DESCRIPTIVE SUMMARY: The United States responses to interrogatories of the Cities of Aztec and Bloomfield

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1 STATE OF NEW MEXICO SAN JUAN COUNTY THE ELEVENTH JUDICIAL DISTRICT COURT STATE OF NEW MEXICO, ex rel. STATE ENGINEER, vs. Plaintiff, THE UNITED STATES OF AMERICA, et al., Defendants, THE JICARILLA APACHE TRIBE AND THE NAVAJO NATION, D-1116-CV HON. JAMES J. WECHSLER Presiding Judge SAN JUAN RIVER GENERAL STREAM ADJUDICATION AB-07-1 Claims of the Navajo Nation Defendant-Intervenors. NAME OF PARTY: The United States of America DESCRIPTIVE SUMMARY: The United States responses to interrogatories of the Cities of Aztec and Bloomfield NUMBER OF PAGES: 13 DATE OF SERVICE: August 17, 2012 ATTACHMENT J - RESPONSES OF THE UNITED STATES TO THE CITIES OF AZTEC AND BLOOMFIELD S FIRST SET OF INTERROGATORIES On May 15, 2012, the Cities of Aztec and Bloomfield ( the Cities ) issued discovery requests to the Settling Parties collectively. Pursuant to the Court s order of July 9, 2012, the United States responds to the interrogatories below. INTERROGATORY NO. 1: Has the Navajo Nation or the United States, pursuant to its trust obligations to the Navajo Nation or the State of New Mexico, prepared an analysis of the level of water rights that would be apportioned to the Navajo Nation pursuant to the PIA of Winters v. United States, 207 U.S. 564 (1908)? Further, the form of the interrogatory mischaracterizes the nature of the water rights claims that the United States may pursue and secure on behalf of the Navajo Nation. Specifically, this interrogatory describes Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 1 of 13

2 an apportionment that is inconsistent with the holding of the Winters case and creates an unreasonable ambiguity. Response of the United States: Without waiving the objections made and notwithstanding the serious flaws associated with this interrogatory, the United States asserts the following. In The United States Statement of Claims of Water Rights in the New Mexico San Juan River Basin on Behalf of the Navajo Nation (filed January 3, 2012) (U.S. Statement of Claims), the United States described water right claims based upon future irrigation on practicably irrigable acres (PIA). See U.S. Statement of Claims at pg In the following reports previously provided to the Cities, the United States described the technical basis for the water rights claims based on PIA: 1. Navajo San Juan Pre-Feasibility Irrigation Suitability Land Classification principally authored by Clifford R. Landers, C.P.S.S., Stetson Engineers Inc., 6240 Riverside Plaza Lane NW, Suite 220, Albuquerque, NM 87120, ; 2. Water Resource Assessment to Support the BIA s Groundwater PIA Claim on Behalf of the Navajo Nation in the San Juan River Basin Adjudication principally authored by Dean (Tony) Zimmerman, BIA Southwest Regional Office, 1001 Indian School Road, NW Albuquerque, New Mexico, 87104, and Neil Deeds, INTERRA, Inc., 1812 Centre Creek Drive, Suite 300, Austin, Texas, 78754, ; 3. Economic Analysis of Practicably Irrigable Acreage Trust Lands, San Juan Basin, New Mexico principally authored by Travis Greenwalt (CardnoEntrix); 4. Navajo San Juan River Basin Practicably Irrigable Acreage Study Surface Water principally authored by Aaron Beutler (Keller - Bliesner Engineering, LLC); and 5. Navajo San Juan River Basin Practicably Irrigable Acreage Study Ground Water principally authored by Aaron Beutler (Keller - Bliesner Engineering, LLC). To the extent that the United States has completed an analysis based on PIA, such an analysis is presented in the documents referenced in this response. These documents described above have been previously provided to all participants to the Navajo Inter Se. INTERROGATORY NO. 2: If the answer to Interrogatory No. 1 is yes, please provide a copy of the study and explanation of the assumptions made to arrive at the determination of water rights sufficient to irrigate all practicably irrigable acreage of the Navajo Nation. Please also explain in summary how much water would be available to the Navajo Nation pursuant to that analysis. Objections of the United States: The United States incorporates by reference the objections described in Interrogatory No. 1. Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 2 of 13

