[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
                       H.R. 24, THE SAN JOAQUIN
                           RIVER RESTORATION
                            SETTLEMENT ACT

=======================================================================

                          LEGISLATIVE HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             March 1, 2007

                               __________

                            Serial No. 110-6

                               __________

       Printed for the use of the Committee on Natural Resources



  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html
                                   or
         Committee address: http://resourcescommittee.house.gov




                      U.S. GOVERNMENT PRINTING OFFICE
33-674 PDF                    WASHINGTON  :  2007
---------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government
Printing Office Internet:  bookstore.gpo.gov Phone:  toll free (866)
512-1800; DC area (202) 512-1800 Fax: (202)512-2250 Mail: Stop SSOP,
Washington, DC 20402-0001 







                     COMMITTEE ON NATURAL RESOURCES

               NICK J. RAHALL II, West Virginia, Chairman
              DON YOUNG, Alaska, Ranking Republican Member

Dale E. Kildee, Michigan             Jim Saxton, New Jersey
Eni F.H. Faleomavaega, American      Elton Gallegly, California
    Samoa                            John J. Duncan, Jr., Tennessee
Neil Abercrombie, Hawaii             Wayne T. Gilchrest, Maryland
Solomon P. Ortiz, Texas              Ken Calvert, California
Frank Pallone, Jr., New Jersey       Chris Cannon, Utah
Donna M. Christensen, Virgin         Thomas G. Tancredo, Colorado
    Islands                          Jeff Flake, Arizona
Grace F. Napolitano, California      Rick Renzi, Arizona
Rush D. Holt, New Jersey             Stevan Pearce, New Mexico
Raul M. Grijalva, Arizona            Henry E. Brown, Jr., South 
Madeleine Z. Bordallo, Guam              Carolina
Jim Costa, California                Luis G. Fortuno, Puerto Rico
Dan Boren, Oklahoma                  Cathy McMorris Rodgers, Washington
John P. Sarbanes, Maryland           Bobby Jindal, Louisiana
George Miller, California            Louie Gohmert, Texas
Edward J. Markey, Massachusetts      Tom Cole, Oklahoma
Peter A. DeFazio, Oregon             Rob Bishop, Utah
Maurice D. Hinchey, New York         Bill Shuster, Pennsylvania
Patrick J. Kennedy, Rhode Island     Dean Heller, Nevada
Ron Kind, Wisconsin                  Bill Sali, Idaho
Lois Capps, California               Doug Lamborn, Colorado
Jay Inslee, Washington
Mark Udall, Colorado
Joe Baca, California
Hilda L. Solis, California
Stephanie Herseth, South Dakota
Heath Shuler, North Carolina

                     James H. Zoia, Chief of Staff
                   Jeffrey P. Petrich, Chief Counsel
                 Lloyd Jones, Republican Staff Director
                 Lisa Pittman, Republican Chief Counsel
                                 ------                                

                    SUBCOMMITTEE ON WATER AND POWER

              GRACE F. NAPOLITANO, California, Chairwoman
     CATHY McMORRIS RODGERS, Washington, Ranking Republican Member

Jim Costa, California                Ken Calvert, California
George Miller, California            Dean Heller, Nevada
Mark Udall, Colorado                 Doug Lamborn, Colorado
Joe Baca, California                 Don Young, Alaska, ex officio
Hilda L. Solis, California
Nick J. Rahall II, West Virginia, 
    ex officio
                                 ------                                









                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on March 1, 2007....................................     1

Statement of Members:
    Cardoza, Hon. Dennis, a Representative in Congress from the 
      State of California........................................    11
    Costa, Hon. Jim, a Representative in Congress from the State 
      of California..............................................     7
    Napolitano, Hon. Grace F., a Representative in Congress from 
      the State of California....................................     1
        Prepared statement of....................................     4
    Nunes, Hon. Devin, a Representative in Congress from the 
      State of California........................................    10
    Radanovich, Hon. George P., a Representative in Congress from 
      the State of California....................................     8
        Prepared statement of....................................     9
    Rodgers, Hon. Cathy McMorris, a Representative in Congress 
      from the State of Washington...............................     5
        Prepared statement of....................................     6
    Udall, Hon. Mark, a Representative in Congress from the State 
      of Colorado................................................    10

Statement of Witnesses:
    Birmingham, Thomas W., General Manager/General Counsel, 
      Westlands Water District, Fresno, California...............    66
        Prepared statement of....................................    67
        Response to questions submitted for the record...........    71
    Candee, Hamilton, Senior Attorney, Co-Director, Western Water 
      Project, Natural Resources Defense Council, San Francisco, 
      California.................................................    26
        Prepared statement of....................................    28
        Response to questions submitted for the record...........    30
    Dooley, Daniel M., Dooley Herr & Peltzer, LLP, Counsel to 
      Members of the Friant Water Users Authority, Sacramento, 
      California.................................................    14
        Prepared statement of....................................    16
        Response to questions submitted for the record...........    21
    Ishida, Allen R., Chairman, Tulare County Board of 
      Supervisors, Visalia, California...........................    80
        Prepared statement of....................................    81
        Response to questions submitted for the record...........    83
    Michael, Cannon, Landowner in San Joaquin River Exchange 
      Contractors Water Authority, Los Banos, California.........    73
        Prepared statement of....................................    74
        Response to questions submitted for the record...........    75
    Peltier, Jason, Principal Deputy Assistant Secretary for 
      Water and Science, U.S. Department of the Interior, 
      Washington, D.C............................................    35
        Prepared statement of....................................    36
        Response to questions submitted for the record...........    40
    Robbins, Kenneth M., General Counsel, Merced Irrigation 
      District...................................................    75
        Prepared statement of....................................    76
        Response to questions submitted for the record...........    79
    Saracino, Nancy, Chief Deputy Director, California Department 
      of Water Resources.........................................    47
        Prepared statement of....................................    48
        Response to questions submitted for the record...........    50
    Wolk, Hon. Lois, Assembly Member and Chair, Committee on 
      Water, Parks, and Wildlife, California State Assembly......    52
        Prepared statement of....................................    53
        Response to questions submitted for the record...........    56



  LEGISLATIVE HEARING ON H.R. 24, ``THE SAN JOAQUIN RIVER RESTORATION 
                            SETTLEMENT ACT''

                              ----------                              


                        Thursday, March 1, 2007

                     U.S. House of Representatives

                    Subcommittee on Water and Power

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Subcommittee met, pursuant to call, at 10:05 a.m. in 
Room 1334, Longworth House Office Building, Hon. Grace F. 
Napolitano [Chairwoman of the Subcommittee] presiding.
    Present: Representatives Napolitano, McMorris Rodgers, 
Costa, Radanovich, Udall, Nunes, Cardoza and Calvert.

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

    Mrs. Napolitano. Thank you, ladies and gentlemen, and good 
morning. This meeting of the Subcommittee on Water and Power 
will come to order. I want to gavel somebody with this.
    The purpose of this Subcommittee hearing is to hold a 
discussion on H.R. 24, the San Joaquin River Restoration 
Settlement Act. But before we begin the hearing, I would like 
to take a prerogative to mention that this is the first 
Subcommittee hearing in the 110th Congress of which it is my 
privilege to serve as the Chairwoman, and give a warm welcome 
to my Ranking Member to the Subcommittee, Congresswoman Cathy 
McMorris Rodgers of Stevens County, Washington. We look forward 
to working together.
    Before I begin, it is my understanding that we have Devin 
Nunes from California who wishes to videotape portions of this 
hearing. Normally we only allow registered newscasts, news 
media. We just heard of the request. And I have talked to Mr. 
Nunes, who is not a member of this committee, and I would like 
to know if any of the Members object to having portions of this 
hearing recorded. I would like to have everybody know that this 
is not a credentialed media rep, and if there are any 
objections, I would like to hear them. If not, we will approve 
his being able to record. No objections.
    [Laugher.]
    Mrs. Napolitano. I would like to remind all Members that 
any request to do any taping, any video recording, must be made 
through the Committee Press Office well in advance, at least 48 
hours prior to the hearing. So with that, we will move on.
    I am pleased to welcome several of our colleagues to the 
Subcommittee. Cathy, you will do your presentations. And I 
would like to begin by asking unanimous consent that 
Congressmen Radanovich, Cardoza, and Nunes be allowed to sit in 
the Subcommittee hearing to participate in these hearings.
    Mr. Nunes. I object.
    Mr. Costa. Thank you, we can leave now.
    Mrs. Napolitano. Hearing one objection, it is ordered.
    [Laughter.]
    Mr. Costa. Madame Chairman, can we request that Portuguese 
be removed from the room?
    [Laughter.]
    Mrs. Napolitano. Do you see how it is going to happen in 
this Subcommittee? Withdrawn. And you understand that we have 
great relationships on both sides, so that we can work 
together. We have worked together in the past, and we look 
forward to a lot of this mirth and sharing, and hope it 
translates into support for where we need it. Thank you, 
gentlemen.
    Allow me to now briefly introduce our Democratic Members on 
the Subcommittee. First of all, to my left is Jim Costa of 
Fresno, California. And Jim and I go back many years in the 
California State Legislature. His knowledge of water issues is 
very comprehensive and very well known, and this is his second 
term on the Water and Power Subcommittee. Welcome, Jim.
    Next we have Congressman Mark Udall of Boulder County, 
Colorado. I was just in his backyard. Now in his fifth term in 
the House, and whose special interest is the management of the 
Colorado River Basin and the law of the river. We are pleased 
to welcome Mark, who is especially distinguished on the 
Democratic side of the Subcommittee because he is the only non-
Californian. Two Coloradans, OK, but on the Democratic side.
    Next is Congressman Joe Baca from, they say Rialto, Joe. It 
is San Bernardino, isn't it? San Bernardino County. We welcome 
him back to the Subcommittee. He is now Chairman of the 
Congressional Hispanic Caucus; also the Chair of the House 
Subcommittee on Department Operations, Oversight, Nutrition, 
and Forestry of the full Agriculture Committee. And I know as a 
good friend, and especially concerned over the cleanup efforts 
and protecting groundwater supplies from perchloric 
contamination. Again, this will be one of the priorities of the 
Subcommittee.
    Next we have Dennis Cardoza, also from California, an old 
friend from the days of, well, what can I say, Dennis? State 
Legislature. A gentleman who has distinguished himself in a 
state office, and has great concern for not only the farmers, 
but for the whole State of California. And welcome, Dennis.
    Cathy?
    Mrs. McMorris Rodgers. Thank you, Madame Chairman. It is 
indeed an honor to serve as the Ranking Republican on this 
Subcommittee, and I look forward to working with you, Madame 
Chairman, on a variety of issues that will come before this 
Subcommittee.
    I would like to introduce the colleagues on the Republican 
side of the Subcommittee. First, Congressman Ken Calvert, no 
stranger to this committee. Ken is from Corona, California; 
represents the 44th Congressional District; was the illustrious 
leader of this Subcommittee for four years. He also serves on 
the Armed Services and Science Committees.
    Should I introduce those that aren't here? Yes? Congressman 
Dean Heller from Carson City, Nevada, represents the state's 
Second Congressional District in Nevada. He has the 
distinguished honor of serving for three terms as Nevada's 
Secretary of State. He serves on the Small Business Committee, 
as well.
    Congressman Doug Lamborn represents Colorado's Fifth 
District, and is from Colorado Springs. He served in the 
Colorado Senate for 11 years. He also serves on the Veterans 
Affairs Committee, and is on leave from the Armed Services 
Committee.
    In addition, we would like to welcome to this hearing 
former Subcommittee Chairman George Radanovich--good morning, 
glad you are here--and former committee Member Devin Nunes. We 
are privileged to serve with these fine individuals. Each of 
our states has our own pressing water and power issues, and we 
look forward to providing our specific expertise to this 
Subcommittee.
    Mrs. Napolitano. Thank you, Mrs. Rodgers. I did not 
introduce two people who are not here: George Miller, current 
Chairperson of the Committee on Education and Labor. He was a 
previous Chair not only of this Subcommittee, but was also 
previous Chair of the full Committee on Natural Resources. And 
his special interest is protecting water quality in the 
Sacramento and San Joaquin Delta, which serves as a source of 
drinking water for his district. And of course, we drink the 
water from that area, too.
    So we welcome George, as well as Hilda Solis from El Monte, 
California, who serves as a Vice Chair of the Energy and 
Commerce Committee, Environment and Hazardous Materials 
Committee, a subcommittee dedicated to the cause of 
environmental justice, and is a strong advocate of groundwater 
remediation.
    As we begin the work of the Subcommittee for the 110th 
Congress, may I assure each and every one of you that I will do 
my best in the Subcommittee to treat it with fairness and 
respect for each and every Member. I have an open-door policy, 
and all of you, Republican or Democrat, are welcome to contact 
me or my Staff Director, Steve Lanich, to my left, at any time. 
We will, I am sure, have partisan differences, but I assure you 
that the work of the Subcommittee will be handled on a non-
partisan basis, as it has been for many years. And I intend to 
continue that work to help solve water problems in the West. We 
can accomplish much, but only if we set aside our partisan 
differences.
    Now I will move on to the subject of today's hearing. H.R. 
24 was introduced on January 4 by Congressman George 
Radanovich, of which I am an original co-sponsor. I have 
supported the legislation; I intend to continue to support and 
see its enactment. Other co-sponsors include Jim Costa, George 
Miller, Dennis Cardoza, and Joe Baca.
    The Subcommittee on Water and Power held an oversight 
hearing of the San Joaquin Restoration, San Joaquin River 
Restoration Settlement, on September 21, 2006. And at that 
time, no legislation had been introduced to implement the 
settlement. The recording of that hearing has been printed, and 
is available as Serial Number 109-63. The legislation we will 
consider today was prepared last September as a consensus 
document following a series of meetings of the affected 
parties, with not only Senator Diane Feinstein, but 
Representatives Costa, Cardoza, Pombo, Radanovich, and Nunes.
    The parties agreed to a number of provisions intended to 
protect the identified third parties from unintended 
consequences that might result as the legislation and the 
actual restoration projects were implemented over the next 18 
years or so. I do congratulate the settling parties, the third 
parties, and the participants from this House, and most of all 
California Senator Diane Feinstein, for all their hard work to 
reach the agreement on the many complex issues presented by the 
settlement.
    I welcome our witnesses today, and I appreciate your 
cooperation in helping us compile a complete and accurate 
defensible record of consideration of H.R. 24. I would like to 
note that two of our witnesses today, Mr. Candee and Mr. 
Ishida, have submitted extra written material to the statements 
they will make. These materials are quite lengthy, and for that 
reason they have not been copied, nor included in the folders 
placed in front of each Member. The documents are available 
electronically, and all of these materials will be entered into 
the record. If anyone needs to refer to them, please request a 
copy, and we will be happy to provide it.
    I am now pleased to yield to my friend from Spokane, 
Ranking Minority Member of our Subcommittee, Congresswoman 
Cathy McMorris Rodgers, for any statements or comments she may 
make.
    [The prepared statement of Mrs. Napolitano follows:]

            Statement of The Honorable Grace F. Napolitano, 
              Chairwoman, Subcommittee on Water and Power

    H.R. 24 was introduced on January 4, 2007 by Congressman George 
Radanovich. I am an original co-sponsor of the bill. I support this 
legislation and I will work hard for its enactment. Other co-sponsors 
include Congressmen Jim Costa, George Miller, Dennis Cardoza, and Joe 
Baca.
    The Subcommittee on Water and Power held an oversight hearing on 
the San Joaquin River Restoration Settlement on September 21, 2006. At 
that time no legislation had been introduced to implement the 
settlement. The record of that hearing has been printed and is 
available as Serial Number 109-63.
    The legislation we will consider today was prepared last September 
as a consensus document following a series of meetings of the affected 
parties with Senator Dianne Feinstein and Representatives Costa, 
Cardoza, Pombo, Radanovich and Nunes. The parties agreed to a number of 
provisions intended to protect the identified Third Parties from 
unintended consequences that might result as the legislation and the 
actual restoration projects are implemented over the next 18 years or 
so. I congratulate the Settling Parties, the Third Parties, the 
participants from the House, and especially Senator Feinstein for their 
hard work to reach agreement on the many complex issues presented by 
the Settlement.
    I welcome our witnesses today, and I appreciate your cooperation in 
helping us compile a complete and defensible record of our 
consideration of H.R. 24. I want to note that two of our witnesses 
today, Mr. Candee and Mr. Ishida, have submitted written material in 
addition to the statements they will make. These materials are quite 
lengthy, and for that reason they have not been copied and included in 
the folders placed in front of each Member. If anyone needs to refer to 
the materials, I have them here with me. We will be happy to print 
copies for any of the Members who need a copy. The documents are also 
available electronically. All of these materials will be entered into 
the record.
                                 ______
                                 

STATEMENT OF THE HON. CATHY McMORRIS RODGERS, A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF CALIFORNIA

    Mrs. McMorris Rodgers. Again, thank you, Madame Chairman. 
As we all know, many of the issues before this Subcommittee 
cross party lines. Some matters enjoy bipartisan support, 
others enjoy bipartisan opposition.
    The Subcommittee, however, has a history of rolling up its 
sleeves and getting things done together. We have many 
important issues to tackle over the next two years. The stakes 
are high, and we owe it to the citizens of this country to do 
the very best.
    I am encouraged, thus far. The distinguished Chairwoman 
showed real leadership when she invited the Members of their 
Subcommittee and their staff over for a wonderful breakfast two 
weeks ago. I really enjoyed it. She is a great cook, and that 
action says a lot. So I look forward to working with you, 
Madame Chair, and all of our colleagues, on what I hope to be a 
very inclusive and promising two years.
    Now let me turn to the legislation. The San Joaquin River 
Restoration Settlement Act, offered by our distinguished Former 
Chair, George Radanovich, is a symbol of what people can 
accomplish when they sit down and negotiate in good faith. The 
battle over the San Joaquin River's future has raged for 18 
long years, with little progress. Little has been done for the 
farmer or the fish. But this bill attempts to reverse that and 
take action out of our Federal courthouse.
    As some of you may know, the Pacific Northwest has its own 
endangered salmon problems. Salmon restoration is consumed by 
endless litigation. A Federal judge is dictating how we use the 
water, and some environmental extremists want to tear down dams 
and undermine the promise of renewable and inexpensive 
hydropower that FDR and LBJ gave to our region.
    Over $800 million in Federal money has been spent each year 
to restore salmon populations. Three out of every 10 dollars in 
our electricity bills go toward salmon. In one instance, rate 
payers spent over $3 million per fish, due to a judge's action 
to mandate unnecessary spills.
    Let us be clear. All of us in the region are 
environmentalists. Everyone wants to see salmon survive and 
succeed. But the most well-intentioned people argue over how we 
measure progress and define success when it comes to recovering 
our salmon.
    With the salmon money meter still running, we are trying, 
but not even close, to answering these questions. I am sure all 
of you here today want to see salmon and river restoration 
succeed on the San Joaquin. I hope that you have thought very 
seriously about how success will be defined, what benchmarks 
you will need to accomplish this goal, and how you will 
mitigate the impacts on people and other endangered fish.
    When this settlement can be reopened in 20 years and after 
all this money is spent, I really hope that we have made 
tangible progress on helping humans and fish. The last thing we 
want is the California version of salmon wars on our doorsteps.
    I again want to commend the sponsors of this bill and the 
parties here today for attempting to resolve these delicate 
matters. I look forward to today's testimony, and focusing on 
the next steps of the legislative process.
    [The prepared statement of Mrs. McMorris Rodgers follows:]

          Statement of The Honorable Cathy McMorris Rodgers, 
          Ranking Republican, Subcommittee on Water and Power

    It is indeed an honor to serve as the Ranking Republican on this 
Subcommittee and a pleasure to serve with some of the best and 
brightest this Congress has to offer.
    As we all know, many of the issues before this Subcommittee cross 
party lines. Some matters enjoy bipartisan support. Others enjoy 
bipartisan opposition. This subcommittee has a history of rolling up 
its sleeves and getting things done together.
    We have many important issues to tackle over the next two years. 
The stakes are high and we owe it to our constituents to do the very 
best.
    I'm encouraged thus far. The distinguished Chair showed real 
leadership when she invited the Subcommittee members and their staff 
over for a wonderful breakfast two weeks ago. That action says a lot. 
So, I look forward to working with you, Madame Chair, and all our 
colleagues on what I hope to be a very inclusive and promising two 
years.
    Now, let me turn to the legislation. The San Joaquin River 
Restoration Settlement Act, offered by our distinguished former Chair, 
George Radanovich, is a symbol of what people can accomplish when they 
sit down to negotiate in good faith.
    The battle over the San Joaquin River's future has raged for 18 
long years with little progress. Little has been done for the farmer or 
the fish, but this bill attempts to reverse that and take action out of 
the federal courthouse.
    As some of you may know, the Pacific Northwest has its own 
endangered salmon problems. Salmon restoration is consumed by endless 
litigation, a federal Judge is dictating how we use the river, and some 
environmental extremists want to tear down dams and undermine the 
promise of renewable and inexpensive hydropower that FDR and LBJ gave 
to our region. Over $800 million in federal money has been spent each 
year to restore salmon populations, 3 out of every 10 dollars in our 
electricity bills go towards salmon and in one instance, ratepayers 
spent $3.1 million per fish due to a Judge's action to mandate 
unnecessary spills.
    Let's be clear: all of us in the region are environmentalists. 
Everyone wants to see salmon survive and succeed. But the most well-
intentioned people argue over how we measure progress and define 
success when it comes to recovering our salmon. With the salmon money 
meters still running, we are trying but not even close to answering 
these questions.
    I'm sure all of you here today want to see salmon and river 
restoration succeed on the San Joaquin. I hope that you have thought 
very seriously about how success will be defined, what benchmarks you 
will need to accomplish this goal and how you will mitigate the impacts 
on people and other endangered fish. When this settlement can be re-
opened in 20 years and after all this money is spent, I really hope 
that you have made tangible progress on helping humans and fish. The 
last thing you want is the California version of Salmon Wars on your 
doorsteps.
    I again want to commend the sponsors of this bill and the parties 
here today for attempting to resolve these delicate matters. I look 
forward to today's testimony and focusing on the next steps of the 
legislative process.
                                 ______
                                 
    Mrs. Napolitano. Thank you, Mrs. McMorris Rodgers. At this 
point I will recognize Members who wish to make brief 
statements. Any Member who decides to be heard will be heard, 
and of course additional material may be submitted for the 
record. We do have a full schedule, so I am asking that we try 
to keep that to a minimum so that we can then hear from the 
panels.
    I will enforce the five-minute rule with our timer. Ladies 
and gentlemen, it is right before you. As my former Chair 
Radanovich used to say, green means go, yellow means speed up, 
red means stop. So I am borrowing that from you, George.
    I now recognize Congressman Costa for any statement he may 
have.

 STATEMENT OF THE HON. JIM COSTA, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Costa. Thank you very much, Madame Chairperson. And I, 
too, want to commend you and congratulate you on this 
chairmanship. I know you are going to do a very able job, and I 
look forward to working with all the Members on the 
Subcommittee. So thank you for your efforts to start this off 
in the proper fashion.
    The hearing we are holding today, this morning, is, as been 
mentioned, part of a long effort that many of us have been 
involved with as it relates to not just water policy in 
California, but specifically in the San Joaquin Valley.
    As was noted, the lawsuit has extended for now over 18 
years. And as any out-of-court settlement, there is always 
aspects of a settlement that you like better than others. I 
think this is no exception for me.
    Nonetheless, what is important here is that we, after 18 
years, have been able to find a way for parties to come 
together and try to solve problems. And I think it is in that 
spirit that we should look at the enabling legislation this 
morning.
    The fact is that the San Joaquin Valley, the eight-county 
region, is the fastest-growing region in California, for a lot 
of reasons, in terms of population growth, in terms of people 
settling there, in terms of cost of living. It also is the 
richest agricultural region in the entire United States, and, 
for that matter, the world. And so there are a lot of 
conflicting issues that relate to this water resolution and 
this settlement.
    It is also an area which has been ground zero on many of 
the contentious water fights in California for decades, and 
everyone here is well aware of that.
    The fact is that to the degree that we can solve a problem 
and take it off the table, it allows us to progress and to make 
efforts to the long-term water needs of California, and to the 
Valley. To that end, we are trying to put together a regional 
water plan for the eight counties to look at our water supply 
needs over the next 30 years, to look at our water quality 
issues that we have to face. I know that the Chairman is very 
focused on, to deal with environment restoration issues that we 
need to focus on to continue to accommodate the growth, and to 
be good stewards of the environment.
    And finally, as was with this last spring, California has 
either too much or too little. And last spring we had too much 
water, and we had flooding. And we have concerns about not just 
levees in the Delta, but levees in the San Joaquin Valley, as 
well. So all of those four water-related issues are key, and 
part and parcel of this settlement agreement that we talk about 
this morning.
    I will look forward to the testimony and to the questions 
that I have, and to the responses as we work on this enabling 
legislation. I noted in the discussions we had last September 
that all the parties came together; that the Members who 
represent those areas, as you noted, including Senator 
Feinstein, worked very hard to try to see if we could put 
together this enabling legislation.
    And it is in that spirit that I approach the hearing here 
this morning, realizing that, like anything else, there is 
always room for improvement. Nonetheless, I am hopeful that we 
will be able to move forward in a collegiate and bipartisan 
fashion to solve this matter. And I want to thank you, Madame 
Chairperson, again for your hard work and your focus in this 
area.
    Mrs. Napolitano. Thank you. Mrs. McMorris Rodgers.
    Mrs. McMorris Rodgers. And now I turn to Mr. Radanovich.

 STATEMENT OF THE HON. GEORGE RADANOVICH, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Radanovich. I would love to make an opening statement.
    Mrs. Napolitano. Very good.
    Mr. Radanovich. Thank you. It is great to be back here. 
Chairwoman Napolitano, congratulations. It is great to have a 
fellow Californian as Chairman of this Subcommittee, and Mrs. 
McMorris Rodgers, having you as Ranking Member is a good thing. 
So I am glad to be here. I miss this committee. I am pretending 
I am still on the committee, by the way, so I will be showing 
up I think regularly.
    But I did want to read a statement into the record 
regarding this, because I think it is important for the San 
Joaquin Valley. And I am so thankful that you are conducting 
this hearing as one of the final steps in putting to rest an 
18-year battle over the San Joaquin River.
    I am eager to work with this committee to see it come to 
its rightful conclusion. For 18 years a legal battle to restore 
salmon fishing in the San Joaquin River has been waged in the 
courts. Hard-working families who depend on the San Joaquin 
River and the Friant Dam at Millerton Lake have been living 
with the uncertainty of their water source.
    In the meantime, many of us were aware that waiting for a 
judicial decision could be costly to all parties, without 
necessarily providing an amicable solution, and could linger 
for years while being appealed to the Supreme Court.
    For these reasons, Senator Diane Feinstein and I join 
together to urge the parties to take their fight out of the 
courtroom and back to the negotiating table. The Friant Water 
Users Authority, the NRDC, and the U.S. Government and third 
parties began negotiation in good faith, and hammered out what 
we have before us here today.
    The San Joaquin River Settlement would implement the terms 
of the settlement, which strives to bring life to a dormant 
river, while securing reliable water for fertile valley 
farmlands which depend on the river for sustainability.
    Now that much of the hard work has been done in California, 
it is up to Congress to bring the settlement across the finish 
line and provide necessary funding. The San Joaquin River 
Restoration Settlement is the result of a collaborative effort 
between all parties involved. By working in good faith 
together, we have developed legislation to enact this historic 
settlement and put an end to a long episode of California water 
wars.
    After last year's hearing on the San Joaquin River 
Settlement, third-party concerns of the unintended consequences 
of the settlement were addressed in the legislation, and in a 
memorandum of understanding. As we have worked through the 
issues that arise during this process, let us also keep in mind 
that this will be a continual process.
    I recognize that some of my colleagues have concerns with 
the settlement, and every effort has, and will continue to be, 
made to prevent those concerns from being realized.
    I look forward to hearing more from witnesses today about 
mitigating water losses and addressing this matter. I commend 
the Friant Water Users Authority for developing the potential 
water management programs and projects to recapture, 
recirculate, and reuse water. There are also new opportunities 
separate from this legislation being developed as we speak, 
like the San Luis Drainage Proposal, which may provide more 
options to help mitigate water losses to the friant water 
users, and I look forward to exploring those opportunities.
    I commend those who worked really very hard on this effort, 
and I want to thank all the co-sponsors for their support of 
this bill. Diligent efforts on behalf or by Kole Upton, 
Chairman of the Friant Water Users Authority; Dan Dooley, a 
Friant water attorney; and Hal Candee with the NRDC; and others 
from the state and Federal governments helped achieve this 
settlement.
    Now Congress has the opportunity to enact this critical 
legislation, and I say let us make it happen.
    Thank you very much for the time, and for conducting this 
hearing.
    [The prepared statement of Mr. Radanovich follows:]

   Statement of The Honorable George Radanovich, a Representative in 
                 Congress from the State of California

    Thank you, Chairwoman Napolitano, for holding this hearing on this 
bipartisan bill H.R. 24, the San Joaquin River Restoration Settlement 
Act. This hearing is one of the final steps in putting to rest an 18 
year battle over the San Joaquin River. I am eager to work with this 
Committee to see it come to its rightful conclusion.
    For 18 years a legal battle to restore a salmon fishery on the San 
Joaquin River has been waged in the courts. Hard working farm families 
who depend on the San Joaquin River and the Friant Dam at Millerton 
Lake have been living with the uncertainty of their water source. In 
the mean time, many of us were aware that waiting for a judicial 
decision could be costly to all parties, without necessarily providing 
an amicable solution, and could linger for years while being appealed 
to the Supreme Court.
    For these reasons Senator Dianne Feinstein and I joined together to 
urge the parties to take their fight out of the courtroom and back to 
the negotiating table. The Friant Water Users Authority, NRDC, and the 
U.S. government and third parties began negotiation in good faith and 
hammered out what we have before us today. The San Joaquin River 
Settlement Act would implement the terms of the settlement, which 
strives to bring life to a dormant river, while securing reliable water 
for fertile Valley farmlands which depend on the river for 
sustainability.
    Now that much of the hard work has been done in California, it's up 
to Congress to bring the settlement across the finish line and provide 
the necessary funding. The San Joaquin River Restoration Settlement is 
the result of a collaborative effort between all parties involved. By 
working in good faith together, we have developed legislation to enact 
this historic settlement and put an end to a long episode of California 
Water Wars.''
    After last year's hearing on the San Joaquin River Settlement, 
third party concerns of the unintended consequences of the settlement 
were addressed in the legislation and in a Memorandum of Understanding.
    As we have worked through issues that arise during this process let 
us also keep in mind that this will be a continual process. I recognize 
some of my colleagues have concerns with the settlement, and every 
effort has and will continue to be made, to prevent those concerns from 
being realized. I look forward to hearing more from the witnesses today 
about mitigating water losses and addressing this matter. I commend the 
Friant Water Users Authority for developing the potential water 
management programs and projects to recapture, recirculate, and re-use 
water. There are also new opportunities, separate from this 
legislation, being developed as we speak, like the San Luis drainage 
proposal, which may provide more options to help mitigate water losses 
to the Friant Water Users, I look forward to exploring those 
opportunities.''
    I commend those who worked so hard on this effort and I thank all 
the cosponsors for their support of this bill. Diligent efforts by Kole 
Upton, Chairman of the Friant Water Users Authority, Dan Dooley, a 
Friant Attorney, Hal Candee, with NRDC, and others from the state and 
federal governments helped achieve the settlement. Now Congress has the 
opportunity to enact this critical legislation. Let's make it happen.
                                 ______
                                 
    Mrs. Napolitano. Thank you, Congressman. Congressman Udall.

STATEMENT OF THE HON. MARK UDALL, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF COLORADO

    Mr. Udall. Thank you, Madame Chairman. I will be very 
brief. I want to acknowledge your kind remarks about my service 
on the Resources Committee, and just mention to the committee 
Members that are here that I have a bill pending that hopefully 
will be considered by the Subcommittee, dealing with the Platte 
River. And the good news is that river flows to the east. At 
this point, California has no stake in the water in that river.
    [Laughter.]
    Mrs. Napolitano. I will keep that in mind, sir.
    Mr. Udall. Although the States of Wyoming and Nebraska are 
also affected by the Platte River.
    Thank you, Madame Chair.
    Mrs. Napolitano. Thank you, sir. Mrs. McMorris Rodgers.
    Mrs. McMorris Rodgers. Thank you, but not Washington State, 
eh?
    Representative Nunes.

STATEMENT OF THE HON. DEVIN NUNES, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Nunes. Thank you, Mrs. McMorris Rodgers, and 
congratulations, Mrs. Napolitano, on your Chairmanship. I know 
you have been to my district numerous times, and I thank you 
for that. I remember when I was first elected, you actually 
came out to my district and attended a field hearing in my 
district. So thank you for that. So I know you are well aware 
of these issues, and I am happy that you are the Chairwoman, 
especially being a Californian.
    I have a statement here that I am going to read part of, 
and I will probably submit it for the record. But I want to be 
extremely clear that I have always supported restoring the San 
Joaquin River, despite the fact that I ask tough questions 
about this settlement.
    I remain committed to the restoration of the river; in 
fact, folks in this room today may not remember, but I 
campaigned on this issue. I pledged in my first run for office 
to restore the river and bring water certainty to my 
constituents. And I have never stopped working on this issue.
    Indeed, it is a noble goal to bring back the mystic salmon 
population that have been reported to be abundant in the river 
over 70 years ago. Unfortunately, no one in this room can say 
with any level of certainty that the legislation before us 
today would accomplish this goal.
    I expect to hear a lot of words like we expect, we hope, 
and it is our goal; but what I do not expect to hear is that 
there will be 100,000 fish in 20 years, or that Friant will be 
able to recover all its lost water.
    Why is that? Because we simply do not know. No feasibility 
study has been done on what would be the largest and most 
expensive river project the West has ever seen.
    While I give the settling parties an A for their hard work 
in negotiating the detailed specifics of restoring the river, I 
give them an F in their attempts to provide any level of 
certainty of recovering lost water. We will hear about goals; 
but without concrete legislative language, goals can be 
forgotten or even ignored, as we have seen in the past.
    The parties to the settlement have come to Congress and 
asked us to trust them, and have told us they have the best 
interests in the Valley in mind. Again, while their thoughts 
may be genuine, trust and faith do not hold any weight in the 
court of law or in the court of public opinion. If it is not 
codified in law, then it doesn't exist.
    Today I expect to hear that third parties have been 
consulted, and that their impacts have been addressed. While 
this is partially true, other third parties, like cities and 
counties in my district, were not consulted, nor were they 
invited to the negotiating table. They have serious concerns 
about the impacts on groundwater, and have already had a tough 
time meeting EPA standards for water quality. Any loss of 
surface water will only result in increased reliance on 
groundwater. This situation will diminish water quality even 
further.
    In fact, I have received resolutions from every city 
council in Tulare County, and both the Tulare County and Kern 
County Board of Supervisors, all which clearly express concern 
about the settlement and the need to have concrete mitigation 
plans to recover water.
    We are at a crossroads, and the economic and social future 
of my constituents is at stake. We must have mitigation for the 
groundwater impacts, and we must have a safety net for my 
constituents in case the settling parties fail to live up to 
their grand promises.
    Again, thank you, Mrs. Napolitano, for the opportunity to 
serve just one day on your committee, and I hope that you will 
invite me back.
    Mrs. Napolitano. Thank you. The Committee will if you 
behave.
    [Laughter.]
    Mrs. Napolitano. Hey, I am very up front, my friend.
    [Laughter.]
    Mrs. Napolitano. Mr. Cardoza, Congressman Cardoza.

   STATEMENT OF THE HON. DENNIS CARDOZA, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Cardoza. Madame Chair, thank you very much. I 
congratulate you on your chairmanship, and I assume the same 
admonition that you gave to Mr. Nunes applies to me, as well. I 
will take it in that spirit.
    Although I miss serving on this committee, I know that we 
will continue to work closely with you and your staff that work 
on this proposal. And I truly appreciate the invitation to be 
here today and participate.
    Last fall, after 18 years of litigation, the Friant Water 
Users Authority and the U.S. Bureau of Reclamation Natural 
Resources Defense Council reached a settlement agreement to 
restore the San Joaquin River. Although this historic agreement 
resolved the lengthy and costly litigation issues that created 
the atmosphere of uncertainty for the Friant Authority and for 
the growers that rely upon Friant for their water supply, I 
voice my concerns that this agreement would place burdens on 
landowners, water and flood control districts, not a party to 
this agreement.
    After weeks of intense, and sometimes around-the-clock, 
negotiations with representatives of all parties and my 
colleagues, I am pleased to represent that we were able to come 
to an agreement on language that would allow the settlement to 
go forward, while at the same time protect the water rights and 
property rights of those not a party to this litigation, with 
certainly the caveat of the questions that Mr. Nunes has 
raised.
    H.R. 24, the San Joaquin River Restoration Settlement Act, 
embodies this agreement. This legislation not only sets out a 
course for the implementation of this historic agreement, but 
it also resolves issues that are critical to my constituents in 
California's 18th District. Without the protections contained 
in this legislation, the settlement could result in significant 
costs, in the hundreds of millions of dollars, for downstream 
landowners and flood control operations; and also would have 
the untold impacts on the water delivery system throughout 
California. This legislation ensures that the release of 
restoration flows down the San Joaquin River will not transfer 
impacts to my constituents downstream.
    Further, it requires that the settlement go forward with a 
phased-in approach requiring the Bureau to conduct a 
feasibility study on the issues of cost, impact, and mitigation 
of various options to release the restoration flows.
    I am pleased that the Bureau and many third parties 
recently entered into a memorandum of understanding to 
establish a process and structure for third parties to 
coordinate with the Bureau on a list of issues of joint 
concern. Under the MOU, the Bureau has committed to working 
together and coordinating with third parties in planning and 
designing and implementation of this settlement.
    It is my understanding that the MOU has been finalized. And 
with permission, Madame Chair, I would like to submit a copy of 
the MOU into the record today.
    Mrs. Napolitano. Without objection.
    [NOTE: The Memorandum of Understanding submitted for the 
record by The Honorable Dennis Cardoza, has been retained in 
the Committee's official files.]
    Mr. Cardoza. Last, I would like to stress that the 
settlement agreement's two goals of restoration and water 
management are equal goals. In order for this settlement to be 
successful, it is critical to have the continued support of the 
Friant water users. Meeting the water management goals of the 
settlement with the Bureau developing an effective 
recirculation plan with excess pumping capacity and recovered 
water account to mitigate a substantial portion of the water 
losses to the Friant district is the best path forward toward a 
success. Successful implementation also dictates that funding 
is provided to meet both of these goals.
    I remain committed to continuing to work with my Valley 
Congressional colleagues--with Senator Feinstein and yourself, 
Madame Chair; with all the third parties--to ensure that this 
legislation and the settlement agreement are implemented 
consistent with these goals.
    I thank you again, Madame Chair, for the opportunity.
    Mrs. Napolitano. Thank you. Mrs. Rodgers.
    Mrs. McMorris Rodgers. Thank you. Mr. Calvert.
    Mr. Calvert. Thank you. I just want to congratulate Grace 
F. Napolitano for becoming Chairman of the committee. I served 
with her for four years as the Chairman, and she is going to 
make a fine Chairman.
    Mrs. Napolitano. Thank you.
    Mr. Calvert. I congratulate you, and congratulations to 
Mrs. McMorris Rodgers. And I look forward to working with you. 
And may you have fun working these water battles.
    [Laughter.]
    Mr. Calvert. I miss the good old days of the west side, and 
the east side, and the quantification agreement, and the 
Colorado River.
    Our friends from Colorado left. I just want them to know I 
just flew over Colorado the other day. The mountains were 
glistening with snow, and it is wonderful to look at our water 
when it is white. But they left.
    So thank you, and I look forward to working with you.
    Mrs. Napolitano. Thank you, Ken. It is a pleasure having 
you. And we did have a very, very fruitful four years; we 
worked well together, as I did with George Radanovich. But 
thank you for including me in many of the things that you did, 
because I learned considerably. So we hope to be able to put 
that to good use. Thank you, gentlemen.
    With that, thank you, and we will proceed with the 
witnesses. Sorry it took so long, but these are things that we 
need to get out in the open so you understand how it works.
    We will have the testimony on H.R. 24, the San Joaquin 
River Restoration Settlement Act. Our first panel includes 
representatives from the settling parties, the California 
Department of Water Resources, the California State Assembly, 
and of course we have Mr. Dan Dooley representing the Friant 
Water Users Authority. Mr. Hamilton Candee representing the 
Natural Resources Defense Council, and Mr. Jason Peltier from 
the Department of the Interior, along with Ms. Nancy Saracino 
from the California Department of Water Resources. And of 
course, Hon. Lois Wolk from the California State Assembly. 
Welcome to all of you, and we are looking forward to a very, 
very fruitful hearing.
    The Subcommittee will continue to utilize the same 
procedure used in the last Congress, and that is to allow all 
witnesses on the panel to present their testimony before we ask 
questions. In other words, we will finish listening to them, 
and then we will ask the questions.
    Your prepared statements, ladies and gentlemen, will be 
entered into the record, and all witnesses are asked to limit 
their remarks to five minutes. Don't forget my talk up here.
    If you wish to speak on salient points, since your 
testimony is going to be in the record, please do so. We would 
rather hear your personal passion on this.
    We will begin with Mr. Dan Dooley. Your prepared statement, 
again, is in the record. Proceed for five minutes, sir.

