U.S.C. 1531 et seq.) relating to the use of the water 
associated with the Project. 
(4) NOTICE OF PROPOSED CONVEYANCE.—Not 
later than 45 days before the date of a proposed 
conveyance of any Project facility, the Secretary 
shall submit to the Committee on Resources of the 
House of Representatives and to the Committee on 
Energy and Natural Resources of the Senate notice 
of the conveyance of each Project facility. 
(f) COLORADO RIVER STORAGE PROJECT POWER.— 
The conveyance of Project facilities under subsection (e) 
shall not affect the availability of Colorado River Storage 
Project power to the Project under section 7 of the Act 
of April 11, 1956 (commonly known as the ‘‘Colorado 
River Storage Project Act’’) (43 U.S.C. 620f). 
(g) REGIONAL USE OF PROJECT FACILITIES.— 
(1) IN GENERAL.—Subject to paragraph (2), 
Project facilities constructed under subsection (b) 
may be used to treat and convey non-Project water 
or water that is not allocated by subsection 303(b) 
if— 
(A) capacity is available without impairing 
any water delivery to a Project Participant; and 
(B) the unallocated or non-Project water 
beneficiary— 
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(i) has the right to use the water; 
(ii) agrees to pay the operation, main-
tenance, and replacement costs assignable 
to the beneficiary for the use of the Project 
facilities; and 
(iii) agrees to pay a fee established by 
the Secretary to assist in the recovery of 
any capital cost relating to that use. 
(2) EFFECT OF PAYMENTS.—Any payments to 
the United States or the Nation for the use of un-
used capacity under this subsection or for water 
under any subcontract with the Nation or the 
Jicarilla Apache Nation shall not alter the construc-
tion repayment requirements or the operation, main-
tenance, and replacement payment requirements of 
the Project Participants. 
SEC. 303. DELIVERY AND USE OF NORTHWESTERN NEW 
MEXICO RURAL WATER SUPPLY PROJECT 
WATER. 
(a) USE OF PROJECT WATER.— 
(1) IN GENERAL.—In accordance with this Act 
and other applicable law, water supply from the 
Project shall be used for municipal, industrial, com-
mercial, domestic, and stock watering purposes. 
(2) USE ON CERTAIN LAND.— 
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(A) IN
GENERAL.—Subject to subpara-
graph (B), the Nation may use Project water 
allocations on— 
(i) land held by the United States in 
trust for the Nation and members of the 
Nation; and 
(ii) land held in fee by the Nation. 
(B) TRANSFER.—The Nation may transfer 
the purposes and places of use of the allocated 
water in accordance with the Agreement and 
applicable law. 
(3) HYDROELECTRIC
POWER.—Hydroelectric 
power may be generated as an incident to the deliv-
ery of Project water under paragraph (1). 
(4) STORAGE.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), any water contracted for delivery 
under paragraph (1) that is not needed for cur-
rent water demands or uses may be delivered by 
the Project for placement in underground stor-
age in the State of New Mexico for future re-
covery and use. 
(B) STATE APPROVAL.—Delivery of water 
under subparagraph (A) is subject to— 
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(i) approval by the State of New Mex-
ico under applicable provisions of State law 
relating to aquifer storage and recovery; 
and 
(ii) the provisions of the Agreement 
and this Act. 
(b) PROJECT
WATER
AND
CAPACITY
ALLOCA-
TIONS.— 
(1) DIVERSION.—The Project shall divert from 
the Navajo Reservoir and the San Juan River a 
quantity of water that does not exceed the lesser 
of— 
(A) 37,760 acre-feet of water; or 
(B) the quantity of water necessary to sup-
ply a depletion from the San Juan River of 
35,890 acre-feet. 
(2) ALLOCATION.— 
(A) IN GENERAL.—Water diverted under 
paragraph (1) shall be allocated to the Project 
Participants in accordance with subparagraphs 
(B) through (E), other provisions of this Act, 
and other applicable law. 
(B) ALLOCATION TO THE CITY OF GAL-
LUP.—The Project shall deliver at the point of 
diversion from the San Juan River not more 
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than 7,500 acre-feet of water for use by the 
City. 