3 Response of the United States: Without waiving the objections made and notwithstanding the serious flaws associated with this interrogatory, the United States asserts the following. All participants to the Navajo Inter Se have been previously provided a copy of the documents described in the response to Interrogatory No. 1. To the extent that this interrogatory seeks additional information, a response to this interrogatory may be derived or ascertained from examination of the documents described in the response to Interrogatory No. 1. The burden of deriving or ascertaining additional response to this interrogatory is substantially the same for the Cities as for the United States. Rule 1-033(E), NMRA. INTERROGATORY NO. 3: If a study of PIA outcomes at trial has been performed what was the: a. Source of water; b. The crops to be grown; c. The ratio of specialty crops to basic crops; d. The market analysis performed; e. The on-farm delivery costs; f. Analysis of the effects of insects and disease; g. Costs allocated to storage, transportation, carriage loss and economies of scale related to drought; h. The accounting system used to develop the cost benefit analysis; i. The discount rate; j. The final cost benefit ration (sic); and k. the Accounting treatment of federal subsidies? Objections of the United States: The United States incorporates by reference the objections described in Interrogatory No. 1. Response of the United States: Without waiving the objections made and notwithstanding the serious flaws associated with this interrogatory, the United States asserts the following. To the extent that a response exists to this interrogatory, a response to this interrogatory may be derived or ascertained from examination of the documents described in the response to Interrogatory No. 1. The burden of deriving or ascertaining the answer to this interrogatory is substantially the same for the Cities as for the United States. Rule 1-033(E), NMRA. INTERROGATORY NO. 4: Is it the Navajo Nation s position, that with the enactment of NIIP, that a portion of the Navajo Nation s Winters rights remained unimpaired? In particular, please see Section 13 (c) of the NIIP, which recognized the potential of the Navajo Nation having a remaining Winters right after the adoption of the law. Response of the United States: This interrogatory is not directed to the United States and the United States anticipates that the Navajo Nation will state its position with respect to this Interrogatory. INTERROGATORY NO. 5: Please provide the actual acre-feet per year diversion and depletion of water for the NIIP, from the years from its implementation through the current year. Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 3 of 13

4 Please also provide an estimate by year of the anticipated diversions and depletion for the current period, through completion of NIIP under the settlement (December of 2015). Further, the interrogatory seeks an estimate of future water use associated with an irrigation project whose water use is not exclusively under the authority and control of the United States. Therefore, the interrogatory unreasonable seeks to have the United States simply speculate about future conduct of others. Finally, the interrogatory is factually inaccurate. NIIP will not be completed in 2015 and no requirement exists that the project be complete by Response of the United States: Without waiving the objections made and notwithstanding the serious flaws associated with this interrogatory, the United States asserts the following. Diversions and depletions associated with NIIP are estimated as follows: Year Estimated Annual Diversion (acre-feet per year) Estimated Annual Depletion (acre-feet per year) Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 4 of 13

5 Anticipated diversions and depletions associated with NIIP are estimated as follows: Year Estimated Annual Diversion Estimated Annual Depletion (acre-feet per year) (acre-feet per year) ,000 to 230, ,000 to 222,500 Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 5 of 13

6 ,000 to 230, ,000 to 222, ,000 to 275, ,000 to 222, ,000 to 275, ,000 to 222,500 INTERROGATORY NO. 6: Based on the fact that NIIP did not specify when the project would be completed, and capped spending at million dollars, please explain how much of the 508,000 acre-feet per year diversion under this settlement would not be available to the Navajo Nation without implementation of the proposed settlement. The United States is unaware of the source of information for the Cities statement: Based on the fact that NIIP did not specify when the project would be completed, and capped spending at million dollars. Such a statement appears to be without basis and without the basis for such a statement, the interrogatory is rendered unreasonably ambiguous making it impossible for the United States to specifically respond. Response of the United States: Without waiving the objections made and notwithstanding the serious flaws associated with this interrogatory, the United States asserts the following. The United States can describe that in the event the Court does not enter the proposed decrees pursuant to the Settlement Agreement, the amount of water available for diversion and use by the Navajo Nation for the Navajo Indian Irrigation Project (NIIP) and other water uses would remain unaffected (508,000 acre feet annual average diversion). INTERROGATORY NO. 7: Please provide an estimate of how many acre-feet per year allocated under this settlement would not be available to the Navajo Nation if the settlement is not approved. Response of the United States: The Court sustained the objections of the United States concerning this interrogatory and the United States is not required to further respond to this interrogatory. See Order Concerning the Objections of the Navajo Nation, The United States and the State of New Mexico to Discovery Requests (July 9, 2012). INTERROGATORY NO. 8: Based on the provision of Section 615tt of NIIP, please explain the amount of acre-feet per year of Winters rights that would be available to the Navajo Nation without the use of any NIIP works or structures. Response of the United States: The Court sustained the objections of the United States concerning this interrogatory and the United States is not required to further respond to this interrogatory. See Order Concerning the Objections of the Navajo Nation, The United States and the State of New Mexico to Discovery Requests (July 9, 2012). Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 6 of 13