STATEMENT OF DANIEL M. DOOLEY, COUNSEL TO MEMBERS OF THE FRIANT 
       WATER USERS AUTHORITY, DOOLEY HERR & PELTZER, LLP

    Mr. Dooley. Thank you, Madame Chair, and congratulations to 
you on assuming the chair of the committee. It is a pleasure to 
be here.
    I am Dan Dooley. I am a partner of Dooley Herr & Peltzer, a 
water law firm in Visalia and Sacramento. I am also a partner 
in a farming operation with a former Member of this 
Subcommittee. We farm in the area that is affected by this.
    I was one of the principal negotiators of the settlement, 
along with Kole Upton, who is the Chairman of the Friant Water 
Users Authority. And I have with me----
    Mrs. Napolitano. Move your mike up sir, please.
    Mr. Dooley. Sorry.
    Mrs. Napolitano. A little further, a little further, just a 
little bit more. There you go.
    Mr. Dooley. Also with me today is Ron Jacobsma, who is the 
Consulting General Manager of the Friant Water Users Authority, 
in case you ask questions that I am not capable of answering.
    I do want to thank the committee for calling an early 
hearing on H.R. 24. It is very important that this bill move 
forward quickly, and we appreciate your support and interest in 
doing that. I also want to thank Mr. Radanovich and Senator 
Feinstein for giving the settling parties a strong push to 
enter into settlement discussions.
    I am not going to spend much time talking about the terms 
of the settlement. We have briefed many of you in the past 
about that, and it is included in our prepared statements.
    I do want to talk a little bit about why the settling 
parties, or why Friant entered into this settlement. And quite 
candidly, it was not for the altruistic reason of restoring the 
San Joaquin River.
    We were facing, we were playing Russian roulette with a 
judge who had a six-shooter fully loaded at our head, and the 
alternative of going to litigation and trial on this matter was 
very disturbing to us. We expected that we would lose far more 
water than is included in the settlement. We would have far 
less certainty than we have been able to provide in the 
settlement, and we would have no opportunity through a judgment 
in the court to pursue any water management policies that are 
embodied in the settlement.
    We knew this, because in August of 2004, the judge ruled 
that the Bureau of Reclamation had violated a state law statute 
that required the release of water from the dam for maintenance 
and restoration of a fishery; and that we had a Valentine's 
Day, 2006, trial date scheduled to determine how much water was 
required to achieve that objective.
    We had no expectation that we would prevail on appeal, 
because the Ninth Circuit Court of Appeals had, in a prior 
appeal ruling, ruled that 5937, which is a state law provision, 
applied to Friant Dam; and therefore, we knew that the results 
were not going to be good if we went to trial.
    So we embarked on the settlement process, trying to achieve 
certainty, both as to water supply and cost, and trying to 
include in the settlement some provisions that would enable us 
the opportunity to recapture some of the lost water supplies 
that would be provided for restoration of the river.
    And that was in lieu of the absolute havoc that we expected 
would have resulted from a judgment issued by the Court, which 
would have been subject to annual review by the judge, so that 
he could adjust the amount of water that would be required to 
be released for the fishery, and we would have absolutely no 
certainty from year to year as to how much water would be 
provided.
    So the settlement, while it does require water to be 
released from Friant Dam, and that water is water that has 
previously been provided to farmers in the San Joaquin Valley, 
it also preserves the vast majority of the water supplies of 
the Friant Project for their historic use. That was our 
objective to enter into this settlement agreement. We were 
making a business judgment, quite candidly, that this 
settlement is far superior to the alternative of going to 
trial.
    Now, I know, as you mentioned, Madame Chair, that since the 
oversight hearing in September, a lot of progress has been made 
with respect to addressing third-party interests. And those 
protections have been embodied into the legislation. And I 
think that is very helpful.
    The Friant Water Users Authority has also spent 
considerable time developing a water management plan. And this 
has been provided to the committee. And I would request it be 
included in the record. It demonstrates----
    Mrs. Napolitano. Without objection, it is so ordered.
    [NOTE: The water management plan ``San Joaquin River 
Restoration Program: Water Management Goal...'' submitted for 
the record by Mr. Dooley has been retained in the Committee's 
official files.]
    Mr. Dooley. Thank you. It demonstrates a number of projects 
that, both from a recirculation point of view and from 
individual district points of view, that the members of the 
Friant Authority intend to undertake to mitigate the water 
supply impacts. And I think it is the first comprehensive 
effort to look at some of the activities that can be undertaken 
to address some of the concerns that Mr. Nunes and others have 
raised about potential water supply impact.
    With that said, I think we believe that this is a 
worthwhile settlement. We believe it is far superior to the 
alternative. We believe that if this legislation doesn't pass, 
we are back in the soup in the litigation again, and facing the 
alternative of a much more havoc-wreaking alternative. And so 
we encourage you to move this bill quickly, and we thank you 
for your support.
    [The prepared statement of Mr. Dooley follows:]

 Statement of Daniel M. Dooley, Dooley Herr & Peltzer, LLP 1
---------------------------------------------------------------------------

    \1\ DOOLEY HERR & PELTZER, LLP represent the Fresno Irrigation 
District, Lewis Creek Water District, Lower Tule River Irrigation 
District, Porterville Irrigation District, Saucelito Irrigation 
District, Stone Corral Irrigation District, Tea Pot Dome Water 
District, and Tulare Irrigation District, all of whom are long-term 
Friant Division Central Valley Project water contractors. Additionally, 
Dooley Herr & Peltzer, LLP represent the Hill's Valley Irrigation 
District, Pixley Irrigation District, and the Tri-Valley Water 
District, all of which are long-term Cross Valley Canal Central Valley 
Project water contractors.
---------------------------------------------------------------------------
CHAIR NAPOLITANO, AND MEMBERS OF THE SUBCOMMITTEE:
    It is an honor and privilege to appear before this Committee, and 
to ask your support for legislation implementing a historic agreement 
that resolves a long-standing conflict on the San Joaquin River. I am 
Daniel M. Dooley, a partner in Dooley Herr & Peltzer, LLP. I serve as 
general counsel for many of the irrigation and water districts that 
compose the Friant Water Users Authority. Along with Kole Upton, 
Chairman of the Friant Water Users Authority, I was a principal 
negotiator of this historic Settlement of the 18 year old lawsuit known 
as NRDC, et al. v. Rodgers, et al. Mr. Ron Jacobsma, Consulting General 
Manager of the Friant Water Authority, is with me today, and will be 
available to respond to any questions you may have regarding 
implementation of the Settlement.
    On September 13, 2006, the Friant Water Users Authority, Natural 
Resources Defense Council and U.S. Department of the Interior 
cooperatively reached what can only be termed a historic moment. As 
representatives of Friant, the NRDC and its coalition, and the federal 
government gathered at the federal courthouse in Sacramento, documents 
were being electronically filed within the U.S. District Court of Judge 
Lawrence K. Karlton to settle the San Joaquin River litigation that has 
been so contentious, and which has placed such a dark cloud over 
Friant's future, for the past 18 years.
    My testimony today will focus on this Settlement and why it is good 
for society as a whole and all the parties. I will discuss how this 
carefully crafted Settlement provides a process to restore a river in a 
manner that maintains a vibrant economy and society and how it offers 
protection, in so many ways, for third parties who are downstream 
stakeholders.
    Most importantly, I will assert to you that this extraordinary 
Settlement offers a positive and productive path forward into a future 
in which all of us can use our resources and talents in a cooperative 
effort rather than one that is wastefully devoted to continued 
bickering and fighting. This Settlement may not be not perfect, but it 
is by far the most practical option for each of the parties, and 
particularly for the members of the Friant Water Users Authority and 
the water users they serve.
    I commend the legislators and policy makers--Federal, State, and 
Local--who have done so much to reach this remarkable point in time. In 
particular, Mr. Chairman, the settling parties and the people and 
organizations we represent are grateful for the leading roles that the 
former Chair, Mr. Radanovich and Senator Feinstein willingly took to 
bring us back to the negotiating table and bridge our differences in a 
way that has made it possible for all of us to embrace this Settlement 
and its provisions.
    As you may know, the Friant Water Users Authority consists of 22 
member agencies that receive water from the Friant Division of the 
Central Valley Project. The Friant service area consists of 
approximately 15,000 mostly small family farms on nearly one million 
acres of the most productive farmland in the nation along the southern 
San Joaquin Valley's East Side. The Friant Division sustains 
underground water supplies relied upon by residents, businesses and 
industries in the cities within the Friant service area and delivers 
surface water to cities and towns that include Fresno, Friant, Orange 
Cove, Lindsay, Strathmore and Terra Bella.
    The Friant interests were motivated to find a way to settle the 
NRDC's lawsuit over the San Joaquin River because of our determination 
to preserve the valley's way of life. Friant Dam and water delivered 
through the Madera and Friant-Kern canals has always provided a great 
deal of opportunity. For the past 18 years, the water supply of water 
from Friant has been under a dark cloud. We have had every reason to 
believe that those who farm and the communities that exist because of 
Friant could end up losing all or a major portion of their water 
through a judge's decision in the NRDC case or because of some other 
challenge.
    Such a possibility was and is unacceptable. Farmers cannot farm 
without an adequate and affordable water supply. Further, farmers must 
have some certainty before committing to plant a crop. As this case 
began down a fast track toward trial to determine how much water was 
required to restore the River, we were provided with an opportunity to 
sit down and try again to reach a mutually agreeable settlement.
BACKGROUND
    It goes without saying that this case has been seemingly endless, 
frequently frustrating, incredibly challenging, internally complicated, 
often controversial and always expensive.
    It began in 1988 just as the U.S. Bureau of Reclamation was 
beginning to renew Friant's long-term 40-year contracts. NRDC and its 
coalition of environmental and fishing interests challenged the 
government's decision to renew Friant water service contracts without 
an Environmental Impact Statement. Of course, it didn't stay that 
simple. NRDC's complaint was amended seven times over the next 15 years 
to include other claims. One of those was a claim under the Endangered 
Species Act, and still another that contended the operation of Friant 
Dam was in violation of California Fish and Game Code Section 5937, 
which requires dam operators to release sufficient water to keep fish 
in good condition below the dam. Most of the earlier claims are no 
longer relevant. But the river flow issue--the most crucial of all to 
Friant users--came to be the litigation's focus over the past several 
years, especially during an earlier four-year settlement effort that 
was unfortunately not successful.
    The case reached a crucial turning point in August 2004 when the 
judge ruled Section 5937 imposes a continuing duty to release 
sufficient water from Friant Dam into the San Joaquin River to restore 
former historic salmon runs and fishery conditions. It assigned 
liability to the Bureau of Reclamation. The court did not determine how 
much water would be needed to satisfy the state law but set the case 
for a trial that was to have started in February 2006 to determine the 
``remedies''--the amount of the releases. In 2005, the parties began 
preparing for that trial and in the process gained valuable new 
scientific information from the expert reports prepared by our 
respective trial witnesses about possible restoration strategies.
    The Judge admonished the parties that the law did not permit him to 
finely tune a solution in the way the parties could through a 
negotiated settlement. The Judge's admonition resonated with the Friant 
contractors. It seemed to say what many of us had long suspected--that 
if the judge decided this case, there was going to be a great deal of 
Friant water used as a ``remedy'' down the river. And without a 
settlement, there wasn't going to be any of the extensive and 
critically needed work done in the channel and to structures to provide 
any sort of on-the-ground hope that salmon could be lured back by water 
alone. The Judge would likely have retained jurisdiction to increase 
water releases in order to accomplish the Restoration Goal. There was, 
however, a strong likelihood that Friant's water users and the economic 
and social structure in the San Joaquin Valley that depends upon this 
water supply could very well be severely impacted.
    That was the situation fall of 2005 when then Chairman Radanovich 
and Senator Feinstein began a non-partisan effort to try to get Friant, 
NRDC and the government to try again to negotiate a mutually agreeable 
Settlement. It should be obvious that Mr. Radanovich and Mrs. Feinstein 
were amazingly persuasive! They asked the parties to respect the 
critical principles. The first was to respect the need for water supply 
and financial certainty in the Friant community. The second was to 
respect the need for certainty that the Restoration effort would 
actually occur. The concept was a good old-fashioned compromise. This 
is essentially how it was framed:
    In exchange for restoring the San Joaquin River below Friant Dam, 
Friant's new water dedication for the fishery's needs would be capped 
at certain amounts based upon hydrologic conditions. That instantly 
provided Friant water users with what had long been missing--a 
declaration of water supply and quantity certainty for decades into the 
future. We were well aware in taking this key compromise and filling in 
the details that such an agreement would result in use of a portion of 
the Friant Division water supply for Restoration Flows. And, yes, it 
represents water that our already water-short area can't afford to 
lose. Friant also recognized that the cap on water for Restoration 
Flows would remove what promised to be years of continued uncertainty 
over the Friant water supply that would result in socioeconomic 
disruption of the eastern San Joaquin Valley.
    Of equal importance to that certainty and the river's restoration 
was development of the Settlement's unique means of using good, 
innovative water management to provide means to recover, re-use and 
recirculate water in an attempt to mitigate impacts on Friant water 
users. Also of great importance to Friant was another crucial 
compromise that capped Friant's financial contribution to river 
restoration at present levels--which add up to tens of millions of 
dollars each year paid into the CVP Improvement Act's Restoration Fund 
and Friant Surcharge.
    By April of 2006, the parties were able to inform Judge Karlton 
that agreement had been achieved on numerous issues, including 
restoration goals, water flows, ways of managing and recovering water 
and a host of other issues. At the end of June, attorneys agreed to a 
Settlement in principle and would recommend approval to each of the 
constituencies.
THE SETTLEMENT AGREEMENT
    The Settlement Agreement itself is constructed around two 
important, parallel and, Friant believes, equal goals:
      The Restoration Goal is to restore and maintain a self-
sustaining salmon population below Friant Dam to the confluence of the 
Merced River.
      The Water Management Goal is to reduce or avoid adverse 
water supply impacts to all of the Friant Division long-term water 
contractors.
    THE RESTORATION GOAL includes three essential elements. Those 
include:
      A number of improvements providing for channel capacity, 
related flood protection, fish passage and fish screening. These will 
take place in two phases. By the end of 2013, projects to be completed 
include a salmon bypass channel around Mendota Pool, increasing channel 
capacity between the Eastside Bypass diversion and Mendota Pool to 
4,500 cubic feet per second; increasing the channel capacity (in Reach 
4B) below the Sand Slough control structure to 475 cfs; modifying the 
Sand Slough control structure to provide for fish passage and 
appropriate routing of water; screening the Arroyo Canal diversion; and 
modifying Sack Dam and the Eastside and Mariposa Bypass channels for 
fish passage and low flow conditions; and providing seasonal fish 
barriers to screen fish at Salt and Mud Sloughs. The second phase 
improvements are to be completed by the end of 2016. These include 
increasing Reach 4B channel capacity below the Sand Slough control 
structure to 4,500 cfs unless it is determined not to substantially 
enhance achievement of the Restoration Goal; modifying the Eastside 
Bypass diversion structure to provide appropriate fish screening and 
passage; and isolating gravel pits near Fresno from the river.
      Flow releases from Friant Dam, beginning in 2009 with 
experimental interim flows and with full restoration flows beginning in 
2014; with quantities determined according to hydrographs based upon 
water year types in order to provide fishery habitat water. These 
restoration flows may be supplemented by buffer flows of up to 10% and 
can be further augmented with water purchases from willing sellers. If 
construction of the river improvements is not completed, the Settlement 
agreement contains default provisions designed to preserve water for 
later use to achieve the Restoration Goal. Procedures are also 
specified for flexible management of Restoration Flows to account for 
temperature and biological factors. This adaptive management is to 
avoid causing harm to other downstream fishery programs. The flow 
schedule can't be modified until after December 31, 2026 and any change 
would require a court filing and a referral to the State Water 
Resources Control Board.
      Reintroduction of salmon and other varieties of fish into 
the upper San Joaquin River. The Fish and Wildlife Service is to apply 
to the National Marine Fisheries Service for a permit to reintroduce 
salmon and NMFS must decide on such application by April 30, 2012. Fall 
and spring run salmon are to be reintroduced by the end of 2012.
    THE WATER MANAGEMENT GOAL and its implementation embrace two 
critical elements. They include:
      Development and implementation of a plan to recirculate, 
recapture, reuse, exchange, or transfer water released for Restoration 
Flows within bounds of the Settlement's terms and all applicable laws, 
agreements and environmental policies.
      Creation of a Recovered Water Account that provides an 
opportunity for Friant Division long-term contractors to recover water 
they have lost to Restoration Flows at a reduced water rate in wet 
water conditions. Friant Division long-term contractors providing water 
for Restoration Flows will be able to purchase water for $10 an acre 
foot during certain wet conditions when water is available that is not 
necessary to meet contractual obligations or Restoration Flows. This 
provision is designed to increase water banking and management programs 
and boost incentives for districts to actively participate while 
reducing the Settlement's water supply impacts.
    SOME OF THE SETTLEMENT'S OTHER FEATURES include and address:
      State of California Participation: This contemplates that 
the State will of necessity participate in implementing many 
provisions. A memorandum of understanding has been negotiated with 
various State agencies. It specifies how Friant, the NRDC coalition, 
federal government and the State will integrate implementation 
activities. The State has expressed a desire for its Resources Agencies 
to be actively involved. We expect the State to provide technical and 
funding resources. Specific agreements will be negotiated with the 
State regarding specific Settlement actions. It should also be noted 
that Proposition 84 was approved by the California voters in November 
of 2006 and includes $100 million for San Joaquin River restoration.
      Funding: There are very specific provisions related to 
Settlement funding, including provisions relating to the character of 
the capital investment, limitations on Friant Division long-term 
contractor payments, identification of existing funding resources and 
additional appropriations authorization. The Settlement provides that 
costs will not add to CVP capital obligations. It also commits Friant 
Division long-term water contractors to continue paying the CVPIA 
Restoration Charge and Friant Surcharge for the life of the Settlement 
but caps Friant's obligations at those amounts. The Friant Surcharge 
would be dedicated to implementing the settlement, as would Friant's 
capital repayment portion of CVP water rate payments. Up to $2 million 
annually of the Friant CVPIA Restoration Charge payments will be made 
available for implementing the Settlement. In addition, the Settlement 
authorizes appropriations authority for implementation totaling $250 
million. (Some of these identified sources of funding are not subject 
to the appropriations ceiling or to annual appropriations and may not 
be subject to scoring for budget allocation purposes.) State funding 
from various revenue streams, including state bond measures, are 
anticipated. Funding identified in the Settlement is to be available to 
implement the Water Management Goal as well as the Restoration Goal.
      Other Claims Resolved: The Settlement resolves all claims 
pending in the existing litigation, including those challenging the 
validity of the Friant Division long-term renewal contracts. The 
exception is attorneys' fees and costs.
      Third Party Impacts And Participation: There has been a 
great deal of concern voiced about third party impacts. All of us 
clearly understand and the Settlement acknowledges that implementation 
will require a series of agreements with agencies, entities and 
individuals who are not parties to the litigation. The Interior 
Department is to coordinate with interested third parties (including 
third parties who own or control lands or facilities affected by 
Settlement implementation), and for public participation in Settlement 
implementation. Provisions of the MOU with the State contemplate joint 
efforts to provide mechanisms for non-party participation in Settlement 
implementation. Further, and as a result of a series of intense 
negotiations last September, a number of changes and additions were 
agreed to the legislation before you today that resolved most of the 
third party concerns. All participating in those discussions have 
signed a pledge that as a result of the changes, they will support the 
Settlement and the legislation and oppose changes that are not agreed 
to by all of the parties.
      Management And Administration: A Restoration 
Administrator position is to be established to help implement the 
agreement and advise the Interior Department on how the river 
restoration hydrographs are to be implemented, when buffer flows may be 
needed, river channel and fish passage improvements, reintroduction of 
salmon, interim flows for data collection purposes, targets, goals and 
milestones for successful implementation of the fishery program and 
coordination of flows with downstream tributary fishery efforts. 
Appointment will be for a six-year term. A Technical Advisory Committee 
will be created to advise the Restoration Administrator. It will 
include two representatives each from the plaintiffs' coalition and 
Friant defendants as well as two members mutually agreed upon, but none 
are to be federal employees. Terms are to be for three years.
      Long-Term Friant Water Service Contract Amendments: When 
the Friant Division's long-term renewal contracts were enacted in 2001, 
they included a stipulation requiring necessary contract amendments to 
reflect and be consistent with any Settlement agreement. Such a 
provision is part of the Settlement. Friant's long-term contracts will 
be kept in place with no further National Environmental Policy Act or 
Endangered Species Act compliance actions required.
      Resolution of Disputes: Procedures are included for 
attempting to resolve disputes by meeting and conferring. Should that 
be unsuccessful, services of a neutral third party are to be used. 
Finally, the parties could turn to the U.S. District Court.
FEDERAL LEGISLATION
    This issue is before the Subcommittee because some Interior 
Department actions called for in the Settlement require Congressional 
authority. As you have seen, an exhibit to the agreement contains 
legislative language proposed to implement the Settlement. It is 
referred to as the ``San Joaquin River Settlement Act.'' Passage of 
this legislation in substantially the same form as has been introduced 
is critical because any party could void the Settlement if the 
necessary legislation were not enacted on a timely basis. Further, 
State of California funds will be available to implement the Settlement 
on July 1, 2007. Enactment of this legislation is critical to 
effectively utilize the State funds and to keep implementation of the 
Settlement on the admittedly aggressive schedule agreed to by the 
parties.
MITIGATION WATER SUPPLY IMPACTS
    The Friant Water Users have carefully evaluated the water supply 
delivery impacts of restoring Restoration Flows to the San Joaquin 
River. In addition to flood flows and surplus water supplies, Friant 
estimates the average annual impacts to historic water deliveries to be 
approximately 170,000 acre feet. Unmitigated, this annual impact would 
have significant adverse impacts on the Friant service area and the 
communities existing therein. These potential impacts are of concern to 
the Friant Contractors and many community interests along the eastern 
side of the southern San Joaquin Valley.
    The Friant Water Users Authority and its member districts have 
undertaken to prepare a report that identifies a number of specific 
programs and projects that could be undertaken to substantially, if not 
completely, mitigate the water supply impacts. Some of provisions of 
the report identify options for recirculation, recapture and reuse of 
water that should be considered by the Secretary of Interior when 
developing the plan required by Paragraph 16 of the Settlement. Other 
provisions identify activities that the Friant Water Users Authority 
and its members are considering to further reduce the direct water 
supply impacts resulting from the initiation of Restoration Flows as 
well as the indirect impacts on the communities in the Friant service 
area. These programs and projects include, but are not limited to:
      Projects and programs that should be considered by the 
Secretary in developing the plan for recirculation, recapture and reuse 
of Restoration Flows that is required by the Settlement and the 
legislation;
      Rehabilitation and enhancement of Friant Division 
conveyance facilities to permit greater utilization of surplus River 
water to maximize the effectiveness of integrated regional and district 
programs and projects;
      Integrated regional management projects and programs that 
create improved integrated water management activities between 
districts and among groups of districts; and
      Improved district groundwater banking, conveyance, 
distribution and water management programs and facilities.
    I offer a report that summarizes these programs and projects and 
includes a detailed exhibit for inclusion into the record of this 
hearing.
CONCLUSION
    Settlement of the 18-year-old litigation known as NRDC v. Rodgers 
has been rightly applauded in much of the nation's press as an 
outstanding achievement. The Friant Water Users Authority and its 
member agencies appreciate that sentiment and view the Settlement as 
historic, and the beginning of a new era in which the policies and 
activities of the past are blended with society's environmental 
priorities of the present and future. This Settlement has been 
constructed upon a newfound willingness among the settling parties to 
cooperate and compromise for the common good, and to the benefit of 
each of our positions.
    In addition to society's general interest in the San Joaquin River, 
there are three interest groups lobbying Congress on the legislation 
proposed for implementing this Settlement. These parties include:
      The environmentalists interested in restoring flows and 
salmon to the San Joaquin River.
      The San Joaquin Valley folks who are dependent on San 
Joaquin River water for sustaining their livelihoods and homes within 
the Friant Division.
      The third party interests who do not want the 
implementation of the Settlement to cause material adverse impacts to 
their constituents.
    I submit to you that, collectively and individually, all these 
interests and society itself will be far better served by this 
Settlement than by Congress rejecting it. Of course not everyone is 
fully satisfied, from either the environmental coalition or the water 
users community:
      Some in the environmental community may wonder why they 
should settle with caps on Friant's costs and water releases when they 
have won so convincingly to date in Judge Karlton's Court. The answer 
for them is that this Settlement offers a process and constructive 
opportunity of cooperation for salmon restoration. With a court 
judgment, the attitude and approach by the valley folks would be 
predominantly one of perpetual resistance, and an emphasis on how to 
save as much water as possible. Under that scenario, water would nearly 
certainly be released upon orders of a federal judge, but the necessary 
improvements and cooperative nature essential to an effective salmon 
recovery would be entirely missing. And, if it were ever to be 
achieved, if would be accomplished only be after a much longer time 
with far greater amounts of water.
      Some water users interests may feel that this Settlement 
makes no sense because, they reason, Congress six decades ago agreed to 
make the Friant project a reality and decided to make it work by drying 
up 60 miles of the San Joaquin River. Valley folks may also feel a 
federal judge should not have the power to overturn such a decision 
made long ago, and subsequently reaffirmed, by Congress. There is a 
misperception by some that an unfavorable ruling to valley water users 
and agencies would be a strong candidate for being reversed on appeal 
to the Ninth Circuit or the Supreme Court. Unfortunately, Friant has 
already been down that road once with this judge's decisions, including 
that our contracts should be voided and that California Fish and Game 
Code Section 5937 should apply to Friant Dam. His ruling was upheld by 
the Ninth Circuit and the Supreme Court would not take the case.
      The Third Party interests have sought protection and 
indemnification against unfair water and fiscal costs they assert the 
Settlement would be inflict upon their constituents. We have addressed 
their concerns in the legislation before you. It is important to 
understand that rejection of the Settlement and proceeding to trial 
would not provide the third parties any of the protections contained in 
the Settlement and legislation.
    This Settlement, and the legislation before you, is the product of 
literally thousands of hours or arduous negotiation and analysis. All 
parties to the litigation, and third parties who expressed concerns 
about the Settlement originally, have committed enormous good faith 
efforts to structure an agreement that fairly and acceptably balances 
all of the varied interests. Incredibly, we found such a balance. I 
believe this Settlement sets forth a model for resolving complex water 
resource disputes. The last piece is enactment of H.R. 24. I request 
that this Committee move this Bill as quickly as possible so that the 
parties can fully move forward to the challenging task of implementing 
this historic restoration program.
    Thank you.
                                 ______
                                 

         Response to questions submitted for the record by the 
                      Friant Water Users Authority

Submitted by Mr. Nunes (CA) to all witnesses:
    If all of the other parties involved in the negotiations concerning 
the form of H.R. 24 were to agree, would your organization support an 
amendment of H.R. 24 authorizing the construction of pumping and 
conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal of the 
Settlement?
Response:
    At the completion of negotiations on H.R. 24 in Senator Feinstein's 
Office on September 27, 2006, Friant signed a pledge (with all of the 
other Settling Parties and many third parties) not to support 
amendments to the legislation unless such amendments were agreed to by 
all of the other signatories. Friant will consider any amendments 
offered to H.R. 24 and confer with the other signatories to the 
September 27, 2006 pledge and only support any such amendments if the 
other signatories agree. Friant certainly has a critical interest in 
making sure the Water Management provisions of the Settlement are fully 
implemented.
Submitted by Chairwoman Napolitano to the Settling Parties:
Restoration of Salmon Fisheries
    1.  What was the value of the San Joaquin Chinook salmon fishery 
(sport and commercial) prior to extirpation of the species, in then-
current, and in 2007 dollars?
Response:
    In conjunction with the water rights hearing that led to the 
California State Water Rights Board's decision No. 935 in 1959, the 
California Department of Fish and Game submitted evidence of the value 
of California's commercial salmon fishery. Friant has no knowledge of 
that amount being converted into 2007 dollars. Friant has no knowledge 
of any effort to assign a monetary value specific to the salmon fishery 
of the San Joaquin River.
    2.  The Settlement Agreement calls for restoring fall and spring 
runs of Chinook salmon, yet Sec. 10 of H.R. 24 only addresses 
restoration of spring-run Chinook. Will the fact that the bill does not 
directly address restoration of fall Chinook salmon affect 
reintroduction of fall Chinook as called for in the Settlement? Has a 
decision been made that it is infeasible to restore both spring-run and 
fall-run Chinook salmon, as provided for in settlements paragraph 
14(a)? If so, please explain the basis for this decision.
Response:
    The provisions of Sec. 10 of H.R. 24 do not address fall-run 
Chinook salmon because the species already exists on the lower San 
Joaquin River and tributaries thereto, and the species is not currently 
listed under Sec. 4 of the Endangered Species Act. Thus, all of the 
parties, including the downstream tributary interests did not feel it 
necessary to include protections for such species. The Settlement 
provides for the reintroduction of fall-run as well as spring-run 
Chinook salmon. The Settling Parties acknowledge that the spring-run 
was the dominant species on the upper San Joaquin River for a variety 
of biological reasons. Consequently, the hydrographs that are the 
foundation of the Settlement are principally designed to meet the needs 
of spring-run.
    3.  The report that would assess the success of the reintroduction 
of salmon is to be made no later than December 31, 2024, under H.R. 24. 
Why is the deadline 12 years after the expected introduction of the 
experimental population in 2012? Will there be other reports or 
monitoring that will gauge progress sooner or on a regular basis?
Response:
    The date of the report required by Sec. 10 of H.R. 24 was chosen, 
in part, so that Congress would be informed of the progress of the 
experimental population prior to the end of the protections provided to 
third parties that are included in the provisions of Sec. 10. There are 
other provisions of the Settlement, the Memorandum of Understanding 
with the State of California and the Memorandum of Understanding with 
third parties that provide for constant monitoring of the progress of 
implementation of the Restoration and Water Management Goals. Twelve 
years was selected as the time period because Central Valley spring-run 
Chinook salmon generally mature and return to spawn when they are 3-4 
years old, so twelve years provides an opportunity to examine the 
success of the experimental population through about three generations 
of fish.
    4.  In the 1992 Central Valley Project Improvement Act, Congress 
directed the Secretary of the Interior to develop a program to ensure 
sustainable anadromous fish populations double their average from 1967-
1991 in 10 years; however, after 15 years, this goal has not been 
achieved. Given the difficulty in meeting the obligations set out in 
1992, how long will it take to restore to ``good condition'' an 
extirpated species?
Response:
    Friant is not aware of all of the reasons the doubling goal of the 
Central Valley Improvement Act has not been achieved. The reason is 
surely a function of many factors. In the case of restoration of a 
fishery to the San Joaquin River, the Settling Parties agree on the 
physical work necessary to restore the River. The Settling Parties have 
agreed upon Restoration Flow hydrographs and how those flows will be 
administered. Further, the Settling Parties have agreed upon a 
timeframe (concluding in 2026) that should allow sufficient generations 
of salmon to return to the San Joaquin River to evaluate the 
effectiveness of the Restoration effort. All of the parties acknowledge 
that the undertaking is significant and its success will be affected by 
a number of factors.
    5.  What other fish and wildlife species will benefit from this 
restoration effort? Do they include other listed or candidate species 
on federal or state endangered species lists?
Response:
    There are a number of plant and animal species that will benefit 
from reintroduction of flows and reestablishment of riparian habitat 
along the San Joaquin River. Friant is not aware of all of the 
particular listed or candidate species that might benefit from 
implementation of the Settlement, though it is anticipated that the re-
establishment of a riparian vegetation corridor would benefit listed 
species which typically inhabit such areas in California's Central 
Valley, such as the Giant Garter Snake and the Valley Elderberry 
Longhorn Beetle. As a part of the early planning and design process for 
implementation of the Settlement, surveys will be performed that will 
identify species that exist in the area of the Restoration effort.
    6.  What recreation benefits might be realized from these 
restoration activities?
Response:
    The Restoration of the San Joaquin River will provide many 
aesthetic benefits and will likely create opportunities for 
recreational benefits. Such opportunities must be balanced with the 
property rights of adjacent landowners along the restored river.
Experimental Populations Under the Endangered Species Act
    1.  Would any reintroduction of spring-run salmon to the San 
Joaquin River be outside the current range and wholly separate from 
nonexperimental populations of this species?
Response:
    Friant understands that there are no spring-run on the San Joaquin 
River or tributaries thereto presently. Thus, reintroduced spring-run 
on the San Joaquin River would be wholly separate from existing 
populations on the Sacramento River and its tributaries. Of course, out 
migrating adults from the experimental population and existing 
populations on the Sacramento River and its tributaries will both 
proceed to the ocean via the Sacramento-San Joaquin Delta and San 
Francisco Bay.
    2.  Section Sec. 10(b) of H.R. 24 makes the reintroduction of 
spring-run Chinook salmon dependent upon a discretionary finding by the 
Secretary that such a permit can be issued. What are the guarantees 
that the reintroduction will be allowed to proceed under this approach, 
or if it is allowed to proceed, that it will not be legally 
challengeable under a strict reading and interpretation of Sec. 10(j) 
of the ESA?
Response:
    The provisions of the Settlement explicitly state that the 
Settlement will be implemented in accordance with all applicable laws 
including, but not limited to, the Endangered Species Act. Thus, the 
Settlement is careful not to limit discretion of the Secretary of 
Commerce under provisions of the Endangered Species Act. Consequently, 
there are no guarantees that the Secretary will issue the permit as 
contemplated by Sec. 10 of H.R. 24. Having said this, it is important 
to note that both the National Marine Fisheries Service and the Fish 
and Wildlife Service are parties to the Settlement and participated in 
negotiating the provisions of Sec. 10 of H.R. 24. They have advised 
Friant, the other Settling Parties and the third parties that use of 
Sec. 10(j) of the ESA and adoption of a Sec. 4(d) rule is precisely the 
mechanism they would utilize for reintroduction of spring-run on the 
San Joaquin River. Clearly, the exercise of discretion under these 
provisions must be supported by sound science in order to avoid a 
sustainable challenge.
    3.  How will the introduced population be determined a success or 
failure? What if the experimental population of salmon does not 
succeed? Will this affect the terms of the Settlement? Will there be 
changes in the restoration flows or water management activities?
Response:
    Provisions of Exhibit D to the Settlement provide a procedure by 
which the Technical Advisory Committee, the Restoration Administrator 
and the Secretary of Interior will develop interim and long-term 
targets and metrics to measure the effectiveness of the Restoration 
program. Additionally, the Bureau of Reclamation has already 
established a project implementation team that includes other state and 
federal agencies. This team includes a technical group working on the 
fishery management portions of the Settlement. The Settling Parties 
have acknowledged in the Settlement itself that, notwithstanding their 
best efforts, the effort may not succeed. Pursuant to the procedure 
included in the Settlement, any Settling Party may seek to modify the 
Restoration Flows after December 31, 2025. Prior to that time, there 
can be no changes to the required releases for the Restoration program. 
There are no provisions in the Settlement for modification of the water 
management provisions of the Settlement.
    4.  Section 10(b) of H.R. 24 directs the Secretary to reintroduce 
spring-run Chinook salmon pursuant to ESA Sec. 10j and the Settlement. 
What potential conflicts exist between these prescriptions for 
introducing salmon and how will they be resolved?
Response:
    Friant does not believe there are substantial conflicts between the 
Settlement and H.R. 24. However, to the extent that there are any 
conflicts between the Settlement and H.R. 24 with respect to issues 
such as the method of achieving ESA compliance for the reintroduced 
species, H.R. 24 is more recent and reflects the agreement reached 
amongst all of the negotiating parties, and it should therefore 
control.
    5.  The San Joaquin River supported spring and fall-run Chinook 
salmon in the southernmost part of their historical range. Could 
factors such as climate change or natural migration make it unlikely 
for salmon to exist in the San Joaquin River when experimental 
populations are assessed in 2024?
Response:
    It is possible that these factors could affect the potential of 
success of the reintroduction. Friant has no specific information that 
enables it to conclude that these are relevant factors affecting 
success or not.
    6.  If the experimental population of Chinook salmon were 
determined to be essential, and critical habitat designated, will this 
modify federal water management activities on the San Joaquin River? 
Will third parties be affected?
Response:
    Friant understands that the determination of nonessential relates 
to whether taking of ``brood'' stock from the spring-run populations 
existing on the Sacramento River and tributaries thereto will likely 
affect their survival in those watersheds. A similar determination must 
be made about whether the introduction of an experimental population on 
the San Joaquin River will affect the survival of the existing runs on 
the Sacramento River and its tributaries. Assuming it is found not to 
affect the survival of the spring-run on the Sacramento and tributaries 
thereto, Friant does not believe the presence of an experimental 
population of spring-run on the San Joaquin would result in a critical 
habitat designation on the San Joaquin. Thus, except as provided in the 
Settlement, the presence of an experimental population will not affect 
water management activities on the San Joaquin or adversely affect 
third parties.
    7.  Section 4(d) of ESA authorizes the Secretary to prepare 
regulations to provide for the conservation of threatened species. Has 
the National Marine Fisheries Service (NMFS) or Fish and Wildlife 
Service (FWS) ever been directed by Congress to issue a 4(d) rule under 
ESA for an experimental population?
Response:
    Friant has no knowledge with which to answer this question.
Submitted by Mr. Radanovich (CA):
    1.  In his testimony to the Water & Power Subcommittee of the House 
Resources Committee on March 1, 2007, Allen Ishida, Chair of the Tulare 
County Board of Supervisors, asked that two studies be introduced into 
the Record. The first such study was prepared by Northwest Economics 
Associates and the second by the University of California. His 
testimony stated that the studies concluded that ground water levels 
would nearly double in depth and pumping costs significantly increase 
as a result of water releases required by the Settlement. Please answer 
the following:
        a.  Are you familiar with these studies?
Response:
    Yes.
        b.  Do you know the date each of the studies was prepared?
Response:
    The University of California at Berkeley (UC) report was prepared 
in 1996. The second report was prepared by Northwest Economic 
Associates (NEA) in 1997 and was a re-examination of the Central Valley 
Production model used by UC.
        c.  Were the water releases contemplated by these studies the 
        same as those required by the Settlement that is the subject of 
        H.R. 24? If not, what assumptions regarding water releases did 
        the studies assume?
Response:
    No, the studies did not contemplate the Restoration Flows 
contemplated by the Settlement. The UC report modeled the impacts of 
two water supply reduction scenarios, one equaling 200 thousand acre-
feet (TAF) per year and one equaling 500 TAF per year. The NEA study 
estimated the results of the same two water supply reduction scenarios, 
but the NEA study modified the groundwater modeling and simulated 20 
years rather than 10. The water supply reductions modeled by the UC and 
NEA reports are not the same as the water releases called for in the 
Settlement, which provides for restoration flows that will vary 
depending on the type of hydrologic conditions in that water year.
        d.  Are you aware if any subsequent studies have been prepared 
        based upon updated information? If so, when?
Response:
    Yes. In conjunction with the litigation that ultimately gave rise 
to this settlement, one of the authors of the NEA report, Dr. Robert 
McKusick, prepared a report that specifically analyzes the economic 
impacts associated with the hydrographs that are incorporated into the 
settlement. This report was prepared in September 2005.
    Unlike the other two studies, Dr. McKusick's September 2005 report 
was based on a new model developed to allow analysis of water supply 
impacts at a more disaggregate level than the Central Valley Production 
Model which had been used for the UC and NEA reports. This new model, 
the Friant Division Production Model (FDPM), was constructed and 
calibrated based on current agricultural conditions and San Joaquin 
River releases. Among other things, Dr. McKusick and his staff surveyed 
Friant water managers and water users about their current water demands 
and supplies and their anticipated reactions to water losses associated 
with the proposed river restoration flows.
        e.  If you are aware of more recent studies, can you explain 
        what different assumptions were utilized by the more recent 
        studies?
Response:
    While all of the studies anticipated that some of the lost Friant 
water would be replaced by increased groundwater pumping, the UC 
report's assumptions related to groundwater hydrology and pumping cost 
equations were rough. Those assumptions were refined in the NEA study 
and further refined with the development of Dr. McKusick's September 
2005 report, which was premised on extensive, current data on 
groundwater conditions in the Friant service area collected by Dr. 
Charles Burt, Richard Moss, and Dr. Kenneth Schmidt. (Dr. Burt, Mr. 
Moss and Dr. Schmidt all submitted reports in September 2005 related to 
the impact of the river restoration flows on various aspects of 
groundwater conditions within the Friant Service Area.)
    Furthermore, because the prior studies relied on the Central Valley 
Production Model, the UC and NEA reports treated the Friant Division as 
a whole and did not allow for local variations in cropping rotations, 
soils, water sources and quality, financial solvency, and other issues. 
In contrast, the Friant Division Production Model recognizes the 
differences between the 23 Friant Division agricultural contractors. 
The FDPM classified the Friant Division contractors into eight zones 
based on availability of other surface water supplies, groundwater 
availability and depth, cropping pattern, and geographic proximity. The 
FDPM assumes that agricultural producers facing a change in irrigation 
water supplies may change cropping patterns, reduce irrigated acreage, 
or adopt different irrigation technologies. The FDPM also assumes that 
farmers may reduce water application rates (thereby reducing yields), 
unlike the constant yields assumed in the CVPM.
        f.  If you are aware of more recent studies, can you explain 
        what different conclusions were reached by the more recent 
        studies?
Response:
    Dr. McKusick's September 2005 report indicates that, if the 
restoration flows are implemented without modification of project 
operations or any recovery of lost supplies, by 2025, crop acreage in 
the Friant service area would decline by 51,320 acres, or six (6) 
percent of existing acreage. Farm value of output would fall by $159.3 
million per year, causing regional declines of $264.9 million in annual 
output, $80.7 million in annual personal income, and a loss of 3,070 
jobs. Reduced agricultural acreage would have spin-off impacts 
throughout and beyond the service area and would impact many 
industries, including agriculturally-related, retail, transportation, 
real estate, health, and financial services. The magnitude of these 
numbers highlights the importance of water supplies to the economy of 
California's Central Valley and emphasizes the need for effective 
implementation of the Settlement's Water Management Programs.
    2.  Are you aware of other independent studies that have been 
prepared that analyzing the impact of the water releases required by 
the Settlement on groundwater conditions or the economy of Tulare 
County? If so, what are the studies and what did they conclude?
Response:
    The impact of the water releases required by the Settlement on 
groundwater conditions in the Friant service area was analyzed in three 
expert reports prepared by Richard Moss, Charles Burt, and Kenneth 
Schmidt, all of which are dated September 2005. Other than Dr. 
McKusick's September 2005 report, Friant is not aware of any studies 
that analyze the potential economic impacts to Tulare County associated 
with the water releases incorporated into the settlement.
    3.  Mr. Ishida's written testimony makes reference to a new well 
drilled by the City of Lindsay nearly 3 miles outside of the City 
limits. You stated that the distance outside of the City limits was 
related to salinity and nitrate water quality issues. Are you aware of 
what caused the salinity and nitrate problems necessitating the 
drilling of a well so far outside of the City limits?
Response:
    Friant understands that groundwater contamination in and around the 
City of Lindsay is a result of the historic operation of a large olive 
processing facility in the City. While the plant is now closed, its 
historic operation apparently caused significant salinity and nitrate 
contamination affecting the City's municipal water system. The problem 
is not related to declining groundwater conditions.
    4.  What actions has Friant to inform local agencies and landowners 
about the terms and conditions of the Settlement?
Response:
    Friant has undertaken a significant effort to inform local 
interests and landowners about the Settlement and the alternative of 
proceeding with the litigation. Attached is a spreadsheet that details 
the organized activities of the Authority. In addition, individual 
member water and irrigation districts also did considerable outreach, 
including, but not limited to, landowner meetings and production and 
distribution of a DVD explaining the Settlement. Further, there were 
monthly articles in the Friant Waterline (circulation of 5,500) that 
detailed the terms and conditions of the Settlement.
                                 ______
                                 
