amendments to H.R. 885 

are required to ensure New Mexico’s ability to construct the New 

Mexico unit and develop the 18,000 acre feet. Over the last 9 

months, we have been working with the State of Arizona, the Bureau of Reclamation, the Bureau of Indian Affairs, the Gila River 

Indian Community, the San Carlos Irrigation and Drainage District, and the Central Arizona Water Conservation District to develop necessary amendments and related settlement documents to 

facilitate construction and operation of the New Mexico unit of the 

CAP. Attached to my written testimony is a summary of progress 

and remaining issues relating to the Arizona Water Settlement Act 

and the New Mexico unit of the Central Arizona Project, as jointly 

prepared by New Mexico and Arizona on September 23 of 2003. 

That summary outlines the issues and tasks that have been or remain to be resolved, in part or whole, between Arizona and New 

Mexico in relation to the 18,000 acre foot exchange. 

Mr. Chairman, we are working tirelessly to finish our negotiations with the State of Arizona, Indian tribes, and other water 

users. Once those discussions are complete and resolutions of these 

issues can be incorporated into the legislation, we look forward to 

providing New Mexico’s strong support for enactment of this bill by 

Congress. 

Thank you again for the opportunity to present our views on this 

matter. 

Mr. HAYWORTH. And, Mr. Lopez, we thank you. 

[The prepared statement of Mr. Lopez follows:]

Statement of Estevan R. Lo ́pez, Director,

New Mexico Interstate Stream Commission 

Mr. Chairman and Subcommittee members, I am Estevan Lo ́pez, Director of the 

New Mexico Interstate Stream Commission. I appreciate very much the opportunity 

to appear before you today and provide comments on behalf of the State of New 

Mexico regarding the Arizona Water Settlements Act, H.R. 885. This legislation will 

resolve long-standing water issues among Indian Tribes and water users in New 

Mexico and Arizona. It is of great importance to the State of Arizona and will bring 

numerous benefits to water users and communities in the Gila River Basin. 

In addition to the benefits to Indian Tribes and water users in Arizona, this bill 

could benefit western New Mexico, which shares the Gila River with Arizona. Both 

Title I of the bill, the Central Arizona Project Settlement Act, and Title II, the Gila 

River Indian Community Water Rights Settlement Act, bear directly on use of water 

within the Gila River Basin in New Mexico. 

During the last year, we have worked with representatives of the State of 

Arizona, Indian Tribes, and water users to craft language that will address New 

Mexico’s needs. We have made substantial progress, and if New Mexico’s interests 

can be protected we will be able to stand fully behind the bill. 

At this time, I would like to give you a brief summary of New Mexico’s interests 

in the legislation and the progress the two states and other parties have made in 

80

addressing our concerns in the settlement documents and legislation. New Mexico 

has two discrete areas of interest. First, in the Upper Valley Defendant (‘‘UVD’’) 

Agreement approved in Title II of the bill, we want to ensure that New Mexico 

farmers in the Virden Valley are treated fairly. Second, the authorization for a New 

Mexico unit under Section 304 of the 1968 Act authorizing the Central Arizona 

Project (43 U.S.C. 1543, Public Law 90-537) (the ‘‘1968 Act’’) must be fully protected 

and advanced. I will discuss these two matters in turn. 

Last year, my office and the New Mexico Office of the State Engineer participated 

in negotiating provisions of the UVD Agreement. The core agreement calls upon the 

UVDs to reduce current irrigation by 3,000 acres in exchange for the ability to pump 

groundwater up to 6 acre-feet per acre regardless of priority. The result in New 

Mexico is that water rights associated with up to 240 acres, or approximately 

8 percent of the currently irrigated acres in the Virden Valley, would be extinguished. 

The State of New Mexico believes the UVD settlement in H.R. 885 is a fair and 

reasonable compromise that will protect all parties and provide a more secure and 

dependable water supply. We support implementing the UVD settlement. 

Our second concern is to carry out the authorization for the New Mexico unit of 

the Central Arizona Project (‘‘CAP’’) as provided in the 1968 Act. 

In the U.S. Supreme Court litigation Arizona v California, 376 U.S. 340 (1964), 

the State of New Mexico presented evidence of present and past uses of water from 

its tributaries in the Lower Colorado River Basin including the Gila River and its 

tributaries. In addition, New Mexico presented a water supply study showing how 

the state could apply and use the water it claimed as its equitable share of the Gila 

River. 

The report of the Special Master found that New Mexico should be allowed 

present uses as an equitable apportionment of the waters of the Gila River Basin, 

but did not make an apportionment of water to New Mexico for future uses from 

the Gila. The 1968 Act authorized an apportionment to New Mexico as part of the 

CAP. The intent of the 1968 Act is to provide for future uses of water in New Mexico from the Gila River Basin above those specified in Arizona v California. 

The 1968 Act directs the Secretary of the Interior to provide New Mexico its additional water through an exchange by which the Secretary would contract with water 

users in New Mexico for water from the Gila River Basin in amounts that will permit consumptive use of water not to exceed an annual average of 18,000 acre-feet, 

including reservoir evaporation, over and above the consumptive uses provided for 

by Article IV of the decree in Arizona v California. 

To complete the exchange, the 1968 Act also directs the Secretary to deliver CAP 

water to users in Arizona in sufficient quantities to replace in full any diminution 

of their Gila River water supply that results from the additional consumptive use 

of Gila River water in New Mexico. 

Amendments to H.R. 885 are required to ensure New Mexico’s ability to construct 

the New Mexico unit and develop the 18,000 acre-feet. Over the last nine months, 

we have been working with the State of Arizona, the Bureau of Reclamation, the 

Bureau of Indian Affairs, the Gila River Indian Community, the San Carlos Irrigation and Drainage District, and the Central Arizona Water Conservation District to 

develop necessary amendments and related settlement documents to facilitate construction and operation of the New Mexico unit of the CAP. 

I will briefly note the issues under discussion and the progress being made. The 

issues are more fully described in the attached ‘‘Summary of Progress and Remaining Issues Relating to the Arizona Water Settlements Act and the New Mexico Unit 

of the Central Arizona Project,’’ as jointly prepared by New Mexico and Arizona on 

September 23, 2003. The following issues and tasks have been or remain to be resolved, in part or whole, between Arizona and New Mexico in relation to the 18,000 

acre-feet exchange: 

1. New Mexico’s initial concern was that the Arizona Water Settlements Act 

would prohibit the exchange of CAP water for New Mexico’s additional diversion of Gila River water. This issue is resolved; 

2. Progress is being made towards agreement on terms and conditions that will 

be incorporated into the exchange agreement between New Mexico, the Gila 

River Indian Community, and the Secretary of the Interior to effect the exchange provided in the 1968 Act; 

3. All parties are working to develop acceptable operational parameters that will 

allow New Mexico to divert water without causing economic injury or harm to 

holders of senior downstream water rights. General concepts have been proposed and technical review is scheduled. We are working hard to resolve this 

difficult and complex issue; 

81

4. Globe Equity constraints may serve to contravene the intent of the 1968 Act 

to provide additional consumptive uses in New Mexico. Work is ongoing related 

to the following Globe Equity issues: 

a. To keep UVD users whole, accounting of storage in San Carlos Reservoir must include any water diverted by the New Mexico unit; and. 

b. The ability of New Mexico to exchange without regard to the 1924 federal storage priority in San Carlos Reservoir, as was assumed in Reclamation’s 1982 and 1987 studies, must be confirmed; 

5. As originally contemplated in the 1968 Act, funding for the New Mexico unit 

is authorized as part of the CAP. While the original New Mexico project cost 

estimate was approximately seventy million dollars, that estimate inflated according to the Consumer Price Index results in a cost total of over three hundred million in today’s dollars. However, we believe we can build a suitable 

project for approximately two hundred twenty million dollars, including increased costs to accommodate federal environmental mandates.

In the settlement, New Mexico has proposed and Arizona is considering one 

hundred fifty million dollars in funding for the New Mexico unit that would be 

integrated with the funding provided for other projects under the Arizona 

Water Settlements Act. Discussions are ongoing regarding what costs would be 

supported. Under this proposal, New Mexico would have to make provision for 

at least seventy million dollars in construction costs plus substantial annual 

costs; and 

6. Several entities are seeking to exchange Gila River water for CAP water, a situation that could result in shortages of available Gila River water in some 

years. New Mexico has the senior exchange priority emanating from the 1968 

Act. However, in the spirit of compromise, New Mexico has offered to share priorities up to a set amount of aggregate exchanges. Discussions and studies are 

under way to determine the amount of exchanges with which New Mexico 

would share priority. 

Mr. Chairman, we are working tirelessly to finish our negotiations with the State 

of Arizona, Indian Tribes and other water users. Once those discussions are complete and resolution of these issues can be incorporated into this legislation, we look 

forward to providing New Mexico’s strong support for enactment of this bill by Congress. Thank you again for the opportunity to present our views on this matter. 

ATTACHMENT TO STATEMENT OF ESTEVAN R. LO ́ PEZ

NEW MEXICO AND ARIZONA DEPARTMENT OF WATER RESOURCES SUMMARY OF

PROGRESS AND REMAINING ISSUES RELATING TO THE ARIZONA WATER RIGHTS

SETTLEMENT ACT AND THE NEW MEXICO UNIT OF THE CENTRAL ARIZONA PROJECT, 

SEPTEMBER 23, 2003

The following issues and tasks have or remain to be resolved, in part or whole, 

between Arizona and New Mexico in relation to the Gila 18,000 acre-feet exchange: 

1. Effect of the Arizona Water Rights Settlement Act on the provision in the 1968 

Colorado River Basin Project Act that provides for exchange of 18,000 acre-feet of 

Central Arizona Project water for a like amount of Gila River water consumptively 

used in NM. The concern was that the Arizona Water Rights Settlement Act could 

directly or indirectly impair New Mexico’s ability to realize the benefits of the 1968 

Act. Resolved in current proposed amendments. 

2. Exchange agreements between New Mexico, Gila River Indian Community, and 

Secretary of the Interior to effect the 1968 exchange. Progress is being made to 

agree on terms and conditions to be incorporated in the exchange agreement. 

3. Operational parameters for the New Mexico Unit. All parties, New Mexico, 

Arizona, Gila River Indian Community, and Reclamation, are working to develop 

operational parameters that will define how and when the New Mexico project diversion may occur without creating economic injury and harm to downstream senior 

Gila water users, including effects on groundwater users. General concepts have 

been proposed and technical review is scheduled. Resolution is hoped. 

4. Globe Equity issues. Work is ongoing related to these issues: 

a. Under the Globe Equity, water users above San Carlos Reservoir are 

permitted to divert Gila River water out of priority in an amount equal 

to water stored in San Carlos Reservoir. A New Mexico project would 

reduce the amount of out of priority diversion permitted. To keep 

Arizona water users whole, an adjustment is required to Globe equity 

accounting of San Carlos storage to include any water diverted by the 

New Mexico feature; and 

82

b. In the Globe Equity, San Carlos has a 1924 storage priority. This was 

assumed not to pose an obstacle in Reclamation’s 1982 or 1987 studies 

of potential New Mexico projects. Changes are needed to clarify the 

ability of New Mexico to exchange as intended in the 1968 Act. 

5. Funding. New Mexico has estimated current project costs could exceed $220M. 

New Mexico has proposed and Arizona is considering that funding for the New Mexico unit be integrated with the funding provided for other projects under the Arizona 

Water Rights Settlement Act. Discussions are ongoing regarding what costs would 

be supported under this provision. 

6. Exchange priority. The desires of various Arizona entities to enter into exchange agreements of Gila River water for Central Arizona Project water presents 

problems when water supplies are low. In one out of two years, there will not be 

enough Gila River water to supply all contemplated exchanges. New Mexico has the 

senior 1968 exchange priority in the 1968 Colorado River Basin Project Act but has 

offered to share priorities up to a set amount of exchanges. Discussions and studies 

are under way to determine the amount of exchanges with which New Mexico would 

share priority. 

Mr. HAYWORTH. Of course, transcending the border of the States 

of Arizona and New Mexico, the presence of the Sovereign Navajo 

Nation. Before I recognize the witness here to testify on behalf of 

President Joe Shirley, let me apologize to those assembled. A 

scheduling dilemma has me having to leave the dais, but the very 

capable Vice Chairman of the Committee, my colleague from 

Arizona, will be taking the chair. But it is my privilege to recognize 

Stanley Pollack, Legal Counsel who is here representing Navajo 

Nation President Joe Shirley, with his testimony. Mr. Pollack, your 

testimony, please, sir. 

STATEMENT OF STANLEY POLLACK, NAVAJO NATION 

Mr. POLLACK. Thank you very much, Congressman Hayworth, 

and thank you very much for affording the opportunity to the Navajo Nation to testify on this important piece of legislation and affording me the opportunity to sit in for President Shirley, who 

sends his regrets. My name is Stanley Pollack. I am the water 

rights counsel for the Navajo Nation from the Navajo Nation’s Department of Justice. 

Again, we want to thank the Committee for addressing this important issue for the State of Arizona and Indian tribes in the 

State of Arizona. The Navajo Nation certainly appreciates the importance of water. We understand this importance, particularly 

since almost half of the homes on the Navajo reservation lack a reliable supply of domestic water. Almost half the homes on the Navajo reservation have to haul water from distant sources in order to 

have a basic supply of potable water. Thus, the Navajo people do 

not take water for granted and we support the efforts of the Gila 

River Indian Community to settle their water rights claims. 

Despite this support, however, there are various aspects of 

H.R. 885 that are troubling to the Navajo Nation and our concerns 

are summarized and set forth in our written testimony. Very briefly, we discuss in the written testimony about how a huge amount 

of Central Arizona Project water will go toward the settlement for 

the Gila River Indian Community. The Navajo Nation does not begrudge the fact that the Gila River Indian Community is entitled 

to a very large quantity of water and we do not hold that against 

the Community. 

83

Our concern, however, is that the Secretary of Interior, by utilizing the vast resources of Colorado River water to settle Central 

Arizona water rights matters for tribes in Central Arizona may be 

without the resources necessary to settle the Navajo claims on the 

Colorado River directly. So we want the Department to be mindful 

of the potential conflict that may arise when it is time to settle the 

Navajo claim. 

Second of all, there is a piece of water in the settlement with the 

Gila River Indian Community that relies on water from Blue Ridge 

Reservoir, and again in our testimony we outline now the Navajo 

Nation considers water from Blue Ridge Reservoir, which is in the 

Little Colorado Basin where the Navajo Nation is located, to be 

claimed by the Navajo Nation. Again, this is an issue—we don’t begrudge the Gila River Indian Community for seeking in their water 

budget and we are confident that we will be able to sit down with 

the Community and work out our concern. 

But the most critical issue that we have with the particular legislation is Section 104(b). In that particular provision, the Secretary’s 

hands are tied by requiring that water rights settlements—I am 

sorry, that the reallocation of CAP water to an Indian tribe in 

Arizona can only occur through a Congressionally approved water 

rights settlement. This is a problem for the Navajo Nation, because 

we need Central Arizona Project water today. 

The community of Window Rock, Arizona, where I live, where I 

work, needs a supplemental water supply of drinking water. Although the community is located in Arizona, the best source of providing potable water to Window Rock comes from the San Juan 

River in New Mexico. 

The Navajo Nation is actually very close to a settlement with the 

State of New Mexico concerning its water rights claims to the San 

Juan River. The centerpiece of that particular settlement would be 

the construction of the Navajo-Gallup Project, which would bring 

water to Gallup, New Mexico, and to Navajo communities in Western New Mexico. But Window Rock is on the border of New Mexico 

and Arizona and the best way to get Window Rock water is 

through the Navajo-Gallup Project. 

The Navajo Nation needs approximately 6,400 acre feet of water 

for that Arizona piece of the project. We need an Arizona allocation. We have sought a Central Arizona Project allocation of 6,400 

acre feet. We hope to introduce settlement legislation as early as 

January of next year that would authorize this particular settlement and this particular project, the Navajo-Gallup Project. 

We can’t afford to wait to settle all of the claims we have with 

the State of Arizona, which includes the claims in the Little Colorado River and the Colorado River mainstem, in order to have a 

final settlement that could get us CAP reallocation under Section 

104(b). Thus, Section 104(b) of H.R. 885 makes it impossible for 

the Secretary to allocate much-needed drinking water for the community of Window Rock. 

We can’t afford the wait, again, for the settlement of our Arizona 

claims, so we need that water now. We are presently engaged in 

discussions with the State of Arizona, with the Department of Interior, and with the Gila River Indian Community to try to resolve 

these claims. We are confident that at the end of the day, we will 

84

all be there and we will be in support of this particular piece of 

legislation. 

Thank you for the opportunity to testify. 

Mr. RENZI. [Presiding.] I thank the gentleman. 

[The prepared statement of Mr. Shirley follows:]

Statement of Joe Shirley, Jr., President, Navajo Nation, on H.R. 885

Chairman Calvert and Members of the Subcommittee: 

I am President Joe Shirley of the Navajo Nation. Thank you for the opportunity 

to provide testimony before the Committee regarding the Navajo Nation’s views on 

the proposed settlement for the Gila River Indian Community to be implemented 

by H.R. 885 entitled the ‘‘Arizona Water Settlements Act.’’ The proposed settlement 

will have a tremendous impact on the ability of the United States to supply the 

Navajo Nation with the water supplies needed to transform the Navajo Reservation 

into the permanent homeland envisioned when the Reservation was established. I 

ask the Committee to consider those impacts before recommending the approval of 

the proposed settlement. Working together, we are confident that the Gila River settlement can be crafted in a way that will not adversely affect the ability of the Navajo Nation to obtain the water supplies so desperately needed on the Navajo Reservation. 

Let me begin by saying that the Navajo Nation greatly appreciates the tremendous effort that the Arizona Congressional Delegation has devoted to addressing the 

difficult water issues that confront the State of Arizona. Nothing is more important 

to the long-term welfare of the State than developing a reliable supply of water to 

meet the needs of all of the State’s citizens, Indian and non-Indian alike. That cannot be done while the water rights of the Indian tribes in the State remain uncertain and cloud the rights of other water users without providing the tribes with the 

water that they so desperately need. We know that Congress is working hard to find 

fair and equitable solutions to these difficult problems, and the Navajo Nation wishes to work with you to find a way to address these issues in a way that also meets 

the long-term needs of the Navajo Nation. 

The Navajo Nation is not a party to the proposed Gila River agreement nor were 

we invited to participate in the settlement discussions. Having reviewed H.R. 885 

and the settlement that it would implement, however, it is apparent that there are 

at least two aspects of the proposed settlement for the Gila River Indian Community 

that involve water resources that are critical to the Navajo Nation. Both of these 

issues are matters of utmost importance to the Navajo Nation. In addition, the legislation represents an enormous federal investment in providing water supplies to the 

State of Arizona. We want to be certain that the present legislation does not preclude devoting further resources towards solving the difficult water supply issues 

facing the Navajo Nation and its neighbors in rural Arizona and New Mexico. 

First, Section 104 of H.R. 885 reallocates 197,500 acre-feet per year of agricultural water priority water from the Central Arizona Project (‘‘CAP’’) for use by 

Arizona Indian tribes. The bill proposes to transfer to the Gila River Indian Community 102,000 acre-feet of that supply. In addition, Section 104 prohibits the reallocation of any of the supply to an Indian tribe in absence of an Indian water rights 

settlement that calls for such a reallocation. Moreover, the water in question is ‘‘agricultural priority’’ water which has an extremely limited reliability. Under the provisions Section 105 of the bill, only 17,448 acre-feet of that supply is firmed up so 

that it can be used for municipal and industrial purposes by the other tribes in 

Arizona for municipal and industrial purposes. In contrast, Section 104 (b) reallocates 65,647 acre-feet of the far more valuable municipal and industrial priority 

water to non-Indian towns and cities in Arizona. 

