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MEMORANDUM OF UNDERSTANDING

AMONG

THE BUREAU OF RECLAMATION

AND 

THE NAVAJO NATION

AND

JICARILLA APACHE NATION

AND

CITY OF GALLUP

CONCERNIING

THE DESIGN AND CONSTRUCTION OF THE

NAVAJO GALLUP WATER SUPPLY PROJECT

ARTICLE I - PURPOSE

1.1 This memorandum of understanding (MOU) among the Bureau of Reclamation, 

(Reclamation), the Navajo Nation, the Jicarilla Apache Nation, and the City of 

Gallup (collectively referred to as “Parties” and individually as “Party”) is for the 

purpose of defining the means and dispensation of how decisions will be made 

pertaining to the adjustment of the project components and features from what is 

defined for the Navajo-Gallup Water Supply Project (Project) in the Planning 

Report/Final Supplement to the Environmental Impact Statement (PR/FEIS), 

specifically Appendix B to the PR/FEIS, titled Appraisal Level Designs and Cost 

Estimates, commonly referred to as the Construction Cost Estimate (CCE). The 

Navajo Nation, the Jicarilla Apache Nation, and the City of Gallup may collectively 

be referred to as “Project Participants” and individually as a “Project Participant.”

ARTICLE II – AUTHORITY

2.1 Public Law 111-11 – OMNIBUS PUBLIC LAND MANAGEMENT ACT of 

2009 (Act) signed on March 30, 2009

2.1.1 Section 10602 (a): “The Secretary, acting through the Commissioner of 

Reclamation, is authorized to design, construct, operate, and maintain the 

Project in substantial accordance with the preferred alternative in the Draft 

Impact Statement”. The Draft Impact Statement was completed in July of 

2009, and is known as the PR/FEIS and the subsequent Record of Decision 

was signed by the Secretary of the Interior on October 1, 2009, which 

identified the selected alternative and established the commitments.

2.1.2 Section 10609 (a) authorizes appropriations of $870,000,000 in 2007 dollars 

for the period of fiscal years 2009 through 2024, subject to adjustments as 

indicated by engineering cost indices.
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2.1.3 Section 10604 (g) of the Act authorizes the formation of a Project 

Construction Committee (PCC):

2.1.3.1 To review cost factors and budgets for construction, operation and 

maintenance activities;

2.1.3.2 To improve construction management through enhanced 

communication; and

2.1.3.3 To seek additional ways to reduce overall Project costs.

ARTICLE III - RESPONSIBILITIES

3.1 In the context of this MOU, Reclamation will be responsible for the following 

activities:

3.1.1 Act as the Federal Action Agency. This involves NEPA and ESA oversight 

assuring that all PR/FEIS commitments are accounted for.

3.1.2 Provide overall Project accounting as compared to the CCE of all planned 

and actual expenditures. All reimbursable and non-reimbursable costs will 

be accounted for in all of the various components of the Project estimated 

costs and expenditures.

3.1.3 Approve cost share credit proposals from the State of New Mexico and 

approve expenditures from the cost share provided by the State of New 

Mexico. This includes accounting of these expenditures as they relate 

directly with the CCE.

3.1.4 Provide for consultation on all Project decisions with the Project Participants. 

Strive for consensus on all significant Project issues. If consensus cannot be 

obtained, and the circumstances dictate the need for a decision to be made, 

Reclamation will make the decision.

3.1.5 Provide for a flexible approach to Project design and construction decisions, 

within the legal framework described herein and in the PR/FEIS, from a 

strict interpretation of the Project components and features in the PR/FEIS

to allow consideration for the delivery of water from Project transmission 

facilities near to existing or planned future supply points of distribution 

systems while maintaining costs within the overall CCE. All issues related to 

impacts to archeological compliance, environmental compliance, operation,

maintenance, replacement, real estate, engineering, and construction will be 

considered during the decision making process.
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3.1.5.1 The CCE will be updated for the following reasons; a) indexing, b) if 

design changes render the CCE substantially inaccurate c) if the 

prices change which render the CCE substantially inaccurate, and d) 

adjustments to reflect the State of New Mexico Cost Share credit. 

Maintaining costs within the overall CCE is a guiding principle and 

decisions will not be made on adjusting the alignment, storage 

facilities, pumping plants, capacities, or delivery points which violate 

this principle.

3.1.5.2 The term “near” means without leaving a significant expense to a 

Project Participant to bring Project water to existing or planned 

future distribution systems.

3.1.6 Provide support to the Project Participants, as appropriate, regarding 

decisions where tradeoffs are made involving reduction in scope to portions 

of the Project which must be implemented to avoid CCE overruns. Support 

may include providing information and/or justification to the State of New 

Mexico, constituents, the press, the public, boards, councils, chapters, the 

Commissioner of Reclamation, or others. This support may be provided by 

Reclamation in writing at the request of the Project Participants. 