    Mrs. Napolitano. Thank you. We will next hear from Hamilton 
Candee, Attorney for the Natural Resources Defense Council in 
San Francisco. Sir.

  STATEMENT OF HAMILTON CANDEE, SENIOR ATTORNEY, CO-DIRECTOR, 
    WESTERN WATER PROJECT, NATURAL RESOURCES DEFENSE COUNCIL

    Mr. Candee. Thank you very much. Thank you, Madame 
Chairwoman and Members of the Subcommittee. It is a wonderful 
opportunity to be back here to testify once again about 
restoration of the San Joaquin River.
    My name is Hamilton Candee. I am an attorney, senior 
attorney with the NRDC, and Co-Director of the NRDC Western 
Water Project. I appreciate the opportunity to speak today in 
strong support of the historic settlement in NRDC v. Rogers, 
and the pending legislation to authorize and approve the 
settlement, H.R. 24.
    For the past 18 years I have been a counsel of record in 
this case, representing a coalition of 14 environmental and 
fishing groups, which in turn represent over two million people 
nationwide, and more than 250,000 Californians.
    Madame Chairwoman, you have emphasized recently, as 
recently as yesterday in a very nice event that I had the 
opportunity to attend, that it is very important to you and to 
this Subcommittee that people try to solve water problems 
through partnerships. And in particular, those partnerships be 
partnerships that will benefit people.
    And I am very pleased, therefore, to be here today to 
support legislation that will approve and authorize an 
unprecedented partnership; one that will solve a major water 
problem in California, and will benefit millions of people.
    Settlement on the San Joaquin River will literally bring 
back a living river to an entire region of our state, and will 
do so through a creative and extraordinary partnership between 
farmers and environmentalists, fishermen and water districts, 
and Federal agencies and state agencies. And I must say, I want 
to thank Congressman Radanovich in particular and Senator 
Feinstein for bringing us all together and being leaders in 
this effort to build this partnership.
    Governor Schwarzenegger mentioned in a letter to the 
Secretary of the Interior last year that one reason he was 
supporting the settlement effort is that it will benefit 
literally millions of Californians, while preserving a strong 
agricultural economy. And that is the spirit of our testimony 
today. We believe the settlement should be supported for all of 
those reasons.
    I have previously appeared before the Subcommittee and 
testified on the San Joaquin River Settlement. I understand 
that transcript is now available and will be part of the 
legislative history, so I will not repeat that. What I do want 
to do is talk about some of the remarkable developments since 
the last hearing in September.
    Madame Chairwoman, you have already outlined some of the 
developments. As many people in this hearing room know, Senator 
Feinstein invited us all back literally the same day, the 
afternoon, of that hearing, to bring the parties together to 
try to hammer out additional protections. We already felt there 
were protections in the settlement for third parties, but we 
added a lot of additional protections in the legislation to try 
to deal with the concerns about impacts to third parties. And 
after some very intense negotiations, on September 27 that 
agreement was reached. Senator Feinstein's press release 
announcing that agreement is in the attachments to my 
testimony.
    Incidentally, we did bring some additional copies of those 
attachments in case anyone needs an additional copy of that.
    So the legislation, the revised legislation, which is now 
pending before this Subcommittee, has the support of not only 
the settling parties in the State of California, but also the 
third parties who were in that room and involved in those 
negotiations.
    Senator Feinstein did a very creative thing. She then 
handed around a piece of paper, a pledge-of-support document, 
and we all signed that. And I must say, yesterday we were all 
working together, the third parties and the settling parties, 
briefing Members of the Subcommittee and other interested 
Members of Congress about the revised legislation.
    Since that time the Federal Court has now approved the 
settlement. It has gone into effect. And of course, in November 
the voters of California approved Proposition 84, which 
earmarks $100 million of state money to support the settlement. 
There is also Proposition 1E, a flood bond that has additional 
funding. And Secretary Chrisman from the State of California 
has indicated that he thinks there may be as much as another 
$100 million in those two state initiatives.
    So we believe we are already off and running. The 
settlement is starting to be implemented, and the voters of 
California have spoken that they support it, and they are 
prepared to put funding into it.
    As a result of these consensus discussions, we now have 
H.R. 24 and S. 27 pending before the committee. And I would 
like to thank all of the co-sponsors of the legislation. We are 
very indebted to you.
    We believe that the final thing to keep in mind is all of 
the benefits of this settlement and this legislation. I will 
just list them quickly, just a quick summary of some of the 
more important ones.
    First, restore continuous flows to the San Joaquin River, 
California's second-longest river, and one of the two main 
arteries to the Bay Delta system, benefitting over 23 million 
Californians.
    Second, restoring some of the historic salmon runs, as well 
as other fish species.
    And then provide certainty of the Friant Division long-term 
contractors, preserve a strong economy, provide flexibility to 
the contractors through water management measures, and provide 
protections for third parties.
    As Mr. Dooley said, now it is up to Congress to give a vote 
of approval, and we urge you to pass the legislation as quickly 
as possible. Thank you.
    [The prepared statement of Mr. Candee follows:]

      Statement of Hamilton Candee, Senior Attorney; Co-Director, 
        Western Water Project, Natural Resources Defense Council

    Good morning. I would like to thank the Subcommittee for this 
opportunity to testify once again about restoration of the San Joaquin 
River. My name is Hamilton Candee and I am a senior attorney with the 
Natural Resources Defense Council (NRDC) and the Co-Director of NRDC's 
Western Water Project. I appreciate the opportunity to speak today in 
strong support of the historic settlement in NRDC v. Rodgers and the 
pending legislation to authorize and approve this settlement, H.R. 24. 
For the past 18 years, I have been a counsel of record in this case, 
representing a coalition of 14 environmental and fishing groups which, 
in turn, represent over 2 million people nationwide, and more than 
250,000 Californians. With me today is NRDC senior attorney Kate Poole, 
who also represents the NRDC Coalition and participated with me in the 
multi-party negotiation that produced the landmark settlement that is 
the subject of today's hearing.
    I previously appeared before this Subcommittee to discuss the San 
Joaquin River Restoration Settlement on September 21, 2006. At that 
time, the Subcommittee heard from two panels: the first comprised of 
representatives of the Settling Parties and the State of California, 
and the second comprised of interested third parties. I will not repeat 
here our earlier testimony which provided considerable background on 
the Settlement; however I would like to request that my prior testimony 
and submissions from that hearing be made part of the record for this 
hearing. I would like to focus my testimony today on the remarkable 
progress we have continued to make on the Settlement since that hearing 
last September.
    Immediately following the hearing, the Settling Parties were 
invited by Senator Feinstein to commence negotiations with a wide 
coalition of third parties who had asked for revisions to the then-
pending proposed Settlement legislation to address their concerns about 
potential impacts of the Settlement. These negotiations included 
several members of the House Resources Committee, other interested 
members of the House, both of California's Senators, as well as the 
various parties who testified on the third-party panel on September 21, 
2006. On September 27, 2006, after extensive and difficult negotiations 
in Washington, DC and California, the Settling Parties, the State of 
California, and these numerous third parties agreed on a large number 
of changes to the proposed legislation that were acceptable to all of 
the parties. To memorialize this remarkable agreement, all of the 
parties signed what has come to be affectionately known as ``the blood 
oath'' which committed all the signatories to support the Settlement 
and the revised legislation, and to oppose any amendments to the 
revised legislation that are not agreeable to all of the parties. A 
copy of that Pledge of Support document, along with Senator Feinstein's 
press release announcing the agreement, is submitted with my testimony 
today as an attachment.
    Subsequently, on October 23, 2006, the Federal Court in Sacramento 
that had presided over the NRDC v. Rodgers litigation for 18 years 
approved the Settlement following a hearing on the joint motion of the 
Settling Parties. The Court approved the Settlement without change 
after considering the views of 13 interested individuals and groups who 
were not parties to the litigation but who were allowed to file amicus 
briefs expressing their views on the Settlement.
    On November 7, 2006, the voters of the State of California passed 
two Initiatives that potentially provide substantial State funding for 
implementation of the Settlement. First, the voters passed Proposition 
84, which contains $100 million explicitly dedicated to implementation 
of the Settlement, as well as numerous other potential funding sources. 
Second, the voters passed Proposition 1E, the flood infrastructure 
bond, which provides several billion dollars in bond funds to upgrade 
the State's flood protection. Because the Settlement also calls for 
flood protection upgrades to be implemented along the San Joaquin 
River, the State has informed the Settling Parties that Prop 1E could 
potentially provide tens of millions of dollars in additional State 
funding towards Settlement implementation. In the aggregate, the State 
anticipates providing at least $200 million towards Settlement 
implementation, as explained in the November 30, 2006 Letter from 
California's Resources Secretary Mike Chrisman to Senator Feinstein 
submitted as an attachment to my testimony.
    In December, 2006, the Settling Parties and the State of California 
addressed Senator Feinstein's request to revise further the Settlement 
legislation to address the issue of ``costsharing'' between non-Federal 
sources of funding and the $250 million in new Federal funds authorized 
in the legislation. The Settling Parties were able to successfully 
address the Senator's concerns. As a result of these two rounds of 
consensus discussions to make final revisions to the draft legislation, 
on December 6, 2006, H.R. 6377 and S. 4084 were introduced in the House 
and the Senate with broad, bi-partisan support, including original co-
sponsorship by Senators Dianne Feinstein and Barbara Boxer and 
Representatives George Radanovich, Dennis Cardoza, Jim Costa, George 
Miller, Grace F. Napolitano and Richard Pombo. Action was not taken on 
the bills given the short time left in the 109th Congress, but were 
reintroduced on January 4th of this year as H.R. 24 and S. 27, on the 
first day of the 110th Congress, once again with bi-partisan support in 
the California delegation.
    We thank all of the co-sponsors for their strong support. This is 
the background of the legislation that is now pending before you. It is 
unique legislation in that it has the support of the Settling Parties--
who represent 22 water districts, 14 conservation and fishing groups, 
and 5 federal agencies--as well as a wide array of California water 
users and landowners who were not parties to the Settlement but who 
have now pledged their support for the settlement and this legislation, 
and the State of California (which has committed extensive financial 
and agency resources to the implementation of the Settlement).
    We are also pleased to note that the President's recently-delivered 
federal budget, and Governor Schwarzenegger's recently delivered State 
budget, both support increased funding for the relevant government 
agencies to implement the Settlement. In closing, I would like to 
briefly recap the benefits of passing H.R. 24 and fully implementing 
the Settlement. The Settlement will:
      Restore continuous flows to the San Joaquin River--
California's second-longest river and one of two main arteries to the 
Sacramento-San Joaquin River Delta, the source of drinking water for 
over 23 million Californians;
      Restore the Central Valley Spring-run Chinook salmon, 
fall run Chinook salmon, and other fish populations to the San Joaquin, 
much of which had been destroyed by the operation of Friant Dam over 
the past 60 years;
      Provide certainty to the Friant Division long-term water 
contractors through the specified water releases provided for in the 
Settlement;
      Preserve the San Joaquin Valley's strong agricultural 
economy, while enhancing environmental values in the Valley through 
restoration of a living river and associated habitat;
      Provide flexibility to the Friant Division long-term 
contractors to reduce or avoid the water supply impacts resulting from 
the Settlement through specified water management techniques such as 
recirculation, low-cost water in wet years, and other measures;
      Provide protections to the interests of third parties, as 
included in the current legislation and in the Settlement, and ensuring 
that all of the settlement provisions will be implemented in accordance 
with all applicable laws, including the National Environmental Policy 
Act, the Endangered Species Act, and State law;
      And provide for myriad opportunities for public input and 
participation during the implementation of the Settlement.
    NRDC, having worked together with the other Settling Parties, the 
State and those third parties who have signed the attached Pledge of 
Support, is extremely proud of what we have accomplished in this 
Settlement and revised legislation. The Federal and State agencies and 
the Settling Parties have already begun the hard work of Settlement 
implementation. The State and Federal governments have identified lead 
agency personnel and teams to execute certain tasks. The Settling 
Parties are cooperatively developing protocols and agreements for 
public and third party participation and input. But it is critical for 
all of us that we obtain passage of this legislation that is pending 
before you in order to fully implement what Secretary Kempthorne and so 
many other leaders have correctly described as an ``historic 
settlement.''
    We ask that Congress promptly pass the San Joaquin River 
Restoration Settlement Act so that the San Joaquin River can flow once 
again and all of the benefits of the Settlement can be realized.
    Thank you.
                                 ______
                                 
    [The response to questions submitted for the record by 
Hamilton Candee, Co-Director, Western Water Project, Natural 
Resources Defense Council, follows:]

March 15, 2007

The Honorable Grace F. Napolitano, Chairwoman
Subcommittee on Water and Power
Committee on Natural Resources
U.S. House of Representatives
1522 Longworth House Office Building
Washington, DC 20515

Attn: Emily Knight, Subcommittee Clerk

Re:  March 1, 2007 Hearing on H.R. 24--SJ River Settlement Act: 
Submittal #1 Response to Additional Questions by Representative Nunes

Dear Chairwoman Napolitano:

    Thank you for your letter of March 5, 2007 forwarding the two 
questions from Representative Devin Nunes to witnesses at the March 1, 
2007 hearing of the Subcommittee on Water and Power regarding H.R. 24, 
the San Joaquin River Restoration Settlement Act. One of those 
questions was directed to Mr. Tom Birmingham. The other question was 
directed to all witnesses. We provide below the response of the Natural 
Resources Defense Council (NRDC) to the question directed to all 
witnesses.
    Mr. Nunes asks:
        If all of the other parties involved in the negotiations 
        concerning the form of H.R. 24 were to agree, would your 
        organization support an amendment of H.R. 24 authorizing the 
        construction of pumping and conveyance facilities required to 
        implement the recirculation, recapture, and reuse elements of 
        the Water Management Goal of the Settlement?
    As the Subcommittee knows, the Settling Parties (including the 
Natural Resources Defense Council, the Friant Water Users Authority, 
the U.S. Bureau of Reclamation, the U.S. Fish and Wildlife Service, and 
the National Marine Fisheries Service) devoted extensive time and 
effort to creating a Water Management Goal as part of the San Joaquin 
River Settlement, and H.R. 24 would require the Secretary of the 
Interior to carry out a number of measures specified in the Settlement 
in the effort to achieve that goal. But none of those measures has been 
implemented yet. Accordingly, NRDC believes an amendment to H.R. 24 as 
proposed by Rep. Nunes would be premature and would not support it.
    Among other things, the Settlement calls for the Secretary of the 
Interior, in consultation with the Plaintiffs and Friant Parties, to 
develop and implement a plan for recirculation, recapture, reuse, 
exchange or transfer of the Interim Flows and Restoration Flows for the 
purpose of reducing or avoiding impacts to water deliveries to all of 
the Friant Division long-term contractors caused by the Interim Flows 
and Restoration Flows. That plan has not yet been developed. Until it 
is, the Settling Parties do not have sufficient information to identify 
the most efficacious and cost-effective measures to pursue the water 
management goal, and whether any further congressional authorization is 
necessary.
    In addition, any new pumping and conveyance facilities could impact 
water users and other interests that are not currently represented by 
parties involved in the negotiations concerning the form of H.R. 24, 
including water users who rely on water from the Sacramento-San Joaquin 
River Delta for all or a portion of their supply. We look forward to 
the development of the Plan envisioned by Paragraph 16(a) of the 
Settlement, which we expect will consider a range of possible water 
supply mitigation measures. As that list is developed, we expect the 
Interior Department to engage potentially interested or affected 
stakeholders, including Delta water users, to obtain their input.
    Thank you for providing us this opportunity to provide additional 
information to the Committee about H.R. 24.

Sincerely,

Hamilton Candee
Co-Director, Western Water Project

cc: Honorable Devin Nunes
                                 ______
                                 

   Answers of Natural Resources Defense Council (NRDC) to Additional 
Questions by Chairwoman Napolitano re: SJ River Restoration Settlement 
                              Act, H.R. 24

Questions for the Settling Parties Represented by Dan Dooley, Hamilton 
        Candee, and Jason Peltier
Restoration of Salmon Fisheries
    1.  What was the value of the San Joaquin Chinook salmon fishery 
(sport and commercial) prior to extirpation of the species, in then-
current, and in 2007 dollars?
    ANSWER: State Water Rights Board Decision 935 (D-935) states that 
the California Department of Fish and Game estimated the combined value 
of the sport and commercial salmon runs on the San Joaquin River, at 
the time of commencement of storage and diversions at Friant Dam, to be 
$1,032,000 (D-935, pg. 28, lines 11-20). That figure is based on 1957 
wholesale price values and has not been updated to 2007 or current 
values. In its 2005 Water Plan, the California Department of Water 
Resources presented data showing that freshwater fishing alone 
generates over $3 billion per year of economic output in California--a 
number that does not take into account the loss of the San Joaquin 
River salmon. We are not aware of a more precise and current estimate 
of the economic output generated by the sport and commercial salmon 
runs on the San Joaquin River prior to extirpation of the species.
    2.  The Settlement Agreement calls for restoring fall and spring 
runs of Chinook salmon, yet Sec. 10 of H.R. 24 only addresses 
restoration of spring-run Chinook. Will the fact that the bill does not 
directly address restoration of fall Chinook salmon affect 
reintroduction of fall Chinook as called for in the Settlement?
    ANSWER: No. The reason fall Chinook salmon was not addressed in the 
bill is because it is not listed under the ESA.
        Has a decision been made that it is infeasible to restore both 
        spring-run and fall-run Chinook salmon, as provided for in 
        settlements paragraph 14(a)? If so, please explain the basis 
        for this decision.
    ANSWER: No such decision has been made.
    3.  The report that would assess the success of the reintroduction 
of salmon is to be made no later than December 31, 2024, under H.R. 24. 
Why is the deadline 12 years after the expected introduction of the 
experimental population in 2012?
    ANSWER: The Settlement provides for frequent monitoring of the 
progress of restoration. The deadline for the report on reintroduction 
was selected in part because twelve years is expected to provide data 
on at least 3 generations of salmon.
        Will there be other reports or monitoring that will gauge 
        progress sooner or on a regular basis?
    ANSWER: The Settlement calls for annual Reports on the progress of 
the restoration effort as well as frequent monitoring.
    4.  In the 1992 Central Valley Project Improvement Act, Congress 
directed the Secretary of the Interior to develop a program to ensure 
sustainable anadromous fish populations double their average from 1967-
1991 in 10 years; however, after 15 years, this goal has not been 
achieved. Given the difficulty in meeting the obligations set out in 
1992, how long will it take to restore to ``good condition'' an 
extirpated species?
    ANSWER: The Settling Parties may have different views as to why 
progress under CVPIA has been slower than hoped; in fact, the adequacy 
of the government's implementation of the CVPIA has been a matter of 
some dispute. With respect to H.R. 24 and the San Joaquin River, the 
Settlement defines the Restoration Goal as the restoration and 
maintenance of fish populations in ``good condition'' in the main stem 
of the San Joaquin River below Friant Dam to the confluence of the 
Merced River, including naturally-reproducing and self-sustaining 
populations of salmon and other fish. The Settlement does not 
specifically define what ``good condition'' means in terms of 
population targets. However, the Settlement requires the Technical 
Advisory Committee and the Restoration Administrator to make 
recommendations to the Secretary of the Interior on interim and long 
term population targets toward meeting this goal. As seen historically 
on the main stem San Joaquin and, more recently, on other tributary 
rivers, Chinook salmon populations can grow from a few hundred to 
several thousand within a few years.
    5.  What other fish and wildlife species will benefit from this 
restoration effort? Do they include other listed or candidate species 
on federal or state endangered species lists?
    ANSWER: Numerous fish and wildlife species will benefit from this 
restoration effort. The Settling Parties have focused restoration 
planning on Chinook salmon because satisfying the life history 
requirements for Chinook creates conditions that are favorable for a 
diverse native assemblage of fishes that historically existed below 
Friant Dam. It is anticipated that the restoration requirements 
outlined in the Settlement will sustain native anadromous fish such as 
spring and fall run Chinook salmon and Pacific lamprey, as well as 
resident native fish in the cool-water reaches, including Kern brook 
lamprey, hitch, California roach, hardhead, Sacramento pikeminnow, 
Sacramento sucker, rainbow trout, tule perch, threespine stickleback, 
prickly sculpin and riffle sculpin. In warmer reaches, the restoration 
effort may also help Sacramento blackfish and Sacramento perch. In 
addition, elevated flows, especially spring pulse flows, should help 
Sacramento splittail and other native fishes to spawn in floodplain 
areas, as well as provide additional places for juvenile salmonids to 
rear. While some of these fish face varying levels of threats, none are 
currently listed as threatened or endangered under the federal or state 
endangered species acts, with the exception of spring run Chinook 
salmon.
    The Settlement hydrograph includes ``riparian recruitment'' flows 
designed to help restore riparian vegetation and a riverine ecosystem 
along the banks of the San Joaquin River. This riparian corridor should 
sustain a wide variety of native wildlife and bird species. It could 
also provide a crucial link between existing conservation areas, from 
the San Luis National Wildlife Refuge, the Merced National Wildlife 
Refuge, and the Grasslands Wildlife Management Area along the northern 
stretch of the San Joaquin River to the Mendota Wildlife Area and the 
Kerman and Alkali Sink Ecological Reserves to the south.
    6.  What recreation benefits might be realized from these 
restoration activities?
    ANSWER: By restoring continuous flow, fisheries and riparian 
habitat to the San Joaquin River, the restoration activities will have 
significant, positive impacts on water-dependent outdoor recreation 
along the San Joaquin River.
    Water-dependent recreation activities are very popular in 
California. The California Department of Parks and Recreation has 
conducted statewide surveys of public opinions and attitudes on outdoor 
recreation in California every five years since 1987. The results 
consistently indicate the great importance to Californians of outdoor 
recreation, and water-dependent recreation in particular. In a recent 
survey, conducted in 2002, 84.1% of those surveyed responded that 
outdoor recreation areas and facilities were important or very 
important to them and their families. When respondents were asked to 
consider their favorite recreation activity and to assess the 
importance of various factors to their overall enjoyment of this 
activity, 67.4% said that being outdoors was a very important factor 
for them, and 43.8% said that the availability of water (lakes, 
reservoirs, rivers, wetlands) was very important for them. With regard 
to participation, 75.1 % of respondents had participated at least once 
in 2002 in wildlife viewing, bird watching and/or viewing natural 
scenery; 46.7% had participated in swimming in freshwater lakes, rivers 
and/or streams; and 34% had participated in freshwater fishing.
    Using the data from this survey, the 2005 California Water Plan 
prepared by the Department of Water Resources estimates that, in 2002, 
adult Californians spent about 150 million participation-days on water-
based recreation; in the case of water-related recreation, it estimates 
that there were 55 million adult participation-days for wildlife 
viewing, and 36 million adult participation-days for hiking. With 
regard to the economic impact of water-dependent recreation in 
California, the most specific information available is for 
sportfishing. The 2005 Water Plan presents data showing that freshwater 
fishing alone generates over $3 billion per year of economic output in 
California. The economic activity generated by other components of 
water-dependent recreation, including water-related tourism, exceeds 
that associated with freshwater fishing by a very substantial margin. 
Thus, water-dependent outdoor recreation by both residents and tourists 
is now an important part of the California economy.
    Restoring the San Joaquin River to a living river will provide 
numerous opportunities for these types of water-dependent recreation, 
as well as significant economic benefits for providers and supporters 
of these activities.
Experimental Populations Under the Endangered Species Act
    Section 10(b) of H.R. 24 requires a determination by the Secretary 
of Commerce as to whether a permit for an experimental population can 
be issued for reintroduction of spring- run Chinook salmon under 
Sec. 10(j) of ESA. The language in Sec. 10(j) of ESA, related to 
experimental populations, states that these provisions are applicable 
to introductions outside the current range of such species and wholly 
separate geographically from non-experimental populations of the same 
species. However, spring- (and fall-) run Chinook salmon reintroduced 
into the San Joaquin River may inhabit portions of the Sacramento-San 
Joaquin River drainage in common with other established Chinook salmon 
populations.
    1.  Would any reintroduction of spring-run salmon to the San 
Joaquin River be outside the current range and wholly separate from 
nonexperimental populations of this species?
    ANSWER: This issue was of primary concern to representatives of 
third-party water users who obtain water from tributaries of the San 
Joaquin River downstream of Friant Dam. A member of this group, Mr. 
Kenneth M. Robbins, General Counsel of the Merced Irrigation District, 
provided testimony on this question at the March 1, 2007, hearing on 
behalf of the San Joaquin Tributaries Association. While his views do 
not necessarily reflect the views of the Settling Parties, it should be 
noted that Mr. Robbins testified that:
        With regard to the ``wholly separate'' criterion, the 
        reintroduction of Central Valley Spring Run Chinook Salmon to 
        the San Joaquin River should qualify as no other populations of 
        Central Valley Spring Run Chinook Salmon exist on the San 
        Joaquin River or its tributaries. Indeed, to reintroduce them 
        individuals or eggs of Central Valley Spring Run Chinook Salmon 
        on the Sacramento River will have to be transported to the San 
        Joaquin River.
    2.  Section Sec. 10(b) of H.R. 24 makes the reintroduction of 
spring-run Chinook salmon dependent upon a discretionary finding by the 
Secretary that such a permit can be issued. What are the guarantees 
that the reintroduction will be allowed to proceed under this approach, 
or if it is allowed to proceed, that it will not be legally 
challengeable under a strict reading and interpretation of Sec. 10(j) 
of the ESA?
    ANSWER: Section 10(b) is consistent with existing provisions of the 
Endangered Species Act, which vests discretion with the Secretary of 
Commerce (in the case of anadromous fish such as spring run Chinook 
salmon) to determine whether a permit for the reintroduction of a 
listed species may be issued in light of certain defined factors. We 
anticipate that the Secretary will find that those factors are 
satisfied in this case. Once the Secretary makes that determination 
pursuant to section 10(a)(1)(A) of the Endangered Species Act, section 
10(b) of H.R. 24 provides that spring run Chinook salmon ``shall be 
reintroduced in the San Joaquin River below Friant Dam.''
    3.  How will the introduced population be determined a success or 
failure? What if the experimental population of salmon does not 
succeed? Will this affect the terms of the Settlement? Will there be 
changes in the restoration flows or water management activities?
    ANSWER: The Settlement addresses all of these issues within the 
text of the Stipulation of Settlement. For example, as indicated in the 
answer to Question 4 above, the Settlement requires the Technical 
Advisory Committee (which includes representation of the California 
Department of Fish and Game) and the Restoration Administrator to make 
recommendations to the Secretary of the Interior on interim and long 
term population targets for the reintroduced salmon. Similarly, the 
Settlement provides that certain essential terms can be ``reopened'' 
after 2025 pursuant to a procedure by which the State Water Resources 
Control Board must make a number of specific findings to the Court, 
including findings about levels of progress or success under the 
Settlement. Finally, the Settlement provides explicitly that 
``achieving all of the Restoration Goal by December 31, 2025 may not be 
possible,'' and that ``nonetheless, the Parties agree that engaging in 
the restoration and water management efforts called for by this 
Settlement are expected to provide significant public benefits beyond 
the Restoration and Water Management Goals.''
    4.  Section 10(b) of H.R. 24 directs the Secretary to reintroduce 
spring-run Chinook salmon pursuant to ESA Sec. 10j and the Settlement. 
What potential conflicts exist between these prescriptions for 
introducing salmon and how will they be resolved?
    ANSWER: We do not anticipate potential conflicts between the 
Section 10(b) of H.R. 24 and the Settlement. Nevertheless, the federal 
and state implementing agencies are in the process of creating 
mechanisms for inter-agency coordination as well as ongoing 
consultation with the Settling Parties and with third parties regarding 
implementation of the Settlement and the legislation.
    5.  The San Joaquin River supported spring and fall-run Chinook 
salmon in the southernmost part of their historical range. Could 
factors such as climate change or natural migration make it unlikely 
for salmon to exist in the San Joaquin River when experimental 
populations are assessed in 2024?
    ANSWER: While climate change has the potential to warm our rivers 
and reduce habitat for cold water species like salmon, there are three 
reasons why the San Joaquin River salmon will likely fare better than 
other runs in some other locations. First, the snow pack which feeds 
the San Joaquin River is less likely to be reduced due to global 
warming because some of the highest mountains in the Sierra are in the 
upper San Joaquin drainage. Second, upstream of Friant Dam are several 
hydropower dams with a combined storage (about 600TAF) that is larger 
than Friant Dam (520TAF). These non-diversion dams generally store 
water high in the mountains until the late spring and summer and then 
release much of the water through underground tunnels for power 
generation. This keeps the water cold and provides cooler flows 
beneficial for fish later in the year. Third, spring run Chinook salmon 
are relatively well adapted to climate change because the up-coming 
adults and out-going juveniles migrate during the cold winter and 
spring months. The Settlement also has three flexibility elements that 
will help in managing for the effects of climate change. First, flows 
are allocated in blocks of water to be released at times when they are 
most needed and will provide maximum benefits to fish. Second, the 
Settlement includes an additional 10% of ``buffer flows'' which can be 
called upon if needed to help meet temperature requirements. Third, if 
more flows are needed there are provisions allowing for the purchase of 
additional water from willing sellers.
    Before a population is deemed experimental under ESA, it must be 
determined to be essential or nonessential by the Secretary. 
1 An essential population is defined as a population whose 
loss would be likely to appreciably reduce the likelihood of the 
survival of the species in the wild. All other populations would be 
determined as nonessential. Nonessential populations shall not have 
critical habitat designated; essential populations could have critical 
habitat designated through a special rulemaking process.
---------------------------------------------------------------------------
    \1\ The term Secretary under ESA refers to the Secretary of the 
Interior or the Secretary of Commerce with respect to program 
responsibilities for the species in question, unless otherwise 
specified.
---------------------------------------------------------------------------
    1.  If the experimental population of Chinook salmon were 
determined to be essential, and critical habitat designated, will this 
modify federal water management activities on the San Joaquin River? 
Will third parties be affected?
    ANSWER: As explained above, these issues were of significant 
concern to representatives of third-party downstream water users. A 
member of this group, Mr. Kenneth M. Robbins, General Counsel of the 
Merced Irrigation District, testified at the March 1, 2007 hearing that 
H.R. 24 adequately addresses these concerns. While his views do not 
necessarily reflect the views of the Settling Parties, it should be 
noted that Mr. Robbins testified as follows:
        With respect to the required finding that the experimental 
        population's loss would not appreciably reduce the species' 
        likelihood of survival, it would be difficult to understand how 
        the Secretary could find that the population to be reintroduced 
        is ``essential to the continued existence of the species'' and 
        still remove it from a much more friendly habitat--particularly 
        in light of its threatened status rather than endangered. One 
        would reasonably conclude that the fish would not be taken from 
        their original habitat for such an experiment if they were in 
        fact ``essential.''
    Mr. Robbins further testified that:
        H.R. 24 contains a provision that provides that the 
        reintroduction of the Central Valley Spring Run Chinook Salmon 
        not impose more a than de minimis water supply reductions, 
        additional storage releases, or bypass flows on third parties. 
        We support this language as it is currently written.
    2.  Section 4(d) of ESA authorizes the Secretary to prepare 
regulations to provide for the conservation of threatened species. Has 
the National Marine Fisheries Service (NMFS) or Fish and Wildlife 
Service (FWS) ever been directed by Congress to issue a 4(d) rule under 
ESA for an experimental population?
    ANSWER: This question is directed to two Federal agencies; 
accordingly, we refer the Committee to the response of the Federal 
Parties.
                                 ______
                                 
    Mrs. Napolitano. Thank you, sir. That was a very good wrap-
up.
    Next we will go on to Mr. Jason Peltier, Principal Deputy 
Assistant Secretary for Water and Science with the U.S. 
Department of Interior here in Washington. Welcome, sir.