The Navajo Nation is deeply concerned about these provisions. While we have 

worked hard over the last two decades to resolve the Nation’s claims to water 

throughout Arizona and New Mexico, we have outstanding needs for water that cannot be put aside during the years that will be required to achieve an overall settlement of the Nation’s claims in those states. We do not believe that water required 

to meet the everyday needs of tribal members should be held hostage until those 

settlements are completed. Nor do we believe that the water provided under the provisions of Sections 104 and 105 is adequate to meet the needs—or the outstanding 

claims—of the Navajo Nation. 

For example, it is clear that water from the mainstream of the Colorado River 

in the Lower Basin is essential to meeting the long-term needs of the Navajo Nation 

on its Reservation, yet the extent of the Nation’s mainstream rights has never been 

seriously addressed, let alone determined. The residents of western portion of the 

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Navajo Reservation lack reliable water supplies and commonly are forced to haul 

water to meet their everyday needs. As a result of these critical and immediate 

needs, the Navajo Nation recently brought suit against the Secretary of the Interior 

to redress the United States’ failure to obtain and protect a water supply for the 

benefit of the Nation from the Lower Basin of the Colorado River. While we recognize that this litigation poses a threat to various Colorado River programs that are 

critical to all of the basin states, the continued neglect of Navajo interests left us 

no choice but to proceed with our claims in court. 

The Arizona portion of the Navajo-Gallup Project is another example of the efforts 

underway to address the immediate drinking water needs of the Navajo Nation’s 

members. That project would be the centerpiece of a settlement of the Navajo Nation’s water rights claims to the San Juan River rights in New Mexico. The Navajo 

Nation and the State of New Mexico are close to a final settlement agreement and 

hope to introduce settlement legislation as early as next year. However, the most 

troublesome issue is identifying a supply of water for the Navajo-Gallup Project to 

serve the water-short community of Window Rock in Arizona. A CAP allocation may 

be necessary for use in Arizona through the Navajo-Gallup Project, but H.R. 885 

would prohibit the Secretary from allocating that water supply in the absence of a 

water rights settlement in Arizona. The Navajo communities to be served by the 

project have an immediate need for additional drinking water and cannot wait for 

the resolution of the Navajo claims in Arizona. 

Ultimately, the nature and extent of the Nation’s water rights in Arizona must 

be resolved if there is to be any certainty with regard to the CAP water supply and 

for the Indian communities that rely on this supply. If, in fact, the Gila River settlement eliminates or substantially reduces the availability of CAP water for other 

tribal water rights settlements in Arizona, the United States and the State, in all 

likelihood, will not have sufficient Colorado River resources to facilitate a Navajo 

mainstream settlement without taking water away from existing users. In short, we 

ask that you do not fully obligate CAP allocations in accordance with the terms of 

this bill, given the Navajo Nation’s outstanding needs. The failure to recognize those 

needs and to obtain and protect a water supply sufficient to meet those needs will 

only lead to further controversy and disruption in the future. 

Second, Section 12.14 of the proposed settlement describes a water budget for the 

Gila River Indian Community that includes a supply of water from Blue Ridge Reservoir, which is located on Clear Creek, a tributary of the Little Colorado River. The 

need for water from Blue Ridge to provide drinking water for water-short communities in the southern portion of the Navajo Reservation through the Three Canyon 

Project is now being studied by the Bureau of Reclamation in an ongoing study 

which Senator Kyl has sponsored. The Navajo Nation has always viewed Blue Ridge 

Reservoir as the cornerstone of any settlement of the Navajo rights in the Little Colorado River Basin because it is the only practical way to provide renewable surface 

water supplies to meet the domestic water needs of reservation communities in the 

vicinity of Leupp. As a result, the suggestion that Blue Ridge Reservoir provide a 

water supply for the Gila River settlement jeopardizes the contemplated Little Colorado River settlement to the detriment of everyone in the Basin. It is also important 

to point out that the water supply for Blue Ridge Reservoir is subject to the claims 

of the Navajo Nation in the Little Colorado River Adjudication, even if a portion of 

that water were to be provided to the Gila River Indian Community. In the absence 

of a settlement of the Navajo claims on the Little Colorado River, the Navajo Nation 

will have no alternative other than to pursue its claims to such water in the ongoing 

adjudication. 

Third, this is a very substantial settlement. It provides the Gila River Indian 

Community with a water budget of 653,500 acre-feet of water and a hefty amount 

federal funds. Moreover, it permits the leasing of subsidized settlement water supplies from the community to non-Indian water users in central Arizona with no reimbursement to the United States for the capital costs of CAP. Far more troubling, 

however, are the benefits extended to non-Indian water users by the settlement. For 

example, Section 106(b) in conjunction with Section 107 appears to render non-reimbursable $73,561,337 of debt incurred by CAP agricultural water users in Arizona 

under Section 9(d) of the Act of August 4, 1939. We fail to see the justification for 

such waivers. Moreover, we understand that other non-Indian water users are waiting in the wings to take advantage of the unique and expensive funding mechanisms provided by the legislation. Whatever the merits of the funding mechanisms 

in the bill, the benefits of those procedures should be reserved for Indian water right 

settlements or the provision of much-needed water supplies to tribal communities. 

In closing, the Navajo Nation understands the significance of proposed Gila River 

settlement for the Gila River Indian Community and the State of Arizona. Unfortunately, the settlement as currently proposed jeopardizes the ability to resolve the 

86

critical issues facing Arizona, the United States and the Navajo Nation. The Navajo 

Nation wants to work with Congress, the Arizona Delegation, the State of Arizona 

and the other parties to the proposed Gila River settlement to address these concerns so that the proposed settlement may move forward promptly. Thank you for 

the opportunity to testify on this matter of great importance to the Navajo Nation. 

Mr. RENZI. Before we move to members’ 5-minute questions, I 

want to recognize a gentleman here today, a great young leader of 

the Yavapai Apache, Mr. Jamie Fullmer. If you could stand, please, 

and be recognized, I appreciate you being here and coming today. 

I am grateful. Your written testimony and concerns have been written for the record. 

Mr. RENZI. We are going to move now to the gentlelady from 

California. 

Mrs. NAPOLITANO. I wish I had all day. I have got a ton of questions for a lot of people. 

Essentially, Governor Narcia, one of the things that I have noticed in your report, that you say—on page 11, actually, of the 

bill—your testimony, rather—that this bill is partial compensation, 

on page 11, for water taken from the Community. Do you anticipate a need for future compensation legislation? 

Mr. NARCIA. Mr. Chair, Congresswoman Napolitano, I will defer 

to our chief negotiator, Mr. Rod Lewis, to answer that question. 

Mrs. NAPOLITANO. Thank you. 

Mr. LEWIS. Mr. Chair and Congressman Napolitano, the Gila 

River Indian Community is located in Central Arizona just immediately south of Phoenix. The Gila River flows directly through the 

reservation and the Salt River is immediately adjacent to the reservation. 

We have great claims to waters of both the Gila River and the 

Salt River. Unfortunately for the Gila River Indian Community, 

both those rivers have been diverted above us. We are downstream 

from most people here at the table and people upstream divert our 

water, we think illegally and in violation not only of the Gila Decree, but of our winter’s rights claims that we have to both the Salt 

River and the Gila River. 

So that is the basis for the statement that we have been deprived 

and have lost water, because throughout the years, since settlers 

came West and settled upstream from us. However, this legislation 

will correct that situation by providing us wet water and in return 

providing certainty and stability for the entire State of Arizona 

with respect to a water supply. 

Mrs. NAPOLITANO. So the answer is yes? 

Mr. LEWIS. Yes. 

Mrs. NAPOLITANO. Thank you. Governor Narcia, then under this 

bill, H.R. 885, how much water will be used on your reservation 

and how much do you anticipate might be sold to non-Indian customers? 

Mr. NARCIA. The Community has federally approved plans to use 

all the water provided there by the Settlement Act. Certain water 

leases are included in the settlement framework. Other than the 

settlement leases, the Community plans on putting all of our water 

to use. We are farmers. We have always been farmers. We will continue to be farmers. We don’t plan to sell any of our water. We 

want to use it all. 

87

Mrs. NAPOLITANO. Or lease it out. OK. Thank you. 

To Chairman Seyler, Mr. Hickok of BPA expressed a willingness 

to reconvene discussions with the Spokane Tribe. Do you think the 

discussions would be fruitful, and do you share his interest in 

meeting with intent to reach agreement between both? 

Mr. SEYLER. We have been trying to reach an agreement for 60 

years. We are still willing to negotiate. 

Mrs. NAPOLITANO. OK. 

Mr. SEYLER. We would hope that BPA understands the term of 

negotiation and that it moves away from a ‘‘take it or leave it’’ 

offer. 

Mrs. NAPOLITANO. Thank you. Mr. Lopez, if New Mexico develops 

more water as you describe in your testimony, how will that affect 

the San Carlos Apache Tribe downstream? 

Mr. LOPEZ. Representative, it is our intent, as part of the continuing negotiation on amendments that we feel are still needed, 

to make sure that we can reach agreement on describing under 

what parameters New Mexico would be authorized to divert water 

from the river in such a way that would assure that downstream 

users would not be harmed or economically injured. 

Mrs. NAPOLITANO. Mr. Chair, I will forego right now, but I want 

to make just one statement, that I think that all of the tribes that 

have been at the table may not have been getting a fair shake. If 

I have listened to the testimony from Kathy Kitcheyan in regard 

to the smallness of their ability to have friends in Congress—you 

have friends in Congress, ma’am. I would like to pass on, and my 

next round of questions is going to deal with many of the other 

issues I have in mind. Thank you. 

Mr. RENZI. I thank the gentlelady. 

I am going to move to the gentleman from Southern Arizona. 

Mr. GRIJALVA. Thank you, Mr. Chairman. I have just some comments and questions, and one question in particular that comes to 

mind, and maybe that is a question for the Governor or Chairwoman Saunders, either/or, or both. Can you explain to me how the 

communities will be protected from environmental risk if Congress 

enacts the waiver that is included in this piece of legislation? 

Mr. NARCIA. Congressman Grijalva, like other Indian water settlements, H.R. 885 specifies that the United States will bring certain types of claims either to acquire additional water rights or to 

constrain the activities of those parties that are incorporated in the 

settlement framework. 

With respect to this particular agreement, the Community has 

agreed that the United States should be bound to the settlement 

framework in this manner. However, we also believe that the 

United States is only binding itself in its capacity as trustees for 

the Community and its members. In other words, in a situation 

where a claim could be made based on environmental or other laws 

for a non-Indian citizen or entity, the United States is still free to 

assert that claim on behalf of a member of the Community. The 

United States is only being asked to waive its ability to bring those 

unique claims that could be brought on behalf of an Indian tribe, 

an Indian citizen, an allottee, or any other Indian tribal member, 

but not on behalf of a similarly situated non-Indian. 

Mr. GRIJALVA. Thank you. 

88

Ms. JUAN-SAUNDERS. Congressman Grijalva, the Tohono 

O’odham Nation didn’t waive water quality claims and we feel that 

that is a critical issue for our nation, and it is important not just 

for us but the other water users in Southern Arizona. I just want 

to conclude by saying that this was a very important piece of negotiations for all parties. Coming to the table wasn’t easy for all parties, but we reached compromise and we are here today and this 

is a very significant event for the Nation and we ask for support. 

Thank you. 

Mr. GRIJALVA. Thank you. Mr. Chairman, just an observation 

and a comment in following up on the Chairwoman’s last statement. The process of good faith compromising and good faith negotiations is a difficult process for anyone involved in it, but I really 

feel that there are unresolved issues, issues that seem to be moving 

forward with regard to New Mexico and Arizona. I look forward to 

that. Issues that need to be dealt with with that Navajo Nation, 

and my fond hope that issues relative to San Carlos and the 

Apache Nation are also dealt with in that process of good faith negotiating. 

As the Chairwoman said, it is difficult, and I know it was difficult for all parties and particularly for the nations to come to the 

table on this discussion, but I want to extend my appreciation and 

admiration, because the process is a difficult one, to bring it to this 

point. If the history of this process, being that it is done in good 

faith and among equals, continues, I will certainly continue to support the legislation. Thank you. 

Mr. RENZI. I thank the gentleman. 

I take my privilege and ask a few questions and then we will go 

for a second round if that is OK. Well, let us go to Mrs. Napolitano, 

with a great Italian name. 

Mrs. NAPOLITANO. Thank you. I just wanted to say to Mr. Guenther to give my regards to the Governor, whom I have never had 

the pleasure of meeting. 

[Laughter.] 

Mrs. NAPOLITANO. There was an article on myself when I first 

got elected to Congress with her picture and we have laughed 

about that, which I found rather interesting. 

I hear a lot of—thank you, sir. I hear a lot of concern about how 

this government has not really come to the table with all the parties equitably or in an expedient manner or in a fair manner, and 

that bothers me, because for many years—since I have been in government, since I have been in public office, I have found that sometimes only the squeaky wheel gets the oil—that is to say, those 

that can afford to be represented or have information about how to 

come to the table and what to say and what to do sometimes get 

supported and get the ability to get some of their legislation 

through or assistance in matters that are important to the people 

we represent. 

I am very concerned about what I hear with Ms. Kitcheyan with 

the issues involved with the San Carlos Apaches and also with the 

Navajos. To say that you do not—that you have to cart in water 

to half your people is unconscionable for us in this day and age. 

89

I would like to ask Ms. Kitcheyan, there is apparently pooled 

water behind the dam. Will this be destroyed by the agreement, 

and are there sacred cemeteries that will be destroyed? 

Ms. KITCHEYAN. Madam, I will answer your second question and 

I will defer to an attorney on the first question. There are graves 

underneath Coolidge Dam of our ancestors, and if it dries up, I fear 

that those spirits will come out. 

And on your first question, I am going to defer to our attorney. 

Mrs. NAPOLITANO. Would you identify your name for the record, 

please, sir? 

Mr. SPARKS. Mr. Chairman, Congressman Napolitano, my name 

is Joe Sparks. I am Special Counsel to the San Carlos Apache 

Tribe. 

As to the pool behind the San Carlos Dam, that pool of water 

was purchased as a CAP water exchange by San Carlos, for which 

it paid $66 an acre foot. The diversions of water upstream, both in 

violation of the decree and new diversions that would be authorized 

by this Act, will diminish the flow of the Gila River to the lake and 

make it less likely that the natural flow will go through the lake, 

less likely that it will be replenished, and less likely that San Carlos Apache will be able to implement its existing 1992 settlement 

by exchange of water in San Carlos Lake. So all of those things are 

exacerbated by the anticipation of this legislation. 

Mrs. NAPOLITANO. What would be a better compromise? What 

would help not dry up that pool? 

Mr. SPARKS. We have been fighting for decades to get a natural 

flow of decent quality water from the headwaters of the Gila Mountains to and through Coolidge Dam so that the entire stretch or 

reach of the river can be fresh enough for San Carlos to use. But 

at the moment, the water is of such a poor quality that it kills the 

crops, it ruins the land, and there is an injunction by the Federal 

court ordering that the water quality be improved to San Carlos 

Apache to a point where they can grow moderately salt-sensitive 

crops. But that has not occurred. The river dries up because it is 

pumped upstream and does not come to San Carlos. 

Mrs. NAPOLITANO. Do the requirements of the river for pumping 

include sufficient water for that pond? 

Mr. SPARKS. No, it doesn’t. 

Mrs. NAPOLITANO. Has the Department of Interior or any agency 

looked at ameliorating the issue of water quality, in other words, 

setting up a plant to be able to treat the water so that it can be 

utilized? 

Mr. SPARKS. If they have, it is a well-guarded secret. The answer, 

to our knowledge, is no. 

Mrs. NAPOLITANO. Thank you. You have answered the questions. 

I will go for another round after you are done. 

Mr. RENZI. OK. Thank you. 

Ms. KITCHEYAN. Congressman Renzi, may I add something to 

that——

Mr. RENZI. Yes, ma’am, please. 

Ms. KITCHEYAN [continuing]. For the Congresswoman? Please? 

Mr. RENZI. Please. 

Ms. KITCHEYAN. Because of the quality of the Gila River that 

runs through our reservation, we have experienced a lot of birth 

90

defects, cleft palates, also a lot of cancer, breast cancer, and I can 

attest to that because my son was born with a cleft palate. My 

daughter was born deaf in one ear, what you call a cauliflower ear. 

And I just wanted you to know that. Thank you. 

Mrs. NAPOLITANO. Have there been any studies by any of the 

universities to affirm that the issue may be the water? 

Ms. KITCHEYAN. In the past, Indian Health Service has started, 

but have left the research of it. 

Mrs. NAPOLITANO. Is there a possibility, then, that part of the 

amendments to this water bill maybe will address the issue of 

water quality? 

Ms. KITCHEYAN. I would like to see that, ma’am. 

Mrs. NAPOLITANO. Thank you. 

Ms. KITCHEYAN. Thank you. 

Mr. RENZI. I thank the gentlelady. 

I just have a few questions I want to help flesh out here before 

we go back to a third round, if the gentlelady would like to. 

Mrs. NAPOLITANO. I would. 

Mr. RENZI. OK. I want to stay on the idea of talking about the 

pool of water behind the dam. I personally have fished the lake and 

know firsthand the reliance the San Carlos Tribe has on the tourism, the fees, and the prosperity of that pool of water that we 

made. 

When we talk about getting wet water to that lake and the idea 

that the Upper Valley users are using at a level that causes the 

water not to flow all the way down to the lake, part of the problem 

also is, knowing the area and being from my district, that we have 

got salt cedars that just clog the river bed to the point where it 

contributes to the high sodium levels and possibly to some of the 

impacts that we have been hearing today. 

Have we had an opportunity at all to look at the alternative of 

how we would actually physically get wet water there—I mean, 

realistically get water to the pool and the idea that the offer from 

Governor Narcia of the pipeline? Are there any thoughts, Joe or 

Kathy, on that? 

Ms. KITCHEYAN. Congressman, I would like to have Joe answer 

that, please. 

Mr. SPARKS. Congressman Renzi, Mr. Chairman, thank you for 

providing that to us and we have evaluated it. Let me explain that 

it proposes to deliver the Globe Equity water that the San Carlos 

Apache is entitled to by developing a well field next to the reservation at Goodwin Wash, which would then provide underground 

water to the pipeline and deliver it to the reservation boundary. 

That has two problems. One is that it certainly is a good faith 

suggestion by Governor Narcia. That is not a problem. The problem 

is that it further diminishes the water flow of the Gila River and 

further degrades the quality of the natural flow. It also does not 

comply with the Creed, because the court has ruled specifically, 

and it has been appealed to the Ninth Circuit and confirmed, that 

San Carlos Apache is entitled to the natural flow of the Gila River 

and, therefore, that isn’t a practical way to comply with the decree. 

Mr. RENZI. Joe, are we going to be able to get the river, honestly, 

and I am grateful for the articulation you are teaching me—are we 

ever going to really be able to get the river to the point where we 

91

could run it all the way from New Mexico through the Franklin 

Water District, the Safford cotton growers, all the way to the pool? 