(C) ALLOCATION TO NAVAJO NATION COM-
MUNITIES IN NEW MEXICO.—For use by the 
Nation in the State of New Mexico, the Project 
shall deliver at the points of diversion from the 
San Juan River or at Navajo Reservoir the less-
er of— 
(i) 22,650 acre-feet of water; or 
(ii) the quantity of water necessary to 
supply a depletion from the San Juan 
River of 20,780 acre-feet of water. 
(D) ALLOCATION TO NAVAJO NATION COM-
MUNITIES
IN
ARIZONA.—In accordance with 
subsection (d), the Project may deliver at the 
point of diversion from the San Juan River not 
more than 6,411 acre-feet of water for use by 
the Nation in the State of Arizona. 
(E) ALLOCATION
TO
JICARILLA
APACHE 
NATION.—The Project shall deliver at Navajo 
Reservoir not more than 1,200 acre-feet of 
water for use by the Jicarilla Apache Nation in 
the southern portion of the Jicarilla Apache 
Nation Reservation in the State of New Mexico. 
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(3) USE
IN
EXCESS
OF
ALLOCATION
QUAN-
TITY.—Notwithstanding each allocation quantity 
limit described in subparagraphs (B), (C), and (E) 
of paragraph (2), the Secretary may authorize a 
Project Participant to exceed the allocation quantity 
limit of that Project Participant if— 
(A) capacity is available without impairing 
any water delivery to any other Project Partici-
pant; and 
(B) the Project Participant benefitting 
from the increased allocation quantity— 
(i) has the right to use the additional 
water; 
(ii) agrees to pay the operation, main-
tenance, and replacement costs relating to 
the additional use any Project facility; and 
(iii) agrees to pay a fee established by 
the Secretary to assist in recovering capital 
costs relating to that additional use. 
(c) SOURCES OF WATER.—The sources of water for 
the Project allocated by subsection (b) shall be water origi-
nating in— 
(1) drainage of the San Juan River above Nav-
ajo Dam, to be supplied under New Mexico State 
Engineer File No. 2849; and 
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(2) inflow to the San Juan River arising below 
Navajo Dam, to be supplied under New Mexico 
State Engineer File No. 3215. 
(d) CONDITIONS FOR USE IN ARIZONA.— 
(1) REQUIREMENTS.—Project water shall not 
be delivered for use by any community of the Nation 
in the State of Arizona under subsection (b)(2)(D) 
until the date on which— 
(A) the Secretary determines by hydrologic 
investigation that sufficient water is reasonably 
likely to be available to supply uses from water 
of the Colorado River system allocated to the 
State of Arizona; 
(B) the Secretary submits to Congress the 
determination described in subparagraph (A); 
(C) the Secretary determines that the uses 
in the State of Arizona are within the appor-
tionment of the water of the Colorado River 
made to the State of Arizona through compact, 
statute, or court decree; 
(D) Congress has approved a Navajo Res-
ervoir supply contract between the Nation and 
the United States to provide for the delivery of 
Project water for the uses in Arizona; 
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(E) the Navajo Nation and the State of 
Arizona have entered into an agreement pro-
viding for delivery of water of the Project for 
uses in Arizona; and 
(F) any other determination is made as 
may be required by the Compact. 
(2) ACCOUNTING OF USES IN ARIZONA.—Any 
depletion of water from the San Juan River stream 
system in the State of New Mexico that results from 
the diversion of water by the Project for uses within 
the State of Arizona (including depletion incidental 
to the diversion, impounding, or conveyance of water 
in the State of New Mexico for uses in the State of 
Arizona)— 
(A) shall be accounted for as a part of the 
Colorado River System apportionments to the 
State of Arizona; and 
(B) shall not increase the total quantity of 
water to which the State of Arizona is entitled 
to use under any compact, statute, or court de-
cree. 