    STATEMENT OF JASON PELTIER, PRINCIPAL DEPUTY ASSISTANT 
    SECRETARY FOR WATER AND SCIENCE, U.S. DEPARTMENT OF THE 
                   INTERIOR, WASHINGTON, D.C.

    Mr. Peltier. Thank you, Madame Chairwoman, and 
congratulations on your ascendancy. And we look forward to 
working with you not only on this bill, but on a broad suite of 
issues facing the 17 western states that are--it is a show that 
never ends.
    [Laughter.]
    Mr. Peltier. And we are happy to have you in the ringmaster 
seat, and look forward to working with you.
    Mrs. Napolitano. Sir, you don't know how close we are going 
to be working.
    [Laughter.]
    Mr. Peltier. We look forward to that, whatever it is.
    I am pleased to be here, and pleased to provide the 
Administration's support for H.R. 24. I know a lot of you over 
the years are not used to hearing us open our testimony with 
those words, but we are today very supportive of the 
legislation before the committee.
    I think I would associate myself with everything our 
settling partners have said this morning. And I think I would 
like to move directly, in a few minutes, simply to address some 
of the concerns that Congressman Nunes has raised. Because I 
think the issues about uncertainty and ongoing concerns are two 
very big realities we face across the West. Wherever we see the 
interface of water project operations and ecosystems, whether 
it is in impacts or efforts to improve, absolutely those are 
the watch words. Those are the things that we struggle with 
every day as we deal with how to achieve the economic and 
environmental goals that we have. And uncertainty abounds on 
every front. And it is a great challenge for all sides, that we 
must face and deal with.
    Certainly, in the broader context of water issues in your 
state, we are on the verge of dealing with some very large 
historical issues, whether it be on the Klamath River, the 
Salton Sea, flood control issues around Sacramento, the Delta 
of course, drainage on the west side. All of these issues have 
been evolving and developing and coming to the point of 
potential steps forward. And all of them are embedded with the 
issues of uncertainty and many, many concerns, as we go forward 
and attempt to deal with them.
    I think on all of those issues we can look to this 
experience, to the progress we have made in resolving this 
long, ugly fight, We always weren't pals with Hal and his 
troop. But we have crossed into this new age of working 
together and solving problems. And frankly, it feels very good. 
And it is a good feeling to know that as we strive to solve 
problems, as we strive to eliminate uncertainty, that we can do 
it in a partnership a lot better than we can when we are in a 
conflict mode.
    The partnerships extend beyond the settling parties. The 
third parties have been mentioned. Certainly with our friends 
at the State of California, and in broader, within the U.S. 
Government. There is a range of Federal and state agencies that 
will be deeply, deeply involved in this effort as we go 
forward, all with their independent, and sometimes frankly 
conflicting or competing missions, but that is one of the 
uncertainties and concerns that we all must wrestle with, is 
aligning those missions to accomplish our common end goal.
    With that, Madame Chairwoman, I am prepared to answer 
questions. Thank you.
    [The prepared statement of Mr. Peltier follows:]

 Statement of Jason Peltier, Principal Deputy Assistant Secretary for 
           Water and Science, U.S. Department of the Interior

    Madam Chairman and members of the Subcommittee, I appreciate the 
opportunity to appear before you today to discuss H.R. 24, the San 
Joaquin River Restoration Settlement Act. H.R. 24 provides 
authorization and funding for the Secretary of the Interior to 
implement the terms and conditions of the Stipulation of Settlement 
(Settlement) dated September 13, 2006, in Natural Resources Defense 
Council, et al. v. Kirk Rodgers, et al., which was approved by the U.S. 
District Court on October 23, 2006. The Department supports H.R. 24.
    During the eighteen years since this case was filed, relations 
between stakeholders in the San Joaquin River basin, including the 
State of California, Reclamation water users, environmentalists, and 
Federal agencies, have often been contentious. However, through the 
good faith efforts of the ``Settling Parties,'' namely Natural 
Resources Defense Council (NRDC), Friant Water Users Authority (FWUA), 
and representatives of the Bureau of Reclamation, Fish and Wildlife 
Service, National Marine Fisheries Service, and the Department of 
Justice for the United States, an opportunity has been presented to 
resolve this litigation in a way that will both restore the San Joaquin 
River and increase water supply certainty to farmers in the Friant 
Division. My testimony today will provide an overview of the Settlement 
and the importance of this authorizing legislation.
Brief Background
    The Bureau of Reclamation has water service contracts with 28 
entities made up of cities and water districts of various sorts that 
rely on the water supply from the Friant Division, one of the key 
features of the Central Valley Project. Friant Dam is located on the 
upper San Joaquin River, where it forms Millerton Lake, and became 
fully operational in the late 1940s. Our understanding is that about 
15,000 farms rely on Friant water supplies.
    Except for flood-control operations, Friant Dam/Millerton Lake is 
operated to meet minimum downstream flow requirements and maximize 
water deliveries. As a result, approximately 60 miles of the 153 river 
miles between Friant Dam and the confluence of the Merced River have 
been dried up in most years, except during seasonal flood control 
releases. Prior to construction of Friant Dam, the stretch of river 
downstream of the dam supported a healthy fishery, including salmon 
runs, which the dam effectively eliminated.
    In 1988, a coalition of environmental groups led by NRDC filed suit 
challenging the federal defendants' compliance with the National 
Environmental Policy Act (NEPA) and the Endangered Species Act (ESA) in 
connection with the renewal of the long-term water service contracts 
between the United States and the Central Valley Project, Friant 
Division contractors. Most of the Friant Division long-term contractors 
intervened as additional defendants.
    Through amended complaints, the plaintiffs subsequently included a 
claim asserting that pursuant to Sec. 8 of the Reclamation Act of 1902, 
the federal defendants must operate Friant Dam in accordance with 
California Fish and Game Code Sec. 5937. California Fish and Game Code 
Sec. 5937 requires the owner or operator of any dam in California to 
allow sufficient water to flow through or around the dam in order to 
keep the downstream fishery in ``good condition.'' During the initial 
phase of the litigation, the District Court ruled that the contracts 
were not entered into in violation of NEPA requirements, but held that 
approval of the renewal contracts violated procedural requirements of 
the ESA. The District Court did not rule on the Sec. 5937 claim. On 
June 24, 1998, the Ninth Circuit Court of Appeals affirmed most of the 
District Court's rulings but remanded to the District Court the issue 
of the applicability of California Fish and Game Code Sec. 5937 to the 
operation of Friant Dam.
    From 1998 to 2003, without direct involvement by Federal 
defendants, FWUA and NRDC attempted to settle the remanded issue. In 
2003, those discussions were terminated, and on July 19, 2003, the 
plaintiffs amended their complaint by adding the Secretary of Commerce 
and the National Marine Fisheries Service as additional defendants and 
adding claims asserting that the long-term renewal contracts do not 
conform to the requirements of the Central Valley Project Improvement 
Act (CVPIA). In an Order issued on August 27, 2004, Judge Karlton 
concluded that Reclamation violated California Fish and Game Code 
Sec. 5937, and scheduled a trial on the issue of remedy for that 
violation.
    During the summer of 2005, at the request of Subcommittee Chairman 
George Radanovich and Senator Dianne Feinstein, FWUA and NRDC 
reinitiated settlement discussions. In November 2005, the Federal 
government was invited into those discussions, and in spring 2006, the 
State of California was also approached about the negotiations since 
the negotiators foresaw that the State would have a significant role in 
the implementation of any settlement. On September 13, 2006, the 
Settling Parties filed the Settlement, including proposed Federal 
implementing legislation, with the Court. The Settlement Agreement is 
based on two goals and objectives:
    1.  To restore and maintain fish populations in ``good condition'' 
in the main stem of the San Joaquin River below Friant Dam to the 
confluence of the Merced River, including naturally reproducing and 
self-sustaining populations of salmon and other fish.
    2.  To reduce or avoid adverse water supply impacts to all of the 
Friant Division long-term contractors that may result from the Interim 
Flows and Restoration Flows provided for in the Settlement.
Restoration Goal
    The Settling Parties have carefully studied San Joaquin River 
restoration for many years and as part of the Settlement have 
identified the actions and highest priority projects necessary to 
achieve the restoration goal. These include among others: expanding 
channel capacity, improving levees, and making modifications necessary 
to provide fish passage through or around certain structures in the 
river channel. Also called for are year-round flows in the San Joaquin 
River, including those areas that have been without continuous flows 
for decades. This action would be taken to restore and maintain fish 
populations in good condition, including naturally reproducing and 
self-sustaining populations of Chinook salmon and other fish in the 
153-mile stretch of the river between Friant Dam and the confluence of 
the Merced River.
Water Management Goal
    Recognizing that the Settlement's Restoration Flows will reduce the 
amount of water available for diversion at Friant Dam, the Settlement 
also includes provisions to protect water availability for the 15,000 
farms that currently rely on these supplies. One million acres of some 
of the most productive farmland in the country as well as many towns 
and cities along the southern San Joaquin Valley's East Side receive 
all or a major portion of their water supplies from the Friant 
Division. The Settlement recognizes the importance of this water to 
those farms and calls for development of water management solutions to 
provide these users water supply certainty for the long term. Such a 
program would include a Recovered Water Account to make surplus water 
available at a reduced rate to farmers who have contributed water to 
the Restoration Flows and a flexible combination of recirculation, 
recapture, reuse, exchange and/or transfer programs. Additional 
groundwater banking may also be explored.
Phased Approach
    Restoring continuous flows to the approximately 60 miles of dry 
river will take place in a phased manner. Planning, design work, and 
environmental reviews will begin immediately, and interim flows for 
experimental purposes will start in 2009. The flows will be increased 
gradually over the next several years, with the goal of reintroducing 
salmon by December 31, 2012.
    The flow regime called for in the Settlement continues unchanged 
until 2026, with the U.S. District Court retaining jurisdiction to 
resolve disputes arising under the Settlement.
    After December 31st, 2025 the court, in conjunction with the 
California State Water Resources Control Board, could consider any 
requests by the parties for changes to the Restoration Flows.
Importance of Legislation
    As the implementation of this historic Settlement begins, I can't 
emphasize enough how important it is for Federal authorizing 
legislation to be approved and signed into law. Passing this 
legislation soon will demonstrate the kind of support and commitment 
from the Federal government that is necessary to prove we are serious 
about making this settlement and its twin goals a reality. Some initial 
funding and authority exists for Interior agencies to work with our 
State partners to initiate planning and environmental review 
activities, which we have already begun to do. Without authorizing 
legislation such as H.R. 24, however, we lack sufficient authority to 
implement the actions in the Settlement. Moreover, beginning in Fiscal 
Year 2008 we will have insufficient funding to stay on the aggressive 
schedule called for in the Settlement to complete the necessary 
planning and environmental reviews for initiating construction 
activities and ultimately restoring flows into the San Joaquin River 
from Friant Dam. Such delays would send the wrong message regarding the 
Federal support for implementation.
Restoration Funding
    The proposed legislation is consistent with the recommendation in 
the Settlement regarding funding sources to support implementation of 
these projects, including the use of current payments from farmers and 
cities served by Friant Dam, redirection of Federal funds from the 
Reclamation Fund, state bond initiatives, and authorization for 
additional Federal appropriations as long as there is a non-Federal 
cost share. Funds are to be used to meet both the Water Management and 
Restoration goals.
    More specifically, the proposed legislation, consistent with the 
Settlement, allows for the continuation of and the dedication of the 
``Friant Surcharge,'' an environmental fee charged pursuant to the 
Central Valley Project Improvement Act (CVPIA) of $7 per acre foot of 
water delivered to Friant Contractors. This fee is expected to average 
about $8 million per year ($160 million over the 20-year period). Up to 
$2 million annually of other CVPIA Restoration Fund payments made by 
Friant water users under the CVPIA ($40 million over the 20-year 
period) would also be directed for implementation of the Settlement.
    The legislation also calls for the dedication of the capital 
component of water rates paid by Friant Division water users to the 
Settlement implementation (approximately $220-240 million over the 20-
year period). These are funds that at present go to the Reclamation 
Fund in the U.S. Treasury to repay the capital costs of construction in 
the Friant Division. Under this bill, these funds would be deposited 
into a newly established San Joaquin River Restoration Fund to pay 
directly for implementing the Settlement. The Settlement provides that 
the monies contributed to the Settlement from the Friant Surcharge and 
capital repayment obligation may be used to fund bonds, guaranteed 
loans or other finance instruments issued by agencies or subdivisions 
of the State of California.
    In addition, the legislation authorizes up to $250 million of 
additional Federal appropriations to contribute to the implementation 
and requires a non-federal cost-share of an equivalent amount.
    Funding by the State of California will also support the 
Settlement. Last November, State propositions 84 and 1e were passed by 
the California voters and should provide about $200 million of State 
bond funds for projects that will directly contribute to the 
restoration efforts.
    Although the Settling Parties have agreed on a suite of actions to 
be taken to restore flows and salmon runs, the total cost and the 
specificity of those actions still contain significant uncertainty. The 
Parties anticipate that a multi-agency technical team established to 
implement the Settlement would develop additional design details 
typically found in a Feasibility-level study needed to take the 
proposed actions. The Parties also anticipate that the estimated costs 
projected to be required to meet the restoration goal (i.e. $250 
million-$800 million) would be further refined during the initial phase 
of implementation.
    This uncertainty in project costs has been a source of concern to 
both the Administration and the State of California. As project 
partners, we realize that the Federal appropriations proposed in this 
legislation, in addition to the funding sources already described, may 
be integral to implementing the settlement. However, the Administration 
is not willing to commit to seeking any particular level of funding 
until further planning and engineering studies are completed that 
identify with more certainty the total estimated cost of this Program. 
All the parties to the Settlement must also realize that implementation 
of this settlement, including this authorizing legislation, does not 
imply a limitless Federal commitment to fund whatever it costs.
Status of Implementation
    As already mentioned, some initial funding and authority exists for 
Interior to work with our State partners to initiate planning and 
environmental review activities, and we have been doing just that. 
Interior, through Reclamation and the Fish and Wildlife Service, is 
working with the other Settling Parties, the State of California, the 
affected Third Parties (discussed below), and other Federal agencies 
regarding the implementation process and other related matters. A 
multi-agency Program Management Team including California Dept. of 
Water Resources, California Dept. of Fish and Game, and U.S. Fish and 
Wildlife Service, National Marine Fisheries Service, and Reclamation 
have begun efforts to initiate an implementation process, including 
public outreach, planning, design, and environmental reviews. This 
multi-agency team is developing a Program Management Plan (PMP), 
scheduled for completion this Spring, that will describe the 
implementation process, the scope and timeline of the activities, 
studies to be completed, and the process to involve and receive input 
from interested third parties as well as the broader public. The PMP 
will address strategies to meet both the Restoration Goal and the Water 
Management Goal described in the Settlement. As a further demonstration 
of the Administration's commitment to implementing this settlement, the 
President's FY 2008 Budget for Reclamation presumes a re-direction of 
capital repayment receipts away from the Reclamation Fund and into the 
newly-created San Joaquin Restoration Fund; it also presumes the 
allocation $7.5 million of funds from the CVPIA Restoration Fund to the 
San Joaquin Restoration Fund. However, these actions in the Budget 
presume enactment of the legislation.
Third Parties
    We fully recognize and appreciate the importance of involving 
affected third parties in the implementation of the Settlement, and 
several steps have been taken to meaningfully involve them in the 
development and implementation of the Settlement. Prior to the 
execution of the settlement documents, copies of the draft documents 
were made available in Sacramento, Fresno, and San Francisco for review 
by interested third parties, subject to confidentiality agreements. 
Representatives of water users on the west side of the Central Valley; 
water users from tributaries to the San Joaquin River downstream of 
Friant Dam; the Exchange Contractors, who receive water from the Delta 
in lieu of water they would otherwise divert from the San Joaquin River 
below Friant Dam; and other parties concerned about river management 
issues (collectively, ``Third Parties'') took the opportunity to review 
the Settlement documents. In addition, the Settling Parties conducted 
numerous briefings throughout the Central Valley, which were attended 
by approximately 70 Third Party representatives. At those briefings, 
the Settling Parties reviewed the proposed Settlement in detail, 
responded to questions, and listened to comments. Following those 
briefings, a number of entities submitted written comments on the 
Settlement documents. Their primary areas of concern were related to 
the ESA take provisions, operation & maintenance, funding, meaningful 
participation in implementation of the program, and water rights. After 
consideration of comments from Third Parties, the Settling Parties made 
modifications deemed appropriate to some of the settlement documents 
and further provided the Third Parties with a comprehensive written 
response to their written comments. In addition, language was added to 
the legislation before it was introduced to strengthen protections for 
Third Party interests.
    Since the Settlement was signed and the legislation was drafted, 
the Bureau of Reclamation has been working closely with a group of 
Third Parties with downstream concerns on a Memorandum of Understanding 
(MOU), which was reviewed by the Settling Parties and was signed on 
February 26, 2007 by Reclamation and the Third Parties involved.
    The MOU articulates the interests of these Third Parties and agrees 
that Reclamation will work closely and involve the Third Parties 
throughout the implementation of the Settlement on matters pertaining 
to their interests.
    In supporting this settlement, the Administration remains committed 
to implementing other salmon restoration programs along the Pacific 
coast. The San Joaquin settlement that would be implemented by H.R. 24 
provides a model of how stakeholders can come together to rebuild 
historic salmon populations and restore communities. We are open to 
exploring how this model could be used to help implement other similar 
restoration programs.
Conclusion
    This monumental agreement ends an 18-year legal dispute over the 
operation of Friant Dam and provides increased certainty to Friant 
Division farmers who rely on CVP water deliveries while returning flows 
and salmon runs back to the San Joaquin River. H.R. 24 would provide 
the federal authorization and funding needed to move into 
implementation. We believe that this historic agreement is the start of 
a truly collaborative process that will result in a restored river for 
all. I strongly recommend that this committee act swiftly on this 
legislation to allow the Federal government to move forward without 
delay and to send a message of support to the Parties and our 
implementing partners.
    Madam Chairman, this concludes my testimony. I would like to 
reiterate my appreciation to the subcommittee for your interest in this 
settlement. I would be happy to answer any questions at this time.
                                 ______
                                 

   Response to questions submitted for the record by Jason Peltier, 
   Principal Deputy Assistant Secretary for Water and Science, U.S. 
                       Department of the Interior

Questions from Rep. Napolitano:
    Some stakeholders are concerned that the financing mechanisms 
contained in Sec. Sec. 7 and 9 of H.R. 24 will, in essence, divert 
funds currently flowing to the Central Valley Project Restoration Fund 
(CVPRF) to a new San Joaquin River Restoration Fund. The CVPRF 
currently funds fish, wildlife, and habitat mitigation and restoration 
projects throughout the CVP service area, including the Trinity River 
basin, with apparent emphasis on anadromous fish projects in the 
Sacramento River basin.
    1.  What has been the annual disbursement of CVPRF monies for 
projects in each of the following basins since 2002: the Sacramento 
River basin; San Joaquin River basin; the Trinity River basin?
    Answer: The Central Valley Project is financially and operationally 
integrated and, therefore, Restoration funds are not tracked by river 
basin. Restoration funds are expended to meet the goals and objectives 
of those activities specified in Sections 3406 and 3408 of the Central 
Valley Project Improvement Act. Many of these activities cut across 
river basins.
    2.  How do these disbursements compare with revenues taken into the 
fund from various CVP unit contractors (Sec. 3407(d) charges)? Can you 
please provide a breakdown of annual CVPRF charges by contractor and/or 
by CVP unit?
    Answer: Because the CVP is financially and operationally 
integrated, Restoration charges collected from each division are pooled 
to meet the objectives listed in the CVPIA. Therefore, disbursements 
cannot be compared with revenues taken into the fund from various CVP 
contractors. Congress appropriates revenue collected by the Restoration 
fund and allocates it to ongoing CVPIA program priorities.
    The following table provides a breakdown of annual Central Valley 
Project Restoration fund revenues, collected pursuant to Section 
3407(d), by CVP division for Fiscal Years 2002 through 2006.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

    3.  How might annual disbursement of CVPRF monies change if H.R. 
24, as written, were enacted?
    Answer: Congressional appropriations dictate the annual 
disbursement of CVPRF monies, which for years beyond Fiscal Year 2007 
are unknown at this time. However, Reclamation anticipates that the 
disbursement would take into account the shift of the ``Friant 
surcharge,''* collected pursuant to Section 3406(c)(1) of the CVPIA, to 
the San Joaquin River Restoration Fund (approximately $7.5 million 
annually), and that the remaining CVPRF monies would be allocated to 
ongoing CVPIA program priorities.
    It appears from Reclamation's recent budget request for FY2008 that 
Friant contractors have paid approximately $7.5 million annually in 
Sec. 3406(c)(1) surcharges.
    4.  How much have Friant contractors paid annually in Sec. 3407 
charges?
    Answer: The average annual amount that Friant contractors have paid 
in Sec. 3407 charges over the past ten years (1997-2006) is $9.5 
million.
    5.  How much money has been collected in Sec. 3407 charges on water 
flowing from the Trinity Division?
    Answer: Water flowing from the Trinity Division is combined and 
integrated with water from other divisions of the Project for multiple 
authorized purposes of the CVP, not all of which are charged a 
restoration charge pursuant to Section 3407 of the CVPIA. Therefore, we 
cannot calculate an amount that has been collected specifically on 
water that originates from the Trinity Division.
    6.  Given that Sec. 7(2) of H.R. 24 states that the Friant 
surcharge shall continue to be counted toward the requirements of the 
Secretary to collect charges under Sec. 3407(c)(2) of the CVPIA (but 
deposited into a different fund), is it correct to assume the pool of 
money available for disbursement from the CVPRF would be reduced by at 
least $7.5 million per year (the amount of the Friant surcharge 
collections)? What about Friant Sec. 3407(d) charges? Will Friant 
contractors continue to be assessed a mitigation and restoration charge 
under Sec. 3407?
    Answer: Yes, the amount collected for appropriation into the CVPRF 
would be reduced by the amount of the Friant surcharge (which instead 
would be deposited into the newly created San Joaquin River Restoration 
Fund). As a result, on average the amount of money collected for 
appropriation into the CVPRF would be reduced by $7.5 million per year. 
However, under CVPIA Sec. 3406(c)(1), the Friant division contractors 
are required to pay the surcharge only ``until such time as flows of 
sufficient quantity, quality and timing are provided...to meet the 
anadromous fishery needs identified...''. Thus, once Congress 
authorizes releases from Friant Dam, the Friant surcharge would no 
longer be collected. As part of the Settlement, the Friant Contractors 
have agreed to continue to pay the surcharge, which is reflected in 
Sec. 7(1) of H.R. 24. The amount of funding assessed and collected by 
the Secretary under all provisions of the CVPIA would remain the same 
should H.R. 24 be enacted, including Sec. 3407(d) charges.
Section 9. Appropriations; Settlement Fund
    Section 9 of H.R. 24 outlines expected implementation costs of the 
settlement and how they shall be covered. Non-federal payments are 
estimated to total $200 million, while the federal share is expected to 
be $240 million in repaid CVP capital obligations that would go into 
the San Joaquin River Restoration Fund, instead of the Reclamation Fund 
(U.S. General Treasury), an additional $250 million in appropriations 
authorized under the Act, as well as authorized use of other CVPRF 
monies.
    7.  At minimum, what is the expected annual amount of money to be 
made available for implementation of the Act? Is it correct to assume 
at a minimum that $7.5 million in former Friant surcharges and $8.8 
million in capital payments would be made available in the first year 
of implementation?
    Answer: Under section 9 of H.R. 24, funds collected pursuant to 
section 3406(c)(1) of the CVPIA (the Friant ``surcharge'') would be 
deposited into the newly established San Joaquin River Restoration Fund 
beginning the fiscal year following enactment of the legislation. Those 
surcharges have averaged about $7.5 million over the past ten years. 
Capital payments for the first fiscal year after the date of enactment 
would also be deposited into the fund. Capital payments have averaged 
$8.8 million over the past three years. The actual amount collected in 
any given year for both surcharge and capital, however, is dependent 
upon, among other things, the annual water deliveries, which vary based 
on hydrology and water availability. As a result, a minimum funding 
level cannot be guaranteed. Also, under CVP rate-setting policies, 
application of revenue against annual operation and maintenance costs 
may reduce the amount of anticipated revenue credited toward CVP 
capital in a given year. In the past three years, the lowest amount 
collected was $7.4 million in Friant surcharges, and approximately $7 
million was collected from Project water deliveries and credited to 
capital repayment.
    8.  If it is so that $16.3 million could be expected for immediate 
implementation, what could be expected to be accomplished annually with 
these funds? Will funding go to projects similar in nature to what is 
currently funded via the CVPRF, but within the framework of the 
Settlement? What will be the highest priority projects/programs for 
funding?
    Answer: As stated above, because of uncertain hydrology and related 
water deliveries, we cannot ascertain the exact amount of funding 
available for implementation, immediately or otherwise. However, we do 
know that available funds will be used during the early years of 
implementation for initial planning activities. During the next several 
years, the Department of the Interior and the State of California will 
complete a programmatic planning and environmental review process that 
evaluates all of the actions expected to be taken to implement the 
Settlement. Questions such as implementation strategies, priorities, 
and performance measures will be addressed in the programmatic 
document.
    9.  In addition to these funds, how much funding is likely to be 
requested annually via the Energy and Water Development appropriations 
acts?
    Answer: Although the Settling Parties have agreed on a suite of 
actions to be taken to restore flows and salmon runs, the total cost 
and the specificity of those actions still contain significant 
uncertainty. Reclamation anticipates that a multi-agency technical team 
established to implement the Settlement would develop additional design 
details typically found in a feasibility-level study needed to take the 
proposed actions. We also anticipate that the estimated costs projected 
to be required to meet the restoration goal (i.e. $250 million-$800 
million) would be further refined during the initial phase of 
implementation. Until those planning and engineering studies are 
completed, it is premature to attempt to identify what additional 
annual funding might be appropriate to request. Further, H.R. 24 
specifies that any such additional federal appropriations would only be 
available for expenditure as State and other non-federal funds become 
available.
    10.  Can the Bureau reasonably be expected to meet the time lines 
and deadlines of the Settlement and H.R. 24 with this level of expected 
federal funding?
    Answer: In the Settlement (specifically Exhibit C), the Settling 
Parties acknowledged that the implementation timelines in the 
Settlement are very ambitious, and are premised on a number of 
assumptions. Meeting those timelines will require a high level of 
cooperation from all levels of government, water agencies, 
environmental groups, and private land owners. However, should a bill 
such as H.R. 24 be enacted this fiscal year, federal funding should not 
be the limiting factor in meeting the timelines as specified in H.R. 
24.
    Section 9(c)(2) of H.R. 24 directs future capital repayment 
obligations of the Friant Division long-term contractors to be covered 
to the San Joaquin River Restoration Fund. Friant long-term contractors 
shall be credited for repayment, and the ``appropriate share'' of 
existing federal investment in the CVP shall be reduced by an 
equivalent sum.
    11.  Does this language protect other CVP water and power 
contractors from having to absorb the construction cost repayment 
allocated (but credited) to Friant contractors? Does it reduce the 
amount other CVP water and power contractors are otherwise currently 
expected to repay?
    Answer: This language does not change or otherwise impact other CVP 
water and power contractor obligations for project repayment. 
Allocation of capital costs is a function of total CVP water delivered, 
and, to the extent contractor deliveries fluctuate, the share of 
capital will fluctuate as well. Capital costs are allocated to water 
taken by Friant contractors. Friant contractors pay for CVP water 
according to the existing rate-setting policies, and, in accordance 
with those policies, the capital repayment will be credited 
appropriately.
    12.  By crediting the Friant contractors for repayment, wouldn't 
the total share of existing federal investment (allocated construction 
costs) automatically be reduced by that amount?
    Answer: Crediting will not happen automatically. Friant contractors 
will receive credit for capital payments made and their prorated 
capital repayment obligation will be reduced accordingly even though 
the money is transferred into the newly established fund. The federal 
investment is prorated to all CVP contractors. As drafted, the 
legislation will assure that the overall federal investment will be 
reduced to reflect the Friant payments.
    13.  Under this language, who (e.g., Friant contractors, other CVP 
water and power contractors) gets credit for what?
    Answer: The language does not change the process for crediting CVP 
water and power contractors, including Friant contractors, for payments 
made. Payments will be applied in accordance with the CVP rate-setting 
policies.
    Section 9(c)(4) directs that proceeds from the sale of water 
pursuant to the Settlement be covered to the new San Joaquin River 
Restoration Fund. Currently, under 3407(d)(2) of the CVPIA an annual 
$25 per acre-foot charge is imposed on certain water sales and 
transfers and is deposited into the CVPRF.
    14.  How much money has been collected from such water sales and 
deposited into the CVPRF since 2002?
    Answer: The amount collected from water sales under the referenced 
section 3407(d)(2) from FY2002-FY2006 is $4,082. This is for monies 
collected for M&I surcharges.
    15.  What ``proceeds'' from the sale of CVP water would be 
available to be covered to the new San Joaquin River Restoration Fund?
    Answer: The Settlement provides that the Secretary shall make 
surplus water available to Friant Division contractors during wet 
hydrologic conditions when water is not needed for the Interim Flows 
and Restoration Flows at a total rate of $10 per acre foot. In 
addition, if full Restoration Flows cannot be released by January 1, 
2014, one option available to the Secretary is to sell or transfer the 
remaining Restoration Flows, which might generate revenues. Proceeds 
from each of those types of sales would be deposited into the San 
Joaquin Restoration Fund.
    16.  Would these proceeds include the $25 per acre-foot charge 
currently going to the CVPRF? If so, what affect would such have on 
programs and project funded by the CVPRF?
    Answer: No, the water to be made available at $10 per acre foot 
will not include an additional $25 charge. The Friant contractors have 
not to date been involved in the transfer of water that carried the $25 
charge.
    Section 9(d)(2) authorizes the Secretary to enter into agreements 
that would allow the proceeds received from state issued bonds, loans, 
or other financing mechanisms to be deposited into the San Joaquin 
River Restoration Fund, and be repaid by Friant Division long-term 
contractors (in lieu of making required deposits into the Fund).
    17.  How much money can be expected to be leveraged by using this 
unusual financing mechanism?
    Answer: The amount of funding that could be acquired through bonds 
to implement the Settlement is unknown at this time. Factors such as 
the type of projects as well as the timing and magnitude of the 
projects will influence the pursuit of bond funding and the type of 
bond financing and associated interest costs. Other factors such as 
whether bonds may be tax exempt, the amount that may be issued relative 
to a variable cash flow (revenue) repayment, etc., will also need to be 
taken into account.
    18.  What are the advantages from entering this type of financing 
arrangement with the state and Friant contractors? What are the 
disadvantages?
    Answer: Once construction activities are initiated, there is a 
possibility that the annual funding requirements will exceed the amount 
available. The advantage of this financing arrangement would be the 
ability to access the amount of funding needed for construction at the 
time it is needed. The disadvantages could be that interest cost would 
be associated with accessing the funds earlier and the borrowing 
capacity of the non-Federal agency could be affected.
    19.  What is the total expected state contribution to 
implementation of the Settlement under H.R. 24?
    Answer: State propositions 84 and 1E were passed by the California 
voters in November 2006 and should provide at least $200 million of 
State bond funds for projects that will directly contribute to the 
restoration efforts
Restoration of Salmon Fisheries`
    20.  What was the value of the San Joaquin Chinook salmon fishery 
(sport and commercial) prior to extirpation of the species, in then-
current, and in 2007 dollars?
    Answer: To our knowledge, there has not been a comprehensive 
analysis done that would adequately calculate the total value of the 
San Joaquin Chinook salmon fishery prior to the extirpation of the 
species. However, the recovery of San Joaquin salmon could move us 
closer to de-listing the Spring Run Chinook.
    21.  The Settlement Agreement calls for restoring fall and spring 
runs of Chinook salmon, yet Sec. 10 of H.R. 24 only addresses 
restoration of spring-run Chinook. Will the fact that the bill does not 
directly address restoration of fall Chinook salmon affect 
reintroduction of fall Chinook as called for in the Settlement? Has a 
decision been made that it is infeasible to restore both spring-run and 
fall-run Chinook salmon, as provided for in settlements paragraph 
14(a)? If so, please explain the basis for this decision.
    Answer: No. The restoration goal for implementation has not changed 
from what is described in the Stipulation of Settlement. Many of the 
planned activities would benefit both spring and fall-run Chinook 
salmon.
    22.  The report that would assess the success of the reintroduction 
of salmon is to be made no later than December 31, 2024, under H.R. 24. 
Why is the deadline 12 years after the expected introduction of the 
experimental population in 2012? Will there be other reports or 
monitoring that will gauge progress sooner or on a regular basis?
    Answer: Given the three year cycle of salmon runs, variations in 
conditions from year to year, varied habitats, and the need to 
adaptively manage the system based on the observed responses of the 
fish species, the restoration activities will need time to work to 
allow the fish populations to respond. Subsequent to the reintroduction 
of fish species, we anticipate monitoring and reporting on the progress 
of the reintroduction efforts on a regular basis.
    23.  In the 1992 Central Valley Project Improvement Act, Congress 
directed the Secretary of the Interior to develop a program to ensure 
sustainable anadromous fish populations double their average from 1967-
1991 in 10 years; however, after 15 years, this goal has not been 
achieved. Given the difficulty in meeting the obligations set out in 
1992, how long will it take to restore to ``good condition'' an 
extirpated species?
    Answer: The goal in the Settlement is to fully achieve restoration 
by 2025. This goal is based on estimated time to implement the complete 
physical improvements in the River, initiate sufficient flows from 
Friant Dam, and to adaptively manage the system based on the observed 
responses of the fish species. Our modeling, monitoring and 
experimentation is being set up to help accomplish this goal.
    24.  What other fish and wildlife species will benefit from this 
restoration effort? Do they include other listed or candidate species 
on federal or state endangered species lists?
    Answer: During the next several years, the Secretary of the 
Interior and the State of California, in consultation with other 
agencies, will complete a programmatic planning and environmental 
review process that evaluates all of the actions expected to be taken 
to implement the Settlement. This programmatic review process will 
assess the possible impacts, benefits, and costs from a system-wide 
perspective, including other benefit opportunities that may be 
achieved. In broad terms, we anticipate that a San Joaquin river that 
flows year-round would produce a riparian corridor that could provide 
habitat for a wide range of aquatic, avian and terrestrial species.
    25.  What recreation benefits might be realized from these 
restoration activities?
    Answer: During the next several years, the Secretary of the 
Interior and the State of California, in consultation with other 
agencies, will complete a programmatic planning and environmental 
review process that evaluates all of the actions expected to be taken 
to implement the Settlement. This programmatic review process will 
assess the possible impacts, benefits, and costs from a system-wide 
perspective, including other benefit opportunities that may be 
achieved. In the Settlement, the Settling Parties acknowledge the 
potential for increased recreational activities that may result from 
implementation of the Settlement. We will also work closely with local 
governments and the recreation community as they consider what 
recreational opportunities they might pursue for the river corridor.
Experimental Populations Under the Endangered Species Act
    Section 10(b) of H.R. 24 requires a determination by the Secretary 
of Commerce as to whether a permit for an experimental population can 
be issued for reintroduction of spring- run Chinook salmon under 
Sec. 10(j) of ESA. The language in Sec. 10(j) of ESA, related to 
experimental populations, states that these provisions are applicable 
to introductions outside the current range of such species and wholly 
separate geographically from non-experimental populations of the same 
species. However, spring- (and fall-) run Chinook salmon reintroduced 
into the San Joaquin River may inhabit portions of the Sacramento-San 
Joaquin River drainage in common with other established Chinook salmon 
populations.
    26.  Would any reintroduction of spring-run salmon to the San 
Joaquin River be outside the current range and wholly separate from 
nonexperimental populations of this species?
    Answer: Our understanding of Section 10(j) is that ``wholly 
separate geographically'' is not a criterion for release of an 
experimental population.
    Section 10(j) states that a released population can be regarded as 
experimental ``only when, and at such times as, the population is 
wholly separate geographically from nonexperimental populations of the 
same species.'' The conference report accompanying the 1982 amendment 
to the ESA that enacted 10(j) states: ``If an introduced population 
overlaps with natural populations of the same species during a portion 
of the year, but is wholly separate at other times, the introduced 
population is to be treated as an experimental population at such times 
as it is wholly separate.'' H.R. Conf. Rep. No. 835, 97th Cong. (Sep. 
17, 1982). The possibility of overlap was specifically contemplated by 
Congress in Section 10(j). The purpose for treating a released 
population as experimental, with the lesser level of protections that 
comes with that status, only when it was geographically separate from 
natural populations was for the purpose of ``protect[ing] natural 
populations and to avoid potentially complicated law enforcement 
problems'' during times of overlap. H.R. Conf. Rep. 97-835.
    27.  Section Sec. 10(b) of H.R. 24 makes the reintroduction of 
spring-run Chinook salmon dependent upon a discretionary finding by the 
Secretary that such a permit can be issued. What are the guarantees 
that the reintroduction will be allowed to proceed under this approach, 
or if it is allowed to proceed, that it will not be legally 
challengeable under a strict reading and interpretation of Sec. 10(j) 
of the ESA?
    Answer: We cannot guarantee in advance the outcome of any 
deliberative process required by the Endangered Species Act without 
violating the Administrative Procedure Act. The only requirement for 
release of an experimental population under Section 10 is that the 
Secretary find that such release ``will further the conservation of the 
species.'' Given the potentially available resources in this 
collaborative effort, we do not believe that standard will be difficult 
to meet.
    28.  How will the introduced population be determined a success or 
failure? What if the experimental population of salmon does not 
succeed? Will this affect the terms of the Settlement? Will there be 
changes in the restoration flows or water management activities?
    Answer: Consistent with the legislation, the Secretary of Commerce 
will report to Congress not later than December 31, 2024, on the 
success of the reintroduction. That report is to set out an assessment 
of the major challenges, if any, to reintroduction, as well as an 
assessment of the future of the effort. In the Settlement, the Settling 
Parties acknowledge that complete achievement of the Restoration and 
Water Management Goals may not be possible during the term of the 
Settlement (through December 31, 2025). For the restoration flows to be 
changed prior to December 31, 2025, the Secretary can either: 1) use 
water acquired from willing sellers to increase flows or 2) have all 
the Parties agree to the change in writing.
    29.  Section 10(b) of H.R. 24 directs the Secretary to reintroduce 
spring-run Chinook salmon pursuant to ESA Sec. 10j and the Settlement. 
What potential conflicts exist between these prescriptions for 
introducing salmon and how will they be resolved?
    Answer: We do not believe there are conflicts between ESA Sec. 10j 
and the Settlement. The Settlement states that reintroduction efforts 
will be carried out ``consistent with all applicable law.''
    30.  The San Joaquin River supported spring and fall-run Chinook 
salmon in the southernmost part of their historical range. Could 
factors such as climate change or natural migration make it unlikely 
for salmon to exist in the San Joaquin River when experimental 
populations are assessed in 2024?
    Answer: During the next several years, the Secretary of the 
Interior and the State of California, in consultation with other 
agencies, will complete a programmatic planning and environmental 
review process that evaluates all of the actions expected to be taken 
to implement the Settlement. This programmatic review process will 
assess the possible impacts, benefits, and costs from a system-wide 
perspective. This analysis will be based on the existing conditions and 
the most-likely future conditions of the habitats occupied by the 
reintroduced species.
    Before a population is deemed experimental under ESA, it must be 
determined to be essential or nonessential by the Secretary. 
1 An essential population is defined as a population whose 
loss would be likely to appreciably reduce the likelihood of the 
survival of the species in the wild. All other populations would be 
determined as nonessential. Nonessential populations shall not have 
critical habitat designated; essential populations could have critical 
habitat designated through a special rulemaking process.
---------------------------------------------------------------------------
    \1\ The term Secretary under ESA refers to the Secretary of the 
Interior or the Secretary of Commerce with respect to program 
responsibilities for the species in question, unless otherwise 
specified.
---------------------------------------------------------------------------
    31.  If the experimental population of Chinook salmon were 
determined to be essential, and critical habitat designated, will this 
modify federal water management activities on the San Joaquin River? 
Will third parties be affected?
    Answer: Our understanding is that if the experimental population of 
spring run Chinook on the San Joaquin River were determined to be 
essential, then they would be treated as a threatened species under the 
ESA. Threatened species do not receive protection under the ESA until 
the National Marine Fisheries Service promulgates a regulation under 
Section 4(d) of the Act. Section 10(c) of H.R. 24 directs the Secretary 
of Commerce to issue a final rule under Section 4(d) of the ESA 
governing incidental take of the reintroduced salmon, and to provide 
that the reintroduction not impose more than de minimis water supply 
reductions, de minimis additional storage releases, or de minimis by-
pass flow requirements on unwilling third parties. Critical habitat for 
spring run Chinook was already designated in 2005, and is not 
coextensive with the range of the species.
    32.  Section 4(d) of ESA authorizes the Secretary to prepare 
regulations to provide for the conservation of threatened species. Has 
the National Marine Fisheries Service (NMFS) or Fish and Wildlife 
Service (FWS) ever been directed by Congress to issue a 4(d) rule under 
ESA for an experimental population?
    Answer: We are not aware of any such Congressional direction in the 
past, although we are aware of one instance where Congress codified a 
proposed recovery activity for southern sea otters that included an 
experimental population and various types of incidental take (Pub. L. 
No. 99-625, 100 Stat. 3500).
Questions from Rep. Radanovich:
    33.  In testimony submitted for the record, Clifford L. Marshall, 
Chairman of the Hoopa Valley Tribe, states that ``the Department of the 
Interior has concluded that the San Joaquin settlement will harm third 
parties including the Hoopa Valley Tribe and other beneficiaries of the 
Trinity River Restoration program by causing annually up to a 25% 
reduction in funds available from the CVPIA Restoration Fund.'' Has 
Interior made such a determination? Please explain the effect the 
Settlement Act would have on total funds available for environmental 
restoration activities in the CVP, compared to those available under 
the CVPIA.
    Answer: Interior has not made a determination that there will be 
any harm to third parties. On the contrary, under the proposed 
legislation for the San Joaquin Settlement, the same amount of monies 
will be collected for environmental restoration activities in the CVP 
as is currently collected. However, under the Settlement, the Friant 
``surcharges'' will be deposited to the San Joaquin Restoration Fund, 
rather than into the CVPIA Restoration Fund. Based on a ten year annual 
average, $7.5 million of the $44.3 million in total collections that 
currently goes to the CVPIA Restoration Fund (approximately 17%) will 
go to the newly created San Joaquin Restoration Fund. In addition, the 
Settlement and legislation also provide for dedication of capital 
payments, authorization of up to $250 million in additional federal 
appropriations, and matching State funds for use for restoration of the 
San Joaquin River. Absent the legislation, none of those funds would be 
available for such a purpose. As a result, the legislation 
significantly increases the overall funding available for environmental 
restoration actions in the Central Valley Project. Based upon the ten 
year annual average, $36.8 million per year would still be available 
from the CVPIA Restoration Fund for CVPIA restoration activities, 
including the Trinity River Restoration Program. Although this does 
translate into a redirection of the funds available for appropriation 
from the CVPIA Restoration Fund, Interior believes that this is more 
than made up for by the overall increase in funding for restoration 
activities and the fact that San Joaquin restoration activities will no 
longer be funded out of the CVPIA Restoration Fund.
Question from Rep. Nunes:
    34.  If all of the other parties involved in the negotiations 
concerning the form of H.R. 24 were to agree, would your organization 
support an amendment of H.R. 24 authorizing the construction of pumping 
and conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal of the 
Settlement?
    Answer: The Settlement calls for the Secretary, in consultation 
with the other parties, to develop a plan for recirculation, recapture, 
reuse, exchange or transfer of the Interim and Restoration Flows. The 
Settlement also specifically provides that any such plan must not 
adversely affect the Restoration Goal, downstream water quality, or 
fisheries, and further must not impair the Secretary's ability to meet 
his existing contractual obligations. Until that plan is developed in a 
manner meeting those criteria, it is premature to consider whether 
additional construction authorization might be required. Therefore, 
Interior does not support such an amendment.
                                 ______
                                 