Is that a reality, or are we really probably looking at some point 

at a pipeline? 

Mr. SPARKS. That is a reasonable question, and it would be 

reasonable for you to ask it even if it was unreasonable. 

[Laughter.] 

Mr. SPARKS. But the answer is, under the proposed settlement, 

it is not realistic to expect that the river will flow except at flood 

flows. And the proposal has been made in the past that a canal be 

developed, or pipeline, all the way from the head of Safford Valley 

at San Jose Diversion all the way to the San Carlos Apache points 

of use. That certainly would supply high-quality water at that location. It does nothing to address the inadequacy of San Carlos 

Apaches’ water. 

The one thing that has never been given serious thought, which 

in my mind is the only safety valve that may be possible to relieve 

some of this problem, is actually a pipeline from the CAP canal to 

San Carlos Lake, which would allow CAP water to be parked in 

San Carlos Lake, much like it is in Lake Pleasant as increased. It 

is very expensive, but it is the one place where water can be 

parked at a time when demands on the CAP canal is lower and the 

water could then be used not only to buffer and mitigate upstream 

diversions at various times, but it also could be used to move water 

downstream to Ashurst, Hayden, and on down to Tucson when the 

CAP canal is at capacity. 

Mr. RENZI. Thank you, Joe. 

Governor Narcia, there has been some discussion, particularly in 

Chairwoman Kitcheyan’s comments, about the Globe Equity Decree 

and their rights. Could you discuss or have counsel discuss briefly 

how the settlement or how the opinion of the tribe is that it may 

override the settlement, override their rights? 

Mr. NARCIA. If I understand your question regarding overriding 

their claims——

Mr. RENZI. I am just looking for—yes, the claim of the San Carlos Apache is that this settlement is going to override their Globe 

Equity Decree rights and I am just looking for your response. 

Mr. NARCIA. Congressman Renzi, no, it does not. We have simply 

agreed not to enforce our rights upstream for the upstream 

diverters. The San Carlos Apache Tribe and the United States on 

their behalf remain completely free to pursue enforcement of their 

rights. We have in the past been in court with the San Carlos 

Apache Tribe doing just that. Our settlement means that only we 

will no longer pursue the enforcement together. The San Carlos 

Apache Tribe can certainly continue on their own. 

Also, the 1992 San Carlos Apache Tribe settlement did not interfere with our ability to assert our rights under the 1935 Globe Equity Decree. In the same fashion, our settlement does not interfere 

with the San Carlos Apaches’ ability to assert their rights. 

Mr. RENZI. I thank the gentleman. 

I am going to move now to the Congressman from Arizona, Mr. 

Hayworth. 

Mr. HAYWORTH. Mr. Chairman, I thank you very much, and 

again, thanks to all the witnesses for coming and taking part in 

92

this worthwhile hearing. I think we still hear, as has been chronicled this morning, that a great deal of work is done and there is 

some work that remains. 

Governor Narcia, could you describe some of the steps you have 

taken to work with the other tribes in your settlement negotiations 

with the United States and the other settlement parties? 

Mr. NARCIA. Early in our negotiations, we met and discussed 

with other Arizona Indian tribes our water settlement for the Gila 

River. We desire to approach the settlement with non-Indian parties with a common effort with other tribes. 

During the negotiation process, we met with representatives of 

the San Carlos Apache Tribe, the Tohono O’odham Nation. I personally participated in numerous meetings with the San Carlos 

Apache Tribe. In addition, our negotiation team participated in 

dozens of meetings with them, also. 

During the negotiations, we also met with representatives of the 

Tohono O’odham Nation. The community shared with the representatives of the Nation our settlement agreement and proposed 

legislation. In turn, the Tohono O’odham Nation shared with us 

drafts of their proposed legislation and settlement agreement. 

In addition, we met several times to discuss common concerns. 

Recently, we have met with the majority of the tribal leaders, including Walapi Nation, the Camp Verde Yavapai Tribe, Hopi Tribe, 

San Carlos Tribe, and Cuchan to discuss issues surrounding water 

settlement. We will continue to meet and I remain personally available for any future meetings as appropriate. 

Mr. HAYWORTH. Thank you very much, Governor. 

Let me turn to Director Guenther of the Arizona Department of 

Water Resources. Mr. Guenther, do you believe this bill will allow 

for adequate water and financial resources to help resolve other 

water rights settlements? 

Mr. GUENTHER. Mr. Hayworth, no. I mean, I can elaborate on 

that, if you would like. 

Mr. HAYWORTH. Please. 

Mr. GUENTHER. Obviously, the difference between the claims and 

what is available is significant. There are more claims to water in 

Arizona than there is water on any river system that we have, and 

the Gila is no different. The Gila is different inasmuch as it is a 

much, what do I say, it is either feast or famine on the Gila, and 

so you don’t have significant dependable base flows that are available for the settlement of perfected long-term or Federal reserve 

rights. 

Now, a lot of that water has already been divided up by decree 

and so we are left with waters that are imported from the Colorado 

River, which then through exchange can be made available for 

rights that would have been on the Gila River. That water is limited, too. The Central Arizona Project really is only entitled to 

about 1.4 million acre feet off the Colorado River. All the other 

rights are higher priority and perfected by users along the Colorado 

River. 

So if you take that 1.4 million and then you assess the claims 

that are against it, you tend to run out of water very quickly. And 

so in this—I think the settlement is fair in the division of the 

waters between the non-Indian and Indian communities, but is 

93

there enough water to settle all the claims? No. Is there water 

there to settle a lot of the realistic uses, the beneficial uses that 

this water could be put to on Indian lands as well as non-Indian? 

I believe it would go a long way toward that end. 

Mr. HAYWORTH. Director Guenther, I thank you for that candid 

answer and I think it reaffirms the importance of this hearing and 

what transpires with this vital resource that is so important to us 

all, water, within the State of Arizona. And again, I want to thank 

everyone for coming today. 

You mentioned some of the previous decrees, some of the challenges that brought us here. But for the record, obviously, there are 

other Indian tribes with claims on other river systems in the State 

of Arizona, for example, the Salt River. With your knowledge of the 

Salt River system, granted that we have typified here, specified 

that there is never enough to anyone’s liking in an ideal situation, 

because, after all, so much of our State is desert, with reference to 

the Salt River system, how much water is there that could be used 

to satisfy claims? 

Mr. GUENTHER. Well, really, there is no water available. I mean, 

the Salt River is overallocated, as well. So if you want to say, is 

there any water available to settle outstanding claims of a higher 

priority right, the answer would be no. But that is—the way the 

system works, as far as appropriated water is concerned and doctrine of appropriation, right in time, first in right. So if you are 

going to negotiate a settlement of claims that have a more senior 

right, then you take water from a current user and make that 

water available to satisfy that senior right, which has been done 

on all of the river systems and is involved—that is basically what 

we are doing here with this bill. 

Mr. HAYWORTH. Director Guenther, thank you. 

Just in closing, and I thank you all for the time, and I thank you, 

Mr. Chairman, for being very respectful of the time, for those who 

have come here to testify on H.R. 885, just a quick answer. Obviously, there are some outstanding issues that need to be resolved. 

I would like to ask all parties who are here in testimony, will you 

commit to sit down and resolve these issues promptly? 

[Nodding from witnesses.] 

Mr. HAYWORTH. We are seeing nods of ascent. 

Ms. KITCHEYAN. San Carlos Apache agrees to compromise, to negotiate in good faith. We also expect the same from everyone. 

Mr. HAYWORTH. Thank you, Madam Chair. 

Governor Narcia? 

Mr. NARCIA. We have always been open to negotiating with anyone to resolve any issues that we may have. As I said earlier, this 

is our highest priority and whatever we need to do to reach settlement and resolve issues, we are certainly open to meet with anyone. 

Mr. HAYWORTH. Thank you very much. 

Chairman? 

Ms. JUAN-SAUNDERS. It has taken us 28 years to reach this level 

and it is important to bring parties to the table and to discuss 

issues and to be respectful of one another. Water is a precious commodity for everyone and we certainly have done that in good faith 

with all parties in Southern Arizona. 

94

Mr. HAYWORTH. Thank you very much. 

Mr. Guenther? 

Mr. GUENTHER. Mr. Hayworth, the Governor’s top priority—Governor Napolitano’s top priority—is settling outstanding claims to 

water rights, especially with the American Indian communities. I 

stand ready to commit to that, as well, and have already begun negotiations with several tribes who have not been to the table in 

quite some time. To the degree that we can start with realistic 

water budgets and numbers, it certainly would enhance the 

chances of bringing those negotiations to some beneficial closure. 

Mr. HAYWORTH. Thank you. 

Mr. Lopez? 

Mr. LOPEZ. Representative, New Mexico has been working on 

identifying the issues that are important to us to assure that New 

Mexico’s interests are protected and we stand ready to continue 

those negotiations in good faith. 

Mr. HAYWORTH. Thank you very much. Ladies and gentlemen, 

again, thank you for the testimony. Mr. Chairman, I guess it just 

shows again that whiskey is for drinking, water is for fighting, or 

perhaps for meaningful mediation, and we are grateful for the negotiations and thank you all. 

Mr. RENZI. Thank you, Mr. Hayworth. 

We are going to go one more round here. The gentlelady from 

California. 

Mrs. NAPOLITANO. I can go another five rounds, really. I have so 

many questions that I am sure time will not permit, but one of the 

things that really bothers me from what I have heard is, whether 

it was Kathy Kitcheyan or Mr. Sparks stating they would have to 

pay $74 an acre foot where upstream is about a third of the cost. 

Could somebody answer the reason why? 

Ms. KITCHEYAN. Madam, I will defer that question to our Legal 

Counsel. 

Mrs. NAPOLITANO. If you will make it short, because I have several other questions, please. 

Mr. SPARKS. Mr. Chairman, Congresswoman, the $26 to $28 

price is the non-Indian CAP price in the valley, not upstream, at 

San Carlos. 

Mrs. NAPOLITANO. Upstream, OK. 

Mr. SPARKS. The decreed water costs about $3.41 an acre foot, 

and that is what the local price would be and that is—it is even 

a greater disparity. The CAP water costs $74 and $28 is the spread 

between what it costs the Indian tribe to use agricultural water of 

its own and what it costs the non-Indian farmer to use the same 

Indian agricultural water that is unable to be paid for and delivered to the Indian tribes. 

Mrs. NAPOLITANO. And why is that? 

Mr. SPARKS. Because they can’t afford it or they don’t have a 

delivery system for the exchange systems. 

Mrs. NAPOLITANO. And those delivery systems have been requested be put in place? Have they been negotiated? Have they 

been somewhere on somebody’s table to be able to address——

Mr. SPARKS. Pardon me. They were authorized by the 1968 CAP 

Act. They were authorized by the 1980 CAP contracts for each of 

the tribes and they really never—the non-Indian systems were 

95

built. The Gila River Indian Community system is being built. The 

Achan system was built, but the tribes which require delivery by 

exchange have not been built and they will be last to be built if 

there is money left over under the Basin Project Act fund. 

Mrs. NAPOLITANO. Mr. Chairman, it looks like the priorities have 

to be reorganized. 

One of the other questions I would have for Mr. Guenther from 

Arizona, under the current law, what happens to CAP Indian water 

if it is not used by the tribe and how would that change under this 

bill, and if there is excess water, which many times there won’t be, 

I am sure, any excess water, are the tribes compensated for that 

water that is not used by them and used by other entities? 

Mr. GUENTHER. Congressman——

Mrs. NAPOLITANO. Woman. 

Mr. GUENTHER [continuing]. Napolitano, my sense is right now, 

as I recall, that water is excess water——

Mrs. NAPOLITANO. Right. 

Mr. GUENTHER [continuing]. And is available for distribution 

under excess water rules by the CAWCD. As far as what is paid 

for, usually it is you pay for the water whether you use it or don’t 

use it. It depends if you have an allocation for CAP water. It is the 

same for Indian and non-Indian. 

Mrs. NAPOLITANO. Thank you. I hear a lot of discussion about the 

water, the differences, the allocations, but I hear no one talking 

about establishing either recycled water projects or finding out if 

you have underground water aquifers where you can store water 

or being able to do what we are doing in California, and that is recycling brine water, in other words, cleaning it for use, another use, 

and I would like to have somebody tell me if there is anything in 

anybody’s mind toward this area, toward this end. 

Mr. NARCIA. Congressman Napolitano, our bill does, or our settlement does include reclaimed water was part of our water budget 

and the reuse of reclaimed water. 

Mr. RENZI. Sir, go ahead. Did you finish? 

Mrs. NAPOLITANO. Well, that doesn’t totally answer my question. 

I think what I am searching for is that American Indian tribes 

have forever and ever said that water is sacred. We are learning 

that in the inner cities and beginning to take care of it, or beginning to look at ways of being able to reuse it. There is no more 

water. We have water. We just in some areas do not use it wisely. 

We contaminate it, and that is borne out in the defense installations where we now have volatile organic compounds and perchlorates and all those great things brought about by industry. 

I guess my concern is whether or not your being helped to be 

able to harness rainwater, to be able to store it, to be able to understand how other options are available, if they are available, and 

how you can go about instituting those, coming through for appropriations through this body to assist——

Mr. HAYWORTH. Would my friend yield for just a second to——

Mrs. NAPOLITANO. I certainly do. 

Mr. HAYWORTH. I think it is important just to reaffirm something 

that we have had to live under in Arizona for now over 20 years, 

the Groundwater Management Act, which I think for all water 

users, both Native American and non-Native American, that has 

96

been something that we have done and we are pleased to see others are doing it and I am pleased that you raised that, but I believe 

that is something under which we all live within the State of 

Arizona and have done so for the better part of two decades. 

Mrs. NAPOLITANO. Thank you. Well, I am talking about utilization of rainwater, capturing, storing, et cetera, and that is where 

I am coming to, is those other issues that—I know underground 

water management has been totally all over in Arizona and New 

Mexico. 

Ms. JUAN-SAUNDERS. Mr. Chairman, Congressman Napolitano, 

the Tohono O’odham Nation is located in Southern Arizona. We 

live in the desert. We survive temperatures of 110 degrees every 

summer, and over the last eight to 10 years, we have experienced 

severe drought and just 2 years ago requested a state of emergency 

for the whole State of Arizona in Southern Arizona. So rainwater 

is precious to us, but we are not getting—we can’t control Mother 

Nature. 

Mrs. NAPOLITANO. Correct. 

Ms. JUAN-SAUNDERS. So any alternative sources of water is so 

important to the Nation. 

Mrs. NAPOLITANO. Have you been able to identify any underground storage capability or capacity? 

Ms. JUAN-SAUNDERS. Not at this point. 

Mrs. NAPOLITANO. Thank you very much. 

Mr. RENZI. I thank the gentlelady. I want to——

Mr. NARCIA. Mr. Chairman? 

Mr. RENZI. Please, go ahead, sir. 

Mr. NARCIA. You know, water conservation has been uppermost 

in the minds of Gila River. You know, your suggestion with the 

rainwater, the annual rainfall in Arizona, or Southern Arizona, is 

about seven or 8 percent a year, or annually, so there isn’t much 

rainwater to come. But living on, as Chairman Saunders stated, we 

are in a desert and water conservation is the highest priority for 

us and the use of that water. 

Mr. GUENTHER. Mr. Chairman, if I could just add a little bit to 

that, to answer——

Mrs. NAPOLITANO. I just want to say, I don’t diminish what is 

being done. I am just wondering if all other options, all other assistance from the government, from the Department of Interior, 

from Bureau of Reclamation, from the Army Corps of Engineers 

have been utilized for the tribes. I am not talking about the major 

communities, which I am sure can take care of themselves. I am 

talking about assisting tribes. 

Mr. GUENTHER. Yes, and we do that. Most of our major projects, 

the San Carlos Project, which Coolidge Dam, that is an Indian 

project. We have the Salt River system, which captures just about 

every drop of rain or snow that comes off the watersheds. And 

then, of course, we have the Verde River systems, which is on the 

other side of the State, which captures all the water that comes off 

those watersheds. And then at the bottom of it, we have one dam 

that never has water in it which is used to take the crest off floods. 

But we also have water banking programs, which we bank water. 

In fact, we bank water for California and Nevada in underground 

banks that by exchange is made available at times of increased 

97

need, and we also have replenishment districts, which take all the 

excess water and put that in the ground so it will evaporate for future use. 

Mr. RENZI. I thank the gentlelady. 

I have just got a couple of questions. Mr. Pollack, when we talk 

about the Navajo Nation and we talk about the settlement and the 

ability that it might interfere with water flowing in from New Mexico into Arizona, could you expand on that and could you provide 

me, particularly with Congressman Hayworth here today, what you 

see as the simple fix? 

Mr. POLLACK. Thank you, Congressman Renzi. The solution for 

Window Rock’s water shortage is to get water from New Mexico, 

and we believe that the project that we have negotiated with the 

State of New Mexico is the project to do that. That is the NavajoGallup Project. Because the water is used in the State of Arizona, 

the Colorado River Basin States abide by the terms of the Colorado 

River Compacts, which require that uses charge—I am sorry, uses 

that are made within any given State be charged against that 

State. So even though we would be taking water from the San 

Juan River in New Mexico, in order to charge it to the place of use, 

we would need to get an Arizona water right to do that. So what 

we are seeking is an Arizona water right. 

We think that the easiest solution is simply for the Secretary of 

the Interior to allocate 6,400 acre feet of water under her control. 

We can’t get that allocation under the provisions of 104(b) without 

an Arizona settlement. Ironically, we would have a settlement with 

New Mexico, but not one with Arizona and, as I said before, there 

are a myriad of issues that we have with the State of Arizona. We 

are ready to move on a New Mexico settlement and the Window 

Rock water supply simply can’t wait to resolve all the issues we 

have with Arizona. 

We believe that an appropriate fix would be for this legislation 

to carve out 6,400 acre feet of water, not for the Navajo Nation but 

6,400 acre feet of water that could be held by the Secretary of the 

Interior in the event that there is a Congressionally approved 

water rights settlement with the State of New Mexico to provide 

that 6,400 acre feet. So we would have parallel provisions. 

Mr. RENZI. Thank you. Is there anyone who would like to comment on that? 

Mr. GUENTHER. Mr. Chairman, I can comment on it. We—obviously, we are talking about two different basins here, but I do see 

the Navajo’s concern with regard to the limitations that 104(b) may 

or may not legally impose. But regardless of which way we do go, 

I would ask that we participate very closely in any words that are 

chosen with regard to this type activity because it involves 1922 

Compact issues, which are extremely sensitive in the Basin States. 

It is a matter of Upper Basin right versus Lower Basin right, 

Upper Basin diversion use and Lower Basin. I mean, they are artificial boundaries, but——

Mr. RENZI. You don’t necessarily agree that the settlement would 

impede the ability? You are not sure about that? You need to research that more? 

Mr. GUENTHER. Yes, and it would not impede the ability of using 

a leased right or a purchased right, of a retired agricultural right 

98

of some other type on the river. But I think Mr. Pollack is probably 

correct that it could be interpreted to include an allocation. 

Mr. RENZI. OK. We can work on that, too, then. 

Let me finish up by asking Chairwoman Kitcheyan, we spoke a 

little bit about the Globe Equity Decree and the fact that you feel 

that the settlement would impinge on those rights. Governor 

Narcia addressed it by saying that he is willing to give up his upstream rights. Chairwoman Kathy, do you want to comment on 

that? 