7 INTERROGATORY NO. 9: Is it the Navajo Nation s position under this settlement that it has the ability to change the purpose of use of any settlement waters allocated under the NIIP to uses other than irrigation purposes? If so, please explain. Further, the Cities meaning attached to the phrase settlement waters allocated under the NIIP are unknown making the interrogatory unreasonably ambiguous and impossible to respond to. Response of the United States: This interrogatory is not directed to the United States and the United States anticipates that the Navajo Nation will state its position with respect to this Interrogatory. Nonetheless, the United States asserts that Public Law authorizes an average annual diversion of 508,000 acre-feet of water. The Settlement Act, section 10402, authorizes use of that water for any purpose in addition to irrigation. INTERROGATORY NO. 10: Please provide an estimate of how many acre-feet per year of water allocated to the Navajo Nation under this settlement will not be subject to any requirement to share shortages in the Navajo Reservoir supply, pursuant to Section 615ss(a) of NIIP asserts the following. Pursuant to the Northwestern New Mexico Rural Water Projects Act of 2009, Public Law , 123 Stat ( Settlement Act ) and the Settlement Agreement, for water to which the Navajo Nation is entitled and stored in the Navajo Reservoir such water shall be subject to shortage sharing with all other Navajo Reservoir contract holders. All other water rights recognized under the Settlement Agreement not derived from the Navajo Reservoir are not subject to shortage sharing. A copy of the Settlement Act can be found at and downloaded from INTERROGATORY NO. 11: Does NIIP limit the Navajo Nation s use of water to the consumptive use required by modern water conservation technology (i.e., sprinkler irrigation), or is there an absolute right under NIIP for the Navajo Nation to divert 508,000 acre-feet per year? Further, the interrogatory s reference to an unspecified NIIP limitation renders it unreasonably ambiguous. Response of the United States: Without waiving the objections made and notwithstanding the flaws associated with this interrogatory, the United States asserts the following. No - NIIP does not limit the Navajo Nation s use of water to the consumptive use required by modern water conservation technology (i.e., sprinkler irrigation). Pursuant to Section 10402(a) of the Settlement Act, the average annual diversion by the NIIP from the Navajo Reservoir over any Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 7 of 13

8 consecutive 10-year period shall be the lesser of--(a) 508,000 acre-feet per year; or (B) the quantity of water necessary to supply an average depletion of 270,000 acre-feet per year. To the extent that the interrogatory seeks additional information, the burden of deriving or ascertaining the answer to this interrogatory is substantially the same for the Cities as for the United States. Rule 1-033(E), NMRA. To the extent that an additional response exists to this interrogatory, the United States believes that such a response would be derived or ascertained from examination of the statute authorizing NIIP and the Settlement Act. See Rule 1-033(E), NMRA. INTERROGATORY NO. 12: Has the Navajo Nation, as part of the negotiations resulting in the adoption of the NIIP, waived its right to any of its Winters rights in exchange for passage of NIIP, and if so, by how much? asserts the following. The Navajo Nation, as part of the negotiations resulting in the adoption of the NIIP, did not waive its federally reserved water rights in exchange for passage of NIIP. INTERROGATORY NO. 13: Please quantify under the settlement how much of the Navajo Nation s water rights will not be required to be used solely for irrigation purposes? asserts the following. As authorized under the Settlement Agreement and the Settlement Act, all Navajo Nation water rights are not restricted to irrigation purpose exclusively. To the extent that the interrogatory seeks additional information, the burden of deriving or ascertaining the answer to this interrogatory is substantially the same for the Cities as for the United States. Rule 1-033(E), NMRA. To the extent that additional response exists to this interrogatory, the United States believes that such additional response may be derived or ascertained from the Settlement Agreement (including the partial final decrees) and the Settlement Act. INTERROGATORY NO. 14: Does NIIP allow for the Navajo Nation the ownership right in any water saved (including return flow) as a result of use of the sprinkler irrigation system? Is that water held by the Navajo Nation as a Winters water right? Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 8 of 13

