Sacramento River Settlement Contractors (Settlement Contractors) all have water rights that pre-existed or were perfected independent of the Central Valley Project (CVP). These water rights include pre-1914 water rights as well as post-1914 appropriative water rights licenses.

At the time the CVP was authorized, in 1935, the prior water rights of the Settlement Contractors were recognized. It was acknowledged that in order for the CVP to be constructed and operated and water rights confirmed, a resolution of the Settlement Contractors, protests to the granting of CVP water rights would be necessary. The House Interior and Insular Affairs Committee in 1951 found that the sponsors of the CVP and federal representatives had provided misleading information to Congress on the ability to operate the CVP and also honor previously established Sacramento Valley water rights. The Committee voiced concerns that if the Bureau of Reclamation (Reclamation) and other government officials did not settle water rights claims and disputes in an appropriate fashion, considerable legal problems would develop.

As a result, in 1964 Reclamation began entering into Sacramento River Water Rights Settlement Contracts (Settlement Contracts). These Settlement Contracts resolved the Settlement Contractors. protests to the granting of Reclamation’s application for water rights and, in this context, the dispute between the United States and the Settlement Contractors. Among other things, the Settlement Contractors and Reclamation, based upon studies they jointly conducted, arrived at a negotiated allocation of water rights.

Now, 40 years later, approximately 145 existing Sacramento River Settlement Contracts have either been or will soon be renewed. There are two forms of Settlement Contracts: approximately 56 Standard Form Contracts (17 districts and 39 individuals) and 89 Short Form Contracts. The basic difference between the two forms of contracts is the number of acres covered by the contract. The total amount of water under both Standard Form and Short Form settlement contracts is approximately 2.2 million acre-feet, which serves farms, cities and wildlife refuges between Redding and Sacramento.

The Settlement Contractors, during the past decade, have been recognized for very progressive water management. Many of the Settlement Contractors have implemented system improvements, conjunctive management of surface water and groundwater, and landowners have adopted new farming techniques to increase water use efficiency. Fish screens have been installed by the larger diverters to protect species of fish listed as threatened or endangered under the Endangered Species Act (including salmon and steelhead) and allow the diverters uninterrupted access to water they have the right to divert. This, in turn, has allowed the Settlement Contractors to implement environmentally beneficial programs, including application of water for rice straw decomposition and habitat for wintering waterfowl using the Pacific Flyway, and deliveries to State and Federal wildlife refuges.