(e) FORBEARANCE.— 
(1) IN GENERAL.—Subject to paragraphs (2) 
and (3), during any year in which a shortage to the 
normal diversion requirement for any use relating to 
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the Project within the State of Arizona occurs (as 
determined under section 11 of Public Law 87–483 
(76 Stat. 99)), the Nation may temporarily forbear 
the delivery of the water supply of the Navajo Res-
ervoir for uses in the State of New Mexico under the 
apportionments of water to the Navajo Indian Irri-
gation Project and the normal diversion require-
ments of the Project to allow an equivalent quantity 
of water to be delivered from the Navajo Reservoir 
water supply for municipal and domestic uses of the 
Nation in the State of Arizona under the Project. 
(2) LIMITATION OF FORBEARANCE.—The Na-
tion may forebear the delivery of water under para-
graph (1) of a quantity not exceeding the quantity 
of the shortage to the normal diversion requirement 
for any use relating to the Project within the State 
of Arizona. 
(3) EFFECT.—The forbearance of the delivery 
of water under paragraph (1) shall be subject to the 
requirements relating to accounting and water quan-
tity described in subsection (d)(2). 
(f) EFFECT.—Nothing in this Act— 
(1) authorizes the marketing, leasing, or trans-
fer of the water supplies made available to the Na-
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tion under the Contract to non-Navajo water users 
in States other than the State of New Mexico; or 
(2) authorizes the forbearance of water uses in 
the State of New Mexico to allow uses of water in 
other States other than as authorized under sub-
section (e). 
(g) CONSISTENCY WITH UPPER COLORADO RIVER 
BASIN COMPACT.—Notwithstanding any other provision 
of law, in accordance with the Resolution, water diverted 
by the Project for use in the Lower Colorado River Basin 
in the State of New Mexico shall be a part of the consump-
tive use apportionment made to the State of New Mexico 
by Article III(a) of the Compact. 
SEC. 304. PROJECT CONTRACTS. 
(a) NAVAJO NATION CONTRACT.— 
(1) HYDROLOGIC
DETERMINATION.—Congress 
recognizes that the Hydrologic Determination satis-
factory to support approval of the Contract has been 
completed. 
(2) CONTRACT APPROVAL.— 
(A) APPROVAL.— 
(i) IN GENERAL.—Except to the ex-
tent that any provision of the Contract 
conflicts with this Act, Congress approves, 
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ratifies, and incorporates by reference the 
Contract. 
(ii) AMENDMENTS.—To the extent 
any amendment is executed to make the 
Contract consistent with this Act, that 
amendment is authorized, ratified, and 
confirmed. 
(B) EXECUTION OF CONTRACT.—The Sec-
retary, acting on behalf of the United States, 
shall enter into the Contract to the extent that 
the Contract does not conflict with this Act (in-
cluding any amendment that is required to 
make the Contract consistent with this Act). 
(3) NO REPAYMENT OBLIGATION.—The Nation 
is not obligated to repay— 
(A) any share of the construction costs of 
the Nation relating to the Project authorized by 
section 302(a); or 
(B) any costs relating to the construction 
of the Navajo Indian Irrigation Project that 
may otherwise be allocable to the Nation for 
use of any facility of the Navajo Indian Irriga-
tion Project to convey water to each Navajo 
community under the Project. 
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(4) OPERATION, MAINTENANCE, AND REPLACE-
MENT OBLIGATION.—Subject to subsection (f), the 
Nation shall pay any costs relating to the operation, 
maintenance, and replacement of each facility of the 
Project that are allocable to the Nation. 
(5) LIMITATION, CANCELLATION, TERMINATION, 
AND RESCISSION.—The Contract may be limited by 
a term of years, canceled, terminated, or rescinded 
only by an Act of Congress. 
(b) CITY OF GALLUP CONTRACT.— 
(1) CONTRACT AUTHORIZATION.—To the extent 
consistent with this Act, the Secretary may enter 
into a repayment contract with the City that re-
quires the City— 
(A) to repay, within a 50-year period, the 
share of any construction cost of the City relat-
ing to the Project; and 
(B) to pay the operation, maintenance, and 
replacement costs of the Project that are allo-
cable to the City. 
(2) SHARE OF CONSTRUCTION COSTS.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), the Secretary shall determine the 
share of the construction costs of the City relat-
ing to the Project, based on the ability of the 
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City to pay the construction costs of each facil-
ity of the Project that is allocable to the City. 