Ms. KITCHEYAN. You know, I was listening to Governor Narcia 

talked about the upstream rights. Though we have not met to discuss this, I have been in office 9 months now and we did have one 

meeting scheduled, and unfortunately, I was ill, so we didn’t meet 

to discuss it. 

However, on the Globe Equity, you know, that has been since 

1935 and we have never received our full allocation of it. I would 

certainly like to see Governor Narcia give up his right plus more. 

Thank you. 

[Laughter.] 

Mr. RENZI. I think—yes, go ahead, Joe. 

Mr. SPARKS. Mr. Chairman, in further response and supplement 

to the Chairwoman’s response, the Gila River Indian Community 

is not giving up their Globe Equity rights. They still will have the 

right to take, when the river is running on priority, the first 437.5 

cubic feet per second of the natural flow of the river. What they 

have potentially agreed to is that the Upper Valley pumpers can 

take that water in disregard of Gila River’s priority to have the 

first 437.5 cubic feet per second. But Gila River has not given up 

its right to call on that water and the result of that is that the 

pumpers will continue pumping in violation of the decree at least 

as to the way San Carlos is treated——

Mr. RENZI. And the threat that you——

Mr. SPARKS [continuing]. And the flow of the water will be reduced by that pumping. 

Mr. RENZI. OK. Let us wrap up. Is there anything substantive 

that remains in any of your hearts that hasn’t been drawn out? 

Real quick. We are going to go to votes here in about 5 minutes. 

Speak now, please. Is there anyone else who would like to address 

any issue of a substantive nature? 

[No response.] 

Mr. RENZI. OK. With that, I want to thank the witnesses for 

their valuable testimony. I want to thank the members here for 

their questions. Members of the Subcommittee may have additional 

questions for the witnesses and we will ask that you respond to 

these in writing. The hearing record will be open for 10 days for 

these responses. 

If there is no further business before the Subcommittee, I thank 

the members of the Subcommittee and our witnesses. The Subcommittee stands adjourned. 

[Whereupon, at 12:33 p.m., the Subcommittee was adjourned.]

The following information was submitted for the record: 

99

• Arizona Cities of Chandler, Glendale, Goodyear, Mesa, Peoria, 

and Scottsdale, Statement submitted for the record in support 

of H.R. 885 

• Fines, L. Anthony, Attorney for Gila Valley Irrigation District 

and David A. Brown, Attorney for Franklin Irrigation District, 

Statement submitted for the record 

• Gila River Indian Community, Supplemental testimony 

submitted for the record 

• Hawker, Hon. Keno, Mayor, City of Mesa, Arizona, Statement 

submitted for the record 

• Mason, Douglas, General Manager, San Carlos Irrigation and 

Drainage District, Coolidge, Arizona, Statement submitted for 

the record in support of H.R. 885 

• Payson, Town of, Arizona, Statement submitted for the record 

by the Mayor and Common Council in support of H.R. 885 

• Renner, George, President, Board of Directors, Central Arizona 

Water Conservation District, Statement submitted for the 

record 

• Rimsza, Hon. Skip, Mayor, City of Phoenix, Arizona, Statement 

submitted for the record in support of H.R. 885 

• Sullivan, John F., Associate General Manager, Water Group, 

Salt River Valley Water Users Association and Salt River 

Project Agricultural Improvement and Power District, 

Statement submitted for the record in support of H.R. 885 

• Talley, Hon. Van, Mayor, City of Safford, Arizona, Statement 

submitted for the record in support of H.R. 885

Statement submitted for the record by the Arizona Cities of Chandler, 

Glendale, Goodyear, Mesa, Peoria, and Scottsdale 

Chairman Calvert and Members of the Subcommittee: 

The Arizona Cities of Chandler, Glendale, Goodyear, Mesa, Peoria and Scottsdale 

(‘‘Cities’’) appreciate the opportunity to submit this testimony in support of 

H.R. 885. The Cities collectively represent more than 1.6 million people within the 

Phoenix metropolitan area of Maricopa County, Arizona. H.R. 885 is very important 

to the Cities and other water users throughout Arizona. 

H.R. 885 approves the settlement of ongoing disputes over the past decade between the United States and Arizona interests concerning Central Arizona Project 

(‘‘CAP’’) repayment and water allocation issues. H.R. 885 also approves the settlement of long-standing disputes relating to the Gila River Indian Community water 

right claims. The Gila River Indian reservation includes a large land area of approximately 372,000 acres immediately south of the Phoenix metropolitan area 

where the Cities are located. 

H.R. 885 resolves these contested CAP repayment, CAP water allocation and Gila 

River Indian Community water rights claims in a manner that is fair and equitable 

to all parties. H.R. 885 is important to the Cities and their future water management. It provides more certainty regarding the Cities’ future water supplies while 

settling complex and contentious CAP and Indian water rights claims. 

The Cities are contributing substantial financial and water resources to the Gila 

River Indian Community as part of the Gila River Indian Community Settlement. 

The City of Chandler is directly contributing 4,500 acre feet of reclaimed water annually to the Gila River Indian Community as part of the Settlement. In addition, 

both Chandler and Mesa are annually contributing up to 8,100 acre-feet of additional high quality reclaimed water to the Gila River Indian Community as part of 

the Settlement. The Cities have contributed millions of dollars in treatment and delivery infrastructure to provide this water to the Gila River Indian Community at 

no cost to the Community or the United States. The other Cities are contributing 

tens of millions of dollars to the Settlement by leasing CAP water from the Community. 

The Cities’ consideration for the above contributions also includes the benefits the 

Cities are receiving under Title 1 of H.R. 885. The settlement of the CAP issues reVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00103 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
100

flected in Title 1 of H.R. 885 is directly connected to the settlement of the Gila 

River Indian Community water rights claims. 

Title 1 approves the reallocation of CAP water previously designated for allocation 

to Arizona municipal and industrial interests. Since the mid-1980’s, 65,647 acre-feet 

of CAP water that was designated by the Secretary of Interior for allocation to 

Arizona’s municipal and industrial sector has remained uncontracted. This represents enough water to serve a population of nearly 300,000 people. Despite the 

undeniable need for the water by Arizona’s Cities and Towns, this water has remained unallocated because of various disputes between the United States and the 

Central Arizona Water Conservation District over the CAP repayment obligation 

and allocation of CAP water between Federal and non-Federal interests. H.R. 885 

resolves those disputes and provides a final allocation of CAP water between federal 

and state interests in Arizona. Under Title 1 of H.R. 885, the Cities each receive 

a specific allocation of the uncontracted municipal and industrial CAP water, which 

is needed to serve their growing populations. 

In addition, the Cities’ municipal and industrial CAP subcontracts, like the Gila 

River Indian Community’s CAP contract, will be expressly recognized as permanent 

service contracts with the existing delivery terms extended for 100 years. Title 1 of 

H.R. 885 also provides for the future allocation of 96,295 acre-feet of agricultural 

priority water to Arizona’s municipal and industrial interests. 

The settlement of the Gila River Indian water rights claims as approved by 

H.R. 885 accomplishes many objectives. First, the Settlement Agreement permanently settles all water rights claims of the Gila River Indian Community to both 

surface water and groundwater, including all appropriative rights, federal reserved 

rights and aboriginal rights. Second, it resolves disputes as to groundwater pumping, land subsidence and water quality. Third, it will provide the Gila River Indian 

Community with a significant water right to develop the Community’s lands. 

Fourth, it will furnish the Gila River Indian Community with adequate financial resources to allow for the beneficial and productive use of the water resources provided by the Settlement. This Settlement also will allow the parties, Native American and non-Native American, to plan for the future use and development of their 

water resources in cooperation rather than in conflict, and with certainty rather 

than uncertainty. 

H.R. 885 also provides an additional 214,500 acre-feet of CAP water to be allocated to Federal interests in the State. This represents a significant transfer of 

water from non-Federal to Federal interests within Arizona. However, the Cities 

recognize that the transfer of this water will help resolve Indian water rights 

claims, including the claims of the Gila River Indian Community and other Native 

American interests whose water rights claims have not yet been settled. 

H.R. 885 also resolves significant claims against the federal government, some of 

which involve only the federal government and the Gila River Indian Community. 

H.R. 885 provides an important opportunity for the federal government to meet its 

trust obligations to the Native American communities involved while at the same 

time providing long-term certainty regarding available Central Arizona Project 

Water (‘‘CAP’’) supplies to both Native American and non-Native American interests 

in Arizona. 

All parties to the CAP and Gila River Indian Community settlements benefit by 

settling their claims rather than continuing with protracted litigation. This settlement, as approved by H.R. 885, provides extensive and creative mechanisms to accomplish all the parties’ objectives. These mechanisms are unavailable through a 

court process. These creative mechanisms include exchanging reclaimed water for 

some of the Gila River Indian Community’s Central Arizona Project Water and the 

Cities leasing CAP water from the Community. The settlement also includes the use 

of some state parties’ water facilities to deliver water designated for the Community 

under the Settlement. This settlement provides for the parties to work together to 

accomplish their respective water use objectives and needs rather than continuing 

to devote substantial sums litigating over the nature and extent of CAP water allocation rights and the Gila River Indian Community’s water rights. 

The settlement of the CAP repayment and water allocation issues allows the parties to plan adequately for the future by eliminating uncertainty regarding available 

CAP water supplies and the Gila River Indian Community’s water rights claims. 

The problems that H.R. 885 resolves are serious problems, both for Arizona and the 

federal government. H.R. 885 represents a fair settlement of the disputes over the 

CAP repayment and water allocation issues, and the Gila River Indian Community’s 

water rights claims. We therefore urge your support of H.R. 885 and appreciate the 

opportunity to provide our written testimony to you.

101

NOTE: This statement was signed by the following individuals: 

Boyd Dunn, Mayor, Chandler, Arizona 

Elaine M. Scruggs, Mayor, Glendale, Arizona 

Jim Cavanaugh, Mayor, Goodyear, Arizona 

Keno Hawker, Mayor, Mesa, Arizona 

John Keegan, Mayor, Peoria, Arizona 

Mary Manross, Mayor, Scottsdale, Arizona 

Statement submitted for the record by L. Anthony Fines, Attorney for Gila 

Valley Irrigation District, and David A. Brown, Attorney for Franklin 

Irrigation District 

Chairman Calvert and Members of the Subcommittee, we have read some, but not 

all, of the testimony presented on behalf of the San Carlos Apache Tribe with respect to H.R. 885, the Arizona Water Settlements Act. In our opinion, much of the 

testimony presented on behalf of the San Carlos Apache Tribe is incorrect or not 

true. We do not have the time to address all the errors, but one error is especially 

significant. In the settlement that we are negotiating on behalf of the Gila Valley 

Irrigation District and the Franklin Irrigation District with the Gila River Indian 

Community, all parties have been careful to draft the language so that the rights 

of the San Carlos Apache Tribe will be unaffected by the settlement. In fact, the 

San Carlos Apache Tribe will have the same opportunities and ability to assert its 

rights after the settlement that it now has. We are hopeful that we will also be able 

to negotiate a settlement on behalf of our clients with the San Carlos Apache Tribe. 

If we are unable to reach a settlement with the San Carlos Apache Tribe, we will 

agree to any appropriate amendments to make clear that the rights of the San Carlos Apache Tribe are unaffected by our clients’ settlement with the Gila River 

Indian Community. 

Thank you for the opportunity to present this rebuttal statement.

L. ANTHONY FINES

DAVID A. BROWN

Statement submitted for the record by the Gila River Indian Community 

This supplemental testimony is being submitted to correct certain errors, omissions, and misstatements contained in the testimony of the San Carlos Apache Tribe 

(SCAT). Because of the large number of such errors, omissions and misstatements 

the Gila River Indian Community (Community) has limited its supplemental testimony to those that were most egregious or potentially misleading. The italicized text 

below indicates the error, omission or misstatement being addressed and the Fact 

section presents the Community’s correction for the record. 

I. SAN CARLOS APACHE RESERVATION

A. Water sources 

During the hearing before the House Water and Power Subcommittee of the 

House Resources Committee, the Chairperson of the San Carlos Apache Tribe asserted that the flow of the Gila River was contaminated by pollution that causes 

birth defects on the SCAT Reservation. 

Fact: First, as discussed in greater detail below, the only known water quality 

issue present in the upper Gila River concerns salinity from within the Gila River 

basin. It is generally accepted that elevated salinity levels in water, particularly of 

the levels found in the upper Gila River basin, do not, by themselves, cause birth 

defects. The Community recently contacted local and state health officials to confirm 

that there is no known connection between salinity in water and birth defects. 

Second, even if there were a connection between increased salinity and birth defects, which there is not, SCAT’s written testimony to the Committee confirms that 

SCAT does not use Gila River water for any domestic or municipal use but rather 

relies exclusively on groundwater for domestic and municipal uses. 

Third, although the rate for all Arizona Indians is high by comparison to non-Indians, the rate of birth defects at SCAT (2.4%) is not elevated at all by comparison 

to the average rate of all other tribes in Arizona (2.5%). 

During the hearing, an attorney for SCAT indicated that federal court rulings explicitly require the delivery of SCATS 6,000 acre-feet of water per year (af/y) by direct diversion from the Gila River, rather than by means of an upstream diversion 

into a pipeline that avoids high salinity springs that flow into the Gila River. 

102

Fact: SCAT’s written testimony includes the Water Quality Injunction issued by 

the Globe Equity Court on May 28, 1996, which states: 

‘‘Nothing in this injunction shall prohibit the parties, upon agreement or by order 

of this Court, from connecting the Apache Tribe’s irrigation system directly to the 

canals of the Gila Valley Irrigation District for Delivery of water directly to Apache 

farm lands. The connections may be made by canal or a pipe.’’ (SCAT Exhibit K, p. 

14 (emphasis supplied).) 

II. OVERVIEW OF TITLE I AND TITLE II OF THE ARIZONA WATER SETTLEMENT (SIC.) 

ACT (S. 437 AND H.R. 885) 

The settlement agreements and the exhibits to the settlement agreement ‘‘attempt 

to ‘legislate’ the water rights of [certain] parties in lieu of their adjudication in the 

Gila River Adjudication.’’ (p. 3) 

Fact: First, a condition of the enforceability of the Arizona Water Settlements Act 

is the approval by the Gila River Adjudication Court of the Gila River Indian Community Water Rights Settlement Agreement (Settlement Agreement). Thus, any 

water rights confirmed to the Community as a result of this settlement will be reviewed, and hopefully approved, by the Gila River Adjudication Court. During this 

court approval process any affected party, including SCAT or the United States on 

its behalf, may object to the settlement stating the grounds for their objection. The 

Gila River Adjudication Court will then render a judicial determination itself approving the Settlement Agreement or not. 

Second, all of the Indian tribes with claims to the waters of the Gila River and 

its tributaries are participating in the Gila River Adjudication. Several of these 

Indian tribes, including SCAT, have reached agreements with other parties asserting adverse or competing claims. These agreements provide that in exchange for an 

agreement on the amount of reserved right to be asserted by or on behalf of the 

Indian tribe, the tribe and the United States in its trust capacity for that tribe, 

agree not to challenge the claims of the parties to the agreement. In addition to entering such an agreement, SCAT sought and obtained a Special Proceeding before 

the Gila River Adjudication Court to obtain expeditious consideration of its agreement. The Court’s order was issued December 12, 1999. There is absolutely no basis 

for SCAT to challenge the Community’s effort to utilize the same process to reach 

settlements in the Adjudication. The Community’s settlement no more ‘‘legislates’’ 

water rights in the Adjudication than the SCAT Settlement, the Fort McDowell Settlement, the Salt River Pima-Maricopa Settlement, or the Yavapia-Prescott Settlement. 

‘‘The proposed legislation also attempts to settle all pending disputes between certain decreed parties in the Globe Equity No. 59 proceeding. (p. 3)’’

Fact: First, the legislation and the Settlement Agreement only address the Community’s pending disputes with certain parties in the Globe Equity 59 enforcement 

proceeding. All other parties, including SCAT, retain all their legal rights in connection with any pending or future proceedings to protect their rights or claims to 

water in Arizona. 

Second, an additional condition to the enforceability of the Arizona Water Settlements Act is the approval of the Community’s Settlement Agreement by the Globe 

Equity Court. Thus, any water claims settled by the Community as a result of this 

settlement will be reviewed, and hopefully approved, by the Globe Equity Court. 

During this court approval process any affected party, including SCAT or the United 

States on its behalf, may object to the settlement stating the grounds for their objection. The Globe Equity Court will then render a judicial determination itself approving the agreement or not. 

‘‘The settlement agreements would allow Gila Valley and Franklin Irrigation Districts to continue to pump up to six acre-feet per year of water from the ‘subflow’ 

of the Gila River in violation of the Tribe’s senior 1846 water rights under the Globe 

Equity Decree and continue to divert water for ‘hot lands’ which do not have any 

decreed water rights.’’ (p. 3) 

Fact: The Community has agreed not to challenge uses of up to 6 af/y of water 

(by pumping and direct river diversions) on a number of acres that is reduced from 

current levels by 3,000 acres. The Community’s agreement not to challenge such 

uses is contingent on the Upper Valley Diverters’ (‘‘UVDs’’) compliance with very 

specific conditions set forth in the UVD Agreement, including monitoring requirements and control of phreatophytes, among many others. The existing ‘‘hot lands’’ 

are part of the acreage limit to the extent they become Decreed lands pursuant to 

application to Globe Equity court for such status. SCAT may object to such application, as may the United States on SCAT’s behalf, or any other party except the 

Community. 

103

Overall, the UVD agreement will unquestionably reduce UVD water use and consumption. Diversion and pumping records for the period 1936–1997 clearly show 

that pumping and surface diversions as well as total consumptive use of water by 

crops will be reduced when the Settlement Agreement is fully implemented. The 

Settlement Agreement holds the UVDs to total pumping and diversions of approximately 181,860 af/y. In every year since 1956, the UVD’s combined pumping and 

diversions have substantially exceeded this amount. The average of the UVDs’ combined pumping and direct diversions for the period 1937 to 1997 was almost 230,000 

af/y. 

Most significantly, all uses of water, even uses that conform to the UVD agreement, will still remain subject to challenges by SCAT if they believe such uses affect 

their 1846 water right. There is nothing in the legislation, the Settlement Agreement or its exhibits which prevents SCAT or the United States, in any capacity 

other than as trustee for the Community, from proceeding with any new or existing 

claims against the UVDs. 

III. CENTRAL ARIZONA PROJECT

B. Repayment of CAP debt to United States 

‘‘If CAWCD’s debt was $1.65 billion, that would leave approximately $2.35 billion 

in project costs unresolved and possibly charged to Indian lands.’’ (p. 6–7) 

Fact: There is simply no basis in federal law or policy for even speculating about 

whether CAP costs will be disproportionately charged to Indian tribes because the 

Colorado River Basin Project Development Act of 1968 (CRBPA) imposes the following limitation: 

‘‘The Secretary shall determine the repayment capability of Indian lands within, 

under, or served by any unit of the Central Arizona Project. Construction costs allocated to irrigation of Indian lands and within the repayment capability of such 

lands [shall be indefinitely deferred as provided in 25 U.S.C. § 386a], and such costs 

that are beyond repayment capability of such lands shall be nonreimbursable.’’ (43 

U.SC. § 1542, emphasis supplied) 

Other parties address the SCAT’s other misstatements about CAP repayment. 