    Mrs. Napolitano. Thank you, sir. And two things. First I 
want to congratulate you for getting your testimony ahead of 
time, which is a novelty in this committee.
    And second, for your words and being able to work with the 
parties that are involved. Because all we want is to be able to 
help solve those problems and look for the solutions, 
especially when coalitions are willing to give to be able to 
get to that step. And in litigation, I am sorry, gentlemen, 
only the attorneys win. So we look forward to working with you, 
sir.
    Next we have Nancy Saracino, Chief Deputy Director of the 
Department of Water Resources from the State of California. 
Welcome.

   STATEMENT OF NANCY SARACINO, CHIEF DEPUTY DIRECTOR OF THE 
       DEPARTMENT OF WATER RESOURCES, STATE OF CALIFORNIA

    Mrs. Saracino. Thank you very much. Good morning, 
Chairwoman Napolitano and Members. It is a pleasure to be here 
today.
    I am appearing on behalf of the State of California to 
express strong support for H.R. 24. I would like to highlight 
three things in my testimony today.
    The first is a brief summary of the basis for the state's 
support for this legislation. The second is to discuss the 
elements of the bill that are essential to the state's support 
today. And finally, I would like to emphasize the importance of 
early Congressional action on this, and how that relates to 
leveraging state funding and ensuring uninterrupted progress 
toward the restoration of the San Joaquin River.
    We have a unique opportunity, with the resolution of this 
longstanding litigation, to accomplish something significant 
here, which is the restoration of an important Western river. 
The state's support has actually been longstanding. We have put 
resources and a lot of effort into hoping to settle this 
litigation and be where we are today, which is proceeding with 
an implementation of restoration.
    The expressions of that support have included the Governor 
Schwarzenegger letter, mentioned before, expressing the 
importance of restoring flows and a healthy fishery at the San 
Joaquin River. Also, Secretary of Resources Mike Chrisman 
testified here in support of the settlement, and has charged 
the Directors of the California Departments of Fish and Game 
and Water Resources to look for opportunities to further 
support the settlement and find funding to match the Federal 
commitment that we are anticipating under this legislation to 
make sure that the restoration is completed.
    And finally, the voters of California have endorsed the 
settlement by authorizing $100 million under Proposition 84 to 
support the implementation.
    The aspects of H.R. 24 that are critical to our support are 
in three areas. The first is the provision that makes explicit 
that Congress does not intend to preempt state law or modify 
existing obligations of the United States to operate the 
Central Valley Project in conformity with state law.
    The second is those provisions that ensure that impacts 
associated with the restoration efforts will be identified, and 
measures implemented to mitigate them, for adjacent and 
downstream water users and landowners.
    And finally, those provisions of the legislation that 
ensure that a rule regarding incidental take coverage will be 
adopted, and reintroduction of the spring run will not impose 
more than a de minimis impact on water supplies.
    For the importance of early Congressional action, we are 
actually on the ground working now to support the 
implementation. Once the Judge entered that settlement, the 
clock started to run. California had money in the budget. The 
Federal government redirected monies. We have 14 state staff 
working full time on implementation with a management team with 
the Federal agencies.
    The Legislative Analyst's Office has expressed concern 
about the state moving ahead of the Federal government in our 
efforts to restore this river. And while we are committing 
resources today, it is very important that the full resources 
of the Federal government also be brought into the mix.
    We want to make sure that this restoration is successful. 
Delay or any kind of interruption of progress will just make it 
more expensive. And the planning process is critical with the 
collaboration that we have underway. We believe that it is 
important that we move together to ensure that we get started, 
that we plan appropriately, and invest these monies in a way 
that makes the most sense moving forward.
    Thank you for the opportunity to speak today.
    [The prepared statement of Mrs. Saracino follows:]

          Statement of Nancy Saracino, Chief Deputy Director, 
                California Department of Water Resources

Introduction
    Chairwoman Napolitano and members of the Subcommittee, I appreciate 
the opportunity to appear before you today to discuss H.R. 24, the San 
Joaquin River Restoration Settlement Act. I am here to convey the State 
of California's support for this legislation.
    As you know, the settlement that H.R. 24 would implement represents 
unprecedented consensus on a process that will have lasting positive 
impacts on the natural environment while protecting farmers and the 
Central Valley economy. The settlement creates a clear obligation to 
the settling parties, but more importantly, an incredible opportunity 
to achieve a historical restoration of a western river.
The role of the State of California
    Although not a signatory to the settlement, the State of California 
has many interests in a healthy fishery and the successful restoration 
of the San Joaquin River. To that end, we have already allocated a 
considerable amount of our resources to facilitate restoration of this 
important resource.
    Recognizing the importance of an agreement that could set the stage 
for restoration of the San Joaquin River, the state has expressed its 
support throughout the process that ultimately resulted in the 
settlement to be implemented by H.R. 24. In January of 2006, Governor 
Schwarzenegger sent a letter to Secretary of the Interior Gale Norton, 
in which he conveyed early state support for a solution to the long-
debated future of the San Joaquin River.
    In September of last year, the State of California joined with 
federal agencies and other settling parties to sign a Memorandum of 
Understanding (MOU) to help implement the Stipulation of Settlement. 
Soon after, California Secretary for Resources, Mike Chrisman presented 
testimony at a hearing held by this Subcommittee which reaffirmed the 
strong support of the state for the Settlement Agreement. This 
testimony was followed by a letter from Secretary Chrisman to Senator 
Feinstein on November 30, 2006, which reiterated the state's support 
and outlined the state's financial commitment to the restoration 
process.
    California has already allocated $1.5 million dollars for 
restoration activities in the current budget year. An additional $18.3 
million in funding from prior bonds and Proposition 84, the Safe 
Drinking Water, Water Quality and Supply, Flood Control, River and 
Coastal Protection Bond Act of 2006, has been proposed in the 
Governor's 2007-2008 budget to initiate restoration activities 
consistent with the settlement.
    Furthermore, as pledged in Secretary Chrisman's November letter, 
the state is committed to looking for opportunities under Proposition 
1E, the Disaster Preparedness and Flood Prevention Bond Act of 2006, as 
well as other provisions of Proposition 84, in order to fund multi-
benefit projects in support of the settlement. For example, at least 
$40 million dollars is available under Proposition 84 for water quality 
improvement projects on the San Joaquin River.
Coordination and communication among parties
    State agencies, including the Resources Agency, the Department of 
Water Resources and the Department of Fish and Game, federal 
implementing agencies and the settling parties have already begun 
collaborating to plan, design, fund, and implement actions to support 
the restoration of the San Joaquin River.
    If Congress approves legislation implementing the settlement, the 
Department of the Interior will be tasked with new responsibilities to 
carry out the commitments made in the settlement to resolve the 
longstanding litigation. It will be very important for the state to 
coordinate closely with the Department of Interior to ensure that 
planning on restoration activities is well coordinated and funds spent 
in a way that optimizes the value of the investment of scarce 
resources.
    In addition, it will be important to ensure that a full and open 
public process allows for all interested in the restoration efforts to 
be heard as we move forward. Effective communication and coordination 
among all parties early on and throughout the restoration will be a 
challenge, but it is a challenge which must be met.
Progress towards implementation
    Concurrent with the settling parties' signing of the settlement, 
the State of California entered into a MOU which then became an 
appendix to the Agreement and filed in federal court. The intent of the 
MOU was to set out the initial framework for state collaboration with 
the settling parties on implementation.
    The MOU included two critical requirements. First, the Secretaries 
of Interior and Commerce, along with the California Secretaries of 
Environmental Protection and Resources, were required to establish a 
process for the state and federal agencies to implement the settlement. 
This requirement is important because the Stipulation of Settlement 
assigns to the Secretary of Interior many restoration tasks that will 
require California's participation and approval for them to be 
achieved. We have established implementation teams with the federal 
government and a process for coordination consistent with this 
requirement in the MOU.
    Second, the state and the settling parties are to establish a 
mechanism to ensure public participation and input into the 
implementation of the settlement. In addition to concern for the 
environmental considerations of the restoration, the State of 
California recognizes that there are many interested third parties 
along the river and many that have already spent years working on 
restoration efforts. To successfully restore this river, we must work 
collaboratively with all of these interests.
    Allow me to summarize progress to date in achieving the goals of 
the MOU and settlement as well as significant coordination efforts 
among the state and federal governments, the settling parties and other 
interested and affected entities.
    We are engaged with the settling parties in the process of hiring a 
Restoration Administrator who will be charged with directing the 
program manager, and will have the responsibility of assisting with the 
overall implementation of the agreement. The Technical Advisory 
Committee is also taking shape, Friant and NRDC have already appointed 
representatives, and ex-officio state representatives have been 
identified.
    A five-agency Program Management Team has met on multiple occasions 
and is making progress on a Program Management Plan. The Plan will 
serve as the agencies' agreement for implementation of the restoration 
plan and is expected to be completed by the end of April. A public 
involvement process is being developed by the Program Management Team 
to ensure the opportunity for input and participation throughout the 
development of the plan.
    The state is contracting with a nonprofit entity to oversee the 
funding for the Restoration Administrator as well as other charges 
related to the Technical Advisory Committee and public outreach.
    Finally, work is underway to install additional water quality and 
flow stations along the San Joaquin River for the purpose of monitoring 
restoration efforts as they move forward.
    In conclusion, we are pleased with the progress made towards 
restoration thus far. In order to move forward and to begin to reap the 
rewards of restoration the parties await the critical missing piece 
necessarily for full scale implementation, and that is the proposed 
legislation that is before you today.
Conclusion
    The restoration of the San Joaquin River will have enduring 
statewide and national significance. The rejuvenation of a critical 
fishery, restoration of devastated habitat, improvements to the water-
delivery network for more than 22 million Californians and the 
irrigation lifeblood for the productive breadbasket that is 
California's Central Valley: this is what we can all look forward to as 
implementation advances.
    A discouragingly long battle in the courts has at last culminated 
in what can truly be called a landmark settlement. The San Joaquin 
River will once again become a living river, flowing as nature 
intended, from its headwaters in the High Sierra all the way to San 
Francisco Bay.
    Chairwoman Napolitano and members of the Subcommittee: I urge you 
to consider the paramount significance of this settlement, and I 
respectfully ask for you to support this legislation and make the long 
overdue restoration of the San Joaquin River part of your legacy.
    Thank you.
                                 ______
                                 

   Response to questions submitted for the record by Nancy Saracino, 
    Chief Deputy Director, California Department of Water Resources

STATE OF CALIFORNIA -- THE RESOURCES AGENCY
ARNOLD SCHWARZENEGGER, Governor
DEPARTMENT OF WATER RESOURCES
1416 NINTH STREET, P.O. BOX 942836
SACRAMENTO, CA 94236-0001
(916) 653-5791
March 15, 2007

The Honorable Grace F. Napolitano, Chairwoman
Subcommittee on Water and Power
Committee on Natural Resources
U.S. House of Representatives
1522 Longworth House Office Building
Washington, DC 20515

Dear Chairwoman Napolitano:

    As you are aware, the Subcommittee on Water and Power held a 
legislative hearing on the San Joaquin River Settlement Act in 
Washington on March 1, 2007. I represented the interests of the State 
of California at that hearing. Representative Devin Nunes had 
additional questions directed to those who testified at this hearing.
    The question directed to the state is answered below.
    Question posed by Mr. Nunes: If all of the other parties involved 
in the negotiations concerning the form of H.R. 24 were to agree, would 
your organization support an amendment of H.R. 24 authorizing the 
construction of pumping and conveyance facilities required to implement 
the recirculation, recapture, and reuse elements of the Water 
Management Goal of the Settlement?
    Response: The State of California has committed to supporting both 
the Water Management Goal and the Restoration Goal of the settlement 
referenced in H.R. 24. While the settlement agreement and H.R. 24 set 
out a framework for restoration of the San Joaquin River consistent 
with the Water Management Goal, much work remains on identifying and 
analyzing the alternatives for achieving the Water Management Goal 
before any particular method is chosen. It is the state's understanding 
that H.R. 24 as written would provide sufficient flexibility for the 
Department of the Interior to implement appropriate actions to 
accomplish the Water Management Goal once they are chosen through a 
process that fully considers and mitigates for all impacts, including 
those on the two water projects and other water users as well as the 
environment. Therefore, the state does not believe that H.R. 24 should 
be amended.
    Thank you for this opportunity to address Mr. Nunes' question. If 
there are additional questions please do not hesitate to contact me at 
(916) 653-6055.

Sincerely,

/s/ Nancy Saracino
Nancy Saracino
Chief Deputy Director

cc: The Honorable Devin Nunes, U.S. House of Representatives
                                 ______
                                 
STATE OF CALIFORNIA -- THE RESOURCES AGENCY
ARNOLD SCHWARZENEGGER, Governor
DEPARTMENT OF WATER RESOURCES
1416 NINTH STREET, P.O. BOX 942836
SACRAMENTO, CA 94236-0001
(916) 653-5791

March 15, 2007

The Honorable George Radanovich
438 Cannon House Office Building
United States House of Representatives
Washington, DC 20515-0519

Dear Representative Radanovich:

    We have received a copy of your letter dated March 9, 2007 
addressed to The Honorable Grace F. Napolitano, Chairwoman of the 
Subcommittee on Water and Power and The Honorable Cathy McMorris 
Rodgers, Ranking Member. In your letter you requested answers to your 
questions posed as a result of the legislative hearing on H.R. 24, the 
San Joaquin River Restoration Agreement, held March 1, 2007 by the 
Water and Power Subcommittee.
    These questions were posed to those testifying on the San Joaquin 
River Restoration Agreement and the state's response is below.
    Question: In your testimony to the Water and Power Subcommittee of 
the House Resources Committee on March 1, 2007 you mentioned that the 
voters of California approved Proposition 84, which included $100 
million for restoration of the San Joaquin River. Does Proposition 84 
include any other funds that could be available for implementation of 
the Water Management Goal of the Settlement and/or integrated water 
management programs? If Proposition 84 includes such funds, which 
procedures will be required for qualification for such funds?
    Response: Proposition 84 allocates $100 million for restoration of 
the San Joaquin River consistent with the terms of the settlement 
agreement. In addition to the $100 million, there are additional 
opportunities under Proposition 84 for funding programs that would 
provide multiple benefits in support of the Water Management Goal as 
set forth in the settlement agreement. Examples of such programs may 
include, but are not necessarily limited to, funding for Integrated 
Regional Water Management Plans, water quality improvement actions in 
the San Joaquin River, land acquisition, urban streams projects and 
flood protection. Fifty-seven million dollars is specifically allocated 
under Proposition 84 for Integrated Regional Water Management Plans in 
the San Joaquin hydrologic region. Integrated Regional Water Management 
grants are available on a competitive basis and eligible projects must 
be consistent with Department of Water Resources' guidelines.
    Proposition 84 also allocates funds in various other areas, 
including $40 million to be spent on actions to improve water quality 
in the San Joaquin River, where we anticipate projects supporting San 
Joaquin River restoration and the Water Management Goal would be 
eligible to compete for grant monies. We anticipate that all 
expenditures of state funds in the region will be made with an eye to 
the state's commitment to support the settlement agreement, including 
both the Restoration and Water Management Goals.
    In summary, the State of California has already committed to 
investing $100 million towards the restoration of our state's second 
largest river. Furthermore, by funding multi-benefit projects from bond 
funds in the Central Valley, we expect that the aggregate state 
commitment to San Joaquin River restoration will easily reach and 
likely exceed $200 million.
    If you have additional questions please do not hesitate to call me 
at (916) 653-6055.

Sincerely,

/s/ Nancy Saracino
Nancy Saracino
Chief Deputy Director

cc: Th e Honorable Grace Napolitano, Chairwoman, Subcommittee on Water 
and Power
   Th e Honorable Cathy McMorris Rodgers, Ranking Member, Subcommittee 
on Water and Power
                                 ______
                                 
    Mrs. Napolitano. Thank you, ma'am. Next we have the Hon. 
Lois Wolk, Assembly Member and Chair of the Committee on Water 
and Parks and Wildlife for the California State Assembly, and 
to whom I have had the privilege to speak on numerous 
occasions, but it is time for you to call me.

  STATEMENT OF THE HON. LOIS WOLK, ASSEMBLY MEMBER AND CHAIR, 
   COMMITTEE ON WATER, PARKS, AND WILDLIFE, CALIFORNIA STATE 
                            ASSEMBLY

    Mrs. Wolk. With pleasure. Good morning, Madame Chair. 
Congratulations to you on this first hearing, new session, and 
what an auspicious event, to deal with H.R. 24.
    I represent the northern part of the Sacramento San Joaquin 
Delta, and I am very honored by your invitation to come here 
and speak before the Subcommittee, which is our counterpart in 
Congress. And both committees I know strive to balance the 
protection of natural resources with often conflicting and 
contradictory demands for water.
    I am here as an ardent advocate for the settlement of the 
longstanding dispute on the San Joaquin. I urge you to pass 
H.R. 24 to implement the settlement.
    This litigation, this fight that has lasted for a 
generation has sapped the financial resources and political 
energy of the litigants, as well as much of the California 
water community. California can no longer afford the costs of 
conflict on the San Joaquin.
    Since I appeared here last September, much has changed. 
First, Congress and the Subcommittee has changed substantially, 
and I hope that that change will result in speedy passage of 
H.R. 24, and more important, the beginning of a state/Federal 
partnership in addressing the challenges that we find on the 
San Joaquin.
    Second--and reference has already been made to this--
conditions in the State of California have changed with the 
passage of Prop. 84 and Prop 1E. Prop. 84 authorizes up to $100 
million in general obligation bonds to support the settlement 
on the San Joaquin River conflict.
    Before that funding becomes available, the Legislature will 
need to appropriate the funding through the budget. The 
Governor, in his proposed budget, said that we should, and he 
proposed that we spend $14 million beginning in July. That is 
assuming, for those of you who served in the Legislature, that 
we will have a budget in June. That may be harder to achieve 
than the settlement, I don't know.
    But I do appreciate, I do anticipate that the Legislature, 
as was stated by my colleagues, that there may be some 
difficulty in approving the appropriation without action by 
Congress to approve and to implement the settlement. As my 
colleague, Nancy Saracino, said, the Legislative Analyst's 
Office raised some concerns and advised the Legislature last 
week it shouldn't appropriate money until the Congress does. 
Basically, we both have to act. We will walk through the door 
together. We both need to act this year.
    Finally, the settlement itself has changed, with the third-
party concerns now resolved by the language that is in H.R. 24. 
And I, along with my colleagues here, congratulate Senator 
Feinstein, Member Radanovich, and all of you who participated 
in the resolution of these last-minute disputes.
    Taking all that into consideration, it is time to act. A 
significant portion of the California water community has been 
preoccupied with this for decades, and it is now on the way to 
resolution. It is over, and it is our duty to support this 
settlement, and do all we can to restore the San Joaquin River, 
as well as the interests that rely upon that water.
    I hope that our two governments, state and Federal, can 
find a way to collaborate in the most effective, balanced use 
of the resources of the San Joaquin for agriculture and 
fisheries.
    With our two legislative bodies working together in 
partnership, which is, I know, your intention, Madame Chair, I 
have no doubt that this settlement will be a success. And thank 
you again for inviting me to testify.
    [The prepared statement of Mrs. Wolk follows:]

            Statement of The Honorable Lois G. Wolk, Chair, 
    Committee on Water, Parks & Wildlife, California State Assembly

    Good morning, Madame Chairman and members. My name is Lois Wolk and 
I chair the California Assembly Committee on Water, Parks and Wildlife. 
I also represent the northern part of the Delta. I am honored by your 
invitation to appear today before the subcommittee, which is our 
counterpart in Congress. Both committees strive to balance the 
protection of our natural resources heritage with conflicting and often 
contradictory demands.
I. Support for San Joaquin River Settlement
    I appear before you today as an ardent advocate for settlement of 
the long-standing dispute on the San Joaquin River. I urge Congress to 
pass H.R. 24, which would implement the settlement. While the Friant 
Division of the Central Valley Project has produced vast abundance of 
agricultural products, it has produced substantial conflict as well. 
The most recent litigation--and the one we all are here today to 
resolve--has lasted 18 years, often sapping the financial resources and 
political energy of the litigants as well as much of the California 
water community.
    I support the proposed San Joaquin River settlement because it 
reflects a reasonable balance between water supply reliability and 
River restoration. This settlement will confer benefits on many 
Californians, not just the ones who have spent the last two decades in 
court.
A. What Has Changed
    Since I appeared here last fall, much has changed. First, 
Congress--and this subcommittee--has changed substantially. I hope that 
change will allow speedy passage of H.R. 24 and the beginning of a 
state-federal partnership in addressing the challenges we find on the 
San Joaquin River. While there are many other issues on the San Joaquin 
River, including drainage, H.R. 24 needs to proceed now without trying 
to resolve all the other thorny challenges on the San Joaquin. This 
bill may provide a forum for developing a state-federal partnership 
where we can work together to start addressing the many San Joaquin 
River issues.
    Second, conditions for the State of California have changed, with 
the passage of Proposition 84, which authorizes up to $100 million in 
general obligation bonds to support the settlement of the San Joaquin 
River conflict. Before that funding becomes available, the Legislature 
will need to appropriate the funding through the State Budget. The 
Governor's budget proposes that we spend $14 million next year in 
support of the San Joaquin River settlement. I anticipate that the 
Legislature will have concerns about approving that appropriation, 
without action by Congress to implement that settlement. In fact, just 
last week, the Legislative Analyst's Office advised the Legislature 
that it should not appropriate money for the San Joaquin River 
restoration until Congress appropriates funding for the restoration. 
So, effective implementation of the settlement through a state-federal 
partnership will depend on the Congress' timely action.
    Finally, the settlement has changed, with the third-party concerns 
now resolved by language that is in H.R. 24. When we were last here, 
some witnesses objected to potential risks of adverse consequences to 
third parties. Those parties and the settling parties, working with 
Senator Dianne Feinstein, developed the language that is now in H.R. 
24. We may not all agree that this language is necessary substantively, 
but we all can agree that resolving those disputes makes an important 
contribution to achieving--and implementing--a settlement that works 
and enjoys success. We don't need further litigation over this 
settlement, as some witnesses threatened at the last hearing.
    Taking all these changes into consideration, the time has come for 
Congress to act. We have resolved a conflict that has sapped the energy 
of a significant portion of the California water community for decades. 
That conflict is over, and it is our duty as elected representatives to 
do all we can to support that settlement.
B. Value of Resolving Long-Standing Conflict
    This settlement offers all of us an opportunity to move beyond 
conflict. Water conflicts--particularly court litigation--simply cost 
too much. It costs money to pay our advocates--the lawyers and expert 
witnesses. It costs time and missed opportunities. As we fight, we too 
often ignore the continuing and changing needs to operate, maintain and 
rebuild the water infrastructure that may have served us well in 
another time. But with improved technology and increased value for each 
drop of water, we need to invest in creating the most efficient water 
system possible--one that balances the many competing water needs--
agricultural, urban and environmental. Moreover, the inherent risks of 
litigation put the use of our water resources and water supply 
reliability in jeopardy.
    Finally, as we fight, the ecosystem collapses. The public trust 
resources that we have a duty to protect deteriorate. California cannot 
afford the costs of conflict. That's why I'm here today to urge you to 
support H.R. 24, which will let California move beyond this long-
standing conflict.
    I hope that our two governments--state and federal--can find a way 
to collaborate on promoting the most effective and balanced use of the 
San Joaquin's water--for agriculture, cities and the fishery. Only 
recently did the Schwarzenegger Administration begin investing time, 
attention and resources on improving the situation on the San Joaquin. 
I am proud to be one of the legislators who fought for State funding in 
this year's budget to support this settlement. I was also encouraged to 
see that the draft legislation includes a ``savings clause'' for 
existing federal law requiring Central Valley Project compliance with 
State law. This provision will protect the State's sovereignty and 
ensure the State's proper role in overseeing the San Joaquin River's 
water resources.
C. Settlement Helps Resolve Multiple San Joaquin River Issues
    I would like to share a broader perspective about how this helps 
California as a whole.
    Certainty for Water Users. First, there is the added certainty for 
water users throughout the San Joaquin River basin. For more than a 
decade, we have crafted water agreements that would allow for some 
uncertainty due to this litigation. The Federal Government and water 
users on San Joaquin tributaries crafted the 1998 San Joaquin River 
Agreement, often called the VAMP (or the Vernalis Adaptive Management 
Program), leaving some flexibility for an outcome of this litigation. 
The State's Delta water quality standards were imposed on all the 
Central Valley Project permits, to allow for the possibility that water 
might some day come down the mainstem from Friant to the Delta. This 
time of bracing for uncertainty can now end, and we can begin the 
conversation about how to promote greater water certainty throughout 
the San Joaquin system.
    Assistance for Fishery Resources. And, of course, this settlement 
will help the San Joaquin system's fishery resources. I understand 
there may be some who question how much the water released under this 
agreement will help the spring run and, perhaps, may not help fall run 
salmon at all. But let us keep in mind our starting point--a dead 
river--and a basic fact--fish need water for life. Breathing life-
giving water back into this river--even if not as much as some 
suggested would be required--is better for the fishery than dry sand. 
This water will contribute to the fishery needs in the San Joaquin 
River and downstream in the Sacramento-San Joaquin Delta.
    Diluted Salinity. This infusion of water also contributes to 
diluting the salinity flowing downstream from the westside of the San 
Joaquin Valley to the Delta. Some of you may remember the Kesterson 
wildlife debacle when the last drain operated in the 1980's. While some 
have suggested that we tie this settlement to resolving the drainage 
issue, it is more important that we proceed with the settlement now 
than try to resolve all San Joaquin River issues at one time. This 
settlement will contribute a new water resource to this chronic 
salinity problem on the San Joaquin and in the Delta. Even a small 
contribution will nevertheless be a contribution.
    Flood Protection. While flood protection was not one of the 
original purposes, some of the actions required by the settlement will 
improve flood protection, particularly the expansion of the River's 
capacity to 4,500 cfs at various points. Last year, the small town of 
Firebaugh suffered a huge risk that its levees would fail and deluge 
the town. This settlement provides a small indirect flood protection 
benefit that, in these years after Hurricane Katrina, may be 
appreciated.
II. Benefits for the Sacramento-San Joaquin Delta
    This settlement's benefits reach beyond the confines of the San 
Joaquin River, particularly to the broader Sacramento-San Joaquin River 
Delta--California's Critical Crossroads for water. I note that the 
Delta's name includes the San Joaquin River. The Delta is formed by two 
of California's great rivers--the Sacramento AND the San Joaquin. 
Admittedly, the settlement was not necessarily intended, nor are there 
any commitments, for the benefit of the Delta. But, when you begin 
moving toward a healthier river, the Delta cannot help gaining some 
sort of benefit, albeit unquantified.
A. Delta
    The Delta currently suffers from two inter-related problems--water 
quality and an ecosystem crisis. The Delta's water quality issues are 
multi-faceted, involving salinity (both drainage and saltwater 
intrusion), contaminants (including pesticides, mercury and urban 
runoff), and water circulation or flow standards. Increasing the 
availability of San Joaquin River flows will, in any case, contribute 
to improving water quality in the South Delta, where the San Joaquin 
River flows into the Delta.
    Also, in the last year, the State has been investigating the causes 
of the substantial decline of pelagic fish (e.g. delta smelt) and much 
of the ecosystem that supports them. We still do not have final 
answers, but we have seen indications that three categories of causes 
have contributed to this decline--invasive species, contaminants and 
water project pumping operations--and we have recognized that there are 
connections among all three of those categories. Last fall's CALFED 
Science Conference demonstrated that the water project exports play the 
central role in affecting the ecosystem--both directly (taking fish 
into the pumps) and indirectly (changing Delta hydrological flow 
patterns). Those categories also share a connection to the flow of 
water into and within the Delta. The cause of the decline is likely 
related to all of these causes. So, the best news is that introducing 
additional flows into the Delta may assist California in addressing the 
root causes of the Delta ecosystem crisis.
B. Export Water Supplies
    Because California's export water communities--in the San Joaquin 
Valley and Southern California--rely on water exported from the Delta, 
any assistance the Delta receives can help the water supply reliability 
for export water supplies. They had concerns that they may suffer 
negative impacts, but H.R. 24 now has addressed that issue to their 
satisfaction. It may help the two large water projects comply with the 
interior Delta salinity standards. Or the additional San Joaquin River 
inflows may improve the export-inflow ratios that regulate export-
pumping operations. In either case, export water supply may improve 
because there is more water flowing into the Delta.
III. Next Steps
    The next steps to implement the San Joaquin River settlement 
involve both of our legislative bodies. First, California needs the 
Congress to enact H.R. 24 to implement the settlement, including 
elimination of the CVPIA prohibition on Friant releases for these 
purposes. Then, I can assist the effort in the California Legislature 
to enact other supportive legislation and budget appropriations to 
advance the settlement's implementation. For example, one of my 
colleagues, Jared Huffman, who chairs the water quality committee and 
sits on my committee, introduced a short provision to authorize the 
State to participate in this settlement. There will be additional work 
needed on this bill, which may respond to how Congress acts. The 
Federal Government needs to act first, considering its long history of 
controlling the operation of the main stem of the San Joaquin River. I 
have supported state legislation to start addressing San Joaquin River 
issues in this past session, but, before the settlement, it did not 
enjoy the necessary broad support that today's settlement may provide. 
With our two legislative bodies working together, I have no doubt that 
we will succeed in making this settlement a great success!
                                 ______
                                 

 Response to questions submitted for the record by Rep. Devin Nunes to 
 Assemblywoman Lois Wolk, Chair, Assembly Committee on Water, Parks & 
                  Wildlife, California State Assembly

Question Submitted by Mr. Nunes (CA) to all witnesses:
    If all of the other parties involved in the negotiations concerning 
the form of H.R. 24 were to agree, would your organization support an 
amendment of H.R. 24 authorizing the construction of pumping and 
conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal of the 
Settlement?
Response of Honorable Lois Wolk, Chair, Assembly Committee on Water, 
        Parks & Wildlife
    At this point, the most important task for Congress is completing 
the San Joaquin River settlement by passing the San Joaquin River 
Restoration Settlement Act. Upon passage, the State and the Federal 
Government will be able to effectively work together on implementing 
the settlement, which includes both river restoration and water supply 
improvements. It is during implementation that the pumping and 
conveyance facilities you have proposed would best be analyzed, 
consistent with federal and state laws requiring feasibility studies 
and environmental documentation. While I cannot speak for the entire 
California State Assembly, I would support pursuing further 
investigation of such facilities--after passage of the federal 
authorization statute.
                                 ______
                                 