(B) MINIMUM
PERCENTAGE.—The share 
of the construction costs of the City shall be at 
least 25 percent of the construction costs of the 
Project that are allocable to the City 
(3) EXCESS CONSTRUCTION COSTS.—Any con-
struction costs of the Project allocable to providing 
capacity to deliver water to the City that are in ex-
cess of the share of the City of the construction 
costs of the Project, as determined under paragraph 
(2), shall be nonreimbursable. 
(4) GRANT FUNDS.—A grant from any other 
Federal source shall not be credited toward the 
amount required to be repaid by the City under a 
repayment contract. 
(5) TITLE TRANSFER.—If title is transferred to 
the City prior to repayment under section 302(e), 
the City shall be required to provide assurances sat-
isfactory to the Secretary of fulfillment of the re-
maining repayment obligation of the City. 
(6) OPERATION, MAINTENANCE AND REPLACE-
MENT OBLIGATION.—The City shall pay the oper-
ation, maintenance, and replacement costs for each 
facility of the Project that is allocable to the City. 
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(7) WATER DELIVERY SUBCONTRACT.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the Secretary shall not enter 
into a contract under paragraph (1) with the 
City until the City has secured a water supply 
for the portion of the Project for which the City 
is responsible by entering into, as approved by 
the Secretary, a water delivery subcontract for 
a period of not less than 40 years beginning on 
the date on which the construction of any facil-
ity of the Project serving the City is completed, 
but for a period not exceeding 99 years, with— 
(i) the Nation, as authorized by the 
Contract; or 
(ii) the Jicarilla Apache Nation, as 
authorized by the settlement contract be-
tween the United States and the Jicarilla 
Apache Tribe, authorized by the Jicarilla 
Apache Tribe Water Rights Settlement Act 
(Public Law 102–441; 106 Stat. 2237). 
(B) EFFECT.—Nothing in this para-
graph— 
(i) prevents the City from obtaining 
an alternate source of water for the por-
tion of the Project for which the City is re-
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sponsible, subject to approval of the Sec-
retary and the State of New Mexico, acting 
through the New Mexico Interstate Stream 
Commission and the New Mexico State 
Engineer; or 
(ii) obligates the Nation or the 
Jicarilla Apache Nation to enter into a 
water delivery subcontract with the City. 
(c) JICARILLA APACHE NATION CONTRACT.— 
(1) CONTRACT AUTHORIZATION.—To the extent 
consistent with this Act, the Secretary may enter 
into a repayment contract with the Jicarilla Apache 
Nation that requires the Jicarilla Apache Nation— 
(A) to repay, within a 50-year period, the 
share of any construction cost of the Jicarilla 
Apache Nation relating to the Project; and 
(B) to pay the operation, maintenance, and 
replacement costs of the Project that are allo-
cable to the Jicarilla Apache Nation. 
(2) SHARE OF CONSTRUCTION COSTS.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), the Secretary shall determine the 
share of the Jicarilla Apache Nation of the con-
struction costs of the Project, based on the abil-
ity of the Jicarilla Apache Nation to pay the 
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construction costs of the Project facilities that 
are allocable to the Jicarilla Apache Nation. 
(B) MINIMUM
PERCENTAGE.—The share 
of the Jicarilla Apache Nation under subpara-
graph (A) shall be at least 25 percent of the 
construction costs of the Project that are allo-
cable to the Jicarilla Apache Nation. 
(3) EXCESS CONSTRUCTION COSTS.—Any con-
struction costs of the Project allocable to providing 
capacity to deliver water to the Jicarilla Apache Na-
tion that are in excess of the share of the Jicarilla 
Apache Nation of the construction costs of the 
Project, as determined under paragraph (2), shall be 
nonreimbursable. 
(4) GRANT FUNDS.—A grant from any other 
Federal source shall not be credited toward the 
share of the Jicarilla Apache Nation of construction 
costs. 
(5) NAVAJO
INDIAN
IRRIGATION
PROJECT 
COSTS.—The Jicarilla Apache Nation shall have no 
obligation to repay any Navajo Indian Irrigation 
Project construction costs that might otherwise be 
allocable to the Jicarilla Apache Nation for use of 
the Navajo Indian Irrigation Project facilities to 
convey water to the Jicarilla Apache Nation. 