C. CAWCD sells Indian water to non-Indians and keeps the income 

D. CAWCD discriminates against Indians in its pricing structure for CAP water 

which makes tribal use of CAP water under Indian contracts cost prohibitive 

E. Disincentive to construct tribal CAP projects due to CAWCDs ability to market 

Indian water for non-Indians and keep the income 

Fact: The Community agrees that CAWCD has very recently proposed a problematic ‘‘excess water’’ pricing scheme, which, if implemented, would allow non-Indians 

to purchase CAP water at a lower rate than Indian tribes. Such policy would affect 

the Community more than SCAT because the Community has an existing CAP allocation of water that is larger than that of SCAT. The enactment of Title I of S. 437 

and H.R. 885 will provide immediate relief from the disparity caused by this proposed CAWCD pricing scheme. In addition, because CAWCD will be reimbursed by 

the federal government for fixed Operation, Maintenance, and Replacement (OM&R) 

charges for CAP water held under long-term tribal contracts, and not reimbursed 

for such charges for ‘‘excess water’’, the CAWCD’s incentive will be to encourage the 

use of CAP water by Indians. 

H. CRBP development fund will be used for non-project purposes and will continue 

to be used to the disadvantage of Indians 

Fact: Each of the points raised in this section are effectively refuted by the proposed amendment to § 403 (43 U.S.C. § 1543) of the Colorado River Basin Project 

Act (CRBPA). 

Three sources of revenue established by the CRBPA and the ‘‘annual payment by 

the CAWCD to effect repayment of reimbursable CAWCD construction costs [$1.65 

billion], shall be credited against the annual payment owed by the CAWCD,’’ and 

then all of these funds: 

‘‘shall be available annually, without further appropriation, in order of priority: 

(A) to pay fixed operation, maintenance, and replacement charges associated with 

the delivery of Central Arizona Project water under long-term contracts for use by 

Arizona Indian tribes.’’ (§ 107(a)) 

‘‘GRIC is first in line to take the credits from the annual payments made by 

CAWCD each year. GRIC proposes to not only use the Fund for CAP purposes * 

* * it will use $147 million to rehabilitate its BIA San Carlos Irrigation Project system which delivers water to GRIC from the Gila River.’’ (p. 12) 

104

Fact: The Settlement Agreement ratified by S. 437 and H.R. 885 impose an annual cap of $25 million on the amount of money available from the Lower Colorado 

River Basin Development Fund (Development Fund) for San Carlos Irrigation 

Project (SCIP) rehabilitation. This ensures that every year there will be millions of 

dollars in excess of this particular cap that can and will be applied to other Indian 

projects. At the request of other parties, the Community agreed to this annual limit 

to ensure that other Indian water projects are also paid for on an ongoing basis. 

The Bureau of Reclamation has developed a projection of funding inflows and outflows for the Development Fund that demonstrates that all Indian projects currently 

contemplated, including SCAT, will be funded in a timely and certain manner. 

SCAT appears to argue that none of the Development Fund should be available 

for tribal irrigation systems unless those systems are used exclusively for CAP 

water. Yet the SCAT project authorized by its 1992 settlement, and funded by the 

Development Fund, will deliver both CAP water and non-CAP water. ‘‘The draft EIS 

will evaluate reasonable alternative methods of delivering the CAP water and other 

waters’’ including 6,000 af/y of G.E. 59 decreed water, 7,300 af/y from the Black and/

or Salt Rivers, and water from local Tribal water sources. (Notice of Intent to Prepare EIS, 67 Federal Register 8316 (February, 2002) 

In addition, SCAT’s argument would deny access to the Development Fund to the 

Navajo Nation, Hopi and possibly other Indian tribes in the Gila River watershed 

and other Arizona watersheds if they obtain settlements that include non-CAP 

water supplies. 

I. The proposed legislation will require that tribes have a water rights settlement in 

place before a tribe can use CAP water whereas non-Indians have been able to 

use CAP water for years without a settlement of water rights 

‘‘Tribes without water settlements will not have their CAP delivery systems built 

until a settlement is in place. That violates the Tribe’s CAP contracts.’’ (p. 13) 

Fact: This statement simply ignores the provisions of S. 437 and H.R. 885, which 

provide that both CAP repayment funds and appropriated funds are available ‘‘to 

pay the costs associated with the construction of distribution systems required to 

implement the provisions of * * * (II) section 3707(a)(1) of the San Carlos Apache 

Tribe Water Settlement Act of 1992 (106 Stat. §747)’’ (emphasis added), which includes CAP delivery components. See Section 107(a) (amending section 

403(f)(2)(D)(i)(II) of the CRBPA). Both bills also explicitly make funds available for 

the construction of on-reservation distribution systems for the Yavapai Apache 

(Camp Verde), Pascua Yaqui, and Tonto Apache Indian tribes along with the Sif 

Oidak District of the Tohono O’odham Nation.’’ (See Section 107(a)(amending section 

403(f)(2)(E) of the CRBPA.) 

In addition, SCAT’s testimony acknowledges that money from annual appropriations, as well as funds from the Development Fund, will be available to underwrite 

the cost of these and other Indian distribution systems in Arizona. (p. 14). 

‘‘For over 10 years, the San Carlos Apache Tribe has had a settlement in place.’’ 

(p. 14) 

Fact: Unlike other statements in SCAT’s testimony, this statement is correct. As 

discussed above, SCAT’s settlement was only made enforceable in December 1999. 

Nevertheless, for more than 10 years, SCAT has enjoyed the certainty and other 

benefits it has acquired from its 1992 water settlement, a certainty that it seeks 

to deny to the Community. At that time, SCAT ensured that it acquired a water 

supply that is more reliable than other Indian tribes in Arizona can even hope for. 

SCAT was able to accomplish this by keeping other interested parties in the dark 

about its intentions and its negotiations until its settlement was included as one of 

the last titles in largest reclamation project legislation approved by Congress in decades. While SCAT is now championing the virtues of inclusiveness in water settlement negotiation, it did not even attempt to consult with the Community in 1992 

or consider the impact of its settlement on the Community’s efforts to assert claims 

to the Salt and Verde Rivers. 

J. Gila River Indian Community’s settlement CAP water will be substantially used 

by non-Indians 

Fact: SCAT fails to acknowledge that water leases are often an integral component of Indian water rights settlements, including SCAT’s 1992 settlement, where 

they serve a variety of purposes. For example, in the Community’s case, it is able 

to leverage CAP leases in exchange for a greater supply of treated effluent from 

neighboring cities. Upon close examination the leases and exchanges contemplated 

by the Settlement Agreement all serve such dual purposes by increasing water use 

efficiency and/or the reliability of the water provided to the Community. SCAT itself 

105

has leased much of the CAP water it obtained from its 1992 settlement to non-Indian parties. 

L. When the CAP canal capacity is not enough to deliver all CAP water orders, GRIC 

will be the last to be required to take a reduction 

Fact: This is simply incorrect. Paragraph 8.14 of the Settlement Agreement, to 

which the statement by SCAT is directed, simply ensures that GRIC’s CAP water 

deliveries are not reduced based on delivery capacity unless those of ‘‘similarly located,’’ CAP water users are also reduced. 

N. San Carlos Apache Tribe’s Water Rights Settlement Act will likely be impaired 

Fact: At the September 30, 2003 joint hearing before the Senate Energy and 

Natural Resources and Senate Indian Affairs Committees and then before the Water 

and Power Subcommittee of the House Committee on Resources the Acting Assistant Secretary for Indian Affairs, Aurene Martin, was asked several times whether 

the Arizona Water Settlements Act violated the federal government’s trust responsibility to any Indian tribe. She answered that it did not. The Acting Assistant Secretary provided similar assurances to the House Water and Power Subcommittee of 

the House Resources Committee. 

O. San Carlos Apache Tribe’s water supply from Gila River will be further diminished by exchanges of CAP water for Gila River water upstream of tribe’s 

reservation 

Fact: The Community has already shown that the UVD agreement will decrease 

the amount of water used for irrigation in the upper Gila valley. The Community 

also notes that all exchanges contemplated by the Settlement agreement are subject 

to full federal environmental review before they are approved by the Secretary. They 

must also be approved by the Globe Equity Court. The Phelps Dodge agreement explicitly prevents the Secretary from approving the lease/exchange until: ‘‘All Environmental Compliance has been completed relating to the United States’ execution 

of the Lease and Exchange Agreement and any litigation relating to such Environmental Compliance is final and subject to no further appeal.’’ In addition, the entire 

Settlement must be approved in a Special Proceeding before the Gila River Adjudication Court. SCAT will have at least three opportunities to present evidence 

about any impact associated with these exchanges. Finally, in an effort to ensure 

that the SCAT current water supply is not simply preserved, but improved both as 

to quality and quantity, the Community is working actively with other parties to 

develop a mechanism to provide SCAT with a direct delivery of Gila River water 

through a pipeline that avoids the salinity of which SCAT complains. 

P. San Carlos Apache Tribe’s right to power generation benefits of its power site at 

Coolidge Dam will be diminished 

Fact: Any discussion about SCAT’s claim of injury based on a loss of electrical 

power is, of course, academic and speculative at this juncture because no electricity 

is being produced. 

With respect to SCAT’s claim that it was inadequately compensated for the construction of Coolidge Dam, this has no relevance to the settlement of water rights 

disputes concerning the Gila River Indian Community and Tohono O’odham Indian 

tribes. Whatever the merits of SCAT claims, they only serve to create confusion 

about unrelated issues. SCAT chose not to press for resolution of this issue when 

its 1992 settlement was before Congress, perhaps because it did not wish for these 

issues to interfere with its efforts to enact a water settlement It should not be entitled to interject these issues at this juncture, at the expense of other Arizona Indian 

tribes. 

IV. THE GRIC SETTLEMENT (S. 437 AND H.R. 885) WILL RESULT IN UNPRECEDENTED

ENVIRONMENTAL DEGRADATION TO THE GILA RIVER SYSTEM AND SOURCE AND TO

SAN CARLOS LAKE

A. The Gila River system and source as well as San Carlos Lake provide some of 

the last remaining riparian habitat in Arizona, which must be preserved to ensure the continued existence of many sacred, rare, and federally listed animals 

and plants 

1. The habitat of the Gila River and its tributaries. 

Fact: Nothing in the Gila River Indian Water Rights Settlement Act or Settlement 

Agreement contradicts the provisions of P.L. 101–628 establishing the Gila Box Riparian National Conservation Area. 

2. The habitat of San Carlos Lake. 

106

Fact: SCAT’s assertions about San Carlos Lake mirror a series of claims that were 

rejected by the U.S. District Court for Arizona in July 2003. The court found that 

SCAT had not presented enough evidence of any threats to threatened, endangered, 

or other species in San Carlos Lake to merit any further consideration of its claims. 

The court explicitly rejected SCAT’s efforts to tie low lake levels to avian botulism. 

‘‘[T]wo experts with 30 years experience treating injured and diseased raptors, one 

expert working in Arizona since 1973, have never encountered botulism in Bald Eagles and both stated that Bald Eagles would not likely be impacted by this disease.’’ 

SCAT v. United States, 2003 WL 21697724 (2003 D.Ariz.) 

B. The act and agreement will destroy the flows in the Gila River watershed and 

contaminate its flows through the discharge of treated effluent 

Fact: Re-use of highly treated effluent by putting it back into river systems is a 

recognized mechanism for efficient water use, particularly in water-short areas such 

as Arizona. Any discharges of such effluent will be governed by both federal and 

state law, and cannot therefore be characterized as a contaminating pollutant. 

Exchanges with Phelps Dodge, ASARCO and New Mexico can only occur after environmental compliance and then only in accordance with Article XI of the Globe 

Equity Decree. 

‘‘The Apache Tribe objects to the SCIDD proposal which cannot fulfill the United 

States’ trust responsibility to the Apache Tribe to preserve and protect San Carlos 

Lake.’’ (p. 31) 

Fact: In July 2003, the U.S. District Court for Arizona addressed each of SCAT’s 

claims that the operation of San Carlos Reservoir and the failure to provide a minimum storage pool breached the federal government’s trust obligation to SCAT. The 

court rejected each of SCAT’s allegations, including the allegation that the operation 

of the dam violates federal laws for the protection of archeological and cultural resources. The court found that SCAT had simply not presented evidence that there 

was any factual or legal basis to require the government to maintain the minimum 

project pool. In clear terms, there is no trust responsibility to maintain a minimum 

lake level. 

V. THE GRIC SETTLEMENT EXPRESSLY EXEMPTS ITSELF FROM COMPLIANCE WITH

THE NATIONAL ENVIRONMENTAL POLICY ACT AND CONTAINS BROAD AND SWEEPING

ENVIRONMENTAL WAIVERS

A. Exemption from NEPA compliance 

Fact: SCAT is well-aware that this provision is included in all Indian water rights 

settlements. For example, it was included in the San Carlos Apache Water Rights 

Settlement Act of 1992 (3709(a), P.L. 102–575). 

B. The GRIC settlement requires the United States to execute broad waivers and releases for past, present, and future environmental harms 

Fact: SCAT’s comments purposefully ignore the limitations on the scope of the 

claims the United States will not assert pursuant to 207(c). The only claims the government agrees that it will not pursue are those claims enumerated in 207(a). These 

are claims that only involve the interests of the Community, its members, and its 

members as allottees. 

VII. THE GRIC SETTLEMENT ACT CREATES A ‘‘TEMPLATE’’ FOR THE LOSS OF TRIBES’ 

FEDERAL RESERVE WATER RIGHTS FOR LANDS TRANSFERRED INTO TRUST

Fact: Indian land and water settlements frequently contain provisions that address or place constraints on future tribal acquisitions of land or water. SCAT has 

no objection to similar provisions in the Zuni Water Settlement (P.L. 108–34) or in 

Title III of the Arizona Water Settlements Act. 

IX. GLOBE EQUITY DECREE-RIGHTS OF THE SAN CARLOS APACHE TRIBE

A. Federal Globe Equity No. 59 Consent Decree 

1. The San Carlos Apache Tribe has federal reserved and aboriginal water right 

claims pending in the Gila River general stream adjudication for additional water 

rights to the mainstem of the Gila River which could affect the Globe Equity No. 

59 Decree. 

Fact: As the testimony before the Committee explained, nothing in the Arizona 

Water Settlements Act impedes SCAT’s effort to assert its reserved water rights 

claims, just as the Community accepts that SCAT could and did reach settlements 

with parties asserting claims adverse to the Community’s reserved rights claims 

through the 1992 SCAT settlement legislation. The Community’s settlement also 

107

preserves SCAT’s ability to object to any provision in its settlement in federal and 

state court before the Community’s settlement would become effective. It also preserves SCAT’s ability to object in court as to any of the possible exchanges contemplated by the Community’s settlement. 

2. The Globe Equity No. 59 Court has entered a water quality injunction against 

the Gila Valley and Franklin Irrigation District to ensure that the San Carlos 

Apache Tribe receives that quality of water necessary to cultivate moderately saltsensitive crops. 

Fact: Nothing in the Community’s settlement framework interferes with the water 

quality injunction, which, as discussed above, concerns only salinity from within the 

Gila River Valley. 

3. Standard for construing the Globe Equity Decree. 

4. Previous rulings by the Globe Equity Court and the Ninth Circuit confirm that 

UVD pumping is ‘‘covered’’ by the decree. 

The Community has no specific comments on these sections of SCAT’s testimony, 

which recite SCAT’s interpretation of certain laws and court rulings. SCAT’s generalized views on these topics are simply not relevant to the Committee’s consideration of the Arizona Water Rights Settlements Act. As noted above, because SCAT 

retains all its existing rights and claims, it can vigorously pursue the enforcement 

of such rights and claims using such interpretations as a basis for its actions. 

B. The Arizona Gila River General Stream Adjudication 

1. The San Carlos Apache Tribe has unadjudicated federal reserved and aboriginal water right claims to waters of the mainstem and tributaries of the Gila River 

in the Arizona Gila River General Stream Adjudication. 

Fact: Under the Arizona Water Settlements Act, the Community will not seek to 

increase the reserved rights available to it in the Gila River. Nothing in the proposed legislation interferes with SCAT’s right or ability to attempt to increase its 

reserved rights through litigation or separate settlement. 

Statement submitted for the record by Keno Hawker, Mayor,

City of Mesa, Arizona 

Chairman Calvert and members of the Subcommittee; as the Mayor of the City 

of Mesa, Arizona, I appreciate the opportunity to submit this testimony in support 

of H.R. 885. The City of Mesa provides water service to approximately 435,000 people in four cities and across two counties. The importance of H.R. 885 to Mesa, its 

customers, and other water users throughout Arizona cannot be underestimated. 

You will hear a great deal of testimony about the benefits of the Arizona Water 

Settlements Act. You will hear talk of the stability, certainty in water resources 

planning, cessation of costly litigation, and reduced CAP repayment obligation that 

the settlement brings to the State of Arizona. You will hear of the benefits the settlement brings to the federal government, including an increased share of CAP 

water that can be used by the federal government to meet its trust responsibilities 

towards the many Native American communities within Arizona. The City of Mesa 

shares in these important benefits and values them greatly, but I want to emphasize the value of some of the unique benefits that the City of Mesa in particular 

realizes from this Act. 

Through this settlement and its enabling legislation, Mesa will receive an additional allocation of 7,115 acre-feet per year of CAP M&I priority water that is vital 

to ensuring Mesa’s sustainable growth and development. Mesa also will gain the option to lease Gila River Indian Community CAP water in the future, again adding 

to the pool of water Mesa can use for its future. 

Most importantly, however, the City of Mesa is undertaking a water exchange 

with the Gila River Indian Community. Mesa will deliver 29,400 acre-feet per year 

of high quality reclaimed water to the reservation boundary and in exchange will 

receive 23,530 acre-feet of CAP water that Mesa can use in its potable system. This 

exchange is essential to the City of Mesa. The exchange affords Mesa the opportunity to efficiently convert what is a non-drinking water source into a drinking 

water resource that can be used to meet growing municipal and industrial demands. 

The exchange allows the Gila River Indian Community to increase the size of its 

water budget and use this high quality water for agricultural purposes at a very 

low price. Mesa has a history of partnership with its neighbor the Gila River Indian 

Community in the redevelopment of what was Williams Air Force Base, and strongly values the opportunity to partner again with the Community in a project that 

can bring so many benefits to both communities. The proposed reclaimed water exVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00111 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
108

change allows both entities to manage water in a regional, conjunctive, and efficient 

manner that brings great benefits to the residents of both communities. 

For these reasons and others, the City of Mesa strongly endorses the Arizona 

Water Rights Settlements Act and urges your support of H.R. 885. 

Thank you for the opportunity to provide written testimony.

Statement submitted for the record by Douglas Mason, General Manager, 

San Carlos Irrigation and Drainage District, Coolidge, Arizona 

Chairmen Calvert and Members of the Subcommittee, the San Carlos Irrigation 

and Drainage District (District) is pleased to submit this testimony supporting the 

enactment of H.R. 885, the Arizona Water Settlements Act. Our support for enactment reflects the efforts of many parties that have collaborated to bring this settlement to the point where the Congress can consider enactment of the authorizing 

legislation. Of particular note are the efforts of the Arizona Congressional delegation, who have been instrumental in bringing the parties together to structure innovative solutions to what had been considered to be intractable disputes. 