    Mrs. Napolitano. Thank you so very much, Mrs. Wolk. Before 
we move on to the question-and-answer period, I would like to 
receive for the record the testimony of Clifford L. Marshall, 
Chairman of the Hoopa Valley Tribe, which was given to me. It 
is his statement on this issue.
    So without objection, I will order the receiving of this 
testimony.
    [NOTE: The statement submitted for the record by Clifford 
L. Marshall, Chairman, Hoopa Valley Tribe, has been retained in 
the Committee's official files.]
    Mrs. Napolitano. OK. So first of all, Mr. Dooley, one of 
the issues that, in reading some of the testimony given, I have 
a question that deals with a new water management report which 
discusses the options for more aggressive groundwater 
management and/or groundwater banking.
    Does it have that in there? Because I could not find 
something.
    Mr. Dooley. I am sorry, the question is does the report 
include----
    Mrs. Napolitano. The options for more aggressive management 
and banking for the groundwater.
    Mr. Dooley. Absolutely. There are a number of programs that 
are regional programs, including a number of different 
districts that include additional groundwater banking programs. 
There are also individual groundwater banking programs included 
in the report. In fact, of the district-generated proposals, 
additional groundwater recharge and banking are the dominant 
types of programs that are included in the report. So there are 
several different proposals that are included in this document 
that deal with expanded groundwater banking and recharge.
    Mrs. Napolitano. Makes good bedtime reading.
    Mr. Dooley. I didn't find that to be the case.
    [Laughter.]
    Mrs. Napolitano. Mr. Candee, the question that I have for 
you, sir, is, what is the economic benefit timeframe? Because 
we know there is an economic benefit. But what is the timeframe 
for a recovered salmon fishery in the San Joaquin River? And 
have any studies been done to gauge that economic benefit or 
effect?
    Mr. Candee. Well, actually, I think Mr. Dooley mentioned 
that before the settlement negotiations began, we were all 
preparing for trial. And in preparation for trial, all of the 
parties brought in economists to analyze both the impacts and 
the benefits. And so there actually has been some analysis 
about other river systems, and how restoring the river can 
provide economic benefits, not just for the fishing industry, 
but also for recreation, for water quality, for other farmers 
downstream, for example.
    I don't know if any studies have been done specifically on 
the restoration of these two salmon species on this river. The 
river has been dry for 60 years. But the analysis of economic 
benefits from restoration programs is out there, and it is 
cited in that expert report.
    Mrs. Napolitano. And that has been shared with the rest of 
the parties.
    Mr. Candee. Yes. All of the parties have it, and I would be 
happy to make it available.
    Mrs. Napolitano. OK, great. Thank you.
    Mr. Peltier, has the Interior Department requested funding 
for the San Joaquin River Settlement in the Fiscal Year 2008 
budget? If so, how much money? And then, of course, what will 
the money be used for? And what happens if this authorizing 
legislation, which I hope is not the case, is not enacted, will 
the Department be able to spend the money on implementing the 
settlement anyway?
    Mr. Peltier. Yes. In the President's 2008 budget proposal, 
we identify $17 million for funding the restoration program. 
There are some other, there are other monies within the region 
that, such as the monies we are using now to get kick-started 
some of the planning efforts. But there is that $17 million 
identified, along with the commitment of the Administration to 
send up authorizing legislation that would make possible the 
expenditure of that money. It will not be possible without the 
passage of authorizing legislation. H.R. 24 is legislation that 
will make possible the expenditure of that money.
    Mrs. Napolitano. So the funding hinges on the passage.
    Mr. Peltier. Yes.
    Mrs. Napolitano. Thank you, sir. I think I will yield to my 
Ranking Member.
    Mrs. McMorris Rodgers. Thank you, Madame Chairman, and 
thank you, everyone, for being here. I certainly applaud the 
effort to reach an agreement. It is very difficult, to say the 
least, and I understand some of those challenges, coming from 
Washington State. And without a doubt, it is much better to 
reach this settlement among ourselves, rather than allowing the 
Court to be the one dictating.
    We have had that experience most recently. I mentioned it 
in my opening remarks, but we do have an example where, per a 
judge out of Portland, we are spending--we did, in 2004, spend 
over $3 million per Chinook salmon because it was a court-
mandated spillover in the Columbia Snake River system.
    So my question to all the witnesses on the first panel is, 
having the settling parties, I wondered if in the settlement, 
have the parties defined what success is when it comes to river 
restoration and salmon reintroduction? And what benchmarks will 
be in place to determine future success?
    Mr. Candee. I would be happy to take the first stab at 
that, but I am sure others will want to add to it.
    There are several answers. First of all, a process has been 
set up by which the Federal fish agencies and the state fish 
agencies, and also the parties, the settling parties, through a 
technical advisory committee, will try to develop interim 
targets and long-term targets to try to guide the restoration 
program.
    But second, there is a reopener in the settlement which was 
carefully negotiated by all of the settling parties, in which 
if any party seeks to change the fundamental terms of the 
settlement after 2025, that the State Water Board would be 
asked to make a series of findings. And it is not just on the 
success of the restoration program, but also the success of the 
water management program and the reasonableness of any changes.
    And so those were actually spelled out in the settlement 
which the legislation would be approving. So all of that is in 
there, and we hope the fishery agencies and the other parties 
are going to be moving very quickly to start developing some of 
these long-term targets.
    Mr. Dooley. Maybe if I could just add a little bit. And I 
will be very candid. The experts for the Friant community and 
the experts for the Plaintiffs did not agree on what level of 
success could be achieved. I think our experts believe that you 
can restore fish, but perhaps not as many as the Plaintiffs' 
experts.
    And we don't anticipate reintroducing fish until 2012. And 
as Mr. Candee said, the approach in the settlement is that a 
technical committee composed of people who really know what 
they are talking about.
    I practiced a lot of fishery biology in the last 18 months, 
but the people who are really fishery biologists are going to 
sit down and try to develop metrics that will define whether we 
are achieving our goal or not.
    Further, I would say there is a provision in the settlement 
where we acknowledge that there are benefits other than simply 
restoring a fishery, to restoring flows to the river. And we 
acknowledge that, notwithstanding our best efforts, we might 
not be successful in the fishery. So there is an acknowledgment 
that it is a challenging effort, but we are all committed to 
try to make it happen.
    Mrs. McMorris Rodgers. Is there a concern, because this 
hasn't been defined clearly, what success is, or what the 
benchmarks for success will be at some point in the future, 
when the money is gone, that we will be in litigation again as 
a result of not having this defined now?
    Mr. Dooley. Let me say that the structure of the settlement 
does not provide an opportunity to relitigate these issues. It 
resolves the issue pursuant to the terms of the settlement.
    The only option really is to seek to adjust flows in the 
river, in 2026 or thereafter. And that is through a defined 
process that Mr. Candee mentioned. It was very, very important 
to the Friant community that this matter be removed from the 
jurisdiction of the Federal Courts. And we have tried to do 
that, to the extent we can.
    Furthermore, our interest, candidly, in seeing this succeed 
is tempered in substantial part by the assurances we have on 
the limit of the water supply committed to the effort, and the 
agreement of all the parties to cooperate in making sure that 
we do what we can to recirculate that water and recapture it 
for use within the Friant service area.
    So that was our principal motivation. And we think we have 
achieved the highest level of certainty that we could within 
the context of this litigation.
    Mrs. McMorris Rodgers. Yes?
    Mr. Peltier. I would just like to more broadly speak to the 
challenges we face when investing in environmental improvements 
across the West. It is very common. You have had a lot of 
experience with it in the Central Valley of California, between 
the Central Valley Project Improvement Act Restoration Fund, 
expenditures of over $600 million, and the CALFED expenditures 
for ecosystem, we totaled well over $1 billion of investment in 
a little over a decade in ecosystem improvement. Primarily that 
investment has been focused on fisheries.
    And yes, there is this tremendous uncertainty we live with. 
And giving performance measures, getting metrics, is something 
the managers are constantly asking, constantly demanding. The 
CALFED Science Board has had numerous reviews to try and 
identify what investments are producing what returns. And it is 
very difficult.
    We can see habitat improvements. We can see blocks to fish 
passage eliminated. We can see improvements. But what the 
result, what the population level effect of our investments is, 
is something that will be determined over the generations of 
fish, and over the generations of future water management 
practices. And that uncertainty is something that we are forced 
to live with. Because it really is, there are many alternatives 
to how we spend the money, but there is no alternative to 
attempting to address the ecosystem problems.
    Mrs. McMorris Rodgers. OK. Thank you very much.
    Mrs. Napolitano. Thank you. Now we will move on to Mr. 
Costa.
    Mr. Costa. Thank you very much, Madame Chairperson.
    A couple of different focuses. First of all, Mr. Peltier, 
you talked about the funding level. You are really relating to 
administrative costs, right, when you are talking about the 
implementation of this agreement?
    Mr. Peltier. Well, no. There are----
    Mr. Costa. But the bulk of the restoration efforts as a 
part of this agreement are going to come from the redirection 
of the restoration fees that are currently being paid by the 
Friant water users.
    Mr. Peltier. Right. And capital and diversion of capital 
repayment.
    Mr. Costa. Right.
    Mr. Peltier. Both of those are proposed in the President's 
budget to occur in 2008. That is the $17 million. And that will 
go to----
    Mr. Costa. And so have you estimated what your 
administrative fees are going to be on this?
    Mr. Peltier. Higher than we would like.
    Mr. Costa. Shall we use the typical gold plate of 20 
percent for Bureau projects?
    Mr. Peltier. No.
    Mr. Costa. Good.
    Mr. Peltier. Unacceptable.
    [Laughter.]
    Mr. Peltier. But I have a regional director, Kirk Rogers, 
here with me to address his----
    [Laughter.]
    Mr. Peltier. What it costs him to get the job done. It is a 
simple reality that we have to deal with.
    Mr. Costa. But seriously, though, we would like to get a 
much greater handle on frankly what those are. Because I really 
view that, in my mind, separate and distinct from the actual 
dollars that have been committed for the totality. And I know 
there are differences of opinion on how much it is ultimately 
going to cost for restoration, depending upon it, because the 
goals have already been discussed here.
    But the bulk of the funding for the restoration efforts, 
would you not, or would you agree, is the $100 million from the 
state bond, and the Friant water users restoration fee that is 
going to be redirected for the purpose of restoring the river?
    Mr. Peltier. Yes. And the capital repayment. The bill does 
authorize additional Federal appropriations, which would be, we 
anticipate----
    Mr. Costa. No, I understand that.
    Mr. Peltier. OK.
    Mr. Costa. No, I just want to make sure we get a handle on 
the administrative costs, because I think that is important.
    Has DWR, Mrs. Saracino, looked at your administrative 
costs? Separate of the $100 million?
    Mrs. Saracino. We are actually capped. Yes, we are capped 
on expenditure bond costs at 5 percent for administrative 
costs.
    Mr. Costa. Maybe we ought to apply that on the Federal 
level.
    Mrs. Saracino. And we do manage to come in under that. Most 
of the expenditures we see going into actual project 
implementation, digging out the dirt, changing the facilities, 
constructing new levees, bypasses, et cetera.
    Mr. Costa. Right. As it was alluded to earlier, I believe 
it may be Assembly Member Wolk's comments with the legislative 
analyst on the State of California, Elizabeth Hill, who many of 
us worked with before, and I think she does a very good job. In 
reading some of the press accounts last week about her 
recommendations, holding off to the state, I mean, I think it 
needs to be clear, and I hope, as the Chairman of the committee 
and member of the Assembly, that you will indicate that, I 
mean, notwithstanding our process here on the enabling 
legislative authorization, and in subsequent appropriation, 
that the Legislature and the budget analysts recognize that the 
$100 million has already been passed, as you stated in your 
testimony, by the voters, and the Friant water users, as a part 
of the settlement agreement, have already committed. Therefore, 
we obviously have to enact it to redirect those funds.
    But this, unlike a lot of Congressional authorizations and 
appropriations where we have to create the box and then 
appropriate the money, this is different in that sense.
    Mrs. Wolk. Mr. Costa, I understand your concern. We have a 
great deal of respect in California and the legislature on all 
sides, both sides of the aisle, for Elizabeth Hill. We don't 
always follow her advice, however, and there has been a 
tremendous amount of support, budgetary support, from the 
Administration, and from the legislature, for engaging in the 
settlement. And I have full confidence and will support the $14 
million that is proposed by the Governor in his budget. And I 
feel that the Assembly, and I believe the Senate, will, as 
well.
    Mr. Costa. All right. Thank you very much.
    Mrs. Wolk. Again, if we have a budget.
    Mr. Costa. Yes. I see my time is--do I? OK, wonderful.
    Let me get to the area of the holding contracts and try to 
cover that quickly.
    When we discussed in great detail third-party impacts, as 
Congressman Cardoza and Congressman Nunes and Radanovich and 
the rest of us that were a part of those discussions in 
September with Senator Feinstein, it didn't come to my 
attention until after we had concluded those meetings about the 
holding contracts.
    And I would like both Mr. Peltier, as well as Mr. Dooley, 
to comment, why does the settlement assume that downstream 
diversions will continue at their current levels? Because we 
are talking about 120,000 acre-feet of water approximately that 
has been continuing to flow down the river since Friant Dam was 
built. That 120,000 acre-feet has, based upon the agreements 
when the dam was completed, has served water users that now we 
refer to as holding contracts. And their concerns about their 
impacts, third-party impacts, I think are important.
    Could you please tell me your view as it relates to those 
holding contracts?
    Mr. Peltier. I will simply say that we believe that H.R. 24 
does protect the interests of the holding contract folks, and 
there is no question about it in our mind: about the validity 
and the ongoing obligations and responsibilities the project 
has to those people.
    But maybe Dan, who has been engaged in some one-on-one 
discussions that I have not been involved with, would have more 
to offer on that.
    Mr. Dooley. Mr. Costa, actually the settlement agreement 
itself has direct provisions in Exhibit B, which are the 
hydrographs upon which the flows are built. That assumed that 
the holding contractor leases that historically occurred will 
continue to be made for the purpose of the holding contractors, 
and the hydrographs are identifying additional releases that 
would be needed on top of that for the purpose of restoring the 
river.
    Further, that the structure of the agreement is that there 
are releases at the dam, and then there are measuring points 
downstream, that, where specific flows are----
    Mr. Peltier. All the way to Gravelly Ford.
    Mr. Dooley. Well, beyond even Gravelly Ford.
    Mr. Peltier. Right.
    Mr. Dooley. And if the releases at the dam are insufficient 
to meet those downstream requirements, then the Bureau has an 
obligation under the settlement agreement to increase the 
releases at the dam to meet the required flows downstream.
    So to the extent a holding contractor is exercising their 
contractual right to divert from the river, and that affects 
the downstream measurements, then additional releases are 
required. And that is built into the settlement.
    So I think, from our perspective, the settlement provides 
greater protection to the holding contracts than any other 
water user, because of the way the release schedules are 
required to be met.
    Mr. Costa. Do you concur, Mr. Candee? Just say yes or no.
    Mr. Candee. I do, actually.
    Mr. Costa. OK, thank you. And Madame Chairman, I know my 
time has expired. I have some questions I would like to submit 
for the record, as it relates to further questions on the 
holding contracts.
    Mrs. Napolitano. OK. Without objection, so ordered.
    Mr. Costa. Thank you.
    Mrs. Napolitano. Mr. Radanovich.
    Mr. Radanovich. Thank you, Madame Chair. I just have one 
quick question of Mr. Dooley.
    Mr. Dooley, Friant Water Users Authority, can you kind of 
give us a little bit of background on what they are? Why were 
they created, for what purpose were they created? How many 
districts? What was their support of this agreement? Was it 
unanimous? Was it a split decision? Can you give me a 
background of Friant and their support of this thing?
    Mr. Dooley. Well, let me say the Friant Division of the 
Central Valley Project extends from the Chowchilla Water 
District north of Madera to the Arvin-Edison Water Storage 
Districts south of Bakersfield. And it involves diversions from 
Millerton Lake behind Friant Dam into the Friant Kern Canal 
south, and into the Madera Canal North, which serves the Madera 
Irrigation District and Chowchilla.
    There are 28 long-term Friant contractors. There are 22 
long-term contractors who are members of the Friant Water Users 
Authority. All 22 members of the Authority endorse the 
settlement. The Friant Water Users Authority endorse the 
settlement. And to the best of my knowledge, of all of the 22 
boards of directors who considered the settlement, there was on 
no vote, and that related to the extension of the Friant 
surcharge, not to the substance of the settlement.
    So I am very confident in appearing before you today in 
saying that there is unanimous support among the members of the 
Friant Water Users Authority for this settlement, and in a 
strong view that we do not want to go trial on the remedy and 
put the matter back in the hands of Judge Carlton.
    Mr. Radanovich. Thank you very much. That is all.
    Mrs. Napolitano. Thank you. Mr. Cardoza? You pass. Mr. 
Nunes? I don't have any on my side.
    Mr. Nunes. Thank you, Mrs. Napolitano. Mr. Dooley, I have a 
specific question for you here.
    Friant has a document, this one here, ``Potential Programs 
and Projects,'' that was submitted by you for the record. As I 
understand, the intent of this document is to outline potential 
projects for the implementation of the water management bill.
    On page 3 of the document it says that NRDC and Friant 
previously prepared a water supply report that considered 
various options to achieve this objective, and I think that is 
referring to the water management goal in the settlement.
    Was the trans-valley canal one of the conceptual projects 
NRDC and Friant considered?
    Mr. Dooley. It was not prepared--let me make a 
clarification, Mr. Nunes. That reference to a water supply 
report is not in connection with this settlement effort. It was 
prepared in connection with a settlement effort that candidly 
blew up about four years ago.
    And I don't recall if it was called the trans-valley canal. 
My recollection is there was a new cross-valley facility, 
though, that was considered as one of the options in that water 
supply report.
    Mr. Nunes. And I understand that, Mr. Dooley. But was NRDC 
made aware of this plan?
    Mr. Dooley. The water supply report that was prepared in 
the prior settlement process was a jointly prepared document. 
It was prepared by a contractor under joint contract with NRDC 
and Friant.
    Mr. Nunes. So it may have been called something else, but 
it was talked about.
    Mr. Dooley. Right.
    Mr. Nunes. So, Mr. Candee, you referred to everyone, all 
the people party to the settlement have signed what you called 
a blood oath in your testimony. If everyone was to agree, all 
the other parties, that the trans-valley canal needed to be 
built, why not authorize it in this settlement? Make an 
amendment to H.R. 24, authorize the trans-valley canal?
    Mr. Candee. You know, until I received the Friant document 
a day or two ago, I am not sure I ever heard the term trans-
valley canal, and I frankly can't remember whether the 
proposals that were considered in the water supply study--there 
were 73 that we went through--included the same location and 
everything. And my understanding is that Friant just prepared 
this document very recently. So I don't think anyone has 
actually----
    Mr. Nunes. I mean, you have committed to the water 
management goal, Mr. Candee.
    Mr. Candee. Right.
    Mr. Nunes. And you know my issue with the settlement is 
that there is no way in this settlement to get the 200,000 
acre-feet back, OK?
    Now, what I am trying to ask is, wouldn't it be worth 
looking at some concrete objectives? You know, maybe some of 
these that are in here, in the next two months, three months, 
as this bill moves its way through the Congress, that everyone 
sit down and all agree that yes, let us try to get some of that 
200,000 acre-feet back. Would you support any of that?
    Mr. Candee. Congressman, I think it was, as Congressman 
Cardoza pointed out, there is a phased approach in this 
settlement. And the full flows don't even begin for quite a 
while. And the document from Friant----
    Mr. Nunes. Mr. Candee, though, I mean, it is just a yes or 
no question. Why can't you just be willing to support something 
concrete that we can put into law, that has teeth, so that we 
can get the water back?
    Mr. Candee. Let us give an example where CALFED had the 
idea to let us build a storage project called Delta Wetlands. 
And they spent a lot of money studying it, and everybody 
thought that sounds like an interesting idea. And when it was 
all done, guess what? They couldn't find anybody, anybody----
    Mr. Nunes. Yes, but what you are saying is a feasibility 
study. And this settlement doesn't even have a feasibility 
study.
    Mr. Candee. I am not aware of any party that is asking 
right now for Congress to amend this settlement to pre-
authorize a project that until a few days ago nobody had even 
heard about as a proposal, and hasn't been studied or even 
endorsed, as far as I know, by the----
    Mr. Nunes. Only the parties that you ignored. Only the 
parties that were ignored, that happen to be my constituents.
    Mr. Candee. I am not aware--we did so much----
    Mr. Nunes. Only those parties that every elected official 
in Tulare County has submitted a request to have concrete 
mitigation to protect their water supply.
    Mrs. Napolitano. Mr. Nunes, would you allow the gentleman 
to finish? And then you can proceed.
    Mr. Nunes. I will, but I don't want him to burn the time 
out.
    Mrs. Napolitano. Well, the way it is being timed, the only 
time is your questions, not his.
    Mr. Candee. Thank you. The water management goal provision 
which is the subject of the proposal that Friant just came 
forward with. But there is also a separate second plan called 
the recovered water account, in which NRDC agreed to reduce the 
price of Federal water and make it available to those districts 
who were putting up water.
    Mr. Nunes. It was never your water to agree to lower the 
price on.
    Mr. Candee. We are asking Congress.
    Mr. Nunes. So you are supporting it, OK. I just wanted to 
make sure you knew that was the people's water; NRDC doesn't 
own it.
    Mr. Candee. I couldn't agree with you more. That is the 
people's water, and believe me, that is very clear.
    But the idea there was to encourage further groundwater 
banking. We have heard a lot of support from a number of 
members for expanded groundwater recharge and groundwater 
banking.
    These programs, the Federal government has committed to 
developing a plan on the recirculation side. I think what 
Senator Feinstein was asking Friant to do was help jumpstart 
that process with some ideas. I think some of the proposals 
that Friant put forward are new ideas. Some of them have been 
around for a while. As we mentioned, Friant and NRDC spent a 
lot of time trying to study these different ideas, but I don't 
think any of them yet are ready for Congressional action in 
terms of Congressional----
    Mr. Nunes. Well, Mr. Candee, my time is up here, and we 
have a vote on. But in the spirit of working together, if you 
truly want to work together, then why not bring the cities and 
the counties that have asked for mitigation--and I know that 
farmers within my district that are Friant farmers have asked 
for mitigation--why not all sit down, all work together, come 
up with a plan for mitigation to bring the water back?
    I mean, I think there is a lot of ideas out there that 
could do that. We need to put it into law, though, so that 
everybody has some assurances that this is going to happen.
    Mr. Candee. My understanding is that the Interior 
Department already plans--in fact, I think that was the subject 
of the MOU that Congressman Cardoza mentioned, that there is 
going to be public input and participation on all parts of the 
settlement, including the development of the water management 
plan.
    For example, the farmers in San Joaquin County have a lot 
of views about the water management plan and the idea of 
recirculation. And so you are right, there is a lot of people 
who want to be involved in reviewing those different options.
    Mr. Nunes. Is my time up, Mrs. Napolitano?
    Mrs. Napolitano. You have a minute.
    Mr. Nunes. Mr. Peltier, do you have a comment?
    Mr. Peltier. Yes. I would just add that Hal did mention the 
role that the Secretary will play in further developing the 
ideas, the water management plans. And it is critical, the 
success of that planning effort and the implementation work 
will be a function of, if everybody is at the table. Everybody 
brings something different, a different interest. And unless we 
are looking at all of them, our success will be limited.
    So it is not just the Friant farmers in the service area; 
there are folks outside the service area that can contribute. 
There is going to be a huge organized effort that has already 
begun, inter-agency, and not only among the agencies, but also 
with the various water management folks. Congressman Costa has 
a regional water management effort that he is spearheading. 
There is some integration of these efforts that will occur. And 
I think everybody shares the concern about the uncertainty of 
our future water supplies.
    My quick comment would be that if we were talking the loss 
of about 15 percent of the Friant water 20 years ago or more, 
it would be pretty close to a one-to-one loss in terms of water 
available for use. Today, I think we have learned a tremendous 
amount about improved water management, and we will have a 
great opportunity and great success in mitigating that adverse 
impact.
    Thank you.
    Mr. Nunes. But Mr. Peltier, what do I do, though----
    Mrs. Napolitano. I am sorry, Mr. Nunes, we have a vote that 
we have only a few minutes, and I think we need to wrap the 
panel up. I think, Mr. Dooley, if you have a quick comment, and 
then let us move on.
    Mr. Nunes. So you are going to dismiss this panel?
    Mrs. Napolitano. I dismiss it until they come back. You can 
put your questions in writing, sir. Yes, sir.
    Mr. Dooley. I would just mention that a number of the 
proposals that are identified in the report that we submitted 
for the record are what we call integrated regional water 
management plans. And it should be noted that Proposition 84, 
in addition to $100 million for the San Joaquin River 
Settlement, has $117 million that is available for 
implementation of integrated regional water management plans. 
And we expect a number of those projects that are identified 
will be funded through Proposition 84 funds.
    Mrs. Napolitano. OK. Well, thank you very much for all of 
you. Any further questions can be submitted for the record, and 
we will forward them to you.
    I would like to ask the witnesses, we have a vote on. I 
believe we have a couple votes. If the witnesses would remain 
until the hearing is adjourned, because there may be some other 
questions that may be falling on your lap.
    We will proceed with the second panel. My colleague tells 
me she may not be back because she has another engagement, so 
we will work on it when we get back.
    So thank you very much. We will right now adjourn, just 
temporarily.
    [Recess.]
    Mrs. Napolitano. This meeting will reconvene. And I will 
turn over the introduction of Panel II to my Acting Ranking 
Member, George Radanovich.
    Mr. Radanovich. Thank you very much, Grace. Well, I am 
almost back; I have one more chair to move over.
    [Laughter.]
    Mr. Radanovich. Thank you very much, Grace. I would like to 
introduce Panel II. Tom Birmingham, the General Manager of the 
Westlands Water District in Fresno, California; Cannon Michael, 
landowner in the San Joaquin River Exchange Contractors Water 
Authority in Los Banos, California; Ken Robbins, Attorney for 
the Merced Irrigation District; and Allen Ishida, Supervisor 
for Tulare County Government in Visalia, California.
    Welcome to the Subcommittee. Thank you for being here, and 
I look forward to your testimony.
    Mrs. Napolitano. And may I add to Mr. Radanovich, if he is 
not going to learn to pronounce the Mexican names better than 
that, I will rethink----
    Mr. Radanovich. I cannot roll my R's, Grace. I am working 
on it.
    [Laughter.]
    Mrs. Napolitano. You are on, sir.

  STATEMENT OF THOMAS W. BIRMINGHAM, GENERAL MANAGER/GENERAL 
     COUNSEL, WESTLANDS WATER DISTRICT, FRESNO, CALIFORNIA

    Mr. Birmingham. Thank you, Madame Chairman and Mr. 
Radanovich, other Members of the Subcommittee. I appreciate the 
opportunity to appear here today to testify in support of H.R. 
24.
    From the perspective of Westlands Water District and the 
San Luis and Delta-Mendota Water Authority, this settlement 
represents a fair balance between the needs of the natural 
resources of the San Joaquin River and the preservation of a 
water supply that is critical to the economy of the San Joaquin 
Valley, and indeed the State of California.
    Farmers on the west side of the San Joaquin Valley have had 
first-hand experience dealing with chronic water-supply 
shortages that resulted from involuntary reallocations of water 
from irrigation uses to fish and wildlife uses. And we 
certainly understand and support the efforts of the Friant 
water users to minimize water supply impacts that could result 
from an adverse judicial decision.
    At the outset of this process, we had a number of concerns 
about the potential impact that implementation of the 
settlement agreement could have on the area served by the San 
Luis and Delta-Mendota Water Authority, as well as Westlands 
Water District, and those concerns were outlined in testimony 
that I submitted to the Subcommittee last September. I can't 
express enough the appreciation that we have for the efforts of 
Members of this body, as well as Senator Feinstein, and the 
willingness of the settling parties to sit down and discuss 
with us amendments to the original proposed legislation, to 
address the concerns that the third parties involved in the 
discussions had.
    And I think that it is fair to say, as outlined in my 
written testimony, that we are very confident that the 
legislation in its present form expresses an unambiguous 
Congressional intent that the implementation of this settlement 
will not or shall not have adverse impacts on third-party water 
agencies.
    This settlement represents what I would characterize as 
another milestone in efforts to resolve resource issues through 
a consensus process, as opposed to through litigation. And 
again, I want to express our wholehearted support for the 
legislation, and express our appreciation to Members of the 
Subcommittee and to the settling parties.
    Thank you.
    [The prepared statement of Mr. Birmingham follows:]

   Statement of Thomas Birmingham, General Manager/General Counsel, 
                        Westlands Water District

    Madam Chairman and members of the Subcommittee, my name is Thomas 
Birmingham, and I am the General Manager/General Counsel of the 
Westlands Water District (``Westlands''). I also serve as a Director of 
the San Luis & Delta-Mendota Water Authority (``Authority''). I 
appreciate the opportunity to testify today in support of H.R.24, ``The 
San Joaquin River Restoration Settlement Act.''
    At the outset, I would like to express our appreciation to Members 
of Congress and the parties to Natural Resources Defense Council v. 
Rodgers, the litigation that would be settled through enactment of the 
San Joaquin River Restoration Act, for their efforts to ensure that 
third parties will not be adversely affected by implementation of the 
Settlement Agreement or the San Joaquin River Restoration Act. 
Resolution of this longstanding litigation would be historic, and the 
settlement would bring water supply certainty to a portion of the San 
Joaquin Valley that is of critical importance to the agricultural 
economy of the State of California. In our view, however, it is 
critical that the settlement be implemented in a manner that does not 
shift to other agencies unwarranted burdens associated with the San 
Joaquin River restoration program. H.R.24 was drafted carefully to 
avoid creating uncertainty and risk for other portions of the Valley, 
and Westlands and the Authority support its enactment.
South-of Delta Contractors' Experience with Water Shortages
    Westlands is a public agency of the State of California, which 
serves irrigation water to portions of the westside of the San Joaquin 
Valley in Fresno and Kings counties. Westlands is comprised of more 
than 605,000 acres, and the demand for irrigation water is 1.4 million 
acre-feet per year. Historically, that demand has been satisfied 
through the use of groundwater, water made available to the District 
from the Central Valley Project (``Project'') under contracts with the 
United States for the delivery of more than 1.15 million acre-feet, and 
annual transfers of water from other agencies.
    The Authority was formed in 1992 and consists of 32 member public 
agencies, including Westlands, each of which contracts with the United 
States Department of the Interior, Bureau of Reclamation 
(``Reclamation''), for supply of Project water. The Authority's member 
agencies are entitled to approximately 2.5 million acre-feet of water 
for agricultural lands within the western San Joaquin Valley, San 
Benito County, and Santa Clara County, California. Authority members 
also supply water for municipal and industrial uses, including the 
delivery of approximately 150,000 acre-feet of water to the Santa Clara 
Valley Water District, which serves the Silicon Valley. In addition, 
Authority members provide approximately 200,000 acre-feet of water for 
waterfowl and wildlife habitat in the San Joaquin Valley. In addition, 
the Authority operates and maintains certain Project facilities under 
contract with Reclamation. Two such facilities are the C.W. Jones 
Pumping Plant (``Jones Pumping Plant''), located in the southern 
portion of the Delta, near the city of Tracy, and the Delta-Mendota 
Canal, which is used to deliver water from the Jones Pumping Plant to 
the Authority's member agencies.
    The area served by Westlands and other Authority member agencies is 
one of the most fertile, productive and diversified farming regions in 
the nation. Rich soils, a good climate, and innovative farm management 
have helped make this area incredibly productive. Farmers in the area 
served by Authority member agencies produce over 60 different high-
value, commercial crops that are sold both domestically and 
internationally in the fresh, canned, frozen and dry food markets. 
However, like every other region of the arid west, the ability of these 
farmers to produce these crops and generate the associated economic 
activity depends on the availability of an adequate, reliable source of 
water.
    Our experience with the implementation of the Central Valley 
Project Improvement Act (CVPIA), Pub. Law 102-575, is illustrative of 
what can happen to an agricultural region like the area served by the 
Friant Division of the Project when significant quantities of water are 
involuntarily reallocated from irrigation use to fish and wildlife use. 
Project water deliveries to south-of-Delta contractors began in 1952, 
and up until 1991, those deliveries were highly reliable and adequate 
to meet the demand for irrigation water. Indeed, from 1952 to 1991, 
Project water was the principal source of water for irrigation within 
Delta Division, and the only reduction in Project water supplies 
resulted from the extraordinary drought conditions in 1977, the driest 
year on record in California. However, enactment of CVPIA made Project 
water supply both unreliable and inadequate. The CVPIA was implemented 
by the Department of the Interior in a manner dedicated more than 
1,200,000 acre-feet of Project water for the restoration and 
enhancement of fish and wildlife. Much of this water was taken away 
from farms, ranches and business that had relied on it for decades. 
Contrary to the assumption at the time of CVPIA's enactment, that it 
would reduce water supplies by approximately 10% Project wide, 
virtually all of the water supply reductions resulting from 
implementation of CVPIA were imposed on south-of-Delta Project 
agricultural water service contractors. The reliability of water 
supplies for south-of-Delta water service contractors went from 
approximately 92% in 1991 to approximately 50% in 2000, when the CalFED 
Record of Decision was adopted.
    In response to chronic water supply shortages caused by CVPIA, 
farmers have had to rely more on the use of groundwater as a source of 
irrigation water. As an example, in 2004, farmers in Westlands pumped 
more than 210,000 acre-feet of groundwater, which is significantly more 
than the USGS's estimate of the safe yield of the groundwater basin 
(135,000 acre-feet). The extent to which farmers are compelled to rely 
on groundwater is contrary to sound principals of conjunctive use, 
which dictate that in wet or above normal years of precipitation, 
groundwater use should be reduced to allow the groundwater table to 
recover. In addition, Westlands has acquired and fallowed more than 
89,000 acres of land to help balance the demand for water with the 
District's available supply. Westlands has also acquired all of the 
lands in Broadview Water District and the water service contracts of 
Widren Water District, Centinella Water District, Mercy Springs Water 
District, and Ora Loma Water District. Lands in these other districts 
that were previously irrigated with Project water have been retired 
from irrigated agricultural production. In the San Joaquin Valley land 
fallowing results in third party impacts, which disproportionately 
affect the poor and minorities.
    It is easy for westside farmers, who have suffered the turmoil and 
increased costs resulting from unreliable, inadequate water supplies, 
to understand the Friant water users' keen interest in resolving a 
conflict that has the potential of taking more than a-half-a-million 
acre-feet from farmers for fishery restoration. Although we have not 
prepared a detailed analysis of potential impacts, it is safe to 
conclude that a judicial decision adverse to the Friant water users 
would devastate the agricultural economy of the eastside of the San 
Joaquin Valley. For this reason, Westlands and the Authority support 
the Friant water users' efforts to minimize through the Settlement 
Agreement potential water supply losses resulting from a San Joaquin 
River restoration program.
Need to Avoid Third-Party Impacts
    The Settlement Agreement among the NRDC, other environmental 
plaintiffs, the United States, and the Friant water users states that 
the parties neither intend nor believe that implementation of the 
Settlement Agreement will have a material adverse effect on any third 
parties. Given the nature of the claims that the settling parties seek 
to resolve through the Settlement Agreement any other intent would be 
unreasonable. However, in their original form, the Settlement Agreement 
and the proposed legislation attached thereto could be have been 
interpreted or implemented in ways that would have significant adverse 
effects on agencies that were neither parties to the litigation nor 
involved in development of the restoration program. For instance, 
without close coordination, the restoration program established by the 
Settlement Agreement could frustrate efforts undertaken by other 
agencies to restore or enhance the fall run Chinook salmon fishery on 
tributaries of the San Joaquin River. In addition, if as contemplated 
by the Settlement Agreement, spring run Chinook salmon are reintroduced 
into the San Joaquin River, the take prohibition of the Endangered 
Species Act could dramatically reduce the water supply or hydroelectric 
generating capability of other agencies. To avoid such unintended 
consequences, the proposed San Joaquin River Restoration Settlement Act 
was amended prior to its introduction in the 110th Congress to express 
an unambiguous congressional intent that third parties not suffer any 
adverse effects.
    I am confident that other witnesses will focus their testimony on 
potential effects that could have been suffered by their agencies had 
the San Joaquin River Restoration Settlement Act not been amended. My 
testimony will focus on potential impacts on south-of-Delta long-term 
contractors that currently receive water from the Delta Division of the 
Project, including the San Luis Unit.
Use of Central Valley Project Water for Restoration of the Spring and 
        Fall Run
    The Settlement Agreement establishes a ``Restoration Goal'' of 
restoring and maintaining in good condition fish in the main stem of 
the San Joaquin River below Friant Dam to the confluence of the Merced 
River, including naturally-reproducing and self-sustaining salmon 
fisheries. Flow criteria established by the Settlement Agreement limit 
for a period of years the quantity of water that can be released from 
Friant Dam for the restoration and maintenance of fish below the Dam, 
but the Settlement Agreement contains no comparable limitation on the 
use of other Project water or facilities to accomplish the Restoration 
Goal. Although the Settlement Agreement provides that the Secretary of 
the Interior shall comply with Endangered Species Act in connection 
with his operation of the Friant Division of the Project, the 
Settlement Agreement limits the quantity of water that can be 
involuntarily taken from Friant Division long-term contractors to 
achieve the ``Restoration Goal'' or to implement the San Joaquin River 
restoration program. There is in the Settlement Agreement no comparable 
protection for other Project long-term contractors.
    For this reason it is conceivable that, absent clear direction from 
Congress, the Secretary could be required to use water from Project 
facilities outside of the Friant Division to accomplish the 
``Restoration Goal'' established by the Settlement Agreement. As an 
example, if it were determined that the flow provided by releases from 
Friant Dam is insufficient to support out-migrating spring run salmon 
and the insufficient flow would cause jeopardy for the species, the 
Endangered Species Act and the San Joaquin River Restoration Settlement 
Act, when read together, would obligate the Secretary to look to other 
sources of Project water to provide additional flow. To avoid such a 
circumstance Section 10 was added to H.R.24. Section 10 provides:
      (a) FINDINGS.--Congress finds that the implementation of the 
Settlement to resolve 18 years of contentious litigation regarding 
restoration of the San Joaquin River and the reintroduction of the 
California Central Valley Spring Run salmon is a unique and 
unprecedented circumstance that requires clear expressions of 
Congressional intent regarding how the provisions of the Endangered 
Species Act of 1973 (16 U.S.C. 1531 et seq.) are utilized to achieve 
the goals of restoration of the San Joaquin River and the successful 
reintroduction of Central Valley Spring Run Chinook salmon.
      (b) REINTRODUCTION IN THE SAN JOAQUIN RIVER.--California Central 
Valley Spring Run Chinook salmon shall be reintroduced in the San 
Joaquin River below Friant Dam pursuant to section 10(j) of the 
Endangered Species Act of 1973 (16 U.S.C. 1539(j)) and the Settlement, 
provided that the Secretary of Commerce finds that a permit for the 
reintroduction of California Central Valley Spring Run Chinook salmon 
may be issued pursuant to section 10(a)(1)(A) of the Endangered Species 
Act of 1973 (16 U.S.C. 1539(a)(1)(A)).
      (c) FINAL RULE.--
          (1) Definition of third party.--For the purpose of this 
        subsection, the term ``third party'' means persons or entities 
        diverting or receiving water pursuant to applicable State and 
        Federal law and shall include Central Valley Project 
        contractors outside of the Friant Division of the Central 
        Valley Project and the State Water Project.
          (2) Issuance.--The Secretary of Commerce shall issue a final 
        rule pursuant to section 4(d) of the Endangered Species Act of 
        1973 (16 U.S.C. 1533(d)) governing the incidental take of 
        reintroduced Central Valley Spring Run Chinook salmon prior to 
        the reintroduction.
          (3) Required components.--The rule issued under paragraph (2) 
        shall provide that the reintroduction will not impose more than 
        de minimis water supply reductions, additional storage 
        releases, or bypass flows on unwilling third parties due to 
        such reintroduction.
    In addition, Section 4 of the San Joaquin River Restoration 
Settlement Act provides:
          (f) EFFECT ON CONTRACT WATER ALLOCATIONS.--Except as 
        otherwise provided in this section, the implementation of the 
        Settlement and the reintroduction of California Central Valley 
        Spring -Run Chinook salmon pursuant to the Settlement and 
        section 10, shall not result in the involuntary reduction in 
        contract water allocations to Central Valley Project long-term 
        contractors, other than Friant Division long-term contractors
    Westlands and the Authority understand these provisions of H.R.24 
to provide clear congressional direction that the implementation of the 
Settlement Agreement shall not adversely affect the water supply or 
project operations of entities, including Project water service 
contractors outside of the Friant Division, that were not party to the 
litigation.
Recirculation or Recapture of Water
    Provisions of both the Settlement Agreement and the San Joaquin 
River Restoration Settlement Act direct the Secretary to develop and 
implement a plan or program of recirculation, recapture, reuse, 
exchange or transfer of water released for restoration flows, for the 
purpose of reducing or avoiding impacts to water deliveries to the 
Friant long-term contractors. It has been reported in the press that 
Peter Vorster, Ph.D., a hydrologist for the environmental plaintiffs 
has calculated that approximately 100,000 acre-feet of water released 
from Friant Dam pursuant to the Settlement Agreement could be 
recaptured in the Delta for export back to the Friant Division. If 
these reports are accurate, Dr. Vorster's conclusion is unrealistic.
    Presently, the capacity of the Jones Pumping Plant and the 
permitted capacity of the Harvey O. Banks Pumping Plant (``Banks 
Pumping Plant'') are fully dedicated to meeting contractual commitments 
to agencies outside of the Friant Division. Indeed, because of existing 
restrictions imposed at these pumping plants to protect or enhance 
anadromous and pelagic fish, except in extremely wet hydrologic 
conditions, neither the Secretary nor the California Department of 
Water Resources can meet water supply commitments to their respective 
contractors. If a program to recapture, recirculate, or reuse 
restoration flows released from Friant Dam were to displace existing 
uses of the Jones Pumping Plant or the Banks Pumping Plant, the water 
supplies of other agencies would undoubtedly be reduced and significant 
conflict would ensue.
    In discussions with representatives of the Friant Division water 
users they stated that it was not their intent to displace existing 
uses of either the Jones Pumping Plant or the Banks Pumping Plant. 
Instead, they expect to only use excess capacity at these facilities, 
when such capacity is available. To avoid any future conflict 
concerning this issue, Section 4 of the H.R.24 was amended to provide 
that the Secretary shall:
          (4) Implement the terms and conditions of paragraph 16 of the 
        Settlement related to recirculation, recapture, reuse, 
        exchange, or transfer of water released for Restoration Flows 
        or Interim Flows, for the purpose of accomplishing the Water 
        Management Goal of the Settlement, subject to--
          (A) applicable provisions of California water law;
          (B) the Secretary's use of Central Valley Project facilities 
        to make Project water (other than water released from Friant 
        Dam pursuant to the Settlement) and water acquired through 
        transfers available to existing south-of-Delta Central Valley 
        Project contractors; and
          (C) the Secretary's performance of the Agreement of November 
        24, 1986, between the United States of America and the 
        Department of Water Resources of the State of California for 
        the coordinated operation of the Central Valley Project and the 
        State Water Project as authorized by Congress in section 2(d) 
        of the Act of August 26, 1937 (50 Stat. 850, 100 Stat. 3051), 
        including any agreement to resolve conflicts arising from said 
        Agreement.
    Stated succinctly, Westlands and the Authority understand this 
provision of H.R.24 to mean that the Secretary's duty to implement a 
program to recapture, recirculate, or reuse water released from Friant 
Dam pursuant to the Settlement Agreement shall be subordinate to the 
Secretary's use of the Jones Pumping Plant to make Project water and 
water acquired through transfers available to existing Project 
contractors that receive water from the Delta Division of the Project. 
Moreover, because the Agreement of November 24, 1986, Between the 
United States of America and the Department of Water Resources of the 
State of California for the coordinated operation of the Central Valley 
Project and the State Water Project, authorized by Pub. Law 909-546, 
provides, inter alia, for the coordinated operations of the Jones the 
Banks Pumping Plant, the Secretary's duty to implement a recapture, 
recirculation, or reuse program will be subordinate to his performance 
of that agreement and any agreement to resolve conflicts arising from 
the coordinated operations agreement.
Conclusion
    Again, I want to express Westlands' and the Authority's support for 
the Friant water users' effort to minimize the water supply losses that 
could result from an adverse ruling in the judicial proceedings 
concerning the Secretary's obligation to release water from Friant Dam 
to restore and maintain in good condition fish that exist below the 
Dam. In addition, I want to express Westlands' and the Authority's 
appreciation of the settling parties' willingness to draft amendments 
to H.R.24 to ensure that implementation of the Settlement Agreement 
will not have a material adverse effect on any third parties. I would 
welcome any questions from members of the Subcommittee.
                                 ______
                                 