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(6) OPERATION, MAINTENANCE AND REPLACE-
MENT
OBLIGATION.—The Jicarilla Apache Nation 
shall pay the operation, maintenance, and replace-
ment costs relating to each facility of the Project 
that are allocable to the Jicarilla Apache Nation. 
(d) CAPITAL COST ALLOCATIONS.—For purposes of 
determining the capital repayment requirements of the 
Project Participants under this section, the Secretary shall 
review and, as appropriate, update the report prepared by 
the Bureau of Reclamation in the Draft Impact Statement 
allocating capital construction costs for the Project. 
(e) OPERATION, MAINTENANCE, AND REPLACEMENT 
COST ALLOCATIONS.—For purposes of determining the 
operation, maintenance, and replacement obligations of 
the Project Participants under this section, the Secretary 
shall review and, as appropriate, update the report pre-
pared by the Bureau of Reclamation in the Draft Impact 
Statement that allocates operation, maintenance, and re-
placement costs for the Project. 
(f) TEMPORARY WAIVERS OF PAYMENTS.— 
(1) IN GENERAL.—On the date on which the 
Project is substantially complete and the Nation re-
ceives a delivery of water generated by the Project, 
the Secretary may waive, for a period of not more 
than 10 years, the operation, maintenance, and re-
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placement costs of the Project allocable to the Na-
tion that the Secretary determines are in excess of 
the ability of the Nation to pay. 
(2) PAYMENT BY UNITED STATES.—Any oper-
ation, maintenance, or replacement costs waived by 
the Secretary under paragraph (1) shall be paid by 
the United States. 
(3) EFFECT
ON
CONTRACTS.—Failure of the 
Secretary to waive costs under paragraph (1) be-
cause of a lack of availability of Federal funding to 
pay the costs under paragraph (2) shall not alter the 
obligations of the Nation or the United States under 
a repayment contract. 
(4) TERMINATION
OF
AUTHORITY.—The au-
thority of the Secretary to waive costs under para-
graph (1) with respect to a Project facility trans-
ferred to the Nation under section 302(e) shall ter-
minate on the date on which the Project facility is 
transferred. 
SEC. 305. USE OF NAVAJO NATION MUNICIPAL PIPELINE. 
In addition to use of the Navajo Nation Municipal 
Pipeline to convey the Animas-La Plata Project water of 
the Nation, the Nation may use the Navajo Nation Munic-
ipal Pipeline to convey water for other purposes (including 
purposes relating to the Project). 
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SEC. 306. AUTHORIZATION OF CONJUNCTIVE USE WELLS. 
(a) CONJUNCTIVE GROUNDWATER DEVELOPMENT 
PLAN.—Not later than 1 year after the date of enactment 
of this Act, the Nation, in consultation with the Secretary, 
shall complete a conjunctive groundwater development 
plan for the wells described in subsections (b) and (c). 
(b) WELLS IN THE SAN JUAN RIVER BASIN.—In ac-
cordance with the conjunctive groundwater development 
plan, the Secretary may construct or rehabilitate wells and 
related pipeline facilities to provide capacity for the diver-
sion and distribution of not more than 1,670 acre-feet of 
groundwater in the San Juan River Basin in the State 
of New Mexico for municipal and domestic uses. 
(c) WELLS
IN
THE LITTLE COLORADO
AND RIO 
GRANDE BASINS.— 
(1) IN
GENERAL.—In accordance with the 
Project and conjunctive groundwater development 
plan for the Nation, the Secretary may construct or 
rehabilitate wells and related pipeline facilities to 
provide capacity for the diversion and distribution 
of— 
(A) not more than 680 acre-feet of ground-
water in the Little Colorado River Basin in the 
State of New Mexico; 
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(B) not more than 80 acre-feet of ground-
water in the Rio Grande Basin in the State of 
New Mexico; and 
(C) not more than 770 acre-feet of ground-
water in the Little Colorado River Basin in the 
State of Arizona. 
(2) USE.—Groundwater diverted and distrib-
uted under paragraph (1) shall be used for munic-
ipal and domestic uses. 