Although the broad fabric of the Settlement is complete, two areas continue to be 

completed through ongoing negotiations. These include: (1) finalization of arrangements for water users in New Mexico to use the 18,000 acre-feet per year of Central 

Arizona Project water that was promised in the 1968 Colorado River Basin Project 

Act; and (2) completion of agreement language defining the rights of water users 

in the Upper Gila River valleys near the communities of Duncan and Safford in 

western New Mexico and eastern Arizona. This District is participating in those discussions. With conclusion of those two items and any necessary conforming changes 

to the Settlement Agreement and the legislation, the Bill will be ready for enactment. 

From the perspective of this District, the Settlement accomplishes important objectives. They include: 

1. Resolves decades of difficulties between District farmers and members of the 

Gila River Indian Community (Community) over how the Gila River water 

rights shared by the District and the Community are managed; this is accomplished by restructuring and simplifying how San Carlos Irrigation Project 

(Project) water is divided; 

2. Vests in the District and the Community, through a Joint Control Board, operation and maintenance responsibility for the Project irrigation water delivery 

facilities; 

3. Provides for the rehabilitation of Project irrigation water delivery facilities 

using moneys available in the Lower Colorado River Basin Development Fund 

that is to be made available through contracts between (1) the United States 

and the Community and (2) the United States and the District; 

4. Provides that the District will use its available contracting authorities and 

workforce to cost-effectively complete the rehabilitation of all District and most 

Project Joint Works facilities; 

5. Provides that 8,000 acre-feet per year of water conserved through rehabilitating District facilities will be made available to maintain a sustainable water 

supply for a minimum Project fish and wildlife pool in the San Carlos Reservoir; 

6. Provides an option for the United States to use, for a future water rights settlement with the San Carlos Apache Tribe, an average of 10,000 acre-feet per 

year of water conserved through rehabilitating District facilities; and. 

7. Provides that the District will assume the obligation to repay that portion of 

District facility rehabilitation costs that are associated with the net new conserved water supplies received by the District and, further, provides that remaining costs will be non-reimbursable because the beneficiaries of those investments are tribal entities and fish and wildlife resources. 

In conclusion, the San Carlos Irrigation and Drainage District supports enactment 

of H.R. 885 because it resolves historical disputes and establishes mechanisms 

where future disagreements can be resolved among the local interested parties without needing to involve the United States in such management decisions. 

Along with myself, our General Counsel, Riney B. Salmon II, and our Engineering 

Consultant, Michael J. Clinton, will attend the Committee Hearing. We would be 

pleased to address any questions that arise about District participation in the 

Arizona Water Settlements Act and the associated Settlement Agreement. 

Thank you for considering this testimony. 

109

[A letter submitted for the record by the City of Payson, Arizona, 

follows:]

Statement submitted for the record by George Renner, President, Board of 

Directors, Central Arizona Water Conservation District 

Chairman Calvert and Members of the Subcommittee, the Central Arizona Water 

Conservation District is pleased to offer the following testimony regarding H.R. 885, 

the Arizona Water Settlements Act. 

The Central Arizona Project or ‘‘CAP’’ was authorized by the 90th Congress of the 

United States under the Colorado River Basin Project Act of 1968 (Basin Project 

Act). The CAP is a multi-purpose water resource development project consisting of 


89653.001
110

a series of canals, tunnels, dams, and pumping plants that lift water nearly 3,000 

feet over a distance of 336 miles from Lake Havasu on the Colorado River to the 

Tucson area. The project was designed to deliver the remainder of Arizona’s entitlement to Colorado River water into the central and southern portions of the state 

for municipal and industrial, agricultural, and Indian uses. The Bureau of Reclamation (Reclamation) initiated project construction in 1973, and the first water was delivered to central Arizona in 1985. In 2000, CAP delivered its full normal year entitlement of 1.5 million acre-feet for the first time, allowing Arizona to utilize its full 

Colorado River apportionment of 2.8 million acre-feet. 

CAWCD was created in 1971 for the specific purpose of contracting with the 

United States to repay the reimbursable construction costs of the CAP that are 

properly allocable to CAWCD, primarily non-Indian water supply and commercial 

power costs. In 1983, CAWCD was also given authority to operate and maintain 

completed project features. CAWCD’s service area is comprised of Maricopa, Pima, 

and Pinal counties, and includes the state’s major metropolitan areas of Phoenix 

and Tucson. CAWCD is a tax-levying public improvement district, a political subdivision and a municipal corporation, and represents roughly 80% of the water users 

and taxpayers of the State of Arizona. CAWCD is governed by a 15-member Board 

of Directors elected from the three counties it serves. CAWCD’s Board members are 

public officers who serve without pay. 

Project repayment is provided for through a 1988 Master Repayment Contract between CAWCD and the United States. Reclamation declared the CAP water supply 

system (Stage 1) substantially complete in 1993, and declared the regulatory storage 

stage (Stage 2) complete in 1996. No other stages are currently under construction. 

Project repayment began in 1994 for Stage 1 and in 1997 for Stage 2. To date, 

CAWCD has repaid $685 million of CAP construction costs to the United States. 

In 2000, CAWCD and Reclamation successfully negotiated a settlement of their $500 million dispute regarding the amount of CAWCD’s repayment obligation for 

CAP construction costs. That dispute had been the subject of ongoing litigation in 

United States District Court in Arizona since 1995. The settlement includes a number of conditions that must be satisfied before it will become final, including completion of Indian water rights settlements for the Gila River Indian Community and 

Tohono O’odham Nation. Several of those conditions are addressed in H.R. 885. 

Title 1—Central Arizona Project Settlement Act 

Title 1 of H.R. 885 resolves a long-standing dispute between the United States 

and the State of Arizona regarding the allocation of CAP water. Title 1 also provides 

the water supplies and funding source that are necessary to complete Indian water 

rights settlements for the Gila River Indian Community (Title 2), the Tohono 

O’odham Nation (Title 3), and other Arizona tribes. 

CAP WATER FOR INDIAN SETTLEMENTS

Congress authorized the Central Arizona Project for the stated purposes of reducing groundwater overdraft, maintaining as much of central Arizona’s irrigated agriculture as possible, and providing additional water for future municipal and industrial use. H.R. Rep. No. 1312, 90th Cong., 2d Sess. 55 (1968). There is scant mention of any intended CAP benefits for Indian tribes in the legislative history of the 

Basin Project Act. 

Nevertheless, by 1983 the Secretary of the Interior (Secretary) had allocated 

309,828 acre-feet of CAP water to Indian tribes and entered into long-term contracts 

with tribes for much of that supply. That represented about 22 percent of the anticipated annual CAP supply. Arizona Indian water rights settlements completed since 

1983 have increased the amount of CAP water allocated to Indian tribes and decreased the amount available for non-Indian use. Presently, 453,224 acre-feet of 

CAP water—32 percent of the CAP supply—is under contract to Indian tribes or 

dedicated for use in Indian settlements. 

The Arizona Water Settlement Agreement (Agreement) among the United States, 

CAWCD and the Arizona Department of Water Resources, which would be ratified 

by H.R. 885, would make an additional 214,500 acre-feet of CAP water available 

for use by Indian tribes. Most of this additional water would come from non-Indian 

agricultural water users. A total of 293,795 acre-feet of non-Indian agricultural CAP 

water is being sought under the Agreement. Two-thirds of this water would be used 

to facilitate pending and future Indian water rights settlements; one-third would go 

to the State of Arizona for future municipal and industrial use. 

With the additional water provided under the Agreement, a total of 667,724 acrefeet of CAP water—47 percent of the total CAP supply—would be available for 

Indian use. H.R. 885 provides that this division of the CAP supply is final. This is 

a key element of the settlement legislation for non-Indian CAP water users. Some 

111

have suggested that even more CAP water should be allocated for Indian use, but 

any change in the division of CAP water from that reflected in H.R. 885 would require amendment of both the Agreement and the CAP repayment settlement. 

CAWCD is a party to both of those agreements, and CAWCD will not accede to any 

further reduction in the non-Indian CAP supply. 

No central Arizona Indian tribe has a Winters right claim to CAP water, and the 

rights of mainstream tribes to Colorado River water were adjudicated in Arizona v. California. Nevertheless, under H.R. 885 the Secretary would have a pool of 67,300 

acre-feet of CAP water to use in future Arizona Indian water rights settlements. 

That is the only CAP water that will be available for future Indian settlements. Accordingly, it is imperative that the Secretary only be permitted to reallocate this 

water as part of a final Indian water rights settlement, as provided in section 104(b) 

of H.R. 885. 

As noted, the CAP water to be reallocated under H.R. 885 would come from nonIndian agriculture. Non-Indian agricultural water users with long-term contract entitlements to CAP water will be encouraged to permanently relinquish their longterm rights to CAP water. As partial compensation, the Agreement provides that 

the non-Indian agricultural contractors would be relieved from the federal debt they 

incurred under section 9(d) of the Reclamation Project Act of 1939. (Those contractors would remain responsible for repaying any private bond debt.) Collectively, 

their 9(d) debt totals more than $158 million. Under the Agreement, CAWCD will 

pay about $85 million of that debt and the United States will forgive $73.5 million. 

Section 106 of H.R. 885 makes the 9(d) debt that the United States has agreed to 

forgive non-reimbursable and non-returnable. 

Section 106 also exempts land within the CAP service area from the Reclamation 

Reform Act and any other acreage limitation or full cost pricing provision of federal 

law. The Central Arizona Project was constructed to provide a renewable water supply to agriculture to alleviate the significant groundwater overdraft in central 

Arizona. By limiting the agricultural lands that may receive CAP water, the Reclamation Reform Act operates to increase groundwater pumping in central Arizona. 

Thus, the exemption in section 106 is appropriate to help the CAP achieve its mission. This exemption also satisfies a condition to the relinquishment of the CAP 

non-Indian agricultural entitlements. 

Title 1 also prohibits the transfer or use of any CAP water outside the State of 

Arizona, except in the context of the interstate water banking program already established under regulations adopted by the Secretary. Title 1 also directs the Secretary to reallocate 65,647 acre-feet of currently uncontracted CAP M&I water to 

M&I water providers in Arizona. Both of these provisions are essential to CAWCD 

and its water users. 

FUNDING—FOR INDIAN WATER RIGHTS SETTLEMENTS

To provide a funding source for Indian water rights settlements, Title 1 amends 

section 403(f) of the Basin Project Act to allow additional uses of certain funds deposited into the Lower Colorado River Basin Development Fund (Fund). The Fund 

is a separate fund within the U.S. Treasury established by Congress under the 

Basin Project Act, which authorized construction of the CAP. Revenues deposited 

into the Fund come from a number of sources, including: the sale of power from the 

Navajo Generating Station that is surplus to CAP pumping needs; a surcharge on 

power sold in Arizona from Hoover Dam and (beginning in 2005) Parker and Davis 

Dams; and other miscellaneous revenues from operation of the CAP. Under existing 

law and contract, these revenues are paid each year to the general fund of the 

Treasury to return the CAP construction costs that are reimbursable by CAWCD. 

To the extent that Fund revenues are insufficient to meet CAWCD’s annual repayment obligation, CAWCD makes up the difference with a cash payment to the 

United States, which is also deposited into the Fund. 

Title 1 does not affect the collection and deposit of revenues to the Fund. Nor does 

it affect CAP repayment or alter CAWCD’s obligation to make cash payments sufficient to meet its annual repayment obligation for the CAP. Under Title 1, monies 

in the Fund will still be credited first against CAWCD’s annual repayment obligation. But instead of being returned to the general fund, those funds may also be 

used each year, without further appropriation, to pay certain costs of delivering CAP 

water to Indian tribes, constructing distribution systems to deliver CAP water to 

Indian tribes, and other costs authorized under Titles 2 and 3 of H.R. 885. 

Title 2—Gila River Indian Community Water Rights Settlement Act 

Title 2 authorizes, ratifies and confirms a settlement of the water rights claims 

of the Gila River Indian Community (Community) that has been more than a decade 

in the making. This agreement is a significant step forward for Arizona that will 

112

settle longstanding litigation over the Community’s water rights and provide muchneeded certainty for state water management. 

Of particular importance to CAWCD, Title 2 prohibits the lease, exchange, forbearance or transfer of CAP water in any way by the Community for use outside 

the State of Arizona. 

Title 3—Southern Arizona Water Rights Settlement Amendments Act 

Title 3 resolves remaining disputes related to the Southern Arizona Water Rights 

Settlement Act, which was enacted by Congress in 1982 to settle the water rights 

claims of the Tohono O’odham Nation (Nation). Like the Community in Title 2, the 

Nation is expressly prohibited from leasing, exchanging, forbearing or transferring 

any of its CAP water for use outside the State of Arizona. 

Conclusion 

CAWCD strongly supports H.R. 885 as introduced. This legislation represents the 

culmination of years of effort by central Arizona water users in an open and inclusive process to resolve Indian water rights claims by negotiation rather than litigation. Passage of H.R. 885 will help bring closure to many longstanding disputes involving Arizona’s water supplies. 

Statement submitted for the record by The Honorable Skip Rimsza,

Mayor, City of Phoenix, Arizona 

Chairman Calvert and Members of the Subcommittee: 

The City of Phoenix, an incorporated municipality within Maricopa County, 

Arizona, greatly appreciates the opportunity to offer testimony in support of the 

Arizona Water Settlements Act, H.R. 885, which settles the long-standing water 

rights claims of the Gila River Indian Community and disputes over water allocations and costs of the Central Arizona Project. The Settlement Act provides many 

benefits to Arizona Indian tribes, the federal government, the State of Arizona and 

the City of Phoenix, both directly and indirectly. 

The linchpin of the Act is Title I, the Central Arizona Project Settlement. Title 

I settles disputes between the federal government and the State of Arizona over repayment obligations for the Central Arizona Project (CAP). It also divides CAP 

water between state and federal purposes. Most importantly, it provides a framework for the Gila River Indian Community Water Rights Settlement and future 

Indian water rights settlements in Arizona by providing funding sources and identifying water supplies that can be used to fill water budgets for those settlements. 

It also insures that precious Colorado River water will remain within the State and 

be used for the benefit of its citizens. The State, Indian tribes and federal government all reap rewards from settlements. 

Title I provides for long-term contractual commitments of CAP water to be capped 

at 1,415,000 acre-feet with 667,724 acre-feet going to Arizona Indian Tribes and the 

federal government. The remainder of the entitlement, 747,246 acre-feet goes to the 

State and non-Indian water users. The split of this entitlement is used as the basis 

of the State’s repayment obligation for the Central Arizona Project. Agreement between the State of Arizona, the federal government and Arizona Indian tribes on 

this point is a major accomplishment that only could have come to closure in the 

context of the overall settlement package authorized in this bill. 

The reallocation to Arizona’s Municipal and Industrial CAP water users in the 

amount of 65,500 acre-feet has been a hotly debated issue between water users in 

the State of Arizona, the federal government and Arizona Indian Tribes. Title I provides that the City of Phoenix shall receive 8,206 acre-feet of CAP water from this 

pool. The City will pay over $500,000 in back capital charges to the Central Arizona 

Water Conservation District (CAWCD) when that reallocation is finalized. This is 

a critical component of the Arizona Water Settlements Act for the City of Phoenix. 

Other important provisions include the extension of the City’s CAP subcontract for 

an additional 100 years, recognition that the contract is for permanent service and 

the creation of a formula for sharing CAP water between federal and non-federal 

water users in the event a shortage of Colorado River water for the Lower Basin 

States is declared. The City is not alone in the receipt of these benefits; they are 

available to all CAP subcontractors within Arizona. 

The identification of water supplies for Arizona Indian tribes now, in the case of 

the Gila River Indian Community (Community) and in the future for Indian Tribes 

with unfulfilled water rights claims, will benefit tribes, the federal government and 

the State of Arizona. The ability to facilitate settlement of these claims is critical 

to the continued vitality of the State. Settlement of these claims will provide certainty and will avoid costly and protracted legal battles over water resources. PerVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00116 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
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haps the most important provision of the entire bill is Section 107 of the Act which: 

(1) amends the Colorado River Basin Project Act to allow for revenues deposited into 

the Lower Colorado River Basin Fund to be credited against the repayment obligation for the Central Arizona Project; (2) provides funding for the Gila River Indian 

Community and the Tohono O’Odham Nation settlements; (3) allows the federal 

government to meet its obligations to fund Indian tribes’ operation and maintenance 

costs for CAP water deliveries to tribes; (4) provides funds for construction of critical 

water delivery infrastructure for Indian tribes; and (5) creates a mechanism to fund 

future Indian water settlements. This part of the Act provides an enormous collective benefit to the tribes, the federal government and for the State of Arizona and 

is an example of the forward thinking that went into the settlement package. 

Title II, the Gila River Indian Community Water Rights Settlement, is the culmination of many years of intensive negotiations. The settlement is fair and equitable for the GRIC, the State of Arizona, the federal government and local municipal, corporate, agricultural, and private parties and was achieved only with tremendous amounts of give-and-take on all sides. The Indian Community is a reservation 

of over 350,000 acres located within Maricopa and Pinal Counties. The reservation 

is located immediately south of the City of Phoenix and shares a common border 

with the City of Phoenix of approximately twenty-two miles in length. It is the city’s 

largest neighbor in terms of land area. The City of Phoenix has a population of over 

1.4 million people. This settlement agreement has many benefits for both the Gila 

River Indian Community and the City of Phoenix. The success of the settlement negotiations has also opened up many doors between the two communities on other 

important issues as well, and successful passage of the Water Settlement Agreement 

and implementation of the settlement agreement will further enhance future cooperative efforts between the Gila River Indian Community and the City of Phoenix. 

To provide some background to the settlement, the City and the Gila River Indian 

Community have been engaged in longstanding disputes over the rights to Arizona’s 

most scarce and precious natural resource, water. The City and the Community are 

not alone in this regard. These disputes involve significant claims to water by surrounding cities and towns, the State of Arizona and the federal government. The 

settlement, which the City helped craft provides resolution for all these claims in 

a fair and equitable manner to all parties, including the federal government. 

The nature and extent of the disputes deserves some explanation. The Indian 

Community primarily sits astride the Gila River. A portion of the Community also 

sits along the Salt River, a primary tributary to the Gila River. The Community 

contends that it has been denied by its neighbors, as well as by the actions and inactions of the federal government, to its fair share of the surface waters of the Gila 

River. More importantly to Phoenix, the Community claims that its fair share of the 

Salt River has been negatively impacted as well. For many years, the City of Phoenix has relied upon its water rights to the Salt River and its tributaries, through 

deliveries by the Salt River Project, for over 60% of its total water supplies. 

The Community also claims that its groundwater resources have also been unduly 

impacted by pumping that occurs off the reservation. Numerous lawsuits against 

parties in the State, including Phoenix, have been filed by the Community and by 

the federal government on behalf of the Community. 

Without this legislation the settlement will not become effective, and the parties 

including the federal government, will be forced to continue to litigate their disputes 

in court. A general stream adjudication to the rights of the Gila River and all its 

tributaries, the Gila River Adjudication, has been underway in Arizona since the 

1970’s. Without this bill the Community, the federal government and thousands of 

state parties will continue to have to assert and defend their claims in an expensive 

and lengthy process. This settlement solves that problem as well. 

There is a clear need for settlement of all these disputes. This settlement is appropriate and it is fair to all parties including the federal government and the Indian 

Community. All parties have been well represented in negotiating it. The City of 

Phoenix, for its part, has given up some of its Salt River water supplies, for the benefit of the GRIC. The City will also lease 15,000 acre-feet per year of the Community’s CAP water supply at an up-front cost of over $20,000,000. Congressional authority for the Community to lease its water is necessary and that authority is contained in this bill. Phoenix’s contributions to the settlement package are significant 

as are the contributions of the other parties in Arizona. Reciprocal waivers of claims 

between the Community, the federal government and the City of Phoenix and other 

state parties are also a key part of this legislation and are a vital component of the 

settlement. 