    [Response to questions submitted for the record by Thomas W. 
Birmingham, General Manager/General Counsel, Westlands Water District, 
follows:]

March 14, 2007

Emily Knight, Clerk
Subcommittee on Water and Power
1522 Longworth House Office Building
Washington, D.C. 20515

RE: Response to Questions

Dear Ms. Knight:

    Thank you for the opportunity to testify regarding the H.R.24, the 
San Joaquin River Restoration Settlement Act. As I indicated in my 
testimony, Westlands Water District supports the enactment of H.R.24. 
It is important legislation that will resolve a long-standing dispute 
regarding the United States Bureau of Reclamation's obligation to 
release water from Friant Dam to keep in good condition fish that exist 
below the Dam and will help provide water supply certainty for an area 
of California that is vital to the state's agricultural economy. Below 
is my response to written questions posed by Representative Devin Nunes 
after the hearing.
Question Submitted by Mr. Nunes:
    During your oral testimony before the Subcommittee you testified 
that the Bureau of Reclamation and San Luis Unit water service 
contractors are not now ready to pursue legislation to authorize the 
concepts for resolution of drainage issues in the San Luis Unit. 
Realistically, how quickly could the parties to litigation regarding 
drainage issues in the San Luis Unit be prepared to pursue authorizing 
legislation for a settlement?
Answer:
    On February 15, 2007, the United States Bureau of Reclamation 
briefed Members of Congress and congressional staff on discussions 
among Reclamation, San Luis Unit contractors, and other interested 
agencies concerning alternatives means of addressing the drainage issue 
in the San Luis Unit of the Central Valley Project. Among the 
alternatives described by Reclamation were ``Concepts for Collaboration 
Drainage Resolution,'' which describe a potential settlement of 
litigation brought against Reclamation and the San Luis Unit 
contractors by the San Joaquin River Exchange Contractors. A 
substantial amount of work went into the development of those concepts, 
but additional work is required to assure other entities, particularly 
the California Department of Water Resources, that implementation of 
the concepts will not negatively affect their water supply, project 
operations, or costs. If the parties and other interested agencies work 
diligently to address questions raised by the other interested 
agencies, I believe the parties to the litigation could be prepared to 
pursue authorizing legislation by the end of May, 2007.
Question Submitted by Mr. Nunes:
    If all of the other parties involved in the negotiations concerning 
the form of H.R. 24 were to agree, would your organization support an 
amendment of H.R. 24 authorizing the construction of pumping and 
conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal of the 
Settlement?
Answer:
    Except in very rare circumstances, there presently exists no excess 
capacity at the C.W. ``Bill'' Jones Pumping Plant or the Harvey O. Bank 
Pumping Plant for the implementation of the recirculation or recapture 
elements of the Water Management Goal. This is especially true during 
the periods of the year during which Restoration Flows will be 
released. Therefore, if the Secretary is going to successfully 
implement the recirculation and recapture elements of the Settlement 
Agreement, it may be necessary to construct new pumping and conveyance 
facilities. H.R.24 currently provides that implementation of the terms 
of the Settlement related to recirculation, recapture, reuse, exchange, 
or transfer of water released for Restoration Flows or Interim Flows 
shall be subject to, inter alia, the Secretary's use of Central Valley 
Project facilities to make Project water and water acquired through 
transfers available to existing south-of-Delta Central Valley Project 
contractors and the Secretary's performance of the Agreement of 
November 24, 1986, between the United States of America and the 
Department of Water Resources of the State of California for the 
coordinated operation of the Central Valley Project and the State Water 
Project as authorized by Congress in section 2(d) of the Act of August 
26, 1937 (50 Stat. 850), 100 Stat. 3051), including any agreement to 
resolve conflicts arising from said Agreement. So long as these 
provisions of H.R.24 are maintained in the legislation and the other 
parties involved in the negotiations concerning the form of H.R. 24 
agree to the amendment, Westlands Water District would support an 
amendment of H.R. 24 that authorizes the construction of pumping and 
conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal. If any 
party involved in those negotiations were to object to the amendment, 
Westlands Water District could not support it because of its prior 
commitment not to support an amendment unless all parties agree.
    Again, thank you for the opportunity to testify on this important 
legislation. If I may be of further assistance to the Subcommittee, 
please contact me at your convenience.

Very truly yours,

Thomas W. Birmingham
General Manager/General Counsel

cc: The Honorable Grace F. Napolitano
   The Honorable Devin Nunes
   The Honorable George Radanovich
   The Honorable Dennis Cardoza
   The Honorable Jim Costa
                                 ______
                                 
    Mr. Radanovich. Next is Cannon Michael. Cannon, you are 
welcome to the Subcommittee. You are recognized for five 
minutes.

  STATEMENT OF CANNON MICHAEL, LANDOWNER IN SAN JOAQUIN RIVER 
  EXCHANGE CONTRACTORS WATER AUTHORITY, LOS BANOS, CALIFORNIA

    Mr. Michael. Thank you. Chairwoman Napolitano and honorable 
Members of this Subcommittee, good morning and thank you for 
allowing me the opportunity to testify here before you today.
    I would like to just quickly point out the San Joaquin 
River Exchange Contractors Authority. Some of the land that we 
farm is within that authority, but I am not here directly to 
testify on behalf of the exchange contractors. Steve Chedester, 
the Executive Director, is here today, and is happy to answer 
any questions if they are specifically directed at the Water 
Authority.
    As I said, I am a landowner and a farmer. We have a family 
farm near Los Banos, California. Some of the land that we farm 
is adjacent to the Reach 4B that is now part of what is now 
known as Reach 4B.
    Having had some opportunity for input into this 
legislation, I am here today for two purposes. First, to 
testify in support of the legislation; and second, to share 
some concerns if the legislation is not implemented in the way 
that we foresee that it will be.
    I am a sixth-generation Californian. My great-great-great-
grandfather came here from Germany in the 1800s, and we have 
been farming ever since that time. And I have three young boys, 
and would like to continue the tradition of farming. I don't 
know whether they will do it, but I have other cousins and 
other family. And we are just one of many families along the 
San Joaquin. As the San Joaquin stretches for miles below the 
Friant Dam, it goes through many different reaches, and each of 
those reaches will experience different challenges that will 
come from this restoration. And many other landowners, many 
communities will be affected, I feel, by this restoration 
effort.
    We don't know necessarily how those, what the impacts will 
be at this point. I believe firmly that this legislation was 
crafted in a way, with the collaborative effort of all these 
different parties, and third-party input was requested and was 
given. And I think that it is that type of unified effort that 
is going to help move this forward, and is going to make, if 
there is any chance for success, it is going to have to be 
through collaborative effort here.
    I would like to say that as one of these third parties, 
there is a lot more to being a third party than just that name. 
We are a group of landowners. We are families, we are teachers, 
parents, communities. We are providers of food and fiber for 
all of this great nation. We are not just third parties. There 
is a real group of people out there who have been here for 
either a long time or a short time, it doesn't matter; but 
there is a chance that we all could face some real impacts from 
this situation.
    Reach 4B is obviously a place that is very close to me; it 
is a place that I work in and live in, and every day I travel 
across it. I know the challenges there. I see studies where 
there are estimates of about $400 million to restore it. At 
this point it is not capable of carrying anywhere near the 
flows that are called for by the restoration, and I see it as 
one of the major, major challenges. And there are other 
challenges up and down the entire river, that it is not going 
to be an easy--there is no easy way to restore the river.
    But I do believe that it can be done, as I said, through a 
collaborative effort. And I feel that it is imperative that the 
third parties do have a voice in this settlement process. And I 
think that we have had input into the legislation, as I have 
said.
    We do have fears of a project such as the San Luis Drain 
that maybe didn't get completed, that this restoration needs to 
move forward in the phased approach that is outlined in the 
legislation. We need to make sure that the funding is there for 
the project before it goes forward, and that it is taken--the 
water is not reintroduced before we have these improvements in 
place to ensure that the impacts are not too great on the 
landowners there.
    And that is mainly my testimony. I just hope that you will 
all keep in mind that this is a major undertaking, and it is 
going to be a long process for all of us involved. And just 
please don't forget there are many of us who are living along 
this river, and we need your support in order to make sure that 
we are not adversely affected by this restoration effort.
    [The prepared statement of Mr. Michael follows:]

       Statement of Cannon Michael, Bowles Farming Company, Inc.

    Chairwoman Napolitano and honorable members of this Sub-Committee, 
good morning and thank you for allowing me the opportunity to testify 
before you.
    My name is Cannon Michael and I assist my uncle in operating our 
family farm, Bowles Farming Company, Inc., located near Los Banos, 
California. A good portion of the land we farm is adjacent to the San 
Joaquin River along the stretch now known as Reach 4b. Having had an 
opportunity for input into this legislation, I am here today for two 
purposes, first to testify in support of the legislation and second, to 
share with you some concerns should the legislation not be implemented 
in the way we hope it will.
    I am a sixth generation Californian and my family has been involved 
with agriculture since the mid 1800's. My great-great-great grandfather 
came to America, like so many immigrants have, in search of the promise 
of better life and freedom. He arrived in California as a young man 
with little more than a dream of what could be.
    The San Joaquin Valley was no land of dreams for those who settled 
there in the 1800's. It has taken the united efforts of farmers, 
communities, state and local agencies and the federal government to 
make the valley the ``breadbasket of the world'' that it is today. The 
key component in the transformation of the valley has been a reliable 
supply of water. With the reliable water supply, and the protection 
from flooding, the San Joaquin Valley has become the most diverse and 
productive agricultural center in the world.
    I come before you today to testify on behalf of the farmers and 
citizens that will be affected by the proposed restoration of the San 
Joaquin River. We are not just ``Third Parties'' to this Settlement; we 
are families, community leaders, teachers, coaches, providers of food 
and fiber for our great nation. The restoration of the San Joaquin 
River has far reaching impacts for all the residents of the San Joaquin 
Valley. It is imperative that the Third Parties have a voice in this 
complicated, lengthy and costly process.
    For those of us located in Reach 4b, having a voice in the 
restoration process is of vital importance. The San Joaquin River holds 
to a defined channel in its upper reaches, but historically it would 
spread into many ``braided'' channels as it reached the flat valley 
floor in our area. The flows called for in the Settlement are 
exponentially greater than the existing capacity of Reach 4b and could 
severely impact the families that live and farm along this stretch. The 
bill you are considering, H.R. 24, calls for the restoration's impact 
on Reach 4b to be studied carefully and completely prior to introducing 
any high level flows.
    I understand that restoration of Reach 4B will cost in the range of 
$400 million. Cost-benefit is one measure that will have to be 
considered when studying the feasibility of using this reach of the 
river. It is important that you understand the challenge of moving fish 
through this reach. First of all, a sizeable amount of privately held 
land will have to be acquired in order to create a stream channel of 
sufficient width and depth to convey flow of at least 4500 cfs. The 
valley floor here is very flat and the water table is high, so highly 
engineered levees will be needed to protect the adjacent lands from 
surface and sub-surface flooding. The new stream channel will also need 
to be constructed in a fish friendly manner. Even after that, this 
stretch of river has little elevation change, the slow moving water 
will be warm--approaching 80 degrees during the summer, no matter how 
much is released from Friant Dam. Reach 4b will, at best, be a hostile 
environment for fish.
    The San Joaquin River stretches for miles below the Friant Dam and 
every reach has its own unique characteristics. The proposed 
Restoration presents challenges for every mile of the San Joaquin and 
there are many landowners who will be affected. We all need a reliable 
water supply and our lands need to be protected from flooding. We are 
mindful of the experience of water agencies and farmers in our area 
regarding the federal government's failure to complete the San Luis 
drain. We do not want to see a repeat of a half-finished project in 
this restoration program. If our water supplier agencies are adversely 
affected, we will be too. Therefore, it is essential that adequate 
funds be appropriated and that the third parties have a place at the 
table to make sure this program is implemented in a manner that doesn't 
cause us harm.
    In conclusion, this bill was crafted out of a collaborative effort 
by the parties to the litigation, state and federal agencies and the 
third party interests. This is the same type of collaborative effort 
that will be needed if the restoration of the San Joaquin River can 
ever truly be a success. Any changes to this bill could potentially 
subvert the positive results that it represents. I respectfully ask 
that you do not entertain any changes to this legislation.
                                 ______
                                 

   Response to questions submitted for the record by Cannon Michael, 
                      Bowles Farming Company, Inc.

Thursday, March 15, 2007
Submitted by Mr. Nunes (CA) to all witnesses:
        If all of the other parties involved in the negotiations 
        concerning the form of H.R. 24 were to agree, would your 
        organization support an amendment of H.R. 24 authorizing the 
        construction of pumping and conveyance facilities required to 
        implement the recirculation, recapture, and reuse elements of 
        the Water Management Goal of the Settlement?
Answer:
    So long as the existing provisions contained in the January 4, 2007 
version of H.R.24 are maintained in the legislation, the other parties 
involved in the negotiations concerning the form of H.R. 24 agree to 
the amendment and there are no adverse impacts to the funding to be 
made available for the mitigation necessary for the measures already 
identified in the legislation and settlement, I would support an 
amendment of H.R. 24 that authorizes the construction of pumping and 
conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal. In 
addition, I have received the approval from the San Joaquin River 
Exchange Contractors Water Authority and the San Joaquin River Resource 
Management Coalition who, as you know, were active participants in 
developing the Legislation to support the proposed amendments on the 
same terms.

Respectfully,

Cannon Michael
Bowles Farming Company, Inc.
                                 ______
                                 
    Mr. Radanovich. Mr. Michael, thank you for your testimony.
    Next is Mr. Ken Robbins, who is the attorney for the Merced 
Irrigation District. Ken, welcome to the Subcommittee.

          STATEMENT OF KENNETH M. ROBBINS, ATTORNEY, 
                   MERCED IRRIGATION DISTRICT

    Mr. Robbins. Thank you, Mr. Radanovich. I am pleased to be 
here. Madame Chairwoman, I appreciate your invitation to us to 
speak to you again today.
    A lot of things have actually occurred relative to the 
third-party positions in this matter since we last spoke, not 
the least of which obviously is the negotiation of mitigations 
for the issues the third parties, at least downstream of 
Friant, raised with respect to this issue.
    By understanding that the reintroduction of salmon into the 
upper San Joaquin River would be done pursuant to an 
experimental population designation, and by using the tools 
provided by the Endangered Species Act, particularly sections 
10[j] and 4[d], we have assured that the downstream water users 
and the reservoir flood control water supply operators will not 
be damaged by the reintroduction and the reopening of this 
river.
    We also want to report that a very strong promise that was 
made last fall, at the conclusion of our negotiations, whereby 
a mechanism would be created for the continuing input from 
third parties, the downstream third parties, to the process 
would be concluded. And as you have already heard this morning, 
that memorandum of understanding was negotiated, has been 
signed, almost in record speed, for purposes of what we are 
talking about today. And we are very pleased to support the 
legislation, and that MOU.
    We have also been in contact with one of the other parties 
on the river that were not at the table, the Lower San Joaquin 
River Levee District. Our discussion with those folks, I 
believe we have come to the conclusion with them that this 
legislation covers their issues as well; but nevertheless, they 
are in need of a memorandum of understanding as well to ensure 
that their maintenance activities on the levees can be smoothly 
coordinated with the implementation of this legislation. And 
the third parties to this have pledged themselves to assisting 
the levee district with the negotiations of their own MOU in 
this regard.
    I would echo the sentiments from the Department of Water 
Resources. Nancy Saracino put very succinctly that our support 
for this is obviously a result of our ability to have the 
issues relative to the introduction of these threatened species 
into the river actually mitigated.
    Our projects on the Merced, the Tuolumne, the Stanislaus 
Rivers that will be coming up for relicensing before the 
Federal Energy Regulatory Commission, this legislation will 
hold in abeyance any actions relative to those relicensing for 
spring-run salmon until at least 2025 or 2026, whenever the 
agreement may be looked at again relative to the flows.
    So it puts us on essentially the same footing with the 
settling parties, in terms of the protection we can expect from 
the implementing legislation.
    So with the mitigation for the reintroduction of this 
experimental species, and for the relicensing of facilities 
that provide us with water supply assurances, while at the same 
time allowing us to support the reintroduction of salmon and 
the reopening of the river, we are very pleased today to 
support the legislation.
    Thank you very much.
    [The prepared statement of Mr. Robbins follows:]

           Statement of Kenneth M. Robbins, General Counsel, 
                       Merced Irrigation District

    Good morning, Chairwoman Napolitano and members of the 
Subcommittee. My name is Ken Robbins. I am General Counsel for Merced 
Irrigation District. I am pleased to have the opportunity to testify 
today regarding H.R. 24, the San Joaquin River Restoration Settlement 
Act, introduced by Mr. Radanovich and others, that would implement the 
settlement agreement reached by the parties to the Friant litigation.
    The Merced Irrigation District is part of the San Joaquin 
Tributaries Association (SJTA), a group of five associated eastside 
Irrigation Districts with water storage and hydroelectric facilities 
located on the three principal tributaries to the San Joaquin River.
    The SJTA, including the Merced Irrigation District, is supportive 
of the goals of the settlement. The District is confident the 
settlement can be implemented in a manner that ensures both the 
restoration of the San Joaquin River and the mitigation of impacts from 
such an undertaking on third parties. The District believes the 
settling parties when they say they do not intend to impose impacts on 
third parties.
    As you may recall, I testified before this Subcommittee last fall. 
Rather than repeat the background information that was contained in 
that testimony, I respectfully request that my earlier testimony and 
that of Mr. Allen Short, General Manager of the Modesto Irrigation 
District, be incorporated as part of the record of this hearing. Our 
testimony stressed that the third parties were supportive of the 
settlement. At that time we offered suggestions and proposed 
legislative language to ensure that the goal of the settlement is 
achieved without imposing impacts on third parties. A lot has happened 
since last September, and I am happy to report to you that we continue 
to support the efforts of the settling parties and the legislation as 
introduced.
    The legislation before you is the product of months and months of 
hard work by the parties to the litigation and by the third parties and 
could not have been successfully negotiated without the efforts of 
Senator Feinstein, Congressmen Radanovich, Cardoza, and Costa, and 
their excellent staffs. We are grateful to them for their support of 
this legislation that is so vital to the San Joaquin Valley.
    The settlement package negotiated by the parties to the NRDC v. 
Rodgers litigation included proposed legislation to implement the 
settlement. While we felt that the legislation was a good start, it did 
not, by itself, provide the kind of third party protections needed to 
make good on the promise by the settling parties that the settlement 
not impose substantial third party impacts.
    Speaking for my client, the Merced Irrigation District, and the 
SJTA, we feel that H.R. 24 as it now stands provides the protections we 
need to support the settlement. This legislation is the product of 
months of negotiations, culminating with a signed pledge by all the 
parties to support the legislation. Any changes to the legislation, 
therefore, could easily undo that fragile support.
    I want to now focus my discussion on Section 10 of the Act. The 
third parties offered language to amend the legislation proposed by the 
settling parties. These amendments were made to protect the Eastside 
districts, as well as the San Joaquin River Exchange Contractors, other 
water users on the mainstem San Joaquin River, and the U.S. Bureau of 
Reclamation and the California Department of Water Resources, from the 
unintended consequences of introducing a federally-listed threatened 
species of Chinook salmon into the San Joaquin River. Section 10 was 
added to allow for the reintroduction of Central Valley Spring Run 
Chinook Salmon without impacting the third parties and to permit the 
restoration of the San Joaquin River to move forward in a cooperative 
manner.
    The first thing to note is that Section 10(a) makes a finding that 
the settlement and the reintroduction of the Central Valley Spring Run 
Chinook Salmon is a unique and unprecedented circumstance requiring 
clear Congressional intent on the application of the Endangered Species 
Act (ESA) to ensure that the goals of the settlement are accomplished. 
Section 10(b) of the Act goes on to state that the reintroduction shall 
be reintroduced pursuant to Section 10(j) of the ESA provided that the 
Secretary of Commerce makes the requisite findings.
    Section 10(j) of the ESA authorizes the Secretaries of Commerce or 
the Interior to release ``experimental populations'' of threatened or 
endangered species outside the current range of the species in order to 
further the conservation of the species. 16 U.S.C. Sec. 1539(j). At the 
present time, NMFS has not adopted any regulations concerning 
experimental populations, although it is permitted to do so under the 
ESA. The U.S. Fish and Wildlife Service (USFWS) has, however, adopted 
regulations under Section 10(j).
    ``Experimental population'' means a designated population, 
including subsequent off-spring, which can be introduced into an area 
where it is ``wholly separate geographically from nonexperimental 
populations of the same species.'' 16 U.S.C. Sec. 1539(j)(1); 50 C.F.R. 
Sec. 17.80(a). When a population is designated ``experimental,'' it is 
treated as if it were listed as a threatened species, rather than an 
endangered one. 16 U.S.C. Sec. 1539(j)(2)(C); 50 C.F.R. Sec. 17.82. A 
``nonessential experimental population'' means an experimental 
population whose loss would not appreciably reduce the likelihood of 
the species' survival in the wild. 50 C.F.R. sec. 17.80(b). If an 
experimental population is deemed nonessential, no critical habitat 
designation is made for the population. 16 U.S.C. Sec. 1539(j)(2)(C); 
50 C.F.R. Sec. 17.81(f). In addition, for purposes of Section 7 
consultations, nonessential experimental populations are treated as 
species proposed to be listed under Section 4 of the ESA, rather than 
threatened or endangered. 16 U.S.C. Sec. 1539(j)(2)(C)(i).
    The SJTA believes that in order to protect third party interests 
from unintended impacts of the settlement, it is both reasonable and 
essential for the Secretary of Commerce to issue a final rule pursuant 
to section 4(d) of the ESA that will govern the incidental take of the 
Central Valley Spring Run Chinook Salmon prior to its reintroduction in 
the San Joaquin River. Included in the final 4(d) rule should be a 
provision to ensure that third parties not suffer water supply impacts 
as an indirect effect of the San Joaquin River restoration and that 
current lawful operations in the San Joaquin River watershed--including 
tributary water supply and hydroelectric operations on which the SJTA 
districts are critically dependent--would not be subject to ``take'' 
under the ESA. H.R. 24 contains a provision that provides that the 
reintroduction of the Central Valley Spring Run Chinook Salmon not 
impose more a than de minimis water supply reductions, additional 
storage releases, or bypass flows on third parties. We support this 
language as it is currently written.
    With regard to the ``wholly separate'' criterion, the 
reintroduction of Central Valley Spring Run Chinook Salmon to the San 
Joaquin River should qualify as no other populations of Central Valley 
Spring Run Chinook Salmon exist on the San Joaquin River or its 
tributaries. Indeed, to reintroduce them individuals or eggs of Central 
Valley Spring Run Chinook Salmon on the Sacramento River will have to 
be transported to the San Joaquin River.
    With respect to the required finding that the experimental 
population's loss would not appreciably reduce the species' likelihood 
of survival, it would be difficult to understand how the Secretary 
could find that the population to be reintroduced is ``essential to the 
continued existence of the species'' and still remove it from a much 
more friendly habitat--particularly in light of its threatened status 
rather than endangered. One would reasonably conclude that the fish 
would not be taken from their original habitat for such an experiment 
if they were in fact ``essential.''
    This protects all San Joaquin River and tributary water operations 
in three ways. First, if the experimental reintroduction of Central 
Valley Spring Run Chinook Salmon cannot be sustained based upon the 
actions of the settling parties, the Eastside Districts will not be 
required to release additional water, change operations, or commit 
resources to make up the shortfall. Second, if the experimental 
reintroduction is successful, such success will demonstrate that the 
current, lawful operations of the five Eastside districts have no 
detrimental effect on the reintroduced Central Valley Spring Run 
Chinook Salmon. Third, the designation of the reintroduced Central 
Valley Spring Run Chinook Salmon as a nonessential experimental 
population protects the water users while the experiment is in effect 
and allows an opportunity for the third parties, the State of 
California, the settling parties and the federal government to develop 
a longer term Habitat Conservation Plan.
    H.R. 24 also protects the Merced, Turlock and Modesto Irrigation 
Districts from having to mitigate impacts to the experimental 
population of Central Valley Spring Run Chinook Salmon prior to 2026 
when their hydroelectric projects are relicensed by Federal Energy 
Regulatory Commission (FERC) in 2014 and 2016. The Merced Irrigation 
District and the other eastside districts need the same level of 
protection as is afforded to the U.S. Bureau of Reclamation under the 
terms of the settlement. Under the settlement there is no re-opener for 
twenty years, until 2026, for the release of additional water from 
Friant Dam. The Third Parties want this same protection given to them 
for their FERC relicensing. Merced Irrigation District's current FERC 
license expires in 2014, while Modesto Irrigation District and Turlock 
Irrigation District will seek to relicense their Don Pedro Project in 
2016. The National Marine Fisheries Service has mandatory conditioning 
authority under section 18 of the Federal Power Act and section 7 of 
the ESA to condition these licenses with terms and conditions related 
to the reintroduced, experimental population of Central Valley Spring 
Run Chinook Salmon. The Districts are agreeable to have a reopener 
clause in their new FERC licenses to specifically address the 
population's status at that time, but not earlier.
    In recognition of this unique circumstance, H.R. 24 provides that 
the final 4(d) rule specify that the Secretary of Commerce exercise its 
authority under Section 18 of the Federal Power Act by reserving its 
right to file prescriptions until after the settlement terminates or 
December 31, 2025. This protects the district from potential 
unreasonable mandatory conditions placed in their licenses to protect a 
reintroduced, experimental population. We think the time to address 
this issue is after termination of the settlement.
    Following the agreement on the legislation which is now H.R. 24, 
the Stipulation of Settlement was approved by Judge Karlton on October 
23, 2006. The SJTA filed an amicus curiae brief in that proceeding 
supporting the proposed settlement and also identifying for the judge 
the potential third party impacts from the settlement as proposed. I, 
and others, expressed these same concerns to you and the members of the 
Subcommittee at the previously held hearing on September 21, 2006. 
Those concerns have been largely alleviated by H.R. 24.
    The third parties, including the SJTA, plan to be active 
participants in the restoration efforts on the San Joaquin River. The 
final major activity involving the third parties was the development of 
a Memorandum of Understanding (MOU) with the United States Bureau of 
Reclamation. The settlement and the draft legislation did not provide a 
direct vehicle for third party participation. To that end we have 
approved a MOU that will allow the third parties to provide meaningful 
input into the restoration activities and to coordinate our ongoing 
operations on the tributaries and mainstem with those of the 
Restoration Administrator and the other restoration participants.
    The MOU is necessary because the five eastside irrigation districts 
of the SJTA have expended substantial amounts of water and money to 
restore the Fall Run Chinook Salmon fishery on the Merced, Tuolumne and 
Stanislaus Rivers. These efforts include active participation in, and 
funding for the San Joaquin River Agreement, the Vernalis Adaptive 
Management Plan (VAMP), Federal Energy Regulatory Commission (FERC) 
proceedings, on-going district funded studies and monitoring and 
restoration activities, and the Merced River Fish Hatchery. These 
efforts were covered in my September 21, 2006, testimony.
    This concludes my testimony. Madam Chairwoman, thank you for the 
invitation to testify before this Subcommittee today. I will be happy 
to answer any questions members of the Subcommittee may have.
                                 ______
                                 
    [Response to questions submitted for the record by Kenneth 
M. Robbins, General Counsel, Merced Irrigation District, 
follows:]

                   MASON, ROBBINS, BROWNING & GODWIN

                            Attorneys at Law

                     700 Loughborough Dr., Suite D

                            Merced, CA 95348

                             (209) 383-9334

                            Mailing Address

                             P.O. Box 2067

                         Merced, CA 95344-0067

                          FAX: (209) 383-9386

                         E-MAIL: [email protected]

                             March 15, 2007

Ms. Emily Knight, Clerk
Subcommittee on Water and Power
1522 Longworth House Office Building
Washington, D.C. 20515

RE: Response to Questions

Dear Ms. Knight:

    Thank you for the opportunity to testify regarding the H.R.24, the 
San Joaquin River Restoration Settlement Act. As I indicated in my 
testimony the Merced Irrigation District and the San Joaquin Tributary 
Association supports the enactment of H.R. 24. This legislation is 
critical to resolving long standing litigation regarding the operation 
of the Friant Division of the Central Valley project. This legislation 
will also resolve questions of certainty regarding water supply in the 
region.
    Below is my response to the question posed by Representative Devin 
Nunes.
    Question: If all of the other parties involved in the negotiations 
concerning the form H.R. 24 were to agree, would your organization 
support an amendment of H.R. 24 authorizing the construction of pumping 
and conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goals of the 
Settlement?
    Answer: Answering on behalf of myself appearing as a witness for 
the Merced Irrigation District and for the San Joaquin Tributary 
Association and on behalf of Mr. Cannon Michael, who appeared as a 
witness on behalf of The San Joaquin River Resource Management 
Coalition, a group of landowners potentially impacted by river 
restoration efforts, and assuming the premise of the question is true, 
that is to say, that all other parties concur, our agencies and 
landowners would agree to such an amendment as well. Reviewing the 
circumstances upon which such facilities would be constructed and 
operated is of course critically important to ensure that the spirit of 
the legislation continues by providing assurance that such new 
facilities would not impact the water rights or supplies of others is 
critical. We would therefore suggest that extensive studies be included 
within the context of any construction authorization prior to 
implementation.
    Thank you again for the opportunity to testify.

                           Very truly yours,

                   MASON, ROBBINS, BROWNING & GODWIN

                           KENNETH M. ROBBINS

cc: The Honorable Devin Nunes
   The Honorable George Radanovich
   The Honorable Dennis Cardoza
   The Honorable Jim Costa
                                 ______
                                 
    Mr. Radanovich. Thank you, Mr. Robbins, for your testimony. 
We appreciate that.
    And we would like to welcome Mr. Allen Ishida, Supervisor 
from Tulare County. Mr. Ishida, welcome to the Subcommittee. 
You may begin.

           STATEMENT OF ALLEN R. ISHIDA, SUPERVISOR, 
         TULARE COUNTY GOVERNMENT, VISALIA, CALIFORNIA

    Mr. Ishida. Well, thank you, and thank you for the 
opportunity to be here.
    I am a third-generation citrus farmer who takes my water 
from the Friant. I am also the Chair of the Board of 
Supervisors.
    We appreciate this opportunity to appear before you to 
provide my perspective on the San Joaquin River Settlement. 
Madame Chair, I request that I may place the following 
documents into the record: resolutions supporting mitigation 
with a loss of surface water from Tulare County, from Kern 
County, and all eight of our incorporated cities. Letters 
supporting mitigation from the Community Water Center, the 
Plainview Mutual Water Company, and Self-Help Enterprises. An 
article from February 11 from the Fresno Bee detailing the 
water quality issues we have on the east side, and studies from 
the Northwest Economic Associates and the University of 
California about the impact of the settlement on our economy.
    Let me begin by stating that we do not oppose the efforts 
of the settling parties to resolve the San Joaquin River 
dispute. We believe that the restoration of this river is a 
noble goal.
    When the Friant Dam was put in, the main reason for 
building this dam was to secure additional water supplies to 
address the water depletion that happened during the 1920s and 
1930s in the Central Valley. After the dam, our water supplies 
were met, and we actually increased our water table. So it was 
a very plus-plus benefit for the Central Valley.
    Today I am here to give my perspective as an elected 
official. It is a little different than what we have heard 
earlier, because most of the third parties represented here 
today are directly involved either as irrigation districts, or 
the state government, or the Federal government. I am here to 
represent the third parties, the 400,000 residents we have in 
Tulare County who are not direct users of this water.
    We are impacted by any loss of additional surface water. As 
we reduce, as farmers, the need to pump more water from the 
underground, it creates an overdraft situation which diminishes 
the underground water quality.
    To give you a little demographic of Tulare County, over 50 
percent of our population is Latino. In a 2000 census, over one 
third of our population was between the age of zero and 19. We 
are a very young county, and our projected population growth of 
over 50 percent in the next 20 years mainly will come from 
within existing families that we have.
    The future of Tulare County will depend upon the quality 
and quantity of water that is available to our residents. 
Providing water quality is currently a major challenge.
    For example, the City of Lindsay received 60 percent of its 
water from the Friant Kern Canal, and to supplement that water, 
their closest water well is three miles outside the city 
limits. My hometown community of Strathmore is 100 percent 
dependent upon Friant water. Several of our unincorporated 
communities' water supplies do not meet California State water 
quality standards. We are currently looking for new wells.
    The result of the proposed water release from this 
settlement will have a significant native impact on our 
communities. The resulting overdraft of our underground water 
table will further decrease our water quality.
    In closing, I must emphasize all changes to surface water 
deliveries from Friant Dam, absent a mitigation, will undermine 
the very foundations of the economic success and prosperity in 
the Central Valley. A promise to mitigate the loss of surface 
water for the settlement is not adequate for my constituents. 
We are asking for concrete mitigation language and the 
implementation of legislation.
    Thank you for this opportunity to express our concerns.
    [The prepared statement of Mr. Ishida follows:]

              Statement of Allen Ishida, Board Chairman, 
                 Board of Supervisors, County of Tulare

    My name is Allen Ishida, a third generation citrus grower in the 
Lindsay -Strathmore area and the Chairman of the Tulare County Board of 
Supervisors. I have spent over 20 years in the commercial real estate 
business selling farm and subdivision properties in California before 
returning to our family farm. I appreciate the opportunity to appear 
before you to provide my perspective of the San Joaquin River 
Settlement.
    Let me begin by saying that this settlement threatens to turn back 
the clock on an economic and environmental decision that was 
deliberately made by your predecessors to address regional water 
reliability. Therefore, the legislation being debated today represents 
a significant departure from the seventy years of public policy that 
created the most productive agricultural region in the world. Let me 
also say that I do not oppose the efforts of the settling parties to 
resolve the San Joaquin River dispute. I believe the restoration of the 
river is a noble goal.
    The original lands my family began farming were once dry land 
barley fields. My father, uncles and grandfather developed this land 
into citrus because of the availability of the new surface water from 
the Friant Dam and the micro climate that is ideal for citrus. The 
citrus industry in Tulare County is now a 500 million dollar business. 
Our original properties are still solely reliant on the surface water 
provided by Friant because the underground water is not available in 
sufficient quantities. My family and I felt confident in the federal 
government's implied promise to continue supplying water. We therefore 
have invested our future in farming. During the 1970's and 80's, with 
my father and brother, we purchased additional lands that had available 
underground water. Whatever shortfall in water delivery from the San 
Joaquin River Settlement, we will hopefully be able to make up the 
difference by pumping from the underground aquifer. Administration 
Building 2800 W. Burrel, Visalia, CA 93291 (559) 733-6271 FAX: (559) 
733-6898
    The previous statement is from my perspective as a farmer. My 
perspective as an elected official in one of the fastest growing 
regions in California and my experience in the commercial real estate 
profession is very different. I am very aware of the negative impact of 
pumping water from the under ground aquifer will have on the future 
development and quality of life in my county and neighboring counties. 
This settlement has a far greater impact on more than 400,000 Tulare 
County residents who were not direct participants to this settlement. 
Tulare County's population is projected to increase to over 600,000 in 
the next 20 years. The future of our county will depend on the quality 
and quantity of water available to our residents.
    One of the main reasons for building the Friant Dam was to secure 
an additional water supply to address ground water depletion due to 
pumping water for agricultural and domestic uses, which resulted in the 
1920' and 1930's. The new surface water provided by Friant reduced the 
depletion of our underground water. However, this situation is not 
static, and the demand for water to meet the growing demands of urban, 
agricultural and environmental uses in the San Joaquin Valley now means 
that the Valley currently experiences a water supply deficit of 1.1 
million acre-feet in an average year, and 2.6 million acre feet in a 
drought year. This deficit will grow if the Settlement is adopted as 
proposed with out any mitigation plan for water supply losses. These 
numbers show that we need additional surface water, not less.
    In fact, I call your attention to two studies from the Northwest 
Economic Associates and the University of California that came to the 
conclusion that ground water levels would nearly double in depth and 
pumping costs would significantly increase as a result of the water 
releases required in the Settlement. According to the studies, there 
would be serious economic impacts to the region due to the loss of jobs 
and the reduction of agricultural production.
    ``MADAME CHAIRWOMAN, I REQUEST THAT THESE TWO STUDIES BE PLACED IN 
THE HEARING RECORD''
    Providing water in the quantity and quality to our communities is 
one of the major challenges we are currently facing in Tulare County. 
We have significant water quality issues with saline and nitrate levels 
above California State water quality standards. For example, the City 
of Lindsay (population 11,000), which receives approximately 60% of its 
water from Friant, had to locate its supplement water well 3 miles 
outside of the city limits because of water quality. We currently are 
looking for new well sites for several of our unincorporated 
communities whose water quality does not meet state standards. The 
result of these proposed water releases from the Settlement will have a 
significant negative environmental impact on our communities. The 
potential increase overdraft of our underground water table will 
further decrease our water quality.
    ``MADAME CHAIRWOMAN, I REQUEST THAT I MAY ADD 8 TULARE COUNTY CITY 
RESOLUTIONS, TULARE AND KERN COUNTY BOARD OF SUPERVISORS RESOLUTIONS, 1 
NEWSPAPER ARTICLE AND 3 LETTERS FROM CONCERNED CITIZEN GROUPS TO BE 
PLACED IN THE RECORD.''
    In closing, I must emphasize that any changes to water deliveries 
from the Friant Dam, absent mitigation, will undermine the very 
foundation of economic success and prosperity in the Central Valley. A 
promise to mitigate the loss of surface water from the San Joaquin 
River Settlement is not adequate for my constituents. We are asking for 
concrete mitigation language in the implementation legislation.
    Thank you for this opportunity to express our concerns.
                                 ______
                                 
    [NOTE: Additional information submitted for the record by Mr. 
Ishida has been retained in the Committee's official files.]