(d) ACQUISITION OF LAND.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the Secretary may acquire any land or in-
terest in land that is necessary for the construction, 
operation, and maintenance of the wells and related 
pipeline facilities authorized under subsections (b) 
and (c). 
(2) LIMITATION.—Nothing in this subsection 
authorizes the Secretary to condemn water rights for 
the purposes described in paragraph (1). 
(e) CONDITION.—The Secretary shall not commence 
any construction activity relating to the wells described in 
subsections (b) and (c) until the Secretary executes the 
Agreement. 
(f) CONVEYANCE OF WELLS.— 
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(1) IN
GENERAL.—The Secretary shall enter 
into an agreement with the Nation to convey to the 
Nation— 
(A) any well or related pipeline facility 
constructed or rehabilitated under subsections 
(a) and (b) after the wells and related facilities 
have been completed; and 
(B) any land or interest in land acquired 
by the United States for the construction, oper-
ation, and maintenance of the well or related 
pipeline facility. 
(2) OPERATION, MAINTENANCE, AND REPLACE-
MENT.—On completion of a conveyance under para-
graph (1), the Nation shall assume responsibility for 
the operation, maintenance, and replacement of the 
well or related pipeline facility conveyed. 
(3) EFFECT OF CONVEYANCE.—The conveyance 
to the Nation of the conjunctive use wells under 
paragraph (1) shall not affect the application of the 
Endangered Species Act of 1973 (16 U.S.C. 1531 et 
seq.). 
(g) USE OF PROJECT FACILITIES.—The capacities of 
the treatment facilities, main pipelines, and lateral pipe-
lines of the Project authorized by section 302(b) may be 
used to treat and convey groundwater to Nation commu-
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nities if the Nation provides for payment of the operation, 
maintenance, and replacement costs associated with the 
use of the facilities or pipelines. 
(h) LIMITATIONS.—The diversion and use of ground-
water by wells constructed or rehabilitated under this sec-
tion shall be made in a manner consistent with applicable 
Federal and State law. 
SEC. 307. SAN JUAN RIVER IRRIGATION PROJECTS. 
(a) REHABILITATION.—Subject to subsection (b), the 
Secretary shall rehabilitate— 
(1) the Fruitland-Cambridge Irrigation Project 
to serve not more than 3,335 acres of land, which 
shall be considered to be the total serviceable area 
of the Project; and 
(2) the Hogback-Cudei Irrigation Project to 
serve not more than 8,830 acres of land, which shall 
be considered to be the total serviceable area of the 
Project. 
(b) CONDITION.—The Secretary shall not commence 
any construction activity relating to the rehabilitation of 
the Fruitland-Cambridge Irrigation Project or the Hog-
back-Cudei Irrigation Project under subsection (a) until 
the Secretary executes the Agreement. 
(c) OPERATION, MAINTENANCE, AND REPLACEMENT 
OBLIGATION.—Upon the date of completion of the reha-
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bilitation, the Nation shall assume the obligations for the 
operation, maintenance, and replacement of each facility 
rehabilitated under this section. 
SEC. 308. AUTHORIZATION OF APPROPRIATIONS. 
(a) AUTHORIZATION
OF
APPROPRIATIONS
FOR 
NORTHWESTERN NEW MEXICO RURAL WATER SUPPLY 
PROJECT.— 
(1) IN GENERAL.—There is authorized to be 
appropriated to the Secretary to construct the 
Project such sums as are necessary for the period of 
fiscal years 2008 through 2022. 
(2) ADJUSTMENTS.—The amount under para-
graph (1) shall be adjusted by such amounts as may 
be required by reason of changes since 2005 in con-
struction costs, as indicated by engineering cost indi-
ces applicable to the types of construction involved. 
(3) USE.—In addition to the uses authorized 
under paragraph (1), amounts made available under 
that paragraph may be used for the conduct of re-
lated activities to comply with Federal environmental 
laws. 
(b) 
APPROPRIATIONS
FOR
CONJUNCTIVE
USE 
WELLS.— 
(1) SAN JUAN WELLS.—There is authorized to 
be appropriated to the Secretary for the construction 
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