9 asserts the following. Public Law authorizes an average annual diversion of 508,000 acre-feet of water. The Settlement Act, section 10402, authorizes use of that water for any other purpose. Such water is a water right, is specifically reserved by Congress on behalf of the Navajo Nation, and exists regardless of the irrigation system designed or employed for NIIP. INTERROGATORY NO. 15: Section 4 of NIIP provides for increasing the capacity of NIIP facilities to supply water for purposes over and above the diversion requirements for irrigation stated in Section (2). Does the Navajo Nation take the position under the settlement that the diversion amounts shown by NIIP, in excess of those currently being diverted, are diversions that can be used for purposes other than irrigation? If so, please explain. Response of the United States: This interrogatory is not directed to the United States and the United States anticipates that the Navajo Nation will state its position with respect to this Interrogatory. Nonetheless, the United States asserts that the responses provided to Interrogatory Nos. 13 and 14 are completely responsive to this interrogatory. INTERROGATORY NO. 16: Does the settlement legislation allow for use by the Navajo Nation for NIIP diversions for purposes other than irrigation? asserts the following. Public Law authorizes an average annual diversion of 508,000 acre-feet of water. The Settlement Act, section 10402, authorizes use of that water for any other purpose in addition to irrigation. INTERROGATORY NO. 17: Under the settlement legislation, has the purpose of NIIP been converted into the allowance of water rights for municipal and industrial purposes in addition to irrigation purposes? If so, please explain. Further, the statement that the the purposes of NIIP [have] been converted mischaracterizes the Settlement Act. asserts the following. Through Public Law and the Settlement Act, Congress has expressly reserved water for the Navajo Nation. Public Law authorizes an average annual diversion of 508,000 acre-feet of water. The Settlement Act, section 10402, authorizes use of that water for any other purpose in addition to irrigation. Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 9 of 13

10 To the extent that the interrogatory seeks additional information, the burden of deriving or ascertaining the answer to this interrogatory is substantially the same for the Cities as for the United States. Rule 1-033(E), NMRA. To the extent that additional response exists to this interrogatory, the United States believes that such additional response may be derived or ascertained from Public Law ; the Settlement Act; and the Settlement Agreement (including the proposed partial final decrees). INTERROGATORY NO. 18: Is any part of the proposed million dollars in federal funds to be expended to complete the NIIP, subject to being repaid in part by the Navajo Nation to the extent the water is not applied to irrigation purposes. Further, it is unknown to the United States the source of authority for the Cities to describe the proposed million dollars in federal funds to be expended to complete the NIIP making the interrogatory unreasonably ambiguous. asserts the following. No - The Settlement Act provides: The Secretary shall not reallocate, or require repayment of, construction costs of the Navajo Indian Irrigation Project because of the conveyance of water supplies for nonirrigation purposes Settlement Act, section 10402(a). INTERROGATORY NO. 19: Has any party to the proposed settlement prepared a 40-year water plan, pursuant to NMSA 1978, (1941), for the proposed municipal and industrial uses? If the answer is yes, please provide a copy of that plan, even if in draft format. Response of the United States: The Court sustained the objections of the United States concerning this interrogatory and the United States is not required to further respond to this interrogatory. See Order Concerning the Objections of the Navajo Nation, The United States and the State of New Mexico to Discovery Requests (July 9, 2012). INTERROGATORY NO. 20: Are all of the water rights subject to this settlement, except for those being allocated under NIIP and the Animas La Plata Project, being appropriated pursuant to New Mexico law? Please explain. Further, it is unknown to the United States the meaning that the Cities assign to the phrase water rights subject to this settlement being appropriated making the interrogatory unreasonably ambiguous. asserts the following. No - the water rights subject to the Settlement Agreement, are not being Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 10 of 13