           Response to questions submitted for the record by 
               Allen Ishida, Supervisor, County of Tulare

Questions from Congressman Radanovich:
    1.  ``In your testimony to the Water & Power Subcommittee on the 
House Resources Committee on March 1, 2007, you asked that two studies 
be introduced into the Record. The first such study was prepared by 
Northwest Economics Associates and the second by the University of 
California. Your testimony stated that the studies concluded that 
ground water levels would nearly double in depth and pumping costs 
would significantly increase as a result of water releases required by 
the Settlement. Please answer the following:''
    A.  ``What was the date each of the studies was prepared?''
    I submitted two studies for the record. The first study by the 
University of California titled ``Impacts of Water Reallocations on The 
Eastern San Joaquin Valley'' was published on December 31, 1996. The 
second study, commissioned by Friant Water Users Authority, by the 
Northwest Economic Associates titled ``Analysis of the Impacts of 
Surface Water Reductions on the Eastern San Joaquin Valley of 
California'' was published on August 26, 1997.
    B.  ``Were the water releases contemplated by the studies you 
introduced into the record the same as those required by the Settlement 
that is the subject of H.R. 24? If not, what assumptions regarding 
water releases did the study assume?''
    Yes, the parties to the Settlement have stated that ``170,000 acre 
feet, plus 10% buffer flows,'' will be released to restore the river. 
In the past, Friant has stated that sixty percent of the time they 
operate in a Dry and Normal-Dry year. If you take the average releases 
between these two years identified in the Settlement, plus the buffer 
flows, expected releases will reach 237,600 acre feet (see below). Both 
the University of California and Northwest Economics Associates (NEA) 
studies analyzed the impacts of releasing 200,000 and 500,000 acre 
feet. While the studies were conducted ten years ago, the analysis was 
based on releases contemplated in the Settlement (see below).
    On the issue of groundwater, I would like to quote from the NEA 
study:
        ... groundwater would be used to replace a significant portion 
        of the reduced CVP supplies. Over time, though, the increased 
        groundwater pumping would draw down an already over drafted 
        groundwater basin--The higher costs of pumping from 
        increasingly greater depths would cause more land to be removed 
        from production. Ultimately, water quality problems associated 
        with lower water tables and generally depleted aquifers would 
        result in the idling of even more acreage ``''
    Since 1996, the population in the San Joaquin Valley has grown and 
the reliance on surface water has increased. Therefore, it is 
reasonable to assume that if the studies were repeated in 2007, the 
economic impacts would simply increase.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    C.  ``Are you aware if any subsequent studies have been prepared 
based upon dated information? If so, when?''
    I am unaware of any subsequent studies on the impacts of water 
reductions to the San Joaquin Valley. However, numerous studies were 
conducted in the early 1990s on the impacts of the 1986-1992 drought--
four of them were completed by RAND, the California Institute for Rural 
Studies, Inc., and the Northwest Economic Associates. These studies 
outlined the impacts to groundwater and the economic toll it took on 
San Joaquin Valley community. I believe they are relevant because the 
Settlement would be a self imposed partial drought.
    I have been informed that Congressman Nunes has asked Congressional 
Research Service (CRS) to conduct a complete review of the Settlement 
and its impacts on the San Joaquin Valley. Considering a feasibility 
study will not be completed on the Settlement, I am hoping that the CRS 
report will shed some light on the impacts to our community.
    D.  ``If you are aware of more recent studies, can you explain what 
different assumptions were utilized by the more recent studies?''
    See previous answer.
    E.  ``If you are aware of more recent studies, can you explain what 
different conclusions were reached by the more recent studies?''
    See previous answer.
    2.  ``Has the County of Tulare prepared any independent analysis of 
the effects of the water releases required by the Settlement on the 
groundwater conditions within the County? If so, what did the studies 
conclude?''
    The County has not prepared an independent analysis of the water 
releases proposed in the Settlement. The County was not part of the 
negotiations nor were they invited to participate in third party 
negotiations in Washington D.C. Therefore, the County was unaware of 
the releases called for in the Settlement until September 13, 2006. 
Considering the Settlement proposed the expenditure of millions of 
taxpayer dollars, the County believed that an independent feasibility 
study would be completed and more current data would be gathered on the 
impacts to cities and counties in the Friant service area. The County 
has since been made aware that a feasibility study will not be 
completed and the onus of doing such an independent study would be left 
to those impacted. The County already struggles to meet existing 
fiduciary responsibilities and cannot afford the outlays required to do 
an independent study. However, if we were to receive federal assistance 
to conduct a study of the impacts of this federally settled legal 
dispute, we would proceed with an independent study. Absent federal 
support, we are forced to rely on previously prepared studies funded by 
Friant and studies on the impacts of past droughts.
    3.  ``Has the County of Tulare prepared any independent analysis of 
the economic impacts of the water releases required by the Settlement 
on the County? If so, what did the studies conclude?''
    The County has not prepared an independent analysis of the economic 
impacts of the water releases required by the Settlement.
    4.  ``Has the County of Tulare considered any specific programs or 
projects that would mitigate or avoid impacts on groundwater conditions 
and/or potential economic impacts? If so, what are the programs and 
projects?''
    Considering the County of Tulare was only informed of the details 
of the Settlement late last year, the County has not had an opportunity 
to consider any programs or projects. If a feasibility study is done on 
the restoration of the river, it would provide cities and counties the 
opportunity to weigh in on a public process and the time to consider 
any mitigating factors.
    Nevertheless, the County has requested that H.R. 24 be amended. 
Again, Tulare County did not participate in the negotiations that lead 
to the current form and content of H.R. 24, and we are concerned that 
significant water supply shortages could result from the release of 
restoration flows from Friant Dam, with concomitant impacts on our 
groundwater basin and local communities that support irrigated 
agricultural production in Tulare County.
    For these reasons, the County of Tulare requested an amendment to 
H.R. 24 to authorize the Secretary of the Interior to construct 
facilities required to implement the recirculation, recapture and reuse 
elements of the Water Management Goal established by the Settlement 
Agreement. Specifically, we proposed adding a new Section 4(a)(5), 
which would provide:
    ``(5)  STUDIES AND FACILITIES.-
         (A)  IN GENERAL. -The Secretary is authorized and directed to 
        conduct feasibility studies for and to construct new pumping 
        and conveyance facilities on the mainstem of the San Joaquin 
        River above the town of Vernalis required to implement the 
        recirculation, recapture, and reuse elements of the Water 
        Management Goal of the Settlement.
         (B)  DEADLINE.-The study and construction of facilities under 
        subparagraph (A) shall be completed prior to restoration of any 
        flows other than Interim Flows.''
    The County is aware that Congress is generally reluctant to 
authorize under federal Reclamation law the construction of facilities 
prior to the preparation and a submission of a feasibility report that 
describes the estimated cost and potential benefit of the proposed 
facilities. Deviation from this principle is warranted in this 
circumstance because H.R. 24 would authorize the Secretary to implement 
a massive fishery restoration program at unknown costs and without any 
analysis of the potential for restoring a naturally reproducing salmon 
fishery, which is the Settlement Agreement's Restoration Goal. 
Moreover, the Settlement Agreement provides that the Restoration Goal 
and the Water Management Goal shall have equal priority. In as much as 
H.R. 24 authorizes actions necessary to achieve the Restoration Goal, 
it only seems reasonable that the Act would also authorize the 
Secretary to take the actions necessary to achieve the Water Management 
Goal.
    If this amendment were made to H.R. 24, Tulare County could be 
confident that the Secretary would have the means needed to avoid 
devastating water supply impacts, and Tulare County would be in a 
position to support H.R. 24.
    5.  ``Your written testimony makes reference to a new well drilled 
by the City of Lindsay nearly 3 miles outside of the City limits. You 
stated that the distance outside the City limits was related to 
salinity and nitrate water quality issues. Are you aware of what caused 
the salinity and nitrate problems necessitating the drilling of a well 
so far outside the City limits?
    The City of Lindsay had to drill 3 miles outside of the City limits 
to find water that met water quality standards. Lindsay and other 
Eastside communities along the foothill have a high nitrate content in 
the under ground water supply. It appears that the high nitrate content 
may be naturally occurring. The State of California recently did a 
study involving domestic wells on the East side of Tulare County and 
found that many of the wells had high concentrations of nitrates even 
though they were located in areas without active farming. In a couple 
of years we may be able through technology to trace the origin of the 
nitrates. I believe that an environmental impact report on the loss of 
surface water would clear up a lot of the questions and concerns raised 
by this settlement.
Question from Congressman Nunes:
    1.  ``If all of the other parties involved in the negotiations 
concerning the form of H.R. 24 were to agree, would your organization 
support an amendment of H.R. 24 authorizing the construction of pumping 
and conveyance facilities required to implement the recirculation, 
recapture, and reuse elements of the Water Management Goal of the 
Settlement?''
    While we were not included in the negotiations or are we currently 
considered a third party, we would support any project that would bring 
back the lost water.
                                 ______
                                 
    Mr. Radanovich. Thank you, Mr. Ishida, we appreciate your 
testimony.
    Next I think we will open it up to questions.
    Mrs. Napolitano. Yes, but before we do that, I would like 
to receive into the record, Mr. Ranking Member, two pieces of 
testimony that have reached our attention. One is from the San 
Joaquin Water Authority, the Exchange Contractors, dated March 
1, in support of the bill. And the second one a letter from 
Metropolitan Water District in Southern California dated 
February 27, the same support for H.R. 24. And without 
objection, I will enter them into the record.
    Mr. Radanovich. Without objection, so ordered.
    [NOTE: The letter submitted for the record by Jeffrey 
Kightlinger, General Manager, and Timothy F. Brick, Chairman, 
Board of Directors, Metropolitan Water District of Southern 
California, Los Angeles, California, and the letter submitted 
for the record by the San Joaquin River Exchange Contractors 
Water Authority, Los Banos, California, have been retained in 
the Committee's official files.]
    Mr. Radanovich. If I may, I don't have any specific 
questions for this panel. I did want to express my appreciation 
to the third-party negotiators in this thing.
    When this started quite a long time ago, the negotiations 
had to be only between the Friant Water District and the NRDC. 
But those clearly were not the only agencies and water entities 
affected by what might result in some kind of agreement. And it 
ended up being very frustrating I think for a lot of people to 
have to sit on the sidelines for an awful long time while the 
government and NRDC and Friant hammered this thing out. And 
then it was only after a long time, and after that occurred, 
that the parties were able to negotiate with the third parties.
    A lot of patience was displayed by you, Tom Birmingham, 
you, Ken Robbins, Steve Chedester in the back there, and a lot 
of other folks. And I just want to express my appreciation to 
every one of you for hanging on until the negotiations got 
done, and then for being willing participants at the time when 
we were able to actually bring third parties in and negotiate 
this. I think you guys did a great job, and we appreciate 
everything you did for it, and appreciated your patience in it, 
as well.
    And that is really as much as I have to say right now. 
Grace?
    Mrs. Napolitano. Thank you. And our thanks to you, too, 
because of your effort on bringing it to the table and getting 
with Senator Feinstein, and being able to coordinate those 
parties that began to see the value of reaching an accord, 
rather than fighting each other in court.
    And I take my hat off to you for that valiant effort. There 
are maybe some unintended consequences in the future; we don't 
know. We look forward to being able to find a solution for them 
as we move along, where there is future legislation that will 
take care of whatever little thing got left behind. Nothing is 
perfect, and we don't expect it to be, because things do 
change.
    But in the meantime, the fact that all the parties were 
able to move in the same direction, giving way to some of the 
things that you felt were important to reach the accord is very 
admirable. And I think it will stand in the annals of this 
House, at least this committee, of how accords can be reached 
by bringing all the parties to the table, and sitting at the 
table, and maybe locking the door until you do reach an accord.
    And with that, I would like to start off with a question to 
Mr. Ishida. In your testimony you referred to the rapid 
population growth in your area and your concerns about the 
growth, along with the water loss from the settlement, which 
raises concern about the water supplies. Other communities in 
the West have had to deal with this explosive population growth 
and been able to stabilize their water demands. And I can tell 
you that Southern California is a perfect example.
    This happened also in the Tucson area of Arizona, and the 
MET in Los Angeles area--I have worked with them for many 
years--have managed to be able to have addressed the growth 
without harm.
    Is it possible that those experiences of those communities 
in implementing water conservation can be applied to Tulare 
County?
    Mr. Ishida. Part of the problem is one third of our 
residents do not live in incorporated cities; they live in 
hamlets. There must be about 17 hamlets in Tulare County. These 
housing tracts vary from 50 people to 300, or excuse me, 50 
homes to 300 homes. They do not have the funds available to 
them to service their water quality issues without outside 
help.
    Major cities like Los Angeles, even Vacaville, have 
resources available to help them with their water quality. 
These small communities do not. They were founded by the 
Oklahoma migrants that moved into California in the forties, 
and now they are populated by Hispanic populations to the 
extent they are probably 80 percent or more Hispanic.
    Mrs. Napolitano. Is the county and the state then able to 
step in and help those communities to be able to have access?
    Mr. Ishida. We do not have the funds within our general 
fund to help those communities to a great extent.
    A new domestic water well for one of these local water 
providers will cost about $400,000 to drill. So if you divide 
that among the users, it gets pretty significant cost. In fact, 
they have the highest water rates in the county.
    Mrs. Napolitano. Thank you. Mr. Birmingham, how do you 
respond to the suggestion that this legislation should be 
linked to implementation of a drainage solution for the west 
side of the valley?
    Mr. Birmingham. I am not aware that anyone has actually 
made that suggestion. I have read a statement from Mr. Nunes 
that discussed the potential, but I have not been made aware 
that anyone has specifically proposed linking this legislation 
to a potential settlement of issues related to drainage.
    I will make some observations, however. But I do think that 
there are some, there is some connection between resolution of 
the drainage issue and this settlement, the settlement 
described in H.R. 24. And those are that implementation of the 
concepts that were described to Congress several weeks ago by 
Reclamation would result in the elimination of agricultural 
drainage discharges into the San Joaquin River, which would 
improve water quality, and would facilitate restoration of the 
river.
    These are clearly two of the largest resource issues in the 
San Joaquin Valley. There is the potential that implementation 
of the concepts that were described by Reclamation would result 
in money that is currently in Reclamation's budget and being 
spent on drainage being made available to implementation of the 
settlement agreement.
    As an example, the 2008, the budget request submitted by 
the President has in it approximately $4.3 million that would 
be spent on implementation of drainage within the San Luis 
Unit, primarily the implementation of the West Side Regional 
Drainage program. If the concepts that we were talking about a 
few weeks ago with Congress were implemented, that $4.3 million 
could be made available for the implementation of this program, 
and help with the pay-as-you-go rules that are being 
implemented by the House.
    Now, having said all of that, I think that it is critically 
important that this legislation, H.R. 24, move ahead quickly, 
for reasons that other witnesses have described. And I am among 
the people who signed the blood oath, that we would not propose 
or support any amendment unless it were supported by all of the 
other participants in those discussions. And so we would not 
propose linking the two issues.
    One other observation I would like to make, Madame 
Chairman, if I may, is that----
    Mrs. Napolitano. Chairwoman, if you please.
    Mr. Birmingham. I beg your pardon, Madame Chairwoman.
    Mrs. Napolitano. No problem.
    Mr. Birmingham. The opportunity to derive benefits from the 
resolution of the drainage issue won't evaporate if the two 
issues move ahead independently. If H.R. 24 is enacted, and 
ultimately there is a resolution of the drainage issues, the 
potential benefits that I have described in the linkages 
certainly would still exist.
    Mrs. Napolitano. Thank you. And I will take the priority of 
the Chair for two more questions, so I don't have to go to a 
second round, and let you nice folks go home.
    What protections, Mr. Robbins, and consideration would the 
third parties receive if this settlement were not enacted and 
the litigation were settled in Federal Court? What would the 
effects be on the third parties in that scenario?
    Mr. Birmingham. Obviously, that is a difficult question to 
answer because we don't really know what scenario the Judge 
would have.
    Mrs. Napolitano. Would you pull it closer, please?
    Mr. Birmingham. One can easily speculate that the 
reintroduction of endangered species into the Upper San Joaquin 
River would have resulted in the straying of those fish into 
other streams and into other projects. When those projects were 
in need of change of relicensing, or when take began to happen, 
you could easily suggest that water supply losses, reliability 
losses, power generation losses, perhaps even flood control 
protection, could be impacted under those circumstances.
    Now, there are mitigations available for those items. And 
the mitigations that are proposed in this bill could be 
separately enacted, but we are most grateful that the 
settlement is moving forward with these mitigations. We are 
very pleased to see that all of those potential issues go away, 
with respect to the adoption of this bill.
    Mrs. Napolitano. Thank you. You feel, then, they are 
confident that the settlement and the legislation will provide 
sufficient safeguards.
    Mr. Birmingham. Yes. When enacted, 10[j] and 4[d] along 
with the Title 18 rules relative to FERC, will provide adequate 
safeguards for downstream project operators, to ensure that the 
reopening of the river and the reintroduction of spring-run 
salmon will not impact those projects. At least until 2026, 
when all the other projects have the potential for being looked 
at again under the settlement.
    Mrs. Napolitano. Do you have any idea of any unforeseen 
impacts? If they become apparent, what recourse would you have?
    Mr. Birmingham. Such as endangered species issues? Well, in 
the event that we begin to see a success of this experiment, in 
that the spring run flourish, my suggestion is that we might 
not have a lot of the impacts that we are fearful of anyway.
    In the event the experiment does not work, and some other 
form of salmon becomes the fishery of concern, my suggestion is 
that the experiment will not have worked as suggested, and that 
those impacts will not be hitting us on the San Joaquin, 
either.
    So I think that this is a win-win, frankly. The opening of 
the river is a noble cause, and reintroducing salmon into the 
upper river is a noble effort. And we will hope that the 
administrators of the program will be successful, and that the 
mitigations that we have set out here will cover us.
    If they haven't, we obviously will be back to talk to you 
about what more we might be able to do in terms of mitigation.
    Mrs. Napolitano. We hope it will not be necessary.
    Mr. Birmingham. Absolutely.
    Mrs. Napolitano. Mr. Radanovich.
    Mr. Radanovich. Thank you, Madame Chair. Mr. Costa?
    Mr. Costa. Thank you. I have a question that I want to ask 
Mr. Birmingham and Mr. Robbins, and I will ask it and let you 
think about it. And then I want to make a comment.
    Actually, it was a question that I was going to ask the 
previous panel. So think about what you believe being involved 
in all the details last fall of the negotiations, what are the 
key aspects for successful implementation, given your long 
history and background.
    But first, I wanted to acknowledge, as you did, Madame 
Chairperson, Congressman Radanovich's hard work. I know this is 
a difficult time for him and his family, and our thoughts and 
prayers are with you, as well as Senator Feinstein and all the 
parties that have worked on this, even when we have at some 
point agreed to disagree on third-party impacts.
    And this is the statement I want to make, and I want to put 
a fine point on it, to Mr. Ishida, who spoke very well on 
behalf of the citizens of Tulare County, as well as the farmer 
from Los Banos, Mr. Cannon Michael.
    I think the context has to be looked at in the bigger 
picture. It is one of the reasons we are doing this regional 
water plan. We have over 4 million people living in the Valley. 
It is estimated by the year 2030, between Bakersfield and Yuba, 
we are going to have another three to five million more people 
in the Valley, and 70 percent of them are going to be between 
Sacramento and Bakersfield.
    Now, this is the second time the Valley has been asked to 
give at the office, so to speak. In 1994, over 1.2 million 
acre-feet was reallocated for purposes of water quality and 
restoration of the environment. And that has had a lot of 
pluses. As a result of this agreement being enacted with the 
enabling legislation, over 160,000 acre-feet will go from the 
constituents primarily of Congressman Nunes, but some in my 
area and Congressman Radanovich's area, again to restore the 
river, to improve the environment, to improve water quality. 
All noble goals.
    But it is important that our colleagues in California and 
throughout the Congress understand that we have our needs, and 
we have not been diligent, or we have not been unfocused on the 
necessity of water conservation.
    In the last two decades, our water agencies in the 
agricultural areas, as well as our cities, have made the same 
sort of efforts that we have had in Southern California. You 
know why? Because I have been involved with them, and I have 
hammered them. Not just because of that, but it is sound water 
management policy.
    When the cost of water went from $10 an acre-foot to $50 
and to $100 an acre-foot and to $120 an acre-foot, guess what? 
People used that resource differently.
    And so conservation in terms of alternative irrigation 
technologies, in terms of pipelining, in terms of land piping, 
all of those things, drip irrigation, have been dramatically 
implemented over the last 15 years. As a matter of fact, even 
George, our colleague, Congressman Miller, who has been a 
critic oftentimes of Westlands Water District, has acknowledged 
the fact that they are very good water conservators because of 
the preciousness of that resource.
    In cities like Fresno we took the admonitions that my 
colleagues in Southern California talked about in terms of 
water meters. We have turned that thing around, and with the 
growth.
    But Mr. Ishida points out, and I think it is very 
important, we have a lot of communities that just aren't 
cities. And even the cities that are cities are 5,000 to 10,000 
people population. They don't have the resources to do this.
    We haven't got, the country doesn't have, the resources in 
many of these cases, either. We have counties that are just 
trying to keep hospitals open, trying to keep county healthcare 
open, trying to build roads.
    I fought my last term for $1 million for the community of 
Alpaugh to improve their water system. You would think I was 
pulling teeth, because it was 300 residents. I mean, they are 
having to pipe water in. It is in Congressman Nunes's district.
    So the fact is we need to understand that we can't keep 
reallocating water when we have--I mean, even if we are not 
going to grow food for our tables, for the state and for the 
nation, we are growing homes. And so we can't continue to just 
reallocate water from our constituents, from our citizens, and 
not believe and not understand that we need to not only do 
conservation. We are going to do more than conservation, 
absolutely. I am a strong advocate of water conservation, both 
municipal and agricultural.
    But we are also going to need to improve our water supply. 
And it is important that everybody understand that. Because you 
can't make more with less in all cases, which we are being 
asked to do.
    The questions to the two of you, my time has run out.
    Mr. Birmingham. Well, I will try and, with permission of 
the Chair, try to respond to your question, Mr. Costa.
    From our perspective, the key aspect for successful 
implementation of the settlement agreement and the restoration 
program is the parties moving forward in good faith, and with a 
continued respect for the interest of other parties.
    The Chairwoman made reference to the value of resolving 
conflicts of this type through reaching an accord. And it is 
interesting that she would choose that word. Because in 1994, 
Westlands, along with other south of Delta agricultural water 
service contracts, entered into what we called the Bay Delta 
Accord. And we voluntarily gave up approximately 25 percent of 
our water supply for restoration of the Bay Delta.
    And at the time, former Secretary Babbitt said--and this is 
a quote--a deal is a deal. If the Department of the Interior 
determines that we need additional water for the implementation 
of this restoration program, we will acquire it from willing 
sellers. Unfortunately, that didn't happen. And the program 
really has fallen apart, because different groups have said OK, 
we got what we thought we were going to get out of the program; 
now the rest of it should stop.
    This settlement has two goals: a restoration goal and a 
water management goal. And both of them are supposed to be of 
equal importance. And for this program to proceed successfully, 
the parties are going to need to continue to demonstrate their 
willingness to act in good faith, the same kind of willingness 
that resulted in the compromise language contained in H.R. 24.
    Mr. Robbins. Mr. Costa, I would want to acknowledge, 
because it hasn't been done today, your support, and 
Congressman Cardoza's support, in holding open the curtains for 
the third parties to make sure that we actually had access to 
the table. And we are very much grateful for that.
    I think the key issues for us, as third parties, revolve 
around two things. First is the implementation actually of the 
physical improvements that are necessary. Making sure, for 
instance, that the process for deciding about Reach 4[b] is 
open and clear and transparent, and that the parties that are 
affected have access to that process. And I believe that the 
legislation, combined with the MOU, makes that happen.
    And the second, of course, is issues having to do with the 
reintroduction of salmon; making sure that the Secretary of 
Commerce's process, which is set out in the Endangered Species 
Act relative to harvesting spring run from other tributaries 
and bringing them to the San Joaquin, and their reintroduction, 
is done in a timely and orderly and transparent fashion, so 
that we may also participate in that process, and be ready for 
it when it occurs.
    I did want to also offer maybe a piece of hope as well, 
because the water management goals of the Friant settlement 
process is something I think that impacts the third parties as 
well. And I think we are prepared to assist in that.
    There are times in which those of us that are downstream 
can assist in both water supply reliability and in mitigation 
requirements. And so I think we stand ready to participate, as 
well. But we have a longstanding relationship in what is known 
as the San Joaquin River Group Authority. We actually all 
belong to that same agency. And I think it was the 
relationships that we had in that agency and in our prior 
dealings with one another on the other big settlement on the 
San Joaquin River Settlement Agreement that was, that led us to 
the confidence we had in each other, and in the process to make 
this settlement happen.
    So the endangered species issue, the implementation of the 
physical plant issue, and the transparency; those are the three 
big things, I think, for us.
    Mr. Costa. Thank you.
    Mr. Radanovich. Thank you, Mr. Costa. I would like to 
comment. I thought your remarks were excellent, and I want to 
associate myself with those remarks. The need for water 
reliability and inadequate supply is something that cannot be 
left, and projects like the Westlands Drainage Proposal I think 
are projects, incredible projects, I think, that are worth 
taking a serious look at and supporting.
    Mr. Costa. It is the Bureau's proposal.
    Mr. Radanovich. It is the Bureau's proposal, forgive me. 
Yes. Mr. Nunes.
    Mr. Nunes. Thank you, Mr. Radanovich. I want to talk a 
little bit about Mr. Costa, your comments about Alpaugh I think 
were very fitting being that the million dollars that you got 
them was not enough, and then we had to go back through rule 
development and get them another $2.5 million for their water 
supply.
    And Mrs. Napolitano, I think it is important not to gloss 
over this; that Mr. Ishida brought up in his testimony that 
there are very, very poor populations, entirely Latino 
basically, that are living off of this water supply. And I 
think Mr. Dooley said it very honestly in his testimony, that 
they have made a business decision. But the constituents that 
Mr. Ishida has and that I have don't have the ability to make 
business decisions.
    You are looking at $3.5 million that has been spent for one 
little community of 300 people. And that water quality is 
diminishing as we speak. So when you take, it always goes back 
to the same point. If you are going to take the 200,000 acre-
feet out of that basin, and not put it back, there are going to 
be, since the communities weren't considered third-party 
impacts--we will call them fourth-party impacts, since they 
were never involved in the settlement--the fourth parties to 
this agreement are going to be severely, severely hurt. And 
that is what, without changes.
    You know, I have said all along, why don't we just put some 
concrete ways, teeth to this legislation, to bring the water 
back. I don't think that is a very hard request. But it is 
unfortunate that we didn't have more time to ask the first 
panel. But NRDC continues to oppose any types of real teeth, 
real mitigation measures to this settlement. And that is all 
these people are asking for is mitigation.
    Mr. Birmingham and Mr. Michael and Mr. Robbins, they were 
third parties. They were taken care of. My constituents were 
not. The farmers made a business decision, so they have been 
taken care of, at least to what they feel that they have been 
taken care of in this settlement, other than I do believe--and 
I know Friant is not up here any longer--but there are farmers 
that have requested, Friant farmers that requested for 
mitigation.
    Now, Mr. Dooley, I don't know if they brought that to your 
attention or not, but there are farmers within my district that 
have requested mitigation through their boards. And their 
boards are trying to come up with mitigation measures that will 
work, that are more than this. They have asked for something in 
addition to these proposals that are here.
    So I just think that we have to be serious about what we 
are going to do to mitigate in this legislation. I hope, Mrs. 
Napolitano, that we can do it. I mean, it needs to be done. 
Maybe we don't change the settlement, but at least try to, on 
the same vehicle that this is going to go under, try to put 
some kind of mitigation in here to protect these communities 
that Mr. Ishida is talking about. I think it makes a lot of 
sense.
    And one of the ways, and I wish that we could have asked 
this of NRDC and Friant, is that Westlands--and you kind of 
talked about it in your first question to Mr. Birmingham--the 
Bureau of Reclamation and Westlands agreement on the 
settlement, they are coming out to your committee to ask you to 
aid in this implementation of the settlement, I think it 
clearly provides about 100,000 acre-feet of water, on average, 
that would meet half the goal.
    Now, I would really like to know what NRDC thinks of that. 
Would they support that water, if you could work out the 
settlement, would they support that water being used to 
mitigate for my constituents to meet the water management goal?
    Mr. Radanovich. Excuse me, Madame Chairman. As I recall, 
though--may I? If you have written questions of previous, if 
you have questions of a previous panel, I would ask the Chair 
to allow time for written statements and written answers to be 
allowed, and be part of the record.
    I mean, I don't see where their approval of a proposal out 
there by the Bureau has anything to do with this legislation. I 
mean, things that are relevant----
    Mr. Nunes. Because there is water available that could go 
to meet the water management goal, and I think it is important 
in these discussions to----
    Mr. Radanovich. It is not relevant to this bill.
    Mrs. Napolitano. It has not been agreed to, so it is not 
part of the bill. And I think that----
    Mr. Nunes. I don't disagree. But there are severe 
consequences to this legislation.
    Mrs. Napolitano. Then that is something that----
    Mr. Nunes. And if you guys want to ignore that----
    Mrs. Napolitano. Excuse me, sir.
    Mr. Nunes. Yes, Madame Chairwoman.
    Mrs. Napolitano. Thank you. You and I have discussed the 
ability to be able to bring it up. You have brought it out. 
Now, since it is not part of this legislation, I think we need 
to either submit for the record those questions, and maybe put 
into the minds of the people who may be able to consider 
addressing that specific issue--and I agree with you in terms 
that some areas do not get into the agreement, for whatever 
reason. But the major parties that are going to make things 
happen and hopefully be able to help address some of these 
unintended consequences can be part of what this is all about. 
Or am I wrong?
    Mr. Radanovich. No, I think the gentlelady is right. I do 
remember, during the time when this issue was being negotiated 
over in Senator Feinstein's office, that everybody who is here 
was there. And everybody was asked, at the time everybody 
agreed, did they have any other ideas or input that should go 
into this agreement. And nobody spoke. And I think----
    Mr. Nunes. That is not true, Mr. Radanovich.
    Mr. Radanovich.--this is probably the appropriate time----
    Mr. Nunes. That is absolutely, that is absolutely false.
    Mr. Radanovich. No. Sorry.
    Mr. Nunes. Mr. Costa was there. Mr. Costa said that there 
were other concerns.
    Mr. Radanovich. No.
    Mrs. Napolitano. OK, I think we need to move forward. I 
will take the chair back. I will take the time. I believe----
    Mr. Birmingham. Excuse me, Madame. I just wanted to make 
sure that the record is clear, because Mr. Nunes has made 
reference to a settlement agreement between Reclamation and 
Westlands Water----
    Mrs. Napolitano. You know, you are----
    Mr. Birmingham. Thank you. I just want to make sure that 
the record is clear. Reclamation, working with Westlands and a 
number of other contractors, have come up with some concepts. 
But I would not want the Subcommittee to be left with the 
impression that there is a final settlement agreement.
    The concepts are continuing to be developed. And, as I 
indicated in my response to your question earlier, Madame 
Chairwoman, there are potentially some linkages. I am not 
suggesting that the two settlements should be linked together, 
but there potentially are some benefits. But there is not a 
settlement agreement.
    The concepts were disclosed to Members of Congress, because 
Reclamation, as well as the contractors, thought that it would 
be an appropriate time to expand the group of participants in 
those discussions.
    And so we are a ways from reaching conclusion, and in part, 
that is why I think it would be inappropriate to specifically 
link the two. Because, as I said earlier, it is our impression 
that H.R. 24 needs to move quickly.
    Mrs. Napolitano. Thank you, sir. And I would like to be 
able to echo those remarks, because I believe that you don't 
want to lose the momentum; nor the longer this continues to 
drag, the more there are other possible issues that could come 
up that should be considered by the people that are part of the 
agreement and the accord. I look forward to that.
    Mr. Costa.
    Mr. Costa. Yes, thank you, Madame Chair, I am glad you 
clarified that.
    Just for the point of clarification here, because I know we 
are closing, we are finishing up here, and you and I have 
another meeting to go to.
    The reference that was cited and the comment that I made, 
and some of the parties that are testifying here were there, I 
think it was one of the fifth or sixth--it was the last 
meeting, and Senator Feinstein went around the room and asked 
were there any other issues there. And three of the Members who 
were participating weren't there.
    And I said well--and of course that is why I brought up the 
other issue earlier about the holding contracts, because I 
didn't know about it at the time. But I said as far as 
Westlands, which is in my district, and some of the other third 
parties that I had been helping, trying to help to negotiate, I 
believed we had resolved the issues. But I said I cannot 
speak--and I did a bit of euphemism humor that I am known for 
on occasion--I did not pretend to speak on behalf of the 
Portuguese caucus. Nonetheless, I knew my colleague, 
Congressman Nunes, still had concerns as it related to his 
constituents in his area. But that as far as the folks that I 
had worked with, that I felt we had an agreement.
    But I did not, just for clarification purposes, I 
acknowledge that I believe that there were still some 
outstanding concerns or issues.
    Mrs. Napolitano. Thank you, Mr. Costa. With that, I will 
conclude this hearing, and thank the panel for being with us. 
It has been very fruitful, and thank you for your 
participation.
    Under Committee Rule 4[h], additional material for the 
record should be submitted by Members or witnesses within 10 
days after this date. I would appreciate the cooperation of all 
the witnesses in responding promptly to any questions submitted 
to you in writing, and look forward to continuing this great 
work you have done.
    With that, this meeting is adjourned.
    [Whereupon, at 1:00 p.m., the Subcommittee was adjourned.]

    NOTE: Additional information submitted for the record has 
been retained in the Committee's official files. These include:
      Letter from Hamilton Candee, Natural Resources 
Defense Council, dated March 15, 2007, with two attachments--a 
document from Professor Michael Hanemann entitled ``Comments on 
`Analysis of the Impacts of Surface Water Reductions on the 
Eastern San Joaquin Valley of California' by the Northwest 
Economic Associates and `Impacts of Water Reallocations on the 
Eastern San Joaquin Valley' by the University of California'' 
and a copy of the March 7, 2007, Bakersfield Californian 
editorial ``Water, peace to flow soon.''
      ``The Cost of Reducing Friant's Surface Water 
Supply'' by the Friant Water Users Authority submitted for the 
record by The Honorable Devin Nunes
      Supplemental Expert Report of Daniel B. Steiner 
submitted for the record by The Honorable Devin Nunes
      Letter submitted for the record by Allen Ishida 
from Peter Carey, President/CEO, Self-Help Enterprises, 
Visalia, California
      Letter submitted for the record by Allen Ishida 
from Laurel Firestone, Co-Director and Attorney at Law, 
Community Water Center, and Martha Guzman, Legislative Analyst, 
California Rural Legal Assistance
      Letter submitted for the record by Allen Ishida 
from Francisco Martinez, President, Plainview Mutual Water 
Company, Strathmore, California
      Article submitted for the record by Allen Ishida 
from the Fresno Bee entitled ``Many in Tulare Co. can't count 
on clean water'' dated February 11, 2007

                                 