In summary, the City of Phoenix believes the Arizona Water Settlement Act is 

a fair, equitable and cost-effective solution for the settlement of financial and water 

114

claims for the benefit of the State of Arizona and its citizens, Arizona Indian tribes 

and the federal government and urges its enactment. 

Statement submitted for the record by John F. Sullivan, Associate General 

Manager, Water Group, Salt River Valley Water Users Association and 

Salt River Project Agricultural Improvement and Power District, on 

H.R. 885

Chairman Calvert, and members of the Subcommittee: 

Thank you for the opportunity to submit testimony in support of H.R. 885, the 

Arizona Water Settlements Act. My name is John F. Sullivan. I am the Associate 

General Manager, Water Group, of the Salt River Project (‘‘SRP’’), a large multi-purpose federal reclamation project embracing the Phoenix, Arizona metropolitan area. 

SRP is composed of the Salt River Valley Water Users’ Association (‘‘Association’’) 

and the Salt River Project Agricultural Improvement and Power District (‘‘District’’). 

Under contract with the federal government, the Association, a private corporation 

authorized under the laws of the Territory of Arizona, and the District, a political 

subdivision of the State of Arizona, provide water from the Salt and Verde Rivers 

to approximately 250,000 acres of land in the greater Phoenix area. Over the past 

century, most of these lands have been converted from agricultural to urban uses 

and now comprise the core of metropolitan Phoenix. 

The Association was organized in 1903 by landowners in the Salt River Valley to 

contract with the federal government for the building of Theodore Roosevelt Dam, 

located some 80 miles northeast of Phoenix, and other components of the Salt River 

Federal Reclamation Project. SRP was the first multipurpose project approved under 

the Reclamation Act of 1902. In exchange for pledging their land as collateral for 

the federal loans to construct Roosevelt Dam, which loans have long since been fully 

repaid, landowners in the Salt River Valley received the right to water stored behind the dam. 

In 1905, in connection with the formation of the Association, a lawsuit entitled 

Hurley v. Abbott, et al., was filed in the District Court of the Territory of Arizona. 

The purpose of this lawsuit was to determine the priority and ownership of water 

rights in the Salt River Valley and to provide for their orderly administration. The 

decree entered by Judge Edward Kent in 1910 adjudicated those water rights and, 

in addition, paved the way for the construction of additional water storage reservoirs by SRP on the Salt and Verde Rivers in Central Arizona. 

Today, SRP operates six dams and reservoirs on the Salt and Verde Rivers in central Arizona, as well as 1,300 miles of canals, laterals, ditches and pipelines, 

groundwater wells, and numerous electrical generating, transmission and distribution facilities. The six SRP reservoirs impound runoff from a 13,000-square mile 

watershed. The water stored in these reservoirs is delivered via SRP canals, laterals 

and pipelines to municipal, industrial and agricultural water users in the Phoenix 

metropolitan area. SRP also operates approximately 250 deep well pumps to supplement surface water supplies available to the Phoenix area during times of drought. 

In addition, SRP provides power to nearly 800,000 consumers in the Phoenix area, 

as well as other rural areas of the State. 

SRP holds the rights to water stored in its reservoirs, and for the downstream 

uses they supply, pursuant to the state law doctrine of prior appropriation, as well 

as federal law. Much of the water used in the Phoenix metropolitan area is supplied 

by these reservoirs. 

SRP fully supports the enactment of H.R. 885 in its entirety. However, my testimony, offered today on SRP’s behalf, is specifically directed to Title II of the bill, 

authorizing the Gila River Indian Community Water Rights Settlement. 

The Gila River Indian Reservation was created by an Act of Congress in 1859 and 

was enlarged by seven separate Executive Orders in 1876, 1879, 1882, 1883, 1911, 

1913 and 1915. Currently, the Reservation encompasses approximately 377,000 

acres of land in central Arizona. Most of the lands within the Reservation are located within the Gila River watershed. The water rights appurtenant to these lands 

are subject to a consent decree entered by the United States District Court in 1935. 

The 1935 ‘‘Globe Equity Decree’’ adjudicated the rights to water from the main stem 

of the Upper Gila River above its confluence with the Salt River. The Decree entitles 

the United States, on behalf of the Indians of the Gila River Reservation, to divert 

300,000 acre-feet of water annually from the Gila River. Historically, however, the 

Indian Community has received, on average, only about 100,000 acre-feet annually 

of its decreed entitlement, due to insufficient flows in the Gila River at the Reservation’s diversion point. 

115

A small portion of the Gila River Indian Reservation lies within the Salt River 

watershed, west of Phoenix and several miles downstream from SRP’s reservoirs. 

Many of these lands were added to the Reservation in 1879. At that time, a group 

of Indians, commonly referred to as the Maricopa Colony, was living there. Since 

some time prior to 1900, these Indians diverted water from the Salt River for the 

irrigation of approximately 1,000 acres. 

In 1901, the federal government, acting on behalf of the Maricopa Indians, 

brought suit in Arizona territorial court to stop nearby non-Indian irrigators from 

interfering with the waters used by the Indians. Some of the defendants named in 

the suit later became shareholders of the Association, after its incorporation in 

1903. On June 11, 1903, Judge Kent issued the decree in United States v. Haggard, 

which adjudicated the Maricopa Indians’ right to irrigate approximately 1,080 acres 

of land with water from the Salt River. In 1917, the Haggard decree was incorporated into the Benson-Allison decree, which also adjudicated water rights for 

lands not included in the original decree, located near the confluence of the Salt and 

Gila Rivers. 

Other than the approximately 1,080 acres irrigated by the Maricopa Colony, and 

included in the Haggard and Benson-Allison decrees, no lands on the Gila River 

Indian Reservation have ever been directly irrigated using Salt River water. Despite 

this fact, in the mid-1980s, the Gila River Indian Community asserted claims for 

the Reservation in the pending Gila River Adjudication to approximately 1.8 million 

acre-feet of water annually from the Salt, Verde and Gila Rivers. More recently, the 

Indian Community amended its claims and now asserts the right to more than 2.7 

million acre-feet of water annually from the Gila River, its tributaries and groundwater. These claims, which far exceed the combined annual flow of all of these rivers, are based on the federal reservation of rights doctrine and largely encompass 

potential future uses of water by the Indian Community on its Reservation. 

Thus far in the Adjudication, the Community’s attempts to prosecute its extremely large claims to the Salt and Gila Rivers have not met with success. The 

Superior Court in the adjudication recently concluded that the Community and the 

United States are estopped by a decision of the United States Court of Claims, entered decades ago, from asserting any claim to the Salt River other than for the 

1,490 acres within the Maricopa Colony. An earlier decision of the Superior Court 

would limit Reservation lands within the Gila River watershed to their decreed entitlement under the Globe Equity Decree. The Indian Community and the United 

States have appealed both of these decisions of the trial court, and the Arizona Supreme Court is presently considering whether to accept review of these decisions. 

In the absence of the Settlement before this Subcommittee today, the matter is likely to continue in litigation for some time. In the meantime, the uncertainty associated with the potential magnitude of the Community’s rights to water from the Salt 

and Verde Rivers poses a threat to the rights of existing appropriators, including 

SRP. 

In order to alleviate this uncertainty and assure the dependability of water supplies to the more than 3 million residents of Maricopa County in central Arizona, 

SRP initiated water settlement negotiations with the Indian Community and the 

United States in 1989. Over time, neighboring water users joined the negotiations, 

which were often complex and difficult. Fourteen years later, the Indian Community, the United States and local interests including SRP, spurred on by the leadership of Senator Kyl and former Secretary Babbitt, have reached a comprehensive 

settlement of the Community’s water rights claims, benefiting water users throughout the Gila River Basin, in Maricopa, Pinal and Yavapai Counties. The settlement 

is embodied in the Settlement Agreement and legislation before this Subcommittee 

today. 

The Settlement resolves all outstanding water-related litigation between the Gila 

River Indian Community and the other settling parties and settles, once and for all, 

the water rights of the Indian Community to surface water and ground water in the 

Gila River Basin. I have attached a summary of the components of the Settlement 

to my written testimony. However, a few important points, pertaining to the Community’s use of Salt and Verde River water, will be discussed here. 

First. The Settlement recognizes the right of the United States, the Community, 

its members and allottees under the Haggard Decree, as modified by the BensonAllison Decree, to 540 miners inches of water from the Salt River. The Settlement 

also confirms that such rights shall be deemed fully satisfied by SRP’s performance 

of its water delivery obligations under the Contract between the United States and 

the Salt River Valley Water Users’ Association dated May 5, 1936, as amended. This 

Contract, commonly referred to as the Maricopa Contract, provides that SRP shall 

make available 5,900 acre-feet of water per year for diversion and use on ReservaVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00119 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
116

tion lands with rights under the Haggard Decree, as modified by the Benson-Allison 

Decree. 

Second. Under the Settlement, the Community also shall have an annual entitlement to SRP stored water in an amount varying from zero to 35,000 acre-feet, depending on SRP reservoir storage levels on May 1 of each year. The water will be 

transported to the Reservation via SRP’s water delivery system, subject to certain 

delivery system capacity limitations specified in the Agreement. Water that is credited to the Community on May 1 of each year, but is not used by April 30 of the 

following year, may be carried over in storage for the Community’s subsequent use, 

up to a maximum amount, specified in the Agreement, which may not be exceeded 

at any time. Moreover, in any single year, the Community will not be entitled to 

order more than 45,000 acre-feet total from the current year’s entitlement and the 

Community’s entitlement to ‘‘carry over’’ water from prior years. The Community 

will pay for the delivery of SRP stored water at 100 percent of the cost per acrefoot of stored water for SRP shareholders. The Community’s entitlement to SRP 

stored water will be phased in over a period of five-years, commencing in the year 

that the Settlement becomes enforceable. 

Third. Subject to certain monthly and annual volume limitations, SRP has agreed 

to take delivery of CAP water to which the Community is entitled for use by SRP 

shareholders, in exchange for the storage of the same amount of Salt and Verde 

River water in SRP reservoirs for eventual use by the Community. This exchange 

is subject to the ability of SRP to divert and beneficially use the CAP water to which 

the Community is entitled. SRP will deliver exchange water ordered by the Community via the SRP water delivery system only after determining that the system capacity is not needed to fulfill water delivery obligations of SRP that predate the Settlement. 

Fourth. SRP has agreed to accept delivery of CAP water to which the Community 

is entitled for direct delivery to the Reservation, via SRP’s water delivery system. 

The direct delivery of this water to the Community also will be subject to the limits 

of SRP’s water delivery system capacity, as discussed in the previous paragraph. 

Fifth. Phelps Dodge Corporation has offered to transfer to SRP its right, title and 

interest in Blue Ridge Reservoir, including all rights to water developed by operation of the reservoir. If SRP accepts Phelps Dodge’s offer, and the transfer of water 

rights to SRP is accomplished under Arizona law, then SRP will provide to the Community a portion of the water stored behind Blue Ridge Reservoir, ranging from 

zero to 836 acre-feet annually, depending on reservoir storage levels in Blue Ridge 

on May 1 of each year. Water that is credited to the Community on May 1 of each 

year, but is not used by April 30 of the next year will not be available for the Community’s use in subsequent years. If SRP accepts Phelps Dodge’s offer and obtains 

the right to water stored in Blue Ridge, there also may be an opportunity for municipalities in water scarce areas of Gila County, Arizona, to enter into agreements 

with SRP for the use of some of this water. 

Sixth. The Settlement permits the continued use by the Community of water discharged into certain drain ditches by SRP, and provides for the contribution by SRP 

of $500,000 toward the cost of easements, construction, rehabilitation, operation and 

maintenance of these drain ditches on the Reservation. 

Seventh. In exchange for these and other benefits to the Community, its members 

and allottees, the Settlement provides for the execution of a permanent, comprehensive waiver of the claims of these parties, and the United States on their behalf, 

for water rights, injuries to water rights and injuries to water quality, among others, as provided in exhibits to the Settlement Agreement. Of greatest significance, 

the waiver of all water rights claims by the Community, its members and allottees, 

and the United States on their behalf, extends to all water users in the Gila River 

Basin, including users who are not parties to the Settlement Agreement. Other parties to the Settlement Agreement will also execute waivers and releases of claims 

that these parties may have against the Community, its members and allottees, or 

the United States on their behalf, as specified in the Settlement Agreement. 

In conclusion, we support the passage of H.R. 885, which is the culmination of 

the efforts of many people, over almost 15 years, to resolve these difficult issues regarding the allocation of an extremely scarce resource. Enactment of H.R. 885 is 

crucial to achieving certainty among users in central Arizona regarding water 

rights, and the dependable allocation of water supplies for the foreseeable future. 

We therefore strongly urge this Subcommittee to recommend passage of the bill to 

the full House. 

117

ARIZONA WATER SETTLEMENTS ACT

TITLE II—GILA RIVER INDIAN COMMUNITY WATER RIGHTS SETTLEMENT

BRIEFING PAPER/ATTACHMENT TO TESTIMONY OF JOHN F. SULLIVAN, SALT RIVER

PROJECT PREPARED BY SALMON, LEWIS & WELDON, P.L.C., ON BEHALF OF SALT

RIVER PROJECT

HISTORY OF WATER RIGHTS ISSUES PERTAINING TO THE

GILA RIVER INDIAN RESERVATION. 

The Gila River Indian Reservation was created by an Act of Congress in 1859 and 

was enlarged by seven separate Executive Orders in 1876, 1879, 1882, 1883, 1911, 

1913 and 1915. Currently, the Reservation encompasses approximately 377,000 

acres of land in central Arizona. Most of these lands are located in the Gila River 

watershed. A small portion of the 1879 enlargement, however, borders the Salt 

River near its confluence with the Gila River. 

In approximately 1872, upstream settlers in the Safford Valley (presently the Gila 

Valley Irrigation District), Duncan-Virden Valley (presently the Franklin Irrigation 

District) and in the Florence-Casa Grande area (presently the San Carlos Irrigation 

and Drainage District) (‘‘SCIDD’’) began settling upstream of the Reservation and 

diverting water from the Gila River for irrigation. These diversions had the effect 

of reducing the quantities of Gila River water available to the Indian Community 

for downstream diversion. In 1924, in an attempt to obtain a more dependable 

source of water for the Indian Community, the United States Congress authorized 

the construction of Coolidge Dam as the principle feature of the San Carlos Irrigation Project (‘‘SCIP’’). Pursuant to the 1924 Act, and a separate agreement between 

the government and private landowners within the present boundaries of SCIDD, 

water stored behind Coolidge Dam, when constructed, would be used for the irrigation of 50,000 acres within the Gila River Indian Reservation and 50,000 acres within SCIDD. 

In 1925, the United States, on behalf of the Indian Community, SCIDD landowners and others, sued upstream water users in the Safford and Duncan-Virden 

Valleys, along with all other users of water from the Gila River from its confluence 

with the Salt River up to the Duncan-Virden Valley, ending in New Mexico. The 

suit, which came to be known as the Globe Equity litigation, sought among other 

things to establish the prior rights of the Indians of the Gila River Indian Reservation and the newly created SCIP to the use of Gila River water. 

The United States District Court for the District of Arizona appointed a Special 

Master who heard arguments, listened to testimony, and admitted exhibits. After 

ten years of negotiations, the parties agreed to settle the suit and a consent decree 

embodying the settlement was drafted. The court entered the stipulation and consent for entry of the Final Decree on June 29, 1935. Under the Decree, the United 

States, on behalf of the Indians of the Gila River Indian Reservation, is entitled to 

divert 300,000 acre-feet of water annually from the Gila River. Historically, however, the Indian Community has received, on average, only about 100,000 acre-feet 

annually of its decreed entitlement, due to insufficient flows in the Gila River at 

the Reservation’s diversion point. 

Despite the entry of the Globe Equity Decree, disputes persisted over the interpretation of certain of its provisions, particularly those concerning the calculation of the 

upper valley diverters’ annual entitlements under the Decree. Additionally, as technology for pumping from wells became more readily available, withdrawals of 

groundwater in the upper valleys increased. The legality of these uses were not expressly addressed in the Decree; nevertheless, the effect of increased groundwater 

pumping in the upper valleys was to lessen the flow of the Gila River, thereby decreasing the amounts of water available for use by the Community and SCIDD landowners downstream. 

At the time of the entry of the Decree in 1935, the Indian Community’s interests 

were represented in the Globe Equity proceeding by the United States. A motion 

to intervene submitted by the Indian Community just prior to the entry of the Decree was denied by the district court, and this denial was never appealed. In 1982, 

the United States District Court entered an Order permitting the Indian Community to intervene as party to the Globe Equity Decree for the purpose of enforcing 

the Decree against the upper valley users. The court declined to permit the Community to reopen the issues resolved by the Decree. This decision was recently echoed 

by the Maricopa County Superior Court in the Gila River Adjudication. The adjudication court held that the Globe Equity Decree was res judicata as to the Indian 

Community’s claims to additional Gila River water which might have been asserted 

and decided by the court in 1935; the Community accordingly was precluded from 

118

asserting these claims to additional Gila River water in the adjudication. This decision, along with the earlier decision of the Globe Equity Decree court, enhanced the 

importance of the Community’s enforcement suit as a vehicle for addressing its longstanding grievances with water users in the upper Gila valley. 

The Globe Equity enforcement litigation, commenced by the Indian Community in 

1982, remains ongoing. The court has issued numerous decisions interpreting provisions of the Decree; however, the Community’s challenge to the legality of groundwater pumping by the upper Gila valley users has not yet been decided. 

While most of the lands within the Gila River Indian Reservation are within the 

Gila River watershed, a small portion of the Reservation lies within the Salt River 

watershed, west of the Phoenix metropolitan area. Many of these lands were added 

to the Reservation in 1879. At that time, a group of Indians, commonly referred to 

as the Maricopa Colony, was living there. Since some time prior to 1900, these 

Indians diverted water from the Salt River for the irrigation of approximately 1,000 

acres. 

In 1901, the federal government, acting on behalf of the Maricopa Indians, 

brought suit in Arizona territorial court to stop nearby non-Indian irrigators from 

interfering with the waters of the Salt River used by the Indians. Some of the defendants named in the suit later became shareholders of the Association, after its 

incorporation in 1903. On June 11, 1903, Judge Kent issued the decree in United 

States v. Haggard, which adjudicated the Maricopa Indians’ right to irrigate approximately 1,080 acres of land with water from the Salt River. In 1917, the Haggard Decree was incorporated into the Benson-Allison Decree, which also adjudicated water rights for lands not included in the original Haggard Decree, located 

near the confluence of the Salt and Gila Rivers. 

Other than the approximately 1,080 acres irrigated by the Maricopa Colony, and 

included in the Haggard and Benson-Allison Decrees, no lands on the Gila River 

Indian Reservation have ever been directly irrigated using Salt River water. Despite 

this fact, in the mid-1980s, the Indian Community asserted a claim in the pending 

Gila River Adjudication to approximately 1.8 million acre-feet of water annually 

from the Salt and Verde Rivers, as well as the Gila River. More recently, the Indian 

Community amended its claims and now asserts the right to more than 2.7 million 

acre-feet of water annually from the Gila River, its tributaries and groundwater. 