11 appropriated, but adjudicated. The water rights associated with the Settlement Agreement are principally water rights that have been expressly or impliedly reserved by the United State on behalf of the Navajo Nation and/or that have been held by the Navajo Nation since time immemorial. To the extent that a water right is based on or illustrated by prior water use, such prior use has been illustrated by the U.S. Hydrographic Survey. To the extent that the Navajo Nation has secured water rights under the Settlement Agreement under state law, such rights have been specifically described in the Settlement Agreement (including the partial final decrees). INTERROGATORY NO. 21: Will the New Mexico State Engineer be requested to approve the transfer of any of the water diverted as part of the Navajo-Gallup Water Supply Project (NGWSP), from the San Juan Basin to the Zuni Basin in New Mexico? Please explain, including what is the position of the New Mexico State Engineer on this issue. Further, it is unknown to what transfer (real or hypothetical) this interrogatory refers making the interrogatory unreasonably ambiguous. asserts the following. This interrogatory does not appear to be directed to the United States and the United States anticipates that the State of New Mexico will state its position with respect to this Interrogatory. Nonetheless, the United State can describe that the NGWSP does not contemplate servicing the Zuni River Basin in New Mexico. No basis is apparent to the United States for any entity to request that the New Mexico State Engineer approve a transfer of water from the San Juan River Basin to the Zuni River Basin as part of the Navajo-Gallup Water Supply Project (NGWSP). INTERROGATORY NO. 22: The diversion of water under the NGWSP for use by the Navajo Nation in the State of Arizona is contingent upon an accounting being made available to the State of Arizona of the use of the 1,200 acre-feet in Arizona being within the apportionments of the Colorado River Basin. If approval is not obtained for that use, or if such additional water is not available to the compact, please explain the consequences to the NGWSP. Further, it is unknown to the United States the source of authority for the Cities to describe The diversion of water under the NGWSP for use by the Navajo Nation in the State of Arizona is contingent upon an accounting being made available to the State of Arizona of the use of the 1,200 acre-feet in Arizona being within the apportionments of the Colorado River Basin. Without such information, it is impossible for the United States to determine the consequences of a failed condition precedent and the interrogatory is rendered unreasonably ambiguous and impossible to respond to. asserts the following. The United States believes that response to this interrogatory is provided in whatever source of authority that the Cities have to make their statement. Therefore, to the Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 11 of 13

12 extent that a more specific response is required from the United States, the burden of deriving or ascertaining the answer to this interrogatory is substantially the same for the Cities as for the United States. Rule 1-033(E), NMRA. To the extent that a response exists to this interrogatory, a response to this interrogatory may be derived or ascertained from examination of the authority (i.e. statute, agreement, etc) relied upon by the Cities. See Rule 1-033(E), NMRA. INTERROGATORY NO. 23: The settlement provides that transfer of water uses by the Navajo Nation to locations off Navajo lands would require approval of the State Engineer. Do such transfers include the lease of water by the Navajo Nation for use off of Navajo lands? Please explain, including whether such lease would require approval of the New Mexico State Engineer. What is the State Engineer s position on approval of such leases? asserts the following. Under the Settlement Agreement, to the extent that the Navajo Nation has the right transfer water uses, any transfer beyond lands held in trust by the United States on behalf of the Navajo Nation in New Mexico requires approval of the New Mexico State Engineer. Such restrictions on the Navajo Nation s ability to transfer water uses are fully described in the Settlement Act and the Settlement Agreement (including the proposed partial final decrees). To the extent that this Interrogatory is directed to the State of New Mexico, the United States anticipates that the State of New Mexico will state its position with respect to this Interrogatory. INTERROGATORY NO. 24: The settlement provides that the Navajo Nation uses under the NIIP would share in shortages in the Navajo Reservoir supply on a pro rata basis among the San Juan Chama Project, the Navajo Nation, and other Navajo Reservoir supply contractors. Shortages include decreases in water availability caused by implementation of the Endangered Species Act (ESA). Since the Navajo Nation s water supply for the NIIP is not from flows release through the Navajo Reservoir, but through a pipeline directly from the Reservoir itself, please explain how and if such water would be subject to a pro rata reduction required to meet ESA flow requirements below the Navajo Reservoir. asserts the following. Under the Settlement Agreement, the Navajo Nation s water that comes from Navajo Reservoir storage is subject to shortage-sharing with all other Navajo Reservoir contract water users on a pro rata basis. Shortage-sharing among Navajo Reservoir storage water users remains unaffected regardless whether stored water is derived from a pipeline, canal or dam releases. ESA-required flows are not subject to shortage-sharing agreements but may contribute to the need for shortage-sharing among Navajo Reservoir storage water users. Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 12 of 13

13 INTERROGATORY NO. 25: Proposed completion date of the million dollar project of the NIIP is December, Please explain what happens to the 508,000 acre-feet per year, or portion thereof, which cannot be diverted due to lack of completion of project structures if funds are not appropriated in a timely manner to meet that completion date? Further, it is unknown to the United States the source of authority for the Cities to describe a proposed completion date of the million dollar project of the NIIP is December, Without such information, it is impossible for the United States to determine the consequences of a failed condition precedent and the interrogatory is rendered unreasonably ambiguous. asserts the following. Pursuant to the uses identified and authorized in Section 10402(a) of the Settlement Act, use of the 508,000 acre-feet is not subject to completion of NIIP. Attachment J - United States Responses to Aztec and Bloomfield Interrogatories Page 13 of 13