3.2 In the context of this MOU, the Navajo Nation, the Jicarilla Apache Nation, and the 

City of Gallup will be responsible for the following activities:

3.2.1 Strive for consensus with the PCC on all issues. Should objections occur to 

Reclamation decisions, provide immediate notification in writing to all 

Project Participants within 30 days following written notification from 

Reclamation.

3.2.2 Provide input to all specific design and construction decisions relating to the 

adjustment of the alignment, storage facilities, pumping plants, capacities,

and delivery points from what is specifically shown in the PR/FEIS and in 

the CCE.

3.2.3 Provide input regarding acceptable tradeoffs where both adjustments to 

alignment, storage facilities, pumping plants, capacities, and delivery points

and maintaining the Project costs within the CCE are impossible or cause 

significant risk of overrun.

3.2.4 Provide supporting documentation which will be made available to the 

Project Participants, indicating the Parties’ position regarding decisions 

where tradeoffs are made which are implemented to avoid Project CCE 

overruns. Support may include providing information and/or justifications 

to the State of New Mexico, constituents, the press, the public, boards, 

councils, chapters, or the Commissioner of Reclamation. If requested by 
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Reclamation, the Project Participants agree to provide written support of 

these decisions within 30 days following the request.

3.2.4.1 The CCE will be updated for the following reasons; (a) indexing, (b) 

if design changes render the CCE substantially inaccurate (c) if the 

prices change which render the CCE substantially inaccurate, and 

(d) adjustments to reflect the State of New Mexico cost share credit. 

3.2.4.2 Maintaining costs within the overall CCE is a guiding principle and 

decisions will not be made on adjusting alignment, storage facilities, 

pumping plants, capacities, and delivery points which violate this 

principle.

3.3 Attached as Exhibit A is a flow chart that demonstrates how decisions may be made 

under this MOU.

ARTICLE IV - ADMINISTRATIVE PROVISIONS

4.1 Non-Fund Obligation. Nothing in this agreement may be construed to obligate the 

Department of the Interior (Department) or the United States to any current or 

future expenditure of resources in advance of the availability of appropriations 

from Congress.

4.2 Non-Exclusivity. This Agreement does not create any sort of exclusive arrangement 

between or among the Parties.

4.3 Unilateral Termination. Any Party may unilaterally terminate its participation in 

the agreement by providing written notice to the other Parties.

4.4 Review. This Agreement shall be reviewed by the Parties at least every five years to 

re-evaluate the terms of the Agreement to assure the purpose is being met. If it is 

determined that a modification of the Agreement is necessary, Paragraph 4.5 shall 

apply.

4.5 Amendment and Modification. This Agreement may be amended or modified with 

the agreement of all Parties. Any Party who proposes an amendment or 

modification shall provide a written proposal to other Parties. Any amendments or 

modifications shall be effective upon the date of signature of all Parties or the last 

party to execute the amendment or modification.

4.6 Effective Period and Expiration. This Agreement shall become effective on the date 

that the last Party executes the Agreement This Agreement shall expire on the date 

when the last section of the project is classified as plant in service or when it is no 

longer considered in construction status.
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4.7 FACA Implications. The Parties will comply with the Federal Advisory Committee 

Act to the extent it applies.

4.8 Advance Review of Press Releases Mentioning Reclamation. Parties will obtain 

prior approval of all press releases, published advertisements, or other statements

intended for the public that refer to this Agreement or to Reclamation, the 

Department, any Party, or the name or title of any employee of the Department or 

any Party, in connection with this Agreement.

4.9 Agency Representative or Contacts:

Reclamation

Construction Engineer, Four Corners Construction Office.

2200 Bloomfield Highway

Farmington, NM 87401

Jicarilla Apache Nation

Director, Water Administration Office

P.O. Box 507

Dulce, NM 87528

Navajo Nation

Director, Department of Water Resources

P. O. Box 678

Fort Defiance, AZ 86504

City of Gallup

Executive Director, Gallup Joint Utility District

P.O. Box 1270

Gallup, NM 87305-1270

4.10 Endorsements. Nothing in this Agreement may be interpreted to imply that the 

United States, the Department, or Reclamation endorses any product, service, or 

policy of the Parties. The Parties will not take any action or make any statement 

that suggests or implies such an endorsement. Nor shall anything in this Agreement 

be interpreted as the consent of the Project Participants that the total allowable cost 

of the Project is less than amounts authorized under P.L. 111-11 or any other act of 

Congress, nor shall anything in this agreement be interpreted as requiring all 

authorized funding be expended.




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