These claims, which far exceed the combined annual flow of all of these rivers, are 

based on the federal reservation of rights doctrine and largely encompass potential 

future uses of water by the Indian Community on its Reservation. 

Thus far in the Adjudication, the Indian Community’s attempts to prosecute its 

enlarged claims to the Salt River have not met with success. The Superior Court 

in the adjudication recently concluded that the Indian Community and the United 

States are estopped by a decision of the United States Court of Claims, entered decades ago, from asserting any claim to the Salt River other than for the 1,490 acres 

within the Maricopa Colony. The Community has appealed this decision of the Superior Court, as well as its earlier decision precluding the Community’s assertion 

of additional claims to the Gila River. At this time, the Arizona Supreme Court has 

not decided whether to hear the Community’s appeal. In the absence of the Settlement that is presently before the Congress, the continued prosecution of these appeals by the Community could delay the ultimate determination of its water right 

claims by a court for some time. In the interim, the uncertainty associated with the 

potential magnitude of the Community’s rights to water from the Salt and Verde 

Rivers continues to threaten existing water uses. 

In order to alleviate this uncertainty and assure the dependability of water supplies to the more than 3 million residents of Maricopa, Yavapai and Pinal Counties 

in central Arizona, local parties initiated water settlement negotiations with the 

Indian Community and the United States in 1989. Fourteen years later, the Indian 

Community, the United States and local interests have reached a comprehensive 

settlement of the Community’s water rights claims, which is embodied in the Settlement Agreement and legislation presently before the Congress. 

COMPONENTS OF THE GILA RIVER INDIAN COMMUNITY WATER RIGHTS SETTLEMENT

AGREEMENT

I. Parties. 

The Settlement Agreement is entered into among: the United States of America; 

the Gila River Indian Community; the State of Arizona; the Salt River Project Agricultural Improvement and Power District; the Salt River Valley Water Users’ Association; the Roosevelt Irrigation District; the Arizona Water Company; the Arizona 

cities of Casa Grande, Chandler, Coolidge, Glendale, Goodyear, Mesa, Peoria, Phoenix, Safford, Scottsdale and Tempe; the Arizona towns of Duncan, Florence, Gilbert, 

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Kearny and Mammoth; the Franklin Irrigation District; the Gila Valley Irrigation 

District; the Maricopa-Stanfield Irrigation & Drainage District; the Central Arizona 

Irrigation and Drainage District; the San Carlos Irrigation and Drainage District; 

the Hohokam Irrigation and Drainage District; the Arlington Canal Company; the 

Buckeye Irrigation Company; the Buckeye Water Conservation and Drainage District; Central Arizona Water Conservation District; Phelps Dodge Corporation; and 

the Arizona Game and Fish Commission. 

II. Annual Water Entitlement and Components. 

A. Average Annual Entitlement. Under the Settlement Agreement, the Indian 

Community shall be entitled to an average of 653,500 acre-feet of water annually. 

This includes, among other things, the Community’s existing decreed rights under 

the Globe Equity, Benson-Allison and Haggard Decrees, plus substantial amounts 

of groundwater pumped from beneath the Reservation. The average shall be calculated over a consecutive ten-year period, reckoned in continuing progressive series, beginning on January 1 of the year after the date that the Settlement Agreement becomes enforceable. 

B. Components of Entitlement. The Indian Community’s average annual entitlement shall be satisfied from the following sources, subject to their availability in 

any given year, as specified in the pertinent provisions of the Settlement Agreement. 

1. Globe Equity Decree Water. As part of the Settlement, the United 

States and the Indian Community have agreed not to claim any rights 

to the waters of the Gila River except those decreed to them as specified in Articles 5 and 6 of the Globe Equity Decree. The United States 

and the Indian Community shall have the right to enforce the provisions of the Decree against other water users, including water users 

that are not parties to the original Decree. However, the Indian Community has agreed to limit its enforcement rights under the Decree, 

by refraining from bringing enforcement proceedings against existing 

users in the Upper Gila and San Pedro River watersheds. See Section 

II.B.10 below. 

2. Haggard Decree Water. The Settlement recognizes the right of the 

United States, the Community, its members and allottees under the 

Haggard Decree, as modified by the Benson-Allison Decree, to 540 

miners inches of water from the Salt River. The Settlement also confirms that such rights shall be deemed fully satisfied by SRP’s performance of its water delivery obligations under the Contract between 

the United States and the Salt River Valley Water Users’ Association 

dated May 5, 1936, as amended. This Contract, commonly referred to 

as the Maricopa Contract, provides that SRP shall make available 

5,900 acre-feet of water per year for diversion and use on Reservation 

lands with rights under the Haggard Decree, as modified by the Benson-Allison Decree. 

3. SRP Stored Water. Resolving the additional claims of the Indian Community to water from the Salt River, the Settlement entitles the 

Indian Community to an annual amount of water from the Salt River 

Project (‘‘SRP’’), ranging from 0 to 35,000 acre-feet, depending upon 

storage levels in SRP reservoirs on May 1 of each year. The annual 

variation in the amount of the Community’s water entitlement is 

based on a program of shared surpluses and shortages, agreed to as 

a guiding principle by the parties during their negotiations. The Community’s stored water entitlement will be transported to the Reservation via SRP’s water delivery system, subject to certain delivery system capacity limitations specified in the Agreement. Water that is 

credited to the Community on May 1 of each year, but is not used by 

April 30 of the following year, may be carried over in storage for the 

Community’s subsequent use, up to a maximum amount, specified in 

the Agreement, which may not be exceeded at any time. Moreover, in 

any single year, the Community will not be entitled to order more 

than 45,000 acre-feet total from the current year’s entitlement and the 

Community’s entitlement to ‘‘carry over’’ water from prior years. The 

Community shall pay for the delivery of SRP stored water at 

100 percent of the cost per acre-foot of stored water for SRP shareholders. The Community’s entitlement to SRP stored water will be 

phased in over a period of five-years, commencing in the year that the 

Settlement becomes enforceable. 

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4. Roosevelt Water Conservation District Surface Water. The Indian 

Community has reached a separate settlement of its water disputes 

with the Roosevelt Water Conservation District (‘‘RWCD’’), under 

which the Community is entitled to 4,500 acre-feet of water annually 

from RWCD. The agreement also provides for the relinquishment of 

RWCD’s allocation of Central Arizona Project water to the United 

States for the benefit of the Community, also referred to in Section 

II.B.5 below. The Gila River adjudication court’s approval of the 

Indian Community’s settlement agreement with RWCD is proceeding 

independent of this Settlement. 

5. CAP Water. The Settlement entitles the Indian Community to a total 

of 328,500 acre-feet annually of water, from the Central Arizona 

Project (‘‘CAP’’), subject to the availability of the water and the priorities of the respective allocations comprising the Community’s entitlement. In addition to the Community’s original CAP entitlement, multiple entities with contractual rights to water from the Central 

Arizona Project (‘‘CAP’’) have agreed to assign their CAP allocations 

to the Indian Community, as a vehicle for settling the Community’s 

objections to appropriative rights also held by these entities. The individual components of the Community’s entitlement to CAP water are: 

(a) the Community’s original CAP Indian Priority Water allocation 

(173,100 acre-feet); (b) Roosevelt Water Conservation District CAP 

Water (18,600 acre-feet); (c) Harquahala Valley Irrigation District 

CAP Water (17,800 acre-feet); (d) Asarco CAP Water (17,000 acre-feet) 

if an agreement is reached between Asarco and the Community; and 

(e) new CAP non-Indian Agricultural Priority Water (102,000 acrefeet). The Indian Community may lease or exchange all or a portion 

of its CAP entitlement, but none of its entitlement may be permanently transferred, nor may the Community lease, exchange, forbear 

or otherwise transfer its CAP entitlement for use outside the State of 

Arizona.

Subject to certain monthly and annual volume limitations, SRP has 

agreed to take delivery of CAP water to which the Community is entitled for use by SRP shareholders, in exchange for the storage of the 

same amount of Salt and Verde River water in SRP reservoirs for 

eventual use by the Community. This exchange is subject to the ability 

of SRP to divert and beneficially use the CAP water to which the Community is entitled. SRP will deliver exchange water ordered by the 

Community via the SRP water delivery system only after determining 

that the system capacity is not needed to fulfill water delivery obligations of SRP that predate the Settlement.

SRP also has agreed to accept delivery of CAP water to which the 

Community is entitled for direct delivery to the Reservation, via SRP’s 

water delivery system. The direct delivery of this water to the Community also will be subject to the limits of SRP’s water delivery system 

capacity, as discussed in the previous paragraph. 

6. Reclaimed Water from the Cities of Chandler and Mesa. The Indian 

Community shall be entitled to receive 40,600 acre-feet annually of reclaimed water, made available to it by the cities of Chandler and 

Mesa. In exchange, the Indian Community shall cause the delivery to 

these cities of 32,500 acre-feet of the Community’s CAP Indian Priority water. In addition to the exchange of reclaimed water for CAP 

water, the City of Chandler shall deliver reclaimed water to the Community in the amount of 4,500 acre-feet annually. 

7. Underground Water. The Indian Community also shall be permitted 

to pump underground water from wells on the Reservation to the extent needed to satisfy its annual water entitlement to 653,500 acrefeet. The Settlement Agreement additionally calls for the state legislature’s creation of underground water ‘‘protection zones’’ on the south 

side of the Reservation, in Pinal County. Underground water pumping 

by non-Indians from these zones will be limited to specific per-acre 

amounts set forth in the Settlement Agreement. Pumping by non-Indian water users that exceeds these amounts must be replenished by 

the State or other persons as specified in the Agreement. 

8. Blue Ridge Water. Phelps Dodge Corporation has offered to transfer 

to SRP its right, title and interest in Blue Ridge Reservoir, including 

all rights to water developed by operation of the reservoir. If SRP acVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00124 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
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cepts Phelps Dodge’s offer, and the transfer of water rights to SRP is 

accomplished under Arizona law, then SRP will provide to the Community a portion of the water stored behind Blue Ridge Reservoir, 

ranging from zero to 836 acre-feet annually, depending on reservoir 

storage levels in Blue Ridge on May 1 of each year. Water that is credited to the Community on May 1 of each year, but is not used by the 

end of April 30 of the next year, will not be available for the Community’s use in subsequent years. If SRP accepts Phelps Dodge’s offer 

and obtains the right to water stored in Blue Ridge, there also may 

be an opportunity for municipalities in water scarce areas of Gila 

County, Arizona, to enter into agreements with SRP for the use of 

some of this water. 

9. SRP Drain Water. The Settlement permits the continued use by the 

Community of water discharged into certain drain ditches by SRP, 

and provides for the contribution by SRP of $500,000 toward the cost 

of easements, construction, rehabilitation, operation and maintenance 

of these drain ditches on the Reservation. 

10. Diversions by Upper Gila Valley and San Pedro River Water Users. 

As part of the Settlement, the Indian Community will enter into 

agreements with municipalities in the upper Gila valley and San 

Pedro River watershed, resolving objections by the Community to 

these municipalities’ water uses. Agreements with Safford, Duncan, 

Kearny and Mammoth are attached as exhibits to the Settlement 

Agreement. Additionally, the Community will enter into a comprehensive agreement with multiple irrigation districts and other water 

users in the upper Gila valley, which resolves long-held grievances by 

the Community’s with respect to the effects of diversions by these 

users, who are parties to the Globe Equity Decree, on the Community’s downstream water rights.

In addition to the resolution of disputes between the Indian Community and upper valley users with water rights under the Globe Equity 

Decree, the Settlement also creates a legal framework for resolution of 

present and future disputes between the Community and upstream 

water users who do not hold decreed rights. The Settling Parties have 

agreed to the establishment, by state legislation, of the Upper Gila 

Watershed Maintenance Program, whose purpose is to limit groundwater pumping in the Upper Gila River watershed and San Pedro 

River watershed. After the program is established, as long as its provisions are enforced, the Settlement’s ‘‘Safe Harbor’’ provisions, described 

in detail in the Agreement and exhibits, will shield existing water diversions from the upper Gila valley and San Pedro River watersheds 

from legal challenge by the Community. In general, the Safe Harbor 

provisions allow the continuation of existing diversions of water for irrigation, municipal and industrial, and domestic purposes within the 

upper Gila River watershed and the San Pedro River watershed. These 

Safe Harbor provisions also permit the initiation of new domestic and 

large industrial uses in these areas, under terms and conditions specified in the Settlement. 

III. Waiver and Release of Claims. 

In exchange for the benefits provided under the Settlement Agreement, the Indian 

Community, its members and allottees, and the United States on their behalf, shall 

execute a comprehensive waiver and release of claims for water rights, injuries to 

water rights and injuries to water quality, among others, as provided in the exhibits 

to the Settlement Agreement. The other settling parties also shall execute waivers 

and releases of claims that such parties may have against the Community, its members or allottees, and the United States on their behalf, as specified in the Agreement. 

IV. Community Fund. 

A. Federal Funds. The Settlement, when confirmed and implemented by an enactment of the United States Congress, will provide the Community with funding for the following purposes: 

1. Rehabilitation of existing facilities and construction of extensions to 

those facilities—$147 million. 

2. Defrayal of operation, maintenance and replacement costs associated 

with the delivery of the Community’s CAP water—$53 million. 

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3. Rehabilitation of subsidence damages to lands within the Gila River 

Indian Reservation occurring before the date the Settlement Agreement 

becomes enforceable—$4 million. 

4. Implementation of a water quality monitoring program—$3.4 million. 

B. State Contribution. The Settlement also calls for the State of Arizona to ‘‘firm’’ 

the delivery of 15,000 acre-feet of the Community’s new entitlement to CAP 

non-Indian agricultural priority water to the equivalent of municipal and industrial CAP water delivery priority for 100 years. 

V. Congressional and Court Approval. 

Before it can be enforceable, the Agreement must, among other things, be confirmed by the United States Congress and approved by the courts in the Gila River 

Adjudication and Globe Equity proceedings. 

VI. Benefits to the State of Arizona Resulting From the Settlement. 

A. Greatly increased certainty of the priority and quantity of relative rights to the 

Salt, Verde, Gila and San Pedro Rivers, and of CAP allocations will benefit all of 

Arizona in future planning. 

B. The waiver of claims to be executed by the Indian Community and the United 

States under the Settlement Agreement is comprehensive. Specifically, the Community will agree not to assert claims to water in excess of the quantities provided in 

the Agreement as to all water users in Central Arizona, including individuals and 

small entities without the resources to defend themselves in litigation. The Community will also agree not to object to the water right claims of all other users in Central Arizona, with the exception of a small number of users whose asserted water 

rights, if upheld, would impair the exercise of the Community’s water rights under 

the Settlement Agreement. The Community is continuing its efforts to reach a settlement of its disputes with these users. 

C. The resolution of disputed issues related to the allocation of CAP water as part 

of the Congressional legislation approving the Settlement frees up that water for future Indian settlements. 

D. Additional water is made available to the valley cities and towns under the 

Settlement, through leases or exchanges of water with the Indian Community. 

E. State agencies, including the Arizona Department of Water Resources and the 

Arizona Game and Fish Commission would save money that would otherwise be 

spent in litigation of the Indian Community’s claims, as well as the Community’s 

objections to the claims of these state agencies. 

F. This settlement will permit the Community, the United States on its behalf 

and the Community’s neighboring non-Indian water users to put behind them contentious and divisive litigation concerning the Community’s water rights and to 

move forward together in planning for the continued prosperous development of 

Arizona. 

Statement submitted for the record by The Honorable Van Talley, Mayor, 

City of Safford, Arizona 

Chairman Calvert and Members of the Subcommittee: 

Thank you for the opportunity to submit testimony on H.R. 885—Arizona Water 

Settlements Act. The City of Safford respectfully submits written testimony supporting the Gila River Indian Community Water Rights Settlement authorized in 

H.R. 885. On behalf of the residents of Safford, Arizona, and customers of the City 

water system I express gratitude for your interest in our water problems. 

Located along the bank of the Gila River upstream from the Gila River Indian 

Reservation, Safford is a growing city serving water to more than 20,000 people, including the Town of Thatcher and other neighboring communities in Graham County. As Southeast Arizona’s commercial center, Safford, like other municipal, industrial and agricultural sectors, requires reasonable and reliable water supplies. The 

Gila River Indian Community Water Rights Settlement offers this security among 

the parties. 

For decades, Safford has continued to work with water users in the Upper Gila 

River Valley, the United States, and Native American tribes and communities to resolve water quantity and water quality issues. For the past five years, the City, 

along with other parties, diligently worked to settle the Gila River Indian Community’s water rights claims. The bill before you is the culmination of efforts resolving 

the Community’s claims, which in turn saves the parties from uncertain, complex, 

and expensive litigation concerning water rights. 

Like many other parties, one of the benefits Safford receives is certainty of water 

supplies and the ability to plan for the future accordingly. The Community and cerVerDate 0ct 09 2002 15:26 Apr 23, 2004 Jkt 088533 PO 00000 Frm 00126 Fmt 6633 Sfmt 6621 J:\DOCS\89653.TXT HRESOUR1 PsN: KATHY
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tain other parties confirm Safford’s water rights that would otherwise be contested 

and litigated. The Settlement recognizes Safford’s right to use 9,740 acre-feet of 

water per year and provides mechanisms to enable the City to meet higher demands. While Safford’s water allocation is relatively small when compared to the 

Community’s 653,500 acre-feet, it nonetheless assures Safford of water for present 

and reasonably foreseeable needs. 

The Settlement also helps to enhance Gila River water quality while simultaneously providing Safford with a water source to meet additional demands. The Settlement authorizes the appropriation of funds to repay indebtedness on the City’s 

recently constructed state-of-the-art water treatment facility. Treated water may be 

returned to the stream to enhance stream flows and stream quality, or recharged 

to meet Safford’s future water demands. The use of treated water is just one of the 

methods that Safford may implement to meet future needs without diminishing 

available water for other users and parties to the Settlement. To obtain these benefits, Safford agreed to a water budget of about one half of its claimed water rights. 

The treatment plant and a dependable water supply for the benefit of Safford are 

just a few of the positive results that are being proposed in the Settlement. Dozens 

of cities and towns receive similar benefits. Agricultural and industrial interests 

may continue to operate with less litigation risk towards their water supplies. The 

Settlement also enhances and preserves land, wildlife, and the environment. 

The Settlement with the Gila River Indian Community and H.R. 885 is a giant 

step in resolving the pending issues and confirming water rights among the parties 

to a limited supply of water. I urge the House to pass this bill that will settle significant water rights in the State of Arizona and allow the Gila River Indian Community and many cities, towns, irrigation districts and others to plan for future 

growth with confidence and reliable water supplies. 

The following information submitted for the record was too 

lengthy to print and has been retained in the Committee’s official 

files: 

• Burdette, Vivian, Chairwoman, Tonto Apache Tribe, Statement 

submitted for the record in support of H.R. 885 

• Fullmer, Jamie, Chairman, Yavapai-Apache Nation, Statement 

submitted for the record in support of H.R. 885 

• Spokane Tribe of Indians: A Showing of the United States’ 

Need to Fairly and Honorably Settle the Tribes Claims for 

Grand Coulee—A Narrative with Attachments, submitted for 

the record on H.R. 1753

[A supplemental statement on H.R. 885 submitted for the record 

by Herbert R. Guenther, Director, Arizona Department of Water 

Resources, follows:]

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89653.003
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89653.004
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89653.005
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Æ


